-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PROTECTION ONE ALARM MONITORING, INC.,
as Issuer,
PROTECTION ONE, INC.,
and
THE OTHER GUARANTORS LISTED
ON THE SIGNATURE PAGES HERETO,
as Guarantors
8 1/8% SENIOR SUBORDINATED NOTES DUE 2009
--------------
INDENTURE
Dated as of December 21, 1998
--------------
THE BANK OF NEW YORK,
as Trustee
--------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
CROSS-REFERENCE TABLE*
TRUST INDENTURE INDENTURE
ACT SECTION SECTION
310(a)(1) . . . . . . . . . . . . . . 7.07
(b) . . . . . . . . . . . . . . . 7.04; 7.08
311 . . . . . . . . . . . . . . . . . 7.04
312(a) . . . . . . . . . . . . . . . 2.04
(b) . . . . . . . . . . . . . . . 13.01; 13.04
(c) . . . . . . . . . . . . . . . 13.02; 13.04
313(a) . . . . . . . . . . . . . . . 13.02
(c) . . . . . . . . . . . . . . . 7.06; 13.03
314(a) . . . . . . . . . . . . . . . 4.11; 13.06
(e) . . . . . . . . . . . . . . . 13.06
315(a) . . . . . . . . . . . . . . . 7.02
(b) . . . . . . . . . . . . . . . 7.02
(c) . . . . . . . . . . . . . . . 7.02
(d) . . . . . . . . . . . . . . . 7.02
(e) . . . . . . . . . . . . . . . 7.08
316(a) . . . . . . . . . . . . . . . 6.07
(c) . . . . . . . . . . . . . . . 13.15
318(c) . . . . . . . . . . . . . . . 12.01
* This Cross Reference Table is not part of the Indenture.
TABLE OF CONTENTS
PAGE
ARTICLE 1DEFINITIONS AND INCORPORATION BY REFERENCE. . . . . . . . . . . . . . . . .1
Section 1.01. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . .1
Section 1.02. Other Definitions. . . . . . . . . . . . . . . . . . . . . . . 24
Section 1.03. Incorporation by Reference of Trust Indenture Act. . . . . . . 25
Section 1.04. Rules of Construction. . . . . . . . . . . . . . . . . . . . . 26
ARTICLE 2THE NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 2.01. Form and Dating. . . . . . . . . . . . . . . . . . . . . . . . 26
Section 2.02. Restrictive Legends. . . . . . . . . . . . . . . . . . . . . . 27
Section 2.03. Execution, Authentication and Denominations. . . . . . . . . . 29
Section 2.04. Registrar and Paying Agent . . . . . . . . . . . . . . . . . . 30
Section 2.05. Paying Agent to Hold Money in Trust. . . . . . . . . . . . . . 31
Section 2.06. Transfer and Exchange. . . . . . . . . . . . . . . . . . . . . 32
Section 2.07. Book-Entry Provisions for Global Notes . . . . . . . . . . . . 32
Section 2.08. Special Transfer Provisions. . . . . . . . . . . . . . . . . . 35
Section 2.09. Replacement Notes. . . . . . . . . . . . . . . . . . . . . . . 37
Section 2.10. Outstanding Notes. . . . . . . . . . . . . . . . . . . . . . . 38
Section 2.11. Temporary Notes. . . . . . . . . . . . . . . . . . . . . . . . 39
Section 2.12. Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 2.13. CUSIP Numbers. . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 2.14. Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE 3REDEMPTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 3.01. Notices to Trustee . . . . . . . . . . . . . . . . . . . . . . 40
Section 3.02. Selection of Notes to Be Redeemed. . . . . . . . . . . . . . . 40
Section 3.03. Notice of Redemption . . . . . . . . . . . . . . . . . . . . . 41
Section 3.04. Deposit of Redemption Price. . . . . . . . . . . . . . . . . . 42
Section 3.05. Notes Redeemed in Part . . . . . . . . . . . . . . . . . . . . 42
Section 3.06. Optional Redemption. . . . . . . . . . . . . . . . . . . . . . 42
Section 3.07. Mandatory Redemption . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE 4COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 4.01. Payment of Notes . . . . . . . . . . . . . . . . . . . . . . . 43
Section 4.02. Maintenance of Office or Agency. . . . . . . . . . . . . . . . 43
Section 4.03. Compliance Certificate . . . . . . . . . . . . . . . . . . . . 44
Section 4.04. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 4.05. Stay, Extension and Usury Laws . . . . . . . . . . . . . . . . 44
(i)
Section 4.06. Limitation on Incurrence of Additional Indebtedness. . . . . . 45
Section 4.07. Limitation on Senior Subordinated Debt . . . . . . . . . . . . 45
Section 4.08. Limitation on Restricted Payments. . . . . . . . . . . . . . . 46
Section 4.09. Limitation on Asset Sales. . . . . . . . . . . . . . . . . . . 48
Section 4.10. Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 4.11. Reports. . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 4.12. Corporate Existence. . . . . . . . . . . . . . . . . . . . . . 50
Section 4.13. Offer to Repurchase upon Change of Control . . . . . . . . . . 51
Section 4.14. Money for Payments to Be Held in Trust . . . . . . . . . . . . 52
Section 4.15. Officer Certificate as to Events of Default. . . . . . . . . . 53
Section 4.16. Fall-Away Event. . . . . . . . . . . . . . . . . . . . . . . . 54
ARTICLE 5SUCCESSORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 5.01. Merger, Consolidation, or Sale of Assets . . . . . . . . . . . 54
Section 5.02. Successor Person Substituted.. . . . . . . . . . . . . . . . . 55
ARTICLE 6DEFAULTS AND REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 6.01. Events of Default. . . . . . . . . . . . . . . . . . . . . . . 55
Section 6.02. Acceleration.. . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 6.03. Collection of Indebtedness and Suits for Enforcement by
Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 6.04. Trustee May File Proofs of Claim.. . . . . . . . . . . . . . . 58
Section 6.05. Trustee May Enforce Claims Without Possession of Notes.. . . . 59
Section 6.06 Application of Money Collected.. . . . . . . . . . . . . . . . 59
Section 6.07. Limitation on Suits. . . . . . . . . . . . . . . . . . . . . . 60
Section 6.08. Unconditional Right of Holders to Receive Principal,
Premium and Interest.. . . . . . . . . . . . . . . . . . . . . 60
Section 6.09. Restoration of Rights and Remedies.. . . . . . . . . . . . . . 61
Section 6.10. Rights and Remedies Cumulative.. . . . . . . . . . . . . . . . 61
Section 6.11. Delay or Omission Not Waiver.. . . . . . . . . . . . . . . . . 61
Section 6.12. Control by Holders.. . . . . . . . . . . . . . . . . . . . . . 61
Section 6.13. Waiver of Past Defaults. . . . . . . . . . . . . . . . . . . . 62
ARTICLE 7TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 7.01. Notice of Defaults . . . . . . . . . . . . . . . . . . . . . . 62
Section 7.02. Certain Rights of Trustee. . . . . . . . . . . . . . . . . . . 63
Section 7.03. Trustee Not Responsible for Recitals or Issuance of
Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 7.04. May Hold Notes.. . . . . . . . . . . . . . . . . . . . . . . . 65
Section 7.05. Money Held in Trust. . . . . . . . . . . . . . . . . . . . . . 65
Section 7.06. Compensation and Reimbursement.. . . . . . . . . . . . . . . . 65
Section 7.07. Corporate Trustee Required; Eligibility; Conflicting
Interest.. . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 7.08. Resignation and Removal; Appointment of Successor. . . . . . . 67
Section 7.09. Acceptance of Appointment by Successor.. . . . . . . . . . . . 68
(ii)
Section 7.10. Merger, Conversion, Consolidation or Succession to
Business.. . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 7.11. Appointment of Authenticating Agent. . . . . . . . . . . . . . 69
ARTICLE 8DEFEASANCE AND COVENANT DEFEASANCE. . . . . . . . . . . . . . . . . . . . 71
Section 8.01. Option to Effect Defeasance or Covenant Defeasance . . . . . . 71
Section 8.02. Defeasance and Discharge.. . . . . . . . . . . . . . . . . . . 71
Section 8.03. Covenant Defeasance. . . . . . . . . . . . . . . . . . . . . . 72
Section 8.04. Conditions to Defeasance or Covenant Defeasance. . . . . . . . 72
Section 8.05. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions. . . . . . . . . 74
Section 8.06. Repayment to Company.. . . . . . . . . . . . . . . . . . . . . 74
Section 8.07. Reinstatement. . . . . . . . . . . . . . . . . . . . . . . . . 75
ARTICLE 9AMENDMENTS AND SUPPLEMENTS TO THE INDENTURE . . . . . . . . . . . . . . . 75
Section 9.01. Without Consent of Holders.. . . . . . . . . . . . . . . . . . 75
Section 9.02. With Consent of Holders. . . . . . . . . . . . . . . . . . . . 76
Section 9.03. Execution of Amendments and Supplements. . . . . . . . . . . . 77
Section 9.04. Effect of Amendments and Supplements.. . . . . . . . . . . . . 77
Section 9.05. Conformity with Trust Indenture Act. . . . . . . . . . . . . . 77
Section 9.06. Reference in Notes to Amendments and Supplements.. . . . . . . 77
ARTICLE 10NOTE GUARANTEES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 10.01. Note Guarantee.. . . . . . . . . . . . . . . . . . . . . . . . 78
Section 10.02. Obligations Unconditional. . . . . . . . . . . . . . . . . . . 80
Section 10.03. Guarantors May Consolidate, Etc., on Certain Terms.. . . . . . 80
Section 10.04. Notice to Trustee. . . . . . . . . . . . . . . . . . . . . . . 81
Section 10.05. Execution and Delivery of Note Guarantee.. . . . . . . . . . . 81
Section 10.06. Additional Guarantors. . . . . . . . . . . . . . . . . . . . . 82
ARTICLE 11SATISFACTION AND DISCHARGE . . . . . . . . . . . . . . . . . . . . . . . 82
Section 11.01. Satisfaction and Discharge.. . . . . . . . . . . . . . . . . . 82
Section 11.02. Application of Trust Money.. . . . . . . . . . . . . . . . . . 83
Section 11.03. Repayment of Trust Money.. . . . . . . . . . . . . . . . . . . 83
ARTICLE 12MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 12.01. Trust Indenture Act Controls.. . . . . . . . . . . . . . . . . 84
Section 12.02. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
ARTICLE 13HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY. . . . . . . . . . . . 85
Section 13.01. Disclosure of Names and Addresses of Holders.. . . . . . . . . 85
Section 13.02. Reports by Trustee.. . . . . . . . . . . . . . . . . . . . . . 85
Section 13.03. Reports by Company.. . . . . . . . . . . . . . . . . . . . . . 86
(iii)
Section 13.04. Communication by Holders of Notes with Other Holders of
Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Section 13.05. Certificate and Opinion as to Conditions Precedent.. . . . . . 87
Section 13.06. Statements Required in Certificate or Opinion. . . . . . . . . 87
Section 13.07. Rules by Trustee and Agents. . . . . . . . . . . . . . . . . . 88
Section 13.08. No Personal Liability of Directors, Officers, Employees
and Stockholders.. . . . . . . . . . . . . . . . . . . . . . . 88
Section 13.09. Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . 88
Section 13.10. No Adverse Interpretation of Other Agreements. . . . . . . . . 88
Section 13.11. Successors.. . . . . . . . . . . . . . . . . . . . . . . . . . 89
Section 13.12. Severability.. . . . . . . . . . . . . . . . . . . . . . . . . 89
Section 13.13. Counterpart Originals. . . . . . . . . . . . . . . . . . . . . 89
Section 13.14. Table of Contents, Headings, Etc.. . . . . . . . . . . . . . . 89
Section 13.15. Acts of Holders. . . . . . . . . . . . . . . . . . . . . . . . 89
Section 13.16. Legal Holidays.. . . . . . . . . . . . . . . . . . . . . . . . 90
Section 13.17. Benefits of Indenture. . . . . . . . . . . . . . . . . . . . . 91
ARTICLE 14SUBORDINATION OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . 91
Section 14.01. Notes Subordinated to Senior Indebtedness . . . . . . . . . . 91
Section 14.02. No Payment on Notes in Certain Circumstances. . . . . . . . . 91
Section 14.03. Payment over of Proceeds upon Dissolution, Etc. . . . . . . . 93
Section 14.04. Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . 95
Section 14.05. Obligations of Company Unconditional. . . . . . . . . . . . . 96
Section 14.06. Notice to Trustee . . . . . . . . . . . . . . . . . . . . . . 96
Section 14.07. Reliance on Judicial Order or Certificate of
Liquidating Agent . . . . . . . . . . . . . . . . . . . . . . 97
Section 14.08. Trustee's Relation to Senior Indebtedness . . . . . . . . . . 98
Section 14.09. Subordination Rights Not Impaired by Acts or Omissions
of the Company or Holders of Senior Indebtedness. . . . . . . 98
Section 14.10. Holders Authorize Trustee to Effectuate Subordination
of Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Section 14.11. Not to Prevent Events of Default. . . . . . . . . . . . . . . 99
Section 14.12. Trustee's Compensation Not Prejudiced . . . . . . . . . . . . 99
Section 14.13. No Waiver of Subordination Provisions . . . . . . . . . . . . 99
Section 14.14. Payments May Be Paid Prior to Dissolution . . . . . . . . . . 99
Section 14.15. Consent of Holders of Senior Indebtedness Under the
Senior Credit Facility. . . . . . . . . . . . . . . . . . . .100
Section 14.16. Trust Moneys Not Subordinated . . . . . . . . . . . . . . . .100
Section 14.17. Notice to Representative of Designated Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . .100
ARTICLE 15 SUBORDINATION OF NOTE GUARANTEES. . . . . . . . . . . . . . . . . . . .101
Section 15.01. Note Guarantees Subordinated to Guarantor Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . .101
Section 15.02. No Payment on Note Guarantees in Certain Circumstances. . . .101
Section 15.03. Payment over of Proceeds upon Dissolution, Etc. . . . . . . .103
Section 15.04. Subrogation . . . . . . . . . . . . . . . . . . . . . . . . .105
(iv)
Section 15.05. Obligations of Guarantor Unconditional. . . . . . . . . . . .105
Section 15.06. Notice to Trustee . . . . . . . . . . . . . . . . . . . . . .106
Section 15.07. Reliance on Judicial Order or Certificate of
Liquidating Agent . . . . . . . . . . . . . . . . . . . . . .106
Section 15.08. Trustee's Relation to Guarantor Senior Indebtedness . . . . .107
Section 15.09. Subordination Rights Not Impaired by Acts or Omissions
of a Guarantor or Holders of Guarantor Senior
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . .107
Section 15.10. Holders Authorize Trustee to Effectuate Subordination
of Note Guarantees. . . . . . . . . . . . . . . . . . . . . .107
Section 15.11. Not to Prevent Events of Default. . . . . . . . . . . . . . .108
Section 15.12. Trustee's Compensation Not Prejudiced . . . . . . . . . . . .108
Section 15.13. No Waiver of Subordination Provisions . . . . . . . . . . . .108
Section 15.14. Payments May Be Paid Prior to Dissolution . . . . . . . . . .109
Section 15.15. Consent of Holders of Guarantor Senior Indebtedness
Under the Senior Credit Facility. . . . . . . . . . . . . . .109
Section 15.16. Notice to Representative of Designated Guarantor
Senior Indebtedness . . . . . . . . . . . . . . . . . . . . .109
(v)
TABLE OF CONTENTS
(continued)
PAGE
(vi)
TABLE OF CONTENTS
(continued)
PAGE
(vii)
TABLE OF CONTENTS
(continued)
PAGE
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF CERTIFICATE
Exhibit C FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH
TRANSFERS TO NON-QIB ACCREDITED INVESTOR
Exhibit D FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH
TRANSFERS PURSUANT TO REGULATION S
Exhibit E FORM OF NOTE GUARANTEE
Exhibit F FORM OF SUPPLEMENTAL INDENTURE
(viii)
INDENTURE dated as of December 21, 1998 among Protection One Alarm
Monitoring, Inc., a Delaware corporation (the "Company"), the Guarantors and
The Bank of New York, a New York banking corporation, as trustee (the
"Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the 8 1/8% Senior Subordinated Notes due 2009 (the "Initial Notes") and the
8 1/8% Senior Subordinated Notes due 2009 to be issued in connection with
Exchange Offer (the "Exchange Notes" and, together with the Initial Notes,
the "Notes"):
This Indenture is subject to, and shall be governed by, the provisions
of the Trust Indenture Act of 1939, as amended, that are required to be a
part of and to govern indentures qualified under the Trust Indenture Act of
1939, as amended.
AND THIS INDENTURE FURTHER WITNESSETH
For and in consideration of the premises and the purchase of the Notes
by the Holders thereof, it is mutually covenanted and agreed, for the equal
and proportionate benefit of all Holders, as follows.
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. DEFINITIONS.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article 1 have the meanings
assigned to them in this Article 1 and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein, and the terms "cash transaction" and
"self-liquidating paper", as used in TIA Section 311, shall have the
meanings assigned to them in the rules of the SEC adopted under the
Trust Indenture Act;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles, and, except as otherwise herein expressly
provided, the term "generally accepted accounting
principles" with respect to any computation required or permitted
hereunder shall mean such accounting principles as are generally
accepted at the date of such computation; and
(4) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
"Acquired Indebtedness" means Indebtedness of a Person or any of its
Subsidiaries existing at the time such Person becomes a Restricted Subsidiary
or at the time it merges or consolidates with Parent Guarantor or any of its
Restricted Subsidiaries or assumed in connection with the acquisition of
assets from such Person and not incurred by such Person in connection with,
or in anticipation or contemplation of, such Person becoming a Restricted
Subsidiary or such acquisition, merger or consolidation.
"Act", when used with respect to any Holder, has the meaning specified
in Section 14.15.
"Additional Interest" means additional interest then owing on the Notes
pursuant to Section 2(d) of the Registration Rights Agreement.
"Adjusted Consolidated Net Tangible Assets" means the total amount of
assets of the Parent Guarantor and its Restricted Subsidiaries (less
applicable depreciation, amortization and other valuation reserves), except
to the extent resulting from write-ups of capital assets (excluding write-ups
in connection with accounting for acquisitions in conformity with GAAP),
after deducting therefrom (i) all current liabilities of the Parent Guarantor
and its Restricted Subsidiaries (excluding intercompany items) and (ii) all
goodwill, trade names, trademarks, patents, unamortized debt discount and
expense and other like intangibles, all as set forth on the most recent
quarterly or annual consolidated balance sheet of the Parent Guarantor and
its Restricted Subsidiaries, prepared in conformity with GAAP and filed with
the SEC or provided to the Trustee.
"Adjusted Treasury Rate" means with respect to any redemption date, the
rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date, plus 0.50%.
"Affiliate" means, as to any Person, any other Person which, directly or
indirectly, through one or more intermediaries, controls, or is controlled
by, or is under common control with, such Person. The term "control" means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means any Registrar, Co-Registrar, Paying Agent or
authenticating agent.
3
"Asset Acquisition" means (i) any transaction pursuant to which any
Person shall become a Restricted Subsidiary or shall be consolidated or
merged with Parent Guarantor or any Restricted Subsidiary or (ii) the
acquisition by Parent Guarantor or any Restricted Subsidiary of assets of any
Person comprising a division or line of business of such Person.
"Asset Sale" means any sale, transfer or other disposition (including by
way of merger, consolidation or sale-leaseback transaction) in one
transaction or a series of related transactions by Parent Guarantor or any of
its Restricted Subsidiaries to any Person other than Parent Guarantor or any
of its Restricted Subsidiaries of (i) all or any of the Capital Stock of any
Restricted Subsidiary owned by Parent Guarantor or any Restricted Subsidiary,
(ii) all or substantially all of the property and assets of an operating unit
or business of Parent Guarantor or any of its Restricted Subsidiaries or
(iii) any other property and assets (other than the Capital Stock or other
Investment in an Unrestricted Subsidiary or in any Affiliate of Parent
Guarantor not controlled, directly or indirectly, by Parent Guarantor) of
Parent Guarantor or any of its Restricted Subsidiaries outside the ordinary
course of business of Parent Guarantor or such Restricted Subsidiary and, in
each case, that is not governed by the provisions of this Indenture
applicable to mergers, consolidations and sales of assets of Parent
Guarantor; PROVIDED that "Asset Sale" shall not include (a) sales, transfers
or other dispositions of inventory, receivables, equipment leases, capital
lease obligations and other current assets, (b) sales, transfers or other
dispositions of assets constituting a Restricted Payment permitted to be made
under Section 4.08, (c) bona fide sales, transfers or other dispositions of
assets for consideration (including cash equalization payments) at least
equal to the fair market value (as determined by the Board of Directors of
Parent Guarantor) of the assets sold, transferred or disposed of, to the
extent that the consideration received would satisfy clause (i)(B) of Section
4.09(b), (d) sales or other dispositions of delinquent accounts receivable
for collection in the ordinary course of business, (e) sales or other
dispositions of obsolete assets or assets no longer useful in the conduct of
Parent Guarantor's or such Restricted Subsidiary's business, (f) sales or
other dispositions resulting from any casualty or condemnation of property,
(g) licenses and sublicenses of intellectual property and general intangibles
and licenses, leases or subleases in the ordinary course of business, or (h)
sales or other dispositions of assets in any given fiscal year in an amount
less than or equal to $5 million.
"Authenticating Agent" means any Person authorized by the Trustee to act
on behalf of the Trustee to authenticate Notes as specified in Section 2.02.
"Authorized Newspaper" means a newspaper, in the English language,
customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays, and of general circulation in The City of New
York. Where successive publications are required to be made in Authorized
Newspapers, the successive publications may be made in the same or
4
in different newspapers in The City of New York meeting the foregoing
requirements and in each case on any Business Day.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Board of Directors" or "board of directors" means, as to any Person,
either the board of directors of such Person, or any duly authorized
committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors (or a committee of the Board of Directors empowered
to adopt such resolution) and to be in full force and effect on the date of
such certification, and delivered to the Trustee.
"Business Day" means any day (other than a day which is a Saturday,
Sunday or legal holiday in the state of New York) on which banks are open for
business in New York, New York.
"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations or other
equivalents (however designated) of capital stock of such Person and (ii)
with respect to any Person that is not a corporation, any and all partnership
or other equity interests of such Person.
"Capitalized Lease Obligation" means, as to any Person, the obligation
of such Person to pay rent or other amounts under a lease to which such
Person is a party that is required to be classified and accounted for as a
capital lease obligation under GAAP, and for purposes of this definition, the
amount of such obligation at any date shall be the capitalized amount of such
obligation at such date, determined in accordance with GAAP.
"Cedel" means Cedel Bank, SA or its successors.
"Change of Control" means (i) the consummation of any transaction
(including, without limitation, any merger or consolidation) the result of
which is that any "person" or "group" (within the meaning of Sections 13(d)
and 14(d)(2) of the Exchange Act), other than the Principal and its Related
Parties, becomes the "beneficial owner" (as such term is defined in Rule
13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly, of more
than 50% of the Voting Stock of Parent Guarantor or the Company (measured by
voting power rather than number of shares) or (ii) the first day on which a
majority of the members of the Board of Directors of Parent Guarantor or the
Company are not Continuing Directors.
"Change of Control Triggering Event" means the occurrence of both a
Change of Control and a Rating Decline.
5
"Commodity Agreement" means any commodity futures contract, commodity
option or other similar agreement or arrangement.
"Company" means Protection One Alarm Monitoring, Inc., and any and all
successors thereto.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chief Executive Officer, its President,
its Chief Financial Officer, any Vice President, its Treasurer or any Assistant
Treasurer, its Secretary or any Assistant Secretary and delivered to the
Trustee.
"Comparable Treasury Issue" means the United States Treasury Security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term of the Notes that would be utilized, at the time of selection
and in accordance with customary financial practice, in pricing new issues of
corporate debt securities of comparable maturity to the remaining term of the
Notes.
"Comparable Treasury Price" means, with respect to any redemption date, (i)
the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
Business Day preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such Business Day, (A) the
Reference Treasury Dealer Quotations for such redemption date, after excluding
the highest and lowest of such Reference Treasury Dealer Quotations, or (B) if
the Trustee obtains fewer than three such Reference Treasury Dealer Quotations,
the average of all such Quotations.
"Conditional Redemption" means a redemption pursuant to a notice of
redemption that provides that such redemption is subject to the occurrence of
any event before the date fixed for such redemption as described in such notice
of redemption.
"Consolidated EBITDA" means, for any period, the net income of Parent
Guarantor and its Restricted Subsidiaries for such period plus, to the extent
such amount was deducted in calculating such net income (i) Consolidated
Interest Expense, (ii) income taxes, (iii) depreciation expense, (iv)
amortization expense, (v) all other non-cash items, extraordinary items,
nonrecurring and unusual items and cumulative effects of changes in accounting
principles reducing such net income, less all non-cash items, extraordinary
items, nonrecurring and unusual items and cumulative effects of changes in
accounting principles increasing such net income, all as determined on a
consolidated basis for Parent Guarantor and its Restricted Subsidiaries in
6
conformity with GAAP, (vi) upfront expenses resulting from equity offerings,
investments, mergers, recapitalizations, option buyouts, Dispositions, Asset
Acquisitions and similar transactions to the extent such expenses reduce net
income and (vii) gains or losses on Dispositions; PROVIDED that Consolidated
EBITDA shall not include (x) the net income (or net loss) of any Person that is
not a Restricted Subsidiary, except (I) with respect to net income, to the
extent of the amount of dividends or other distributions actually paid to Parent
Guarantor or any of its Restricted Subsidiaries by such Person during such
period and (II) with respect to net losses, to the extent of the amount of
investments made by Parent Guarantor or any Restricted Subsidiary in such Person
during such period; (y) solely for the purposes of calculating the amount of
Restricted Payments that may be made pursuant to clause (iii) of Section 4.08(a)
(and in such case, except to the extent includable pursuant to clause (x)
above), the net income (or net loss) of any Person accrued prior to the date it
becomes a Restricted Subsidiary or is merged into or consolidated with Parent
Guarantor or any Restricted Subsidiary or all or substantially all of the
property and assets of such Person are acquired by Parent Guarantor or any of
its Restricted Subsidiaries; and (z) the net income of any Restricted Subsidiary
(other than the Company) to the extent that the declaration or payment of
dividends or similar distributions by such Restricted Subsidiary of such net
income is not at the time permitted by the operation of the terms of its charter
or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to such Restricted Subsidiary (other than any
agreement or instrument evidencing Indebtedness or Preferred Stock outstanding
on the Issue Date or incurred or issued thereafter without violation of this
Indenture; PROVIDED that the terms of any such agreement restricting the
declaration and payment of dividends or similar distributions apply only in the
event of a default with respect to a financial covenant or a covenant relating
to payment (beyond any applicable period of grace) contained in such agreement
or instrument and PROVIDED such terms are determined by Parent Guarantor to be
customary in comparable financings and such restrictions are determined by
Parent Guarantor not to materially affect the Company's ability to make
principal or interest payments on the Notes when due).
"Consolidated Interest Expense" means, with respect to Parent Guarantor for
any period, without duplication, the sum of (i) the interest expense of such
Person and its Restricted Subsidiaries for such period as determined on a
consolidated basis in accordance with GAAP, including, without limitation, (a)
any amortization of debt discount (other than discount arising solely as a
result of the Incurrence of Indebtedness that is part of an investment unit
together with one or more additional securities), (b) the net cost under
Interest Swap Agreements (including any amortization of discounts), (c) the
interest portion of any deferred payment obligation, (d) all commissions,
discounts and other fees and charges owed with respect to letters of credit,
bankers' acceptance financing or similar facilities and (e) all accrued interest
and (ii) the interest component of Capitalized Lease Obligations paid or accrued
by such Person and its Restricted Subsidiaries during such period as determined
on a consolidated basis in accordance with GAAP; EXCLUDING, HOWEVER, (x) any
amount of such interest of any Restricted Subsidiary if the net income of such
Restricted Subsidiary is excluded in the calculation of Consolidated EBITDA
7
pursuant to clause (z) of the definition thereof (but only in the same
proportion as the net income of such Restricted Subsidiary is excluded from the
calculation of Consolidated EBITDA pursuant to clause (z) of the definition
thereof) and (y) the amortization of deferred financing costs related to the
issuance of the Notes or to the funding of the Senior Credit Facility, all as
determined on a consolidated basis for the Parent Guarantor and its Restricted
Subsidiaries in conformity with GAAP.
"Continuing Directors" means, as of any date of determination, any member
of the Board of Directors of the Parent Guarantor or the Company, as applicable,
who (i) was a member of such Board of Directors on the date of this Indenture or
(ii) was nominated for election or elected to such Board of Directors with the
approval of a majority of the Continuing Directors who were members of such
Board at the time of such nomination or election.
"Convertible Notes" means the Company's 63/4% Convertible Subordinated
Notes due 2003.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 12.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Currency Agreement" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement.
"Custodian" means the Trustee, as custodian with respect to the Notes in
global form, or any successor entity thereto.
"Debt" means notes, bonds, debenture or other similar evidence of
indebtedness for money borrowed.
"Debt Rating" shall mean the rating assigned to the Notes by Moody's or
S&P, as the case may be.
"Default" means an event or condition the occurrence of which is, or with
the lapse of time or the giving of notice or both would be, an Event of Default.
"Depositary" means The Depository Trust Company, its nominees, and their
respective successors.
"Designated Guarantor Senior Indebtedness" means (i) all Obligations
guaranteed by a Guarantor under the Senior Credit Facility and (ii) any other
Guarantor Senior Indebtedness of the Guarantor which, at the date of
determination, has an aggregate principal amount outstanding
8
of, or under which, at the date of determination, the holders thereof are
committed to lend up to, at least $35.0 million and is specifically
designated by the Company in the instrument evidencing or governing such
Guarantor Senior Indebtedness as "Designated Guarantor Senior Indebtedness"
for purposes of this Indenture.
"Designated Senior Indebtedness" means (i) all Obligations under the Senior
Credit Facility and (ii) any other Senior Indebtedness of the Company which, at
the date of determination, has an aggregate principal amount outstanding of, or
under which, at the date of determination, the holders thereof are committed to
lend up to, at least $35.0 million and is specifically designated by the Company
in the instrument evidencing or governing such Senior Indebtedness as
"Designated Senior Indebtedness" for purposes of this Indenture.
"Discount Notes" means the Company's 135/8% Senior Subordinated Discount
Notes due 2005.
"Disposition" means, with respect to any Person, any merger, consolidation
or other business combination involving such Person (whether or not such Person
is the Surviving Person) or the sale, assignment, or transfer, lease, conveyance
or other disposition of all or substantially all of such Person's assets or
Capital Stock.
"Disqualified Capital Stock" means any Capital Stock that, 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, matures (excluding any
maturity as the result of an optional redemption by the issuer thereof) or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the sole option of the holder thereof (except, in each case,
upon the occurrence of a Change of Control if such Capital Stock requires that
the Change of Control Offer with respect to the Notes be completed prior to any
similar offer being made with respect to such Capital Stock), in whole or in
part, on or prior to the final maturity date of the Notes; PROVIDED, HOWEVER,
that only the portion of Capital Stock which so matures or is mandatorily
redeemable or is so redeemable at the sole option of the holder thereof prior to
the final maturity date of the Notes shall be deemed Disqualified Capital Stock.
"Domestic Subsidiary" means a subsidiary organized under the laws of one of
the states of the United States or the District of Columbia.
"Euroclear" means Xxxxxx Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Excess Proceeds" means the amount of such Net Cash Proceeds required to be
applied (or to be committed to be applied) during the period specified in
Section 4.09(b)(i) and not applied as so required by the end of such period.
9
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" has the meaning assigned to it in the preamble to this
Indenture.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"GAAP" means generally accepted accounting principles in the United States
of America, including those set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or the SEC or in such other statements by such other entity as
approved by a significant segment of the accounting profession. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP as in effect on the date of this Indenture.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof), of all or any part of any Indebtedness.
"Guarantor Senior Indebtedness" means, with respect to any Guarantor, the
Senior Indebtedness of such Guarantor.
"Guarantors" means Protection One, Inc., a Delaware corporation ("Parent
Guarantor"), the Subsidiaries named on the signature pages of this Indenture,
and each other Person that executes a Note Guarantee in accordance with the
provisions of this Indenture, and their respective successors and assigns.
"Holder" means a Person in whose name a Note is registered.
"Indebtedness" means with respect to any Person, without duplication, any
liability of such Person (i) for borrowed money, (ii) evidenced by bonds,
debentures, notes or other similar instruments, (iii) constituting Capitalized
Lease Obligations, (iv) incurred or assumed as the deferred purchase price of
property or services, or pursuant to conditional sale obligations and title
retention agreements (but excluding trade accounts payable arising in the
ordinary course of business), (v) for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction, (vi) for
Indebtedness of others guaranteed by such Person, (vii) for Interest Swap
Agreements, Commodity Agreements and Currency Agreements and (viii) for
10
Indebtedness of any other Person of the type referred to in clauses (i) through
(vii) which is secured by any Lien on any property or asset of such first
referred to Person, the amount of such Indebtedness being deemed to be the
lesser of the value of such property or asset or the amount of the Indebtedness
so secured. The amount of Indebtedness of any Person at any date shall be (i)
the outstanding principal amount of all unconditional obligations described
above, as such amount would be calculated in accordance with GAAP, (ii) the
accreted value thereof, in the case of any Indebtedness issued with original
issue discount and (iii) the principal amount thereof, together with any
interest thereon that is more than 30 days past due, in the case of any other
Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Independent Investment Banker" means the Reference Treasury Dealers
appointed by the Trustee after consultation with the Company.
"Initial Notes" has the meaning assigned to it in the preamble to this
Indenture.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Interest Coverage Ratio" means, on any date, the ratio of (i) the
Consolidated EBITDA for the then most recently completed fiscal quarter prior to
such date for which reports have been filed with the SEC or provided to the
Trustee (the "Quarter") to (ii) the aggregate Consolidated Interest Expense
during such Quarter. In making the foregoing calculation, (A) PRO FORMA effect
shall be given to any Indebtedness Incurred or repaid during the period (the
"Reference Period") commencing on the first day of the Quarter and ending on the
date of calculation (other than (i) Indebtedness Incurred or repaid under a
revolving credit or similar arrangement to the extent of the commitment
thereunder (or under any predecessor revolving credit or similar arrangement) in
effect on the last day of such Quarter unless any portion of such Indebtedness
is projected, in the reasonable judgment of the senior management of the
Company, to remain outstanding for a period in excess of 12 months from the date
of the Incurrence thereof and (ii) Permitted Indebtedness incurred on the date
of calculation), in each case as if such Indebtedness had been Incurred or
repaid on the first day of such Reference Period; (B) Consolidated Interest
Expense attributable to interest on any Indebtedness (whether existing or being
Incurred) computed on a PRO FORMA basis and bearing a floating interest rate
shall be computed as if the rate in effect on the date of calculation (taking
into account any Interest Swap Agreement applicable to such Indebtedness if such
Interest Swap Agreement has a remaining term in excess of 12 months or, if
shorter, at least equal to the remaining term of such Indebtedness) had been the
applicable rate for the entire period; (C) PRO FORMA effect shall be given to
Asset Sales and Asset Acquisitions (including giving PRO FORMA effect to the
application of proceeds of any Asset Sales to any discharge or other relief from
Indebtedness to which Parent Guarantor and the Restricted Subsidiaries are not
liable following such Asset Sale and for cost savings resulting in connection
11
with an Asset Acquisition as anticipated in good faith to be realized within the
next 12 months whether or not such cost savings could then be reflected in pro
forma financial statements under GAAP, Regulation S-X promulgated by the SEC or
any other regulation or policy of the SEC; PROVIDED, HOWEVER, that such cost
savings were identified and quantified in good faith in an Officer's Certificate
delivered to the Trustee contemporaneously with the relevant calculation of the
Interest Coverage Ratio) that occur during such Reference Period as if they had
occurred and such proceeds had been applied on the first day of such Reference
Period; and (D) PRO FORMA effect shall be given to asset sales and asset
acquisitions (including giving PRO FORMA effect to the application of proceeds
of any asset sale to any discharge or other relief from Indebtedness to which
Parent Guarantor and the Restricted Subsidiaries are not liable following such
asset sale and for cost savings resulting in connection with an asset
acquisition as anticipated in good faith to be realized within the next 12
months whether or not such cost savings could then be reflected in pro forma
financial statements under GAAP, Regulation S-X promulgated by the SEC or any
other regulation or policy of the SEC; PROVIDED, HOWEVER, that such cost savings
were identified and quantified in good faith in an Officer's Certificate
delivered to the Trustee contemporaneously with the relevant calculation of the
Interest Coverage Ratio) that have been made by any Person that has become a
Restricted Subsidiary or has been merged with or into Parent Guarantor or any
Restricted Subsidiary during such Reference Period and that would have
constituted Asset Sales or Asset Acquisitions had such transactions occurred
when such Person was a Restricted Subsidiary as if such asset sales or asset
acquisitions were Asset Sales or Asset Acquisitions that occurred on the first
day of such Reference Period; PROVIDED that to the extent that clause (C) or (D)
of this sentence requires that PRO FORMA effect be given to an Asset Acquisition
or Asset Sales, such PRO FORMA calculation shall be based upon the four full
fiscal quarters immediately preceding the Transaction Date of the Person, or
division or line of business of the Person, that is acquired or disposed for
which financial information is available.
"Interest Swap Agreements" means any interest rate protection agreement,
interest rate future, interest rate option, interest rate swap, interest rate
cap or other interest rate hedge or arrangement.
"Investment" in any Person means any direct or indirect advance, loan or
other extension of credit (including, without limitation, by way of Guarantee or
similar arrangement; but excluding advances to customers or suppliers in the
ordinary course of business that are, in conformity with GAAP, recorded as
accounts receivable, prepaid expenses or deposits on the balance sheet of Parent
Guarantor or its Restricted Subsidiaries) 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, bonds, notes, debentures or other similar instruments issued by,
such Person and shall include (i) the designation of a Restricted Subsidiary as
an Unrestricted Subsidiary and (ii) the retention of the Capital Stock (or any
other Investment) by Parent Guarantor or any of its Restricted Subsidiaries, of
(or in) any Person that has ceased to be a Restricted Subsidiary. For purposes
of the definition
12
of "Unrestricted Subsidiary" and Section 4.08, the amount of or a reduction
in an Investment shall be equal to the fair market value thereof at the time
such Investment is made or reduced.
"Investment Grade Status" exists as of a date and thereafter if at such
date either (i) the Debt Rating of Xxxxx'x is at least Baa3 (or the equivalent)
or higher or (ii) the Debt Rating of S&P is at least BBB- (or the equivalent) or
higher.
"Issue Date" means the date of original issuance of the Notes.
"Lien" means, with respect to any asset, any lien, mortgage, deed of trust,
pledge, security interest, charge or encumbrance of any kind (including any
conditional sale or other title retention agreement, any lease in the nature
thereof and any agreement to give any security interest).
"Lifeline Merger" means the transaction contemplated by the agreement
between the Company and Lifeline Systems, Inc. ("Lifeline"), pursuant to which
the Company shall acquire Lifeline for approximately $191 million in cash and
common stock of the Parent Guarantor.
"Maturity", when used with respect to any Notes, means the date on which
the principal of such Notes or an installment of principal becomes due and
payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, notice of redemption, notice of option to elect
repayment or otherwise.
"Moody's" means Xxxxx'x Investors Service, Inc. or any successor to the
rating agency business thereof.
"Net Cash Proceeds" means, (a) with respect to any Asset Sale, the proceeds
of such Asset Sale in the form of cash or cash equivalents, including payments
in respect of deferred payment obligations (to the extent corresponding to the
principal, but not interest, component thereof) when received in the form of
cash or cash equivalents and proceeds from the conversion of other property
received when converted to cash or cash equivalents, net of (i) brokerage
commissions and other fees and expenses (including fees and expenses of counsel
and investment bankers) related to such Asset Sale, (ii) provisions for all
taxes (whether or not such taxes will actually be paid or are payable) as a
result of such Asset Sale without regard to the consolidated results of
operations of Parent Guarantor and its Restricted Subsidiaries, taken as a
whole, (iii) payments made to repay debt or any other obligation outstanding at
the time of such Asset Sale that either (A) is secured by a Lien on the property
or assets sold or (B) is required to be paid as a result of such sale and (iv)
appropriate amounts to be provided by Parent Guarantor or any Restricted
Subsidiary as a reserve against any liabilities associated with such Asset Sale,
including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities under
any indemnification obligations associated with such Asset Sale, all as
determined in conformity with GAAP and (b) with respect to any
13
issuance or sale of Capital Stock, the proceeds of such issuance or sale in
the form of cash or cash equivalents, including payments in respect of
deferred payment obligations (to the extent corresponding to the principal,
but not interest, component thereof) when received in the form of cash or
cash equivalents and proceeds from the conversion of other property received
when converted to cash or cash equivalents, net of attorney's fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees incurred in connection
with such issuance or sale and net of taxes paid or payable as a result
thereof.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Guarantee" means, with respect to each Guarantor, the unconditional
Guarantee of the Notes by such Guarantor, pursuant to Article 10.
"Notes" has the meaning assigned to it in the preamble to this Indenture.
"Obligations" means all obligations for principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing, or otherwise relating to, any
Indebtedness.
"Offer to Purchase" means an offer to purchase Notes by the Company from
the Holders commenced by mailing a notice to the Trustee and each Holder
stating:
(i) the covenant pursuant to which the offer is being made and
that all Notes validly tendered will be accepted for payment on a pro rata
basis;
(ii) the purchase price and the date of purchase (which shall be a
Business Day no earlier than 30 days nor later than 60 days from the date
such notice is mailed) (the "Payment Date");
(iii) that any Note not tendered will continue to accrue interest
pursuant to its terms;
(iv) that, unless the Company defaults in the payment of the
purchase price, any Note accepted for payment pursuant to the Offer to
Purchase shall cease to accrue interest on and after the Payment Date;
(v) that Holders electing to have a Note purchased pursuant to the
Offer to Purchase will be required to surrender the Note, together with the
form entitled "Option of the Holder to Elect Purchase" on the reverse side
of the Note completed, to the Paying
14
Agent at the address specified in the notice prior to the close of business
on the Business Day immediately preceding the Payment Date;
(vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the
third Business Day immediately preceding the Payment Date, a telegram,
facsimile transmission or letter setting forth the name of such Holder, the
principal amount of Notes delivered for purchase and a statement that such
Holder is withdrawing his election to have such Notes purchased; and
(vii) that Holders whose Notes are being purchased only in part will
be issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered; PROVIDED that each Note purchased and each new Note
issued shall be in a principal amount of $1,000 or integral multiples
thereof.
The offer to purchase shall further describe the material facts and
circumstances related to the event with respect to which the particular Offer to
Purchase is being made, as determined in good faith by the Company.
On the Payment Date, the Company shall (i) accept for payment on a pro rata
basis Notes or portions thereof validly tendered and not withdrawn pursuant to
an Offer to Purchase and, in the case of an Offer to Purchase pursuant to
Section 4.09, having an aggregate principal amount not in excess of the Excess
Proceeds in respect of such Offer to Purchase (subject to the provisions of such
covenant related to Pari Passu Indebtedness), (ii) deposit with the Paying Agent
money sufficient to pay the purchase price of all Notes or portions thereof so
accepted; and (iii) deliver, or cause to be delivered, to the Trustee all Notes
or portions thereof so accepted together with an Officers' Certificate
specifying the Notes or portions thereof accepted for payment by the Company.
The Paying Agent shall promptly mail to the Holders of Notes so accepted payment
in an amount equal to the purchase price, and the Trustee shall promptly
authenticate and mail to such Holders a new Note equal in principal amount to
any unpurchased portion of the Note surrendered; PROVIDED, HOWEVER, that each
Note purchased and each new Note issued shall be in a principal amount of $1,000
or integral multiples thereof. The Company will publicly announce the results
of an Offer to Purchase as soon as practicable after the Payment Date. The
Trustee shall act as the Paying Agent for an Offer to Purchase. The Company
will comply with Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent such laws and regulations are
applicable, in the event that the Company is required to repurchase Notes
pursuant to an Offer to Purchase. To the extent that the provisions of any
securities laws or regulations conflict with the provisions for such Offer to
Purchase, the Company will comply with the applicable securities laws and
regulations and will not be deemed to have breached its obligations with respect
to such Offer to Purchase by virtue thereof.
15
"Offering" means the offering of the Notes by the Company.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the
Secretary or any Vice President of such Person.
"Officers' Certificate" means a certificate signed by the Chief Executive
Officer, the President, the Chief Financial Officer, any Vice President, the
Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of
the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"Outstanding", when used with respect to Notes, means, as of the date of
determination, all Notes theretofore authenticated and delivered under this
Indenture, except:
(i) Notes theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Notes, or portions thereof, for whose payment, money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set aside and segregated
in trust by the Company (if the Company shall act as its own Paying Agent)
for the Holders of such Notes;
(iii) Notes with respect to which the Company has effected
defeasance and/or covenant defeasance as provided in this Indenture; and
(iv) Mutilated, destroyed, lost or stolen Notes which have become
or are about to become due and payable which have been paid pursuant to
this Indenture or in exchange for or in lieu of which other Notes have been
authenticated and delivered pursuant to this Indenture, other than any such
Notes in respect of which there shall have been presented to the Trustee
proof satisfactory to it that such Notes are held by a bona fide purchaser
in whose hands the Notes are valid obligations of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount (or principal amount at maturity) of Outstanding Notes have
given any request, demand, authorization, direction, notice, consent or waiver
under this Indenture, and for the purpose of making the calculations required by
TIA Section 313, Notes owned by the Company or any other obligor under the Notes
or any Affiliate of the Company or such other obligor shall be
16
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in making such calculation or in
relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Notes which the Trustee knows to be so owned shall be
so disregarded. Notes so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Notes and that the
pledgee is not the Company or any other obligor upon the Notes or any
Affiliate of the Company or such other obligor.
"Parent Guarantor" means Protection One, Inc., or its successors, including
any company the common stock of which is exchanged for the common stock of
Protection One, Inc. by way of merger or other transaction.
"Paying Agent" means any Person (including the Company acting as Paying
Agent) authorized by the Company to pay the principal of, premium or Additional
Interest, if any, or interest on any Notes on behalf of the Company.
"Permitted Indebtedness" means, without duplication, (i) Indebtedness
outstanding on the Issue Date or on any Reinstatement Date (including, without
limitation, the Convertible Notes, Discount Notes, Senior Notes and Capitalized
Lease Obligations); (ii) Indebtedness of the Parent Guarantor and any of its
Restricted Subsidiaries incurred under the Senior Credit Facility (including
letter of credit obligations), PROVIDED that the aggregate principal amount at
any time outstanding does not exceed $500.0 million, less any amount of such
Indebtedness permanently repaid as provided in Section 4.09; (iii) Indebtedness
evidenced by or arising under the Notes, the Note Guarantees and this Indenture
in respect of the Notes; (iv) Interest Swap Agreements, Commodity Agreements and
Currency Agreements; PROVIDED, HOWEVER, that such agreements are entered into
for bona fide hedging purposes and not for speculative purposes; (v) additional
Indebtedness of the Parent Guarantor or any of its Restricted Subsidiaries not
otherwise permitted under Section 4.06 in an aggregate principal amount that,
when aggregated with the aggregate principal amount of all other Indebtedness
then outstanding and incurred pursuant to this clause (v), does not at any one
time outstanding exceed the sum of (x) $75 million and (y) without duplication,
100% of the net proceeds received by the Parent Guarantor or any Restricted
Subsidiary from the issue or sale after the Issue Date of Qualified Capital
Stock (including upon the conversion or exchange of any Indebtedness, including
the Convertible Notes) or net proceeds contributed to the capital of the Parent
Guarantor or any Restricted Subsidiary (other than in respect of Disqualified
Capital Stock) as determined in accordance with clauses (iii)(b) and (iii)(c) of
Section 4.08(a) to the extent such net proceeds have not been applied pursuant
to such clause to make Restricted Payments or to effect other transactions
pursuant to Section 4.08(b) (it being understood that any Indebtedness incurred
under this clause (v) shall cease to be deemed incurred or outstanding for
purposes of this clause (v) from and after the first date on which the Parent
Guarantor could have incurred such Indebtedness under Section 4.06(a) without
17
reliance upon this clause (v), and such Indebtedness shall thereupon be deemed
to have been so incurred); (vi) Refinancing Indebtedness (other than in respect
of Indebtedness incurred pursuant to clauses (ii) and (v) of this definition);
(vii) Indebtedness owed by the Parent Guarantor to any Restricted Subsidiary (so
long as it shall remain a Restricted Subsidiary of the Parent Guarantor) or by
any Restricted Subsidiary (so long as it remains a Restricted Subsidiary) to the
Parent Guarantor or any Restricted Subsidiary; (viii) guarantees by the Parent
Guarantor or Restricted Subsidiaries of any Indebtedness permitted to be
incurred pursuant to this Indenture; (ix) Indebtedness in respect of performance
bonds, reimbursement obligations with respect to letters of credit, bankers'
acceptances, completion guarantees and surety or appeal bonds provided by the
Parent Guarantor or any of its Restricted Subsidiaries in the ordinary course of
their business or Indebtedness with respect to reimbursement type obligations
regarding workers' compensation claims; (x) Indebtedness arising from agreements
providing for indemnification, adjustment of purchase price or similar
obligations, or from guarantees or letters of credit, surety bonds or
performance bonds securing any obligations of the Parent Guarantor or any of its
Restricted Subsidiaries pursuant to such agreements, in each case incurred in
connection with the disposition of any business assets or Subsidiaries of the
Parent Guarantor (other than guarantees of Indebtedness or other obligations
incurred by any Person acquiring all or any portion of such business assets or
its Restricted Subsidiaries for the purpose of financing such acquisition) in a
principal amount not to exceed the gross proceeds, including non-cash proceeds,
actually received by the Parent Guarantor or any of its Restricted Subsidiaries
in connection with such disposition; PROVIDED, HOWEVER, that such Indebtedness
is not reflected on the balance sheet of the Parent Guarantor or any Restricted
Subsidiary (contingent obligations referred to in a footnote to financial
statements and not otherwise reflected on the balance sheet will not be deemed
to be reflected on such balance sheet for purposes of this clause); (xi)
Indebtedness (including but not limited to Capitalized Lease Obligations,
mortgage financings or purchase money obligations) incurred for the purpose of
financing all or any part of the price or cost of the bona fide acquisition,
construction or improvement of property or assets (whether through direct
purchase of assets or the Capital Stock of any Person owning such assets) or
incurred to refinance any such purchase price or cost of acquisition,
construction or improvement, PROVIDED, HOWEVER, that no Indebtedness may be
incurred under this clause (xi) if the amount of Indebtedness outstanding under
this clause (xi) exceeds 5% of the total consolidated assets of the Parent
Guarantor and its Subsidiaries as set forth on its consolidated balance sheet as
of the most recently completed fiscal quarter prior to the Incurrence of
Indebtedness pursuant to this clause (xi) for which financial statements have
been filed with the SEC or provided to the Trustee; (xii) additional
Indebtedness incurred for the purpose of financing all or any part of capital
expenditures in an amount not to exceed $25 million at any time outstanding; and
(xiii) Indebtedness of Persons that are acquired by the Parent Guarantor or any
of its Restricted Subsidiaries or merged into the Parent Guarantor or any of its
Restricted Subsidiaries in accordance with the terms of this Indenture;
PROVIDED, HOWEVER, that such Indebtedness is not incurred in contemplation of
such acquisition or merger; and PROVIDED FURTHER that after giving effect to
such acquisition or merger, the Parent Guarantor
18
would be permitted to incur at least $1.00 of additional Indebtedness (other
than Permitted Indebtedness) under Section 4.06(a).
"Person" means an individual, partnership, corporation, limited liability
company, unincorporated organization, trust or joint venture, or a governmental
agency or political subdivision thereof.
"Place of Payment" means, when used with respect to the Notes the place or
places where the principal, premium, if any, and interest on such Notes are
payable as specified as contemplated by Article 2.
"Placement Agent" means Xxxxxx Xxxxxxx & Co. Incorporated, Chase Securities
Inc., First Union Capital Markets, a division of Wheat First Securities, Inc.,
NationsBanc Xxxxxxxxxx Securities LLC and TD Securities (USA) Inc.
"Preferred Stock" of any Person means any Capital Stock of such Person that
has preferential rights to any other Capital Stock of such Person with respect
to dividends or redemptions or upon liquidation.
"Principal" means Western Resources, Inc.
"Qualified Capital Stock" means any Capital Stock that is not Disqualified
Capital Stock.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Rating Agencies" mean S&P and Xxxxx'x.
"Rating Category" means (i) with respect to S&P, any of the following
categories: AAA, AA, A, BBB, BB, B, CCC, CC, C and D (or equivalent successor
categories); (ii) with respect to Xxxxx'x any of the following categories: Aaa,
Aa, A, Baa, Ba, B, Caa, Ca and C (or equivalent successor categories) and (iii)
the equivalent of any such category of S&P and Xxxxx'x used by another rating
agency. In determining whether the rating of the Notes has decreased by one or
more gradations, gradations within Rating Categories (+ and - for S&P: 1, 2 and
3 for Xxxxx'x; or the equivalent gradations for another rating agency) shall be
taken into account (e.g., with respect to S&P, a decline in a rating from BB+ to
BB, as well as from BB- to B+, will constitute a decrease of one gradation).
"Rating Decline" means (i) a decrease of two or more gradations (including
gradations within Rating Categories as well as between Rating Categories) in the
rating of the Notes by either Rating Agency from the rating of the Notes by such
Rating Agency or (ii) a withdrawal of the rating of the Notes by either Rating
Agency, PROVIDED that such decrease or withdrawal occurs on, or within 90 days
after, the date of public notice of the occurrence of a Change of
19
Control or of the intention by the Company to effect a Change of Control
(which period shall be extended so long as the rating of the Notes is under
publicly announced consideration for possible downgrade by either Rating
Agency).
"Reference Treasury Dealer" means each of Xxxxxx Xxxxxxx & Co.
Incorporated, First Union Capital Markets, a division of Wheat First Securities,
Inc., NationsBanc Xxxxxxxxxx Securities, LLC, and TD Securities (USA) Inc., and
their respective successors; PROVIDED, HOWEVER, that if any of the foregoing
shall cease to be a primary U.S. Government securities dealer in New York City
(a "Primary Treasury Dealer"), the Company shall substitute therefor another
Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any redemption date, the average as determined by
the Trustee, of the bid and asked prices of the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the
third Business Day preceding such redemption date.
"Refinancing Indebtedness" means any refinancing by Parent Guarantor or its
Restricted Subsidiaries of Indebtedness of Parent Guarantor or any of its
Restricted Subsidiaries incurred in accordance with Section 4.06 that does not
(i) result in an increase in the aggregate principal amount of Indebtedness
(such principal amount to include, for purposes of this definition, any
premiums, fees, penalties or accrued interest paid with the proceeds of the
Refinancing Indebtedness) of such Person or (ii) create Indebtedness with (A) a
Weighted Average Life to Maturity that is less than the Weighted Average Life to
Maturity of the Indebtedness being refinanced or (B) a final maturity earlier
than the final maturity of the Indebtedness being refinanced; PROVIDED that
Indebtedness of Parent Guarantor or the Company (other than Guarantor Senior
Indebtedness or Senior Indebtedness, as the case may be) that is refinanced by
issuing Indebtedness of any Restricted Subsidiary (other than the Company) shall
not be deemed to be Refinancing Indebtedness.
"Registration Rights Agreement" means the Registration Rights Agreement,
dated as of December 21, 1998, by and among the Company and the other parties
named on the signature pages thereof, as such agreement may be amended, modified
or supplemented from time to time.
"Reinstatement Date" has the meaning specified in Section 4.16.
"Related Party" with respect to the Principal means (A) any controlling
stockholder or 80% (or more) owned Subsidiary of the Principal or (B) any trust,
corporation, partnership or other entity, the beneficiaries, stockholders,
partners, owners or Persons beneficially holding an 80% or more controlling
interest of which consist of the Principal and/or such other Persons referred to
in the immediately preceding clause (A).
20
"Remaining Scheduled Payments" means, with respect to each Note to be
redeemed, the remaining scheduled payments of the principal thereof and
interest thereon that would be due after the related redemption date but for
such redemption; PROVIDED, HOWEVER, that, if such redemption date is not an
interest payment date with respect to such Note, the amount of the next
succeeding scheduled interest payment thereon will be reduced by the amount
of interest accrued thereon to such redemption date.
"Representative" means the indenture trustee or other trustee, agent or
representative in respect of any Senior Indebtedness; PROVIDED, HOWEVER, that
if, and for so long as, any issue of Senior Indebtedness lacks such a
representative, then the Representative for such issue of Senior Indebtedness
shall at all times constitute the holders of a majority in outstanding
principal amount of such issue of Senior Indebtedness.
"Responsible Officer", when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee
customarily performing functions similar to those performed by any of the
above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Restricted Payment" means (i) the declaration or payment of any
dividend or the making of any other distribution (other than dividends or
distributions payable in Qualified Capital Stock or in options, rights or
warrants to acquire Qualified Capital Stock or dividends or distributions by
a Restricted Subsidiary so long as in the case of any dividend or
distribution payable on or in respect of any class or series of Capital Stock
issued by a Restricted Subsidiary other than a Wholly Owned Subsidiary,
Parent Guarantor or a Restricted Subsidiary receives at least its pro rata
share of such dividend or distribution in accordance with its interest in
such Capital Stock) on shares of the Parent Guarantor's Capital Stock, (ii)
the purchase, redemption, retirement or other acquisition for value of any
Capital Stock of Parent Guarantor, or any warrants, rights or options to
acquire shares of Capital Stock of Parent Guarantor, other than through the
exchange of such Capital Stock or any warrants, rights or options to acquire
shares of any class of such Capital Stock for Qualified Capital Stock or
warrants, rights or options to acquire Qualified Capital Stock, (iii) the
voluntary or optional principal payment, or voluntary or optional redemption,
repurchase, defeasance or other acquisition or retirement for value of
Indebtedness of Parent Guarantor, the Company or any Subsidiary Guarantor
that is subordinated in right of payment to the Notes or Note Guarantees, and
(iv) Investments in Unrestricted Subsidiaries or in Affiliates of Parent
Guarantor that are not, directly or indirectly, controlled by Parent
Guarantor.
21
"Restricted Subsidiary" means a direct or indirect Subsidiary of the
Parent Guarantor other than an Unrestricted Subsidiary and includes all of
the Subsidiaries of the Parent Guarantor existing as of the Issue Date,
including the Company, unless the context otherwise requires.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor to the rating agency business thereof.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of Parent Guarantor or a
Restricted Subsidiary secured by a Lien.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Facility" means the Credit Agreement between Westar
Capital and the Company, dated April 1, 1998, as amended August 17, 1998, as
such agreement 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, replacing or otherwise
restructuring (including by way of adding Subsidiaries of the Company 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, it
being agreed that the Revolving Credit Agreement to be entered into on or
about the date of this Indenture among the Company, as borrower, NationsBank,
N.A., as administrative agent, and the lenders party thereto from time to
time shall, upon its execution and delivery, constitute the Senior Credit
Facility for purposes of this definition.
"Senior Indebtedness" means, as to the Company or any Guarantor, as the
case may be, whether outstanding on the Issue Date or thereafter issued, all
Indebtedness of the Company or such Guarantor, as the case may be, including
interest (including interest accruing on or after the filing of, or which
would have accrued but for the filing of, any petition in bankruptcy or for
reorganization relating to the Company or such Guarantor, as the case may be,
or any Restricted Subsidiary of the Company or such Guarantor, as the case
may be, whether or not a claim for
22
post-filing interest is allowed in such proceeding) and premium, if any,
thereon, and other monetary amounts (including fees, expenses, reimbursement
obligations under letters of credit and indemnities) owing in respect thereof
unless, in the instrument creating or evidencing the same or pursuant to
which the same is outstanding, it is provided that the obligations in respect
of such Indebtedness ranks PARI PASSU with or subordinate to the Notes;
PROVIDED, HOWEVER, that Senior Indebtedness will not include (1) any
obligation of the Company or such Guarantor, as the case may be, to any
Restricted Subsidiary of the Company or such Guarantor, as the case may be,
(2) any liability for federal, state, foreign, local or other taxes owed or
owing by the Company or such Guarantor, as the case may be, (3) any accounts
payable or other liability to trade creditors arising in the ordinary course
of business (including Guarantees thereof or instruments evidencing such
liabilities), (4) any Indebtedness, Guarantee or obligation of the Company or
such Guarantor, as the case may be, that is expressly subordinate or junior
in right of payment to any other Indebtedness, Guarantee or obligation of the
Company or such Guarantor, as the case may be, including any Senior
Subordinated Indebtedness (as to which the Notes expressly shall rank PARI
PASSU in right of payment, unless such Senior Subordinated Indebtedness is
expressly made junior in right of payment to the Notes) or (5) obligations in
respect of any Capital Stock.
"Senior Notes" means the Company's 7 3/8% Senior Notes due 2005.
"Senior Subordinated Indebtedness" means the Notes, the Convertible
Notes, the Discount Notes, and any other Indebtedness of the Company that
specifically provides that such Indebtedness is to rank PARI PASSU with the
Notes in right of payment and is not subordinated by its terms in right of
payment to any Indebtedness or other obligation of the Company which is not
Senior Indebtedness.
"Shelf Registration" means the Shelf Registration as defined in the
Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the SEC.
"Stated Maturity", when used with respect to any Notes or any
installment of principal thereof, means the date specified in such Notes as
the fixed date on which the principal of such Notes or such installment of
principal is due and payable.
"Subsidiary" with respect to any Person, means (i) any corporation of which
the outstanding Capital Stock having at least a majority of the votes entitled
to be cast in the election of directors under ordinary circumstances shall at
the time be owned, directly or indirectly, through one or more intermediaries,
by such Person or (ii) any other Person of which at least a majority of the
voting interest under ordinary circumstances is at the time, directly or
indirectly, through one or more intermediaries, owned by such Person.
Notwithstanding anything herein to
23
the contrary, an Unrestricted Subsidiary shall not be deemed to be a
Restricted Subsidiary for purposes of this Indenture.
"Subsidiary Guarantors" means each direct and indirect domestic
Restricted Subsidiary of the Parent Guarantor that is required to execute a
Guarantee pursuant to this Indenture.
"Surviving Person" means, with respect to any Person involved in or that
makes any Disposition, the Person formed by or surviving such Disposition or
the Person to which such Disposition is made.
"Temporary Cash Investment" means any of the following:
(i) direct obligations of the United States of America or any
agency thereof or obligations fully and/or unconditionally guaranteed by
the United States of America or any agency thereof;
(ii) time deposit accounts, certificates of deposit and money
market deposits maturing within one year of the date of acquisition
thereof issued by a bank or trust company which is organized under the
laws of the United States of America, any state thereof or any foreign
country recognized by the United States of America, and which bank or
trust company has capital, surplus and undivided profits aggregating in
excess of $100 million (or the foreign currency equivalent thereof) and
has outstanding debt which is rated "A" (or such similar equivalent
rating) or higher by at least one nationally recognized statistical
rating organization (as defined in Rule 436 under the Securities Act) or
any money-market fund sponsored by a registered broker dealer or mutual
fund distributor;
(iii) repurchase obligations with a term of not more than one year
for underlying securities of the types described in clause (i) above
entered into with a bank or trust company meeting the qualifications
described in clause (ii) above;
(iv) commercial paper, maturing not more than one year after the
date of acquisition, issued by a corporation (other than an Affiliate of
the Company) organized and in existence under the laws of the United
States of America, any state thereof or any foreign country recognized
by the United States of America with a rating at the time as of which
any investment therein is made of "P-1" (or higher) according to Xxxxx'x
or "A-1" (or higher) according to S&P; and
(v) securities with maturities of six months or less from the
date of acquisition issued or fully and unconditionally guaranteed by
any state, commonwealth or territory of the United States of America, or
by any political subdivision or taxing authority thereof, and rated at
least "A" by S&P or Xxxxx'x.
24
"Transaction Date" means, with respect to the Incurrence of any
Indebtedness by the Company or any Restricted Subsidiaries, the date such
Indebtedness is to be Incurred and, with respect to any Restricted Payment,
the date such Restricted Payment is to be made.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as
in force at the date of this Indenture, except that any supplemental
indenture executed pursuant to this Indenture shall conform to the
requirements of the Trust Indenture Act as in effect on the date of execution
thereof.
"Trustee" means the party named as such above until a successor replaces
it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"Unrestricted Subsidiary" means (i) any Subsidiary of Parent Guarantor
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 Restricted Subsidiary (including any newly acquired or newly
formed Subsidiary of Parent Guarantor), other than the Company, to be an
Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or
owns or holds any Lien on any property of, Parent Guarantor or any Restricted
Subsidiary; PROVIDED that (A) any Guarantee by Parent Guarantor or any
Restricted Subsidiary of any Indebtedness of the Subsidiary being so
designated shall be deemed an "Incurrence" of such Indebtedness and an
"Investment" by Parent Guarantor or such Restricted Subsidiary (or both, if
applicable) at the time of such designation; (B) either (I) the Subsidiary to
be so designated has total assets of $1,000 or less or (II) if such
Subsidiary has assets greater than $1,000, such designation would be
permitted under Section 4.08 and (C) if applicable, the Incurrence of
Indebtedness and the Investment referred to in clause (A) of this proviso
would be permitted under Section 4.06 and Section 4.08. The Board of
Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; PROVIDED that (i) no Default or Event of Default shall have
occurred and be continuing at the time of or after giving effect to such
designation and (ii) all Indebtedness of such Unrestricted Subsidiary
outstanding immediately after such designation would, if Incurred at such
time, have been permitted to be Incurred (and shall be deemed to have been
Incurred) for all purposes of this Indenture. Any such designation by the
Board of Directors shall be evidenced 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 Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or
25
instrumentality thereof) for the payment of which the full faith and credit
of the United States of America is pledged and which are not callable or
redeemable at the issuer's option.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under the
Securities Act.
"Voting Stock" means stock of the class or classes having general voting
power under ordinary circumstances to elect at least a majority of the board
of directors, managers, trustees or individuals performing similar functions
of a Person (irrespective of whether or not at the time stock of any other
class or classes shall have or might have voting power by reason of the
happening of any contingency).
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the
then outstanding aggregate principal amount of such Indebtedness into (b) the
total of the product obtained by multiplying (i) the amount of each then
remaining installment, sinking fund, serial maturity or other required
payment of principal, including payment at final maturity, in respect
thereof, by (ii) the number of years (calculated to the nearest one-twelfth)
which will elapse between such date and the making of such payment.
"Wholly Owned Subsidiary" means, with respect to any Subsidiary of any
Person, the ownership of all of the outstanding Capital Stock of such
Subsidiary (other than any director's qualifying shares or shares owned by
foreign nationals to the extent mandated by applicable law) by such Person or
one or more Wholly Owned Subsidiaries of such Person.
Section 1.02. OTHER DEFINITIONS.
"Acceleration Notice". . . . . . . . . . . . .
"Agent Members" . . . . . . . . . . . . . . . . .
"Authenticating Agent" . . . . . . . . . . . . .
"Authentication Order" . . . . . . . . . . . . .
"Blockage Notice" . . . . . . . . . . . . . . . .
"Change of Control Offer" . . . . . . . . . . . .
"Change of Control Payment" . . . . . . . . . . .
26
"Change of Control Payment Date" . . . . . . . .
"Covenant Defeasance" . . . . . . . . . . . . . .
"Defeasance" . . . . . . . . . . . . . . . . . .
"Definitive Notes" . . . . . . . . . . . . . . .
"Event of Default" . . . . . . . . . . . . . . .
"Fall-Away Event" . . . . . . . . . . . . . . . .
"Funding Guarantor" . . . . . . . . . . . . . . .
"Global Notes" . . . . . . . . . . . . . . . . .
"Guarantee Blockage Notice" . . . . . . . . . . .
"Guarantee Payment Blockage Period" . . . . . . .
"Incur" . . . . . . . . . . . . . . . . . . . . .
"IRS" . . . . . . . . . . . . . . . . . . . . . .
"Pari Passu Indebtedness" . . . . . . . . . . . .
"pay the Notes" . . . . . . . . . . . . . . . . .
"Paying Agent" . . . . . . . . . . . . . . . . .
"Payment Blockage Period" . . . . . . . . . . . .
"Registrar" . . . . . . . . . . . . . . . . . . .
"Regulation S Definitive Notes" . . . . . . . . .
"Regulation S Global Notes" . . . . . . . . . . .
27
"Restricted Definitive Notes" . . . . . . . . . .
"Restricted Global Notes" . . . . . . . . . . . .
"Security Register" . . . . . . . . . . . . . . .
Section 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes and the Note Guarantees;
"indenture security holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes and the Note Guarantees means the Company and the
Guarantors, respectively, and any successor obligor upon the Notes and the
Note Guarantees, respectively.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the
TIA have the meanings so assigned to them.
Section 1.04. 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) words in the singular include the plural, and in the plural include
the singular;
28
(e) provisions apply to successive events and transactions; and
(f) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor sections or rules
adopted by the SEC from time to time.
ARTICLE 2
THE NOTES
Section 2.01. FORM AND DATING.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form annexed hereto as Exhibit A with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture. The Notes may have notations, legends or
endorsements required by law, stock exchange agreements to which the Company
is subject or usage. The Company shall approve the form of the Notes and any
notation, legend or endorsement on the Notes. Each Note shall be dated the
date of its authentication.
The terms and provisions contained in the form of the Notes annexed
hereto as Exhibit A shall constitute, and are hereby expressly made, a part
of this Indenture. To the extent applicable, the Company and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby.
Notes offered and sold in reliance on Rule 144A shall be issued
initially in the form of one or more permanent global Notes in registered
form, substantially in the form set forth in Exhibit A (the "Restricted
Global Notes"), registered in the name of the nominee of the Depositary,
deposited with the Trustee, as custodian for the Depositary, duly executed by
the Company and authenticated by the Trustee as hereinafter provided. The
aggregate principal amount of the Restricted Global Notes may from time to
time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depositary, or its nominee, in accordance with
the instructions given by the Holder thereof, as hereinafter provided.
Notes offered and sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of one or more global
Notes in registered form substantially in the form set forth in Exhibit A
(the "Regulation S Global Notes"), registered in the name of the nominee of
the Depositary, deposited with the Trustee, as custodian for the Depositary,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided. The aggregate principal amount of the Regulation S Global Notes
may from time to time be increased or decreased by
29
adjustments made on the records of the Trustee, as custodian for the
Depositary or its nominee, as hereinafter provided.
Notes issued pursuant to Section 2.07 in exchange for interests in the
Restricted Global Notes and the Regulation S Global Notes shall be in the
form of permanent certificated Notes in registered form substantially in the
form set forth in Exhibit A hereto (the "Restricted Definitive Notes" and the
"Regulation S Definitive Notes", respectively).
The Regulation S Definitive Notes and Restricted Definitive Notes are
sometimes collectively herein referred to as the "Definitive Notes". The
Restricted Global Notes and the Regulation S Global Notes are sometimes
referred to herein as the "Global Notes".
The definitive Notes shall be typed, printed, lithographed or engraved
or produced by any combination of these methods or may be produced in any
other manner permitted by the rules of any securities exchange on which the
Notes may be listed, all as determined by the Officers executing such Notes,
as evidenced by their execution of such Notes.
Section 2.02. RESTRICTIVE LEGENDS.
Unless and until a Note is exchanged for an Exchange Note or sold in
connection with an effective Registration Statement pursuant to the
Registration Rights Agreement, (i) the Restricted Global Notes and Restricted
Definitive Notes shall bear the legend set forth below on the face thereof
and (ii) the Regulation S Definitive Notes and Regulation S Global Notes
shall bear the legend set forth below on the face thereof until at least the
41st day after the Closing Date and receipt by the Company and the Trustee of
a certificate substantially in the form of Exhibit B hereto.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION
HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3)
OR (7) OF REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL
ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE
SECURITIES ACT, (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD
REFERRED TO UNDER RULE 144(k) UNDER THE SECURITIES ACT AS IN EFFECT ON THE
30
DATE OF TRANSFER OF THIS NOTE, RESELL OR OTHERWISE TRANSFER THIS NOTE
EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT,
(C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT,
PRIOR TO SUCH TRANSFER, FURNISHES 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), AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL
AMOUNT OF LESS THAN $100,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT,
(D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE)
OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND (3) AGREES THAT IT WILL DELIVER 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 THE TIME PERIOD REFERRED
TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO THE TRUSTEE. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO
THE TRUSTEE AND THE COMPANY 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 SECURITIES ACT. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION", "UNITED STATES" AND "U.S.
PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE
TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE
FOREGOING RESTRICTIONS.
Each Global Note, whether or not an Exchange Note, shall also bear the
following legend on the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, TO THE
31
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER ENTITY AS IS 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 IS 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.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.08 OF THE INDENTURE.
Section 2.03. EXECUTION, AUTHENTICATION AND DENOMINATIONS.
Subject to Article 4 and applicable law, the aggregate principal amount
of Notes which may be authenticated and delivered under this Indenture is
unlimited. The Notes shall be executed by two Officers of the Company. The
signature of these Officers on the Notes may be by facsimile or manual
signature in the name and on behalf of the Company.
If an Officer whose signature is on a Note no longer holds that office
at the time the Trustee or authenticating agent authenticates the Note, the
Note shall be valid nevertheless.
A Note shall not be valid until the Trustee or authenticating agent
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
At any time and from time to time after the execution of this Indenture,
the Trustee or an authenticating agent shall, upon receipt of a Company
Order, authenticate for original issue Notes in the aggregate principal
amount specified in such Company Order; PROVIDED that the Trustee shall be
entitled to receive an Officers' Certificate and an Opinion of Counsel of the
Company in connection with such authentication of Notes. Such Company Order
shall specify the amount of Notes to be authenticated and the date on which
the original issue of Notes is to be authenticated and, in case of an
issuance of Notes pursuant to Section 2.15, shall certify that such issuance
is in compliance with Article 4.
32
The Trustee may appoint an authenticating agent to authenticate Notes.
An authenticating agent may authenticate Notes whenever the Trustee may do
so. Each reference in this Indenture to authentication by the Trustee
includes authentication by such authenticating agent. An authenticating
agent has the same rights as an Agent to deal with the Company or an
Affiliate of the Company.
The Notes shall be issuable only in registered form without coupons and
only in denominations of $1,000 in principal amount and any integral multiple
thereof.
Section 2.04. REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where 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
Company in respect of the Notes and this Indenture may be served, which shall
be in the Borough of Manhattan, The City of New York. The Company shall
cause the Registrar to keep a register of the Notes and of their transfer and
exchange (the "Security Register"). The Security Register shall be in
written form or any other form capable of being converted into written form
within a reasonable time. The Company may have one or more co-Registrars and
one or more additional Paying Agents.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent. The Company shall
give prompt written notice to the Trustee of the name and address of any such
Agent and any change in the address of such Agent. If the Company fails to
maintain a Registrar, Paying Agent and/or agent for service of notices and
demands, the Trustee shall act as such Registrar, Paying Agent and/or agent
for service of notices and demands. The Company may remove any Agent upon
written notice to such Agent and the Trustee; PROVIDED that no such removal
shall become effective until (i) the acceptance of an appointment by a
successor Agent to such Agent as evidenced by an appropriate agency agreement
entered into by the Company and such successor Agent and delivered to the
Trustee or (ii) notification to the Trustee that the Trustee shall serve as
such Agent until the appointment of a successor Agent in accordance with
clause (i) of this proviso. The Company, any Subsidiary of the Company, or
any Affiliate of any of them may act as Paying Agent, Registrar or
co-Registrar, and/or agent for service of notice and demands.
The Company initially appoints the Trustee as Registrar, Paying Agent,
authenticating agent and agent for service of notice and demands. 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 Holders and shall otherwise
comply with TIA Section 312(a). If the Trustee is not the Registrar, the
Company shall furnish to the Trustee as of each Regular Record Date and at such
other times as
33
the Trustee may reasonably request the names and addresses of Holders as they
appear in the Security Register, including the aggregate principal amount of
Notes held by each Holder.
Section 2.05. PAYING AGENT TO HOLD MONEY IN TRUST.
Not later than 1:00 p.m. (New York City time) on each due date of the
principal, premium, if any, and interest on any Notes, the Company shall
deposit with the Paying Agent money in immediately available funds sufficient
to pay such principal, premium, if any, and interest so becoming due. The
Company 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 the
Holders or the Trustee all money held by the Paying Agent for the payment of
principal of, premium, if any, and interest on the Notes (whether such money
has been paid to it by the Company or any other obligor on the Notes), and
such Paying Agent shall promptly notify the Trustee of any default by the
Company (or any other obligor on the Notes) in making any such payment. The
Company at any time may require a Paying Agent to pay all money held by it to
the Trustee and account for any funds disbursed, and the Trustee may at any
time during the continuance of any payment default, upon written request to a
Paying Agent, require such Paying Agent to pay all money held by it to the
Trustee and to account for any funds disbursed. Upon doing so, the Paying
Agent shall have no further liability for the money so paid over to the
Trustee. If the Company or any Subsidiary of the Company or any Affiliate of
any of them acts as Paying Agent, it will, on or before each due date of any
principal of, premium, if any, or interest on the Notes, segregate and hold
in a separate trust fund for the benefit of the Holders a sum of money
sufficient to pay such principal, premium, if any, or interest so becoming
due until such sum of money shall be paid to such Holders or otherwise
disposed of as provided in this Indenture, and will promptly notify the
Trustee of its action or failure to act.
Section 2.06. TRANSFER AND EXCHANGE.
The Notes are issuable only in registered form. A Holder may transfer a
Note only by written application to the Registrar stating the name of the
proposed transferee and otherwise complying with the terms of this Indenture.
No such transfer shall be effected until, and such transferee shall succeed to
the rights of a Holder only upon, final acceptance and registration of the
transfer by the Registrar in the Security Register. Prior to the registration
of any transfer by a Holder as provided herein, the Company, the Trustee, and
any agent of the Company shall treat the person in whose name the Note is
registered as the owner thereof for all purposes whether or not the Note shall
be overdue, and neither the Company, the Trustee, nor any such agent shall be
affected by notice to the contrary. Furthermore, 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 Holder of such Global Note (or its agent) and that ownership
of a beneficial interest in the Note shall be required to be reflected in a book
entry. When Notes are presented to the Registrar or a co-Registrar with a
request to register the transfer or to exchange them for an equal principal
amount of Notes of
34
other authorized denominations (including an exchange of Notes for Exchange
Notes), the Registrar shall register the transfer or make the exchange as
requested if its requirements for such transactions are met (including that
such Notes are duly endorsed or accompanied by a written instrument of
transfer in form satisfactory to the Trustee and Registrar duly executed by
the Holder thereof or by an attorney who is authorized in writing to act on
behalf of the Holder); PROVIDED that no exchanges of Notes for Exchange Notes
shall occur until a Registration Statement shall have been declared effective
by the SEC and that any Notes that are exchanged for Exchange Notes shall be
cancelled by the Trustee. To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate Notes
at the Registrar's request. No service charge shall be made for any
registration of transfer or exchange or redemption of the Notes, but the
Company may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than any
such transfer taxes or other similar governmental charge payable upon
exchanges pursuant to Section 2.11, 3.05 or 9.06).
The Registrar shall not be required (i) to issue, register the transfer
of or exchange any Note during a period beginning at the opening of business
15 days before the day of the mailing of a notice of redemption of Notes
selected for redemption under Section 3.02 and ending at the close of
business on the day of such mailing, or (ii) to register the transfer of or
exchange any Note so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part.
Section 2.07. BOOK-ENTRY PROVISIONS FOR GLOBAL NOTES.
(a) The Restricted Global Notes and Regulation S Global Notes initially
shall (i) be registered in the name of the Depositary for such Global Notes
or the nominee of such Depositary, (ii) be delivered to the Trustee as
custodian for such Depositary and (iii) bear legends as set forth in Section
2.02.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depositary, or the Trustee as its custodian, or under
such Global Note, and the Depositary may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the absolute owner of
such Global Note for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee, from giving effect to any written certification,
proxy or other authorization furnished by the Depositary or impair, as
between the Depositary and its Agent Members, the operation of customary
practices governing the exercise of the rights of a holder of any Note.
(b) Transfers of a Global Note shall be limited to transfers of such
Global Note in whole, but not in part, to the Depositary, its successors or
their respective nominees. Interests of beneficial owners in Global Notes may be
transferred in accordance with the rules and
35
procedures of the Depositary and the provisions of Section 2.08. In
addition, Restricted Definitive Notes and Regulation S Definitive Notes shall
be transferred to all beneficial owners in exchange for their beneficial
interests in the Restricted Global Notes or the Regulation S Global Notes, as
the case may be, if (i) the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary for the Restricted Global Notes
or the Regulation S Global Notes, as the case may be, and a successor
depositary is not appointed by the Company within 90 days of such notice,
(ii) an Event of Default has occurred and is continuing and the Registrar has
received a request from the Depositary or (iii) in accordance with the rules
and procedures of the Depositary and the provisions of Section 2.08.
(c) Any beneficial interest in one of the Global Notes that is
transferred to a person who takes delivery in the form of an interest in
another Global Note will, upon transfer, cease to be an interest in such
Global Note and become an interest in such other Global Note and,
accordingly, will thereafter be subject to all transfer restrictions, if any,
and other procedures applicable to beneficial interests in such other Global
Note for as long as it remains such an interest.
(d) In connection with any transfer of a portion of the beneficial
interests in a Global Note to beneficial owners pursuant to paragraph (b) of
this Section 2.07, the Registrar shall reflect on its books and records the
date and a decrease in the principal amount of such Global Note in an amount
equal to the principal amount of the beneficial interest in such Global Note
to be transferred, and the Company shall execute, and the Trustee shall
authenticate and deliver, one or more Restricted Definitive Notes or
Regulation S Definitive Notes, as the case may be, of like tenor and amount.
(e) In connection with the transfer of the Restricted Global Notes or
the Regulation S Global Notes, in whole, to beneficial owners pursuant to
paragraph (b) of this Section 2.07, the Restricted Global Notes or Regulation
S Global Notes, as the case may be, shall be deemed to be surrendered to the
Trustee for cancellation, and the Company shall execute, and the Trustee
shall authenticate and deliver, to each beneficial owner identified by the
Depositary in exchange for its beneficial interest in the Restricted Global
Notes or Regulation S Global Notes, as the case may be, an equal aggregate
principal amount of Restricted Definitive Notes or Regulation S Definitive
Notes, as the case may be, of authorized denominations.
(f) Any Restricted Definitive Note delivered in exchange for an
interest in the Restricted Global Notes pursuant to paragraph (b), (d) or (e)
of this Section 2.07 shall, except as otherwise provided by paragraph (e) of
Section 2.08, bear the legend regarding transfer restrictions applicable to
the Restricted Definitive Note set forth in Section 2.02.
(g) Any Regulation S Definitive Note delivered in exchange for an
interest in the Regulation S Global Notes pursuant to paragraph (b), (d) or
(e) of this Section 2.07 shall, except as otherwise provided by paragraph (e)
of Section 2.08, bear the legend regarding transfer restrictions applicable
to the Regulation S Definitive Note set forth in Section 2.02.
36
(h) The registered holder of a Global Note may grant proxies and
otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Notes.
37
Section 2.08. SPECIAL TRANSFER PROVISIONS.
Unless and until a Note is exchanged for an Exchange Note or sold in
connection with an effective Registration Statement pursuant to the Registration
Rights Agreement, the following provisions shall apply:
(a) TRANSFERS TO NON-QIB INSTITUTIONAL ACCREDITED INVESTORS. The
following provisions shall apply with respect to the registration of any
proposed transfer of a Note to any Institutional Accredited Investor which is
not a QIB (excluding Non-U.S. Persons):
(i) The Registrar shall register the transfer of any Note, whether
or not such Note bears the Private Placement Legend, if (x) the requested
transfer is after the time period referred to in Rule 144(k) under the
Securities Act or (y) the proposed transferee has delivered to the
Registrar (A) a certificate substantially in the form of Exhibit C hereto
and (B) if the aggregate principal amount of the Notes being transferred is
less than $100,000, an opinion of counsel acceptable to the Company that
such transfer is in compliance with the Securities Act.
(ii) If the proposed transferor is an Agent Member holding a
beneficial interest in the Restricted Global Notes, upon receipt by the
Registrar of (x) the documents, if any, required by paragraph (i) above and
(y) instructions given in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date and a decrease in the principal amount of the Restricted
Global Notes in an amount equal to the principal amount of the beneficial
interest in the Restricted Global Notes to be transferred, and the Company
shall execute, and the Trustee shall authenticate and deliver, one or more
Restricted Definitive Notes of like tenor and amount.
(b) TRANSFERS TO QIBS. The following provisions shall apply with
respect to the registration of any proposed transfer of a Note to a QIB
(excluding Non-U.S. Persons):
(i) If the Note to be transferred consists of (x) either
Regulation S Definitive Notes prior to the removal of the Private Placement
Legend or Restricted Definitive Notes, the Registrar shall register the
transfer if such transfer is being made by a proposed transferor who has
checked the box provided for on the form of Note stating, or has otherwise
advised the Company and the Registrar in writing, that the sale has been
made in compliance with the provisions of Rule 144A to a transferee who has
signed the certification provided for on the form of Note stating, or has
otherwise advised the Company and the Registrar in writing, that it is
purchasing the Note for its own account or an account with respect to which
it exercises sole investment discretion and that it and any such account is
a QIB within the meaning of Rule 144A and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that it has received
such information regarding the Company as it has requested pursuant to Rule
144A or has
38
determined not to request such information and that it is aware that the
transferor is relying upon its foregoing representations in order to claim
the exemption from registration provided by Rule 144A or (y) an interest
in the Restricted Global Notes, the transfer of such interest may be
effected only through the book entry system maintained by the Depositary.
(ii) If the proposed transferee is an Agent Member, and the Note to
be transferred consists of either Regulation S Definitive Notes prior to
removal of the Private Placement Legend or Restricted Definitive Notes,
upon receipt by the Registrar of the documents referred to in paragraph (i)
above and instructions given in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of Restricted
Global Notes in an amount equal to the principal amount of the Regulation S
Definitive Notes or Restricted Definitive Notes to be transferred, and the
Trustee shall cancel the Regulation S Definitive Notes or Restricted
Definitive Notes so transferred.
(c) TRANSFERS OF INTERESTS IN THE REGULATION S GLOBAL NOTES OR REGULATION
S DEFINITIVE NOTES. The following provisions shall apply with respect to any
transfer of interests in Regulation S Global Notes or Regulation S Definitive
Notes:
(i) prior to the removal of the Private Placement Legend from the
Regulation S Global Notes or Regulation S Definitive Notes pursuant to
Section 2.02, the Registrar shall refuse to register such transfer unless
such transfer complies with Section 2.08(b) or Section 2.08(d), as the case
may be, and
(ii) after such removal, the Registrar shall register the transfer
of any such Note without requiring any additional certification.
(d) TRANSFERS TO NON-U.S. PERSONS AT ANY TIME. The following provisions
shall apply with respect to any transfer of a Note to a Non-U.S. Person:
(i) The Registrar shall register any proposed transfer to any
Non-U.S. Person if the Note to be transferred is a Restricted Definitive
Note or an interest in Restricted Global Notes, upon receipt of a
certificate substantially in the form of Exhibit D hereto from the proposed
transferor.
(ii) (a) If the proposed transferor is an Agent Member holding a
beneficial interest in the Restricted Global Notes, upon receipt by the
Registrar of (x) the document required by paragraph (i) and (y)
instructions in accordance with the Depositary's and the Registrar's
procedures, the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the Restricted Global Notes in an
amount equal to the principal amount of the beneficial interest in the
Restricted Global Notes to be
39
transferred, and (b) if the proposed transferee is an Agent Member, upon
receipt by the Registrar of instructions given in accordance with the
Depositary's and the Registrar's procedures, the Registrar shall reflect on
its books and records the date and an increase in the principal amount of
the Regulation S Global Notes in an amount equal to the principal amount of
the Restricted Definitive Notes or the Restricted Global Notes, as the case
may be, to be transferred, and the Trustee shall cancel the Definitive
Note, if any, so transferred or decrease the amount of the Restricted
Global Notes.
(e) PRIVATE PLACEMENT LEGEND. Upon the transfer, exchange or replacement
of Notes not bearing the Private Placement Legend, the Registrar shall deliver
Notes that do not bear the Private Placement Legend. Upon the transfer,
exchange or replacement of Notes bearing the Private Placement Legend, the
Registrar shall deliver only Notes that bear the Private Placement Legend unless
(i) the Private Placement Legend is no longer required by Section 2.02, (ii) the
circumstances contemplated by paragraph (a)(i)(x) of this Section 2.08 exist or
(iii) there is delivered to the Registrar an Opinion of Counsel reasonably
satisfactory to the Company and the Trustee to the effect that neither such
legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act.
(f) GENERAL. By its acceptance of any Note bearing the Private Placement
Legend, each Holder of such a Note acknowledges the restrictions on transfer of
such Note set forth in this Indenture and in the Private Placement Legend and
agrees that it will transfer such Note only as provided in this Indenture. The
Registrar shall not register a transfer of any Note unless such transfer
complies with the restrictions on transfer of such Note set forth in this
Indenture. In connection with any transfer of Notes, each Holder agrees by its
acceptance of the Notes to furnish the Registrar or the Company 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 a transaction not subject to, the registration requirements
of the Securities Act; PROVIDED that the Registrar shall not be required to
determine (but may rely on a determination made by the Company with respect to)
the sufficiency of any such certifications, legal opinions or other information.
The Registrar shall retain copies of all letters, notices and other written
communications received pursuant to Section 2.07 or this Section 2.08. The
Company shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Registrar.
Section 2.09. REPLACEMENT NOTES.
If a mutilated Note is surrendered to the Trustee or if the Holder claims
that the Note has been lost, destroyed or wrongfully taken, then, in the absence
of notice to the Company or the Trustee that such Note has been acquired by a
bona fide purchaser, the Company shall issue and the Trustee shall authenticate
a replacement Note of like tenor and principal amount and bearing
40
a number not contemporaneously outstanding; PROVIDED that the requirements of
this Section 2.09 are met. If required by the Trustee or the Company, an
indemnity bond must be furnished that is sufficient in the judgment of both
the Trustee and the Company to protect the Company, the Trustee or any Agent
from any loss that any of them may suffer if a Note is replaced. The Company
may charge such Holder for its expenses and the expenses of the Trustee in
replacing a Note. In case any such mutilated, lost, destroyed or wrongfully
taken Note has become or is about to become due and payable, the Company in
its discretion may pay such Note instead of issuing a new Note in replacement
thereof.
Every replacement Note is an additional obligation of the Company and shall
be entitled to the benefits of this Indenture.
Section 2.10. OUTSTANDING NOTES.
Notes outstanding at any time are all Notes that have been authenticated by
the Trustee except for those cancelled by it, those delivered to it for
cancellation and those described in this Section 2.10 as not outstanding.
If a Note is replaced pursuant to Section 2.09, it ceases to be outstanding
unless and until the Trustee and the Company receive proof satisfactory to them
that the replaced Note is held by a BONA FIDE purchaser.
If the Paying Agent (other than the Company or an Affiliate of the Company)
holds on the maturity date money sufficient to pay Notes payable on that date,
then on and after that date such Notes cease to be outstanding and interest on
them shall cease to accrue.
A Note does not cease to be outstanding because the Company or one of its
Affiliates holds such Note, PROVIDED, HOWEVER, that in determining whether the
Holders of the requisite principal amount of the outstanding Notes have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder, Notes owned by the Company or any other obligor upon the Notes or any
Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes which the Trustee has actual
knowledge to be so owned shall be so disregarded. Notes so owned which have
been pledged in good faith may be regarded as outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Notes and that the pledgee is not the Company or any other
obligor upon the Notes or any Affiliate of the Company or of such other obligor.
41
Section 2.11. TEMPORARY NOTES.
Until definitive Notes are ready for delivery, the Company may prepare and
execute and the Trustee shall authenticate temporary Notes. Temporary Notes
shall be substantially in the form of definitive Notes but may have insertions,
substitutions, omissions and other variations determined to be appropriate by
the Officers executing the temporary Notes, as evidenced by their execution of
such temporary Notes. If temporary Notes are issued, the Company will cause
definitive Notes to be prepared without unreasonable delay. After the
preparation of definitive Notes, the temporary Notes shall be exchangeable for
definitive Notes upon surrender of the temporary Notes at the office or agency
of the Company designated for such purpose pursuant to Section 4.02, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Notes the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Notes of
authorized denominations. Until so exchanged, the temporary Notes shall be
entitled to the same benefits under this Indenture as definitive Notes.
Section 2.12. CANCELLATION.
The Company at any time may deliver to the Trustee for cancellation any
Notes previously authenticated and delivered hereunder which the Company may
have acquired in any manner whatsoever, and may deliver to the Trustee for
cancellation any Notes previously authenticated hereunder which the Company has
not issued and sold. The Registrar and the Paying Agent shall forward to the
Trustee any Notes surrendered to them for transfer, exchange or payment. The
Trustee shall cancel all Notes surrendered for transfer, exchange, payment or
cancellation and shall destroy them in accordance with its normal procedure.
Section 2.13. CUSIP NUMBERS.
The Company in issuing the Notes may use "CUSIP", "CINS" or "ISIN"
numbers (if then generally in use), and the Company and the Trustee shall use
CUSIP, CINS or ISIN numbers, as the case may be, in notices of redemption or
exchange as a convenience to Holders; PROVIDED that any such notice shall 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 redemption or exchange and
that reliance may be placed only on the other identification numbers printed on
the Notes. The Company shall promptly notify the Trustee of any change in
"CUSIP", "CINS" or "ISIN" numbers for the Notes.
Section 2.14. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it shall
pay, or shall deposit with the Paying Agent money in immediately available funds
sufficient to pay, the defaulted interest, plus (to the extent lawful) any
interest payable on the defaulted interest, to the
42
Persons who are Holders on a subsequent special record date. A special
record date, as used in this Section 2.14 with respect to the payment of any
defaulted interest, shall mean the 15th day next preceding the date fixed by
the Company for the payment of defaulted interest, whether or not such day is
a Business Day. At least 15 days before the subsequent special record date,
the Company shall mail to each Holder and to the Trustee a notice that states
the subsequent special record date, the payment date and the amount of
defaulted interest to be paid.
ARTICLE 3
REDEMPTION
Section 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.06 hereof, such election to be set forth in a Board
Resolution, it shall furnish to the Trustee, at least 30 days but not more than
60 days before a redemption date, an Officers' Certificate setting forth (i) the
clause of this Indenture pursuant to which the redemption shall occur, (ii) the
redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the
redemption price.
Section 3.02. SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time, selection of
Notes for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Notes are listed or, in the absence of such requirements or if the Notes are not
so listed, on a pro rata basis, by lot or by such other method as the Trustee
shall deem fair and appropriate; PROVIDED, HOWEVER, that no such Notes of $1,000
principal amount or less shall be redeemed in part. In the event of partial
redemption by lot, the particular Notes to be redeemed shall be selected, unless
otherwise provided herein, not less than 30 nor more than 60 days prior to the
redemption date by the Trustee from the outstanding Notes not previously called
for redemption.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions
of Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
43
Section 3.03. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a redemption date, the
Company shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address. Once notice of redemption is mailed, and further subject to the
satisfaction of any conditions of a Conditional Redemption, Notes called for
redemption become due and payable on the redemption date and at the redemption
price. Upon surrender of any Notes to the Paying Agent, such Notes shall be
paid at the redemption price, plus accrued and unpaid interest, if any, to the
redemption date.
Notice of redemption shall be deemed to be given when mailed, whether or
not the Holder receives the notice. In any event, failure to give such notice,
or any defect therein, shall not affect the validity of the proceedings for the
redemption of Notes held by Holders to whom such notice was properly given.
The notice shall identify the Notes (including CUSIP numbers, if any) to be
redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture pursuant
to which the Notes called for redemption are being redeemed; and
(h) 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.
44
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at its expense; PROVIDED, HOWEVER, that the Company
shall have delivered to the Trustee, at least 45 days prior to the redemption
date, an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.
Section 3.04. DEPOSIT OF REDEMPTION PRICE.
Prior to or by 1:00 p.m. (New York City time) the redemption date and
subject to the satisfaction of any conditions of a Conditional Redemption, the
Company shall deposit with the Trustee or with the Paying Agent money sufficient
to pay the redemption price of and accrued interest on all Notes to be redeemed
on that date. The Trustee or the Paying Agent shall promptly return to the
Company any money deposited with the Trustee or the Paying Agent by the Company
in excess of the amounts necessary to pay the redemption price of, and accrued
interest on, all Notes to be redeemed.
If the Company complies with the provisions of the preceding paragraph, on
and after the redemption date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after
an interest record date but on or prior to the related interest payment date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Company to comply with the preceding paragraph
(other than by reason of a failure of one of the conditions of a Conditional
Redemption), interest shall be paid on the unpaid principal, from the redemption
date until such principal is paid, and to the extent lawful on any interest not
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.01 hereof.
If any Note called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and premium, if any, shall, until paid,
bear interest from the redemption date at the rate of interest set forth in the
Note.
Section 3.05. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company shall issue
and, upon the Company's written request, the Trustee shall authenticate for the
Holder at the expense of the Company a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
Section 3.06. OPTIONAL REDEMPTION.
45
(a) The Company has the option to redeem the Notes, in whole or in part,
at any time at the redemption price equal to the greater of (i) 100% of the
principal amount of the Notes to be redeemed or (ii) as determined by an
Independent Investment Banker, the sum of the present values of the Remaining
Scheduled Payments discounted to the redemption date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Adjusted
Treasury Rate, plus, in each case, accrued and unpaid interest (including
Additional Interest), if any, on the Notes to be redeemed to the date of
redemption.
(b) Any redemption pursuant to this Section 3.06 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 hereof.
Section 3.07. MANDATORY REDEMPTION.
The Company shall not be required to make mandatory redemption payments
with respect to the Notes.
ARTICLE 4
COVENANTS
Section 4.01. PAYMENT OF NOTES.
The Company shall pay or cause to be paid the principal of, premium, if
any, and interest, including Additional Interest, on the Notes on the dates and
in the manner provided in the Notes. Principal, premium, if any, and interest
shall be considered paid on the date due if the Paying Agent, if other than the
Company or a Subsidiary thereof, holds as of 1:00 p.m. (New York City time) on
the due date money deposited by the Company in immediately available funds and
designated for and sufficient to pay all principal, premium, if any, and
interest then due.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
the then applicable interest rate on the Notes to the extent lawful; it shall
pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest, including Additional
Interest, (without regard to any applicable grace period) at the same rate to
the extent lawful.
Section 4.02. MAINTENANCE OF OFFICE OR AGENCY.
46
The Company shall maintain in the Borough of Manhattan, The City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes and this Indenture may be served. The
Company 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 Company
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.
The Company 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 such
purposes and may from time to time rescind such designations; PROVIDED, HOWEVER,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York for such purposes. The Company shall give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee as
one such office or agency of the Company in accordance with Section 2.03.
Section 4.03. COMPLIANCE CERTIFICATE.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year, beginning December 31, 1998, a brief certificate from the
principal executive officer, principal financial officer or principal accounting
officer as to his or her knowledge of the Company's compliance with all
conditions and covenants under this Indenture. For purposes of this Section
4.03, such compliance shall be determined without regard to any period of grace
or requirement of notice under this Indenture.
Section 4.04. TAXES.
The Company and the Guarantors shall pay or discharge or cause to be paid
or discharged, before the same shall become delinquent, all material taxes,
assessments and governmental charges levied or imposed upon the Company, the
Guarantors or any of their respective Significant Subsidiaries or upon the
income, profits or property of the Company, the Guarantors or any of their
respective Significant Subsidiaries; PROVIDED, HOWEVER, that the Company or the
Guarantors 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.
Section 4.05. STAY, EXTENSION AND USURY LAWS.
47
The Company and each of the Guarantors covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Company and
each of the Guarantors (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
shall not, by resort to any such law, 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 has been enacted.
Section 4.06. LIMITATION ON INCURRENCE OF ADDITIONAL INDEBTEDNESS.
(a) The Parent Guarantor will not, and will not permit its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume, guarantee or
otherwise become directly or indirectly liable, contingently or otherwise, with
respect to (collectively, "Incur") any Indebtedness, other than Permitted
Indebtedness; PROVIDED, HOWEVER, that the Parent Guarantor and its Restricted
Subsidiaries may Incur Indebtedness if the Interest Coverage Ratio at the time
of Incurrence of such Indebtedness, after giving pro forma effect to such
Incurrence as of such date and to the use of proceeds therefrom, is greater than
or equal to 2.25 to 1.0.
(b) Notwithstanding any other provision of this Section 4.06, the maximum
amount of Indebtedness that the Parent Guarantor or a Restricted Subsidiary may
Incur pursuant to this Section 4.06 shall not be deemed to be exceeded, with
respect to any outstanding Indebtedness, due solely to the result of
fluctuations in the exchange rates of currencies.
(c) For purposes of determining compliance with this Section 4.06, in the
event that an item of Permitted Indebtedness meets the criteria of more than one
of the categories of Permitted Indebtedness or is entitled to be incurred
pursuant to clause (a) of this Section 4.06, the Company shall, in its sole
discretion, classify and, from time to time may reclassify, such item of
Indebtedness and such item of Indebtedness will be treated as having been
incurred pursuant to only one of the clauses of the definition of Permitted
Indebtedness or pursuant to the first paragraph hereof except as otherwise set
forth in clause (v) of the definition of Permitted Indebtedness. Accrual of
interest, the accretion of accreted value and the payment of interest in the
form of additional Indebtedness will not be deemed to be an incurrence of
Indebtedness for purposes of this covenant.
48
Section 4.07. LIMITATION ON SENIOR SUBORDINATED DEBT.
Neither the Parent Guarantor, the Company nor any Restricted Subsidiary
that is a Guarantor shall Incur any Indebtedness that is subordinate in right of
payment to any Senior Indebtedness (or Guarantor Senior Indebtedness, as
applicable) unless such Indebtedness is pari passu with, or subordinated in
right of payment to, the Notes (or the Notes Guarantees, as applicable) to at
least the same extent as the Notes are subordinated to Senior Indebtedness (or
the Notes Guarantees are subordinated to Guarantor Senior Indebtedness, as
applicable; PROVIDED, HOWEVER, that the foregoing limitation shall not apply to
distinctions between categories of Senior Indebtedness or Guarantor Senior
Indebtedness that exists by reason of any Liens or Guarantees arising or created
in respect of some but not all such Senior Indebtedness or Guarantor Senior
Indebtedness.
Section 4.08. LIMITATION ON RESTRICTED PAYMENTS.
(a) The Parent Guarantor will not, and will not cause or permit its
Restricted Subsidiaries, to, directly or indirectly, make any Restricted Payment
if at the time of such Restricted Payment and immediately after giving effect
thereto:
(i) a Default or Event of Default shall have occurred and be
continuing;
(ii) the Parent Guarantor is not able to incur $1.00 of additional
Indebtedness under Section 4.06(a); or
(iii) the aggregate amount of Restricted Payments made subsequent to
the Issue Date (the amount expended for such purposes, if other than in
cash, being the fair market value of such property as determined by the
board of directors of Parent Guarantor in good faith) exceeds the sum of
(A) (x) 100% of Consolidated EBITDA accrued subsequent to the Issue Date to
the most recent date for which financial information has been filed with
the SEC or provided to the Trustee (taken as one accounting period), less
(y) 1.75 times Consolidated Interest Expense for the same period; plus (B)
100% of the aggregate net proceeds, including the fair market value of
property other than cash as determined by the board of directors of the
Parent Guarantor in good faith, received subsequent to the Issue Date by
the Parent Guarantor or any Restricted Subsidiary from any Person (other
than a Restricted Subsidiary of Parent Guarantor) from the issuance and
sale subsequent to the Issue Date of Qualified Capital Stock of Parent
Guarantor or any Restricted Subsidiary (excluding any net proceeds from
issuances and sales financed directly or indirectly using funds borrowed
from Parent Guarantor or any Restricted Subsidiary, until and to the extent
such borrowing is repaid, but including the proceeds from the issuance and
sale (whether before or after the Issue Date) of any securities convertible
into or exchangeable for Qualified Capital Stock of Parent Guarantor or any
Restricted Subsidiary to the extent such securities are so converted or
exchanged after the Issue Date and including any additional proceeds
received by Parent
49
Guarantor or such Restricted Subsidiary upon such conversion or exchange);
plus (C) without duplication of any amount included in clause (iii)(B)
above, 100% of the aggregate net proceeds, including the fair market value
of property other than cash (valued as provided in clause (iii)(B) above),
received by Parent Guarantor as a capital contribution subsequent to the
Issue Date; plus (D) $25 million; plus (E) an amount equal to the net
reduction in Investments in any Unrestricted Subsidiary or in an Affiliate
of Parent Guarantor that is not controlled, directly or indirectly, by
Parent Guarantor resulting from payments of interest on debt, dividends,
repayments of loans or advances, or other transfers of assets, in each case
to Parent Guarantor or any Restricted Subsidiary or from the net proceeds
(if other than cash, valued as provided in clause (iii)(B) above) from the
sale of any such Investment (except, in each case, to the extent any such
payment or proceeds are included in the calculation of Consolidated
EBITDA), or from redesignations of Unrestricted Subsidiaries as Restricted
Subsidiaries (valued in each case as provided in the definition of
"Investments") not to exceed, in each case, the amount of Investments
previously made by Parent Guarantor or any Restricted Subsidiary in such
Person.
(b) Notwithstanding clause (a) of this Section 4.08, this Section 4.08
shall not prohibit:
(i) the payment of any dividend or the making of any distribution
within 60 days after the date of its declaration if such dividend or
distribution would have been permitted on the date of declaration;
(ii) the purchase, redemption or other acquisition or retirement of
any Capital Stock of Parent Guarantor or any Restricted Subsidiary or any
warrants, options or other rights to acquire shares of any class of such
Capital Stock either (A) solely in exchange for shares of Qualified Capital
Stock of Parent Guarantor or any Restricted Subsidiary or other warrants,
options or rights to acquire Qualified Capital Stock of Parent Guarantor or
any Restricted Subsidiary or (B) through the application of the net
proceeds of a substantially concurrent sale for cash (other than to a
Restricted Subsidiary) of shares of Qualified Capital Stock of Parent
Guarantor or any Restricted Subsidiary or warrants, options or other rights
to acquire Qualified Capital Stock of Parent Guarantor or any Restricted
Subsidiary or (C) in the case of Disqualified Capital Stock, solely in
exchange for, or through the application of the net proceeds of a
substantially concurrent sale for cash (other than to a Restricted
Subsidiary) of, Disqualified Capital Stock;
(iii) the making of any principal payment or the redemption,
repurchase, defeasance or other acquisition or retirement for value of
Indebtedness of the Parent Guarantor, the Company or any Subsidiary
Guarantor which is subordinated in right of payment to the Note Guarantee
or the Notes, as the case may be, in exchange for, or out of the proceeds
of, a substantially concurrent sale for cash (other than to a Restricted
50
Subsidiary) of (A) shares of Qualified Capital Stock of Parent Guarantor or
any Restricted Subsidiary (or options, warrants or other rights to acquire
such Capital Stock) or (B) Refinancing Indebtedness;
(iv) payments or distributions to dissenting stockholders pursuant
to applicable law, pursuant to or in connection with a consolidation,
merger or transfer of assets;
(v) repurchases of warrants, options or rights to acquire Capital
Stock deemed to occur upon exercise of warrants, options or rights to
acquire Capital Stock if such warrants, options or rights represent a
portion of the exercise price of such warrants, options or rights;
(vi) dividends on Qualified Capital Stock in an annual amount not
to exceed 6.0% of the net cash proceeds received from shares of Qualified
Capital Stock sold (other than to a Restricted Subsidiary) for the account
of the Parent Guarantor or a Restricted Subsidiary; and
(vii) Investments, not to exceed more than $25 million at any time
outstanding, in Unrestricted Subsidiaries or Affiliates of Parent Guarantor
not controlled, directly or indirectly, by Parent Guarantor;
PROVIDED, HOWEVER, that in the case of clauses other than clauses (i), (ii) and
(vii) of this Section 4.08(b), no Event of Default shall have occurred or be
continuing at the time of such payment or as a result thereof. In determining
the aggregate amount of Restricted Payments made subsequent to the Issue Date,
amounts expended pursuant to clauses (i), (ii)(A), (ii)(B), (iii)(A), (iv) and
(vi) of this Section 4.08(b) shall be included in such calculation.
(c) To the extent the issuance of Capital Stock and the receipt of capital
contributions are applied to permit the issuance of Indebtedness pursuant to
clause (v) of the definition of Permitted Indebtedness, the issuance of such
Capital Stock and the receipt of such capital contributions shall not be applied
to permit payments under this Section 4.08.
Section 4.09. LIMITATION ON ASSET SALES.
(a) The Parent Guarantor shall not, and will not permit any Restricted
Subsidiary to, consummate any Asset Sale, unless:
(i) the consideration received by the Parent Guarantor or such
Restricted Subsidiary is at least equal to the fair market value of the
assets sold or disposed of as determined by the board of directors of the
Parent Guarantor or the Restricted Subsidiary, as the case may be; and
51
(ii) at least 75% of the consideration received consists of cash or
Temporary Cash Investments or the assumption of Indebtedness of the Parent
Guarantor or any Restricted Subsidiary, other than Indebtedness to the
Company or any Restricted Subsidiary (PROVIDED, HOWEVER, that the Parent
Guarantor or such Restricted Subsidiary is irrevocably and unconditionally
released from all liability under such indebtedness, or notes or other
obligations that are promptly, but in no event more than 90 days after
receipt, converted by the Parent Guarantor or such Restricted Subsidiary
into cash or Temporary Cash Investments).
(b) In the event and to the extent that the Net Cash Proceeds received by
the Parent Guarantor or any of its Restricted Subsidiaries from one or more
Asset Sales occurring after the Closing Date in any period of 12 consecutive
months exceed 10% of Adjusted Consolidated Net Tangible Assets, determined as of
the date closest to the commencement of such 12-month period for which a
consolidated balance sheet of the Parent Guarantor has been filed with the SEC
or provided to the Trustee, then the Parent Guarantor shall or shall cause the
relevant Restricted Subsidiary to:
(i) within twelve months after the date Net Cash Proceeds so
received exceed 10% of Adjusted Consolidated Net Tangible Assets (A) apply
an amount equal to the amount of such Net Cash Proceeds in excess of 10% of
Adjusted Consolidated Net Tangible Assets to permanently repay Senior
Indebtedness or Guarantor Senior Indebtedness or any Indebtedness of any
Restricted Subsidiary, other than a Subsidiary Guarantor, in each owing to
a Person other than the Parent Guarantor or any of its Restricted
Subsidiaries; or (B) invest, including by way of capital expenditure or
acquisition of Capital Stock or assets, an equal amount, or the amount not
so applied pursuant to clause (A) (or enter into a definitive agreement
committing to so invest within twelve months after the date of such
agreement), in property or assets (other than current assets) of a nature
or type or that are used in a business (or in a Person having property and
assets of a nature or type, or engaged in a business) related, ancillary,
or complementary to the business of Parent Guarantor and its Restricted
Subsidiaries existing on the date of such investment; and
(ii) apply, no later than the end of later of (x) the 12-month
period referred to in clause (i) above or (y) the additional period
referred to in paragraph (B) of clause (i), such Net Cash Proceeds (to the
extent not applied pursuant to clause (i)) as provided in clause (c) of
this Section 4.09.
(c) If, as of the first day of any calendar month, the aggregate amount of
Excess Proceeds not theretofore subject to an Offer to Purchase pursuant to this
Section 4.09 totals at least $10 million, the Company must commence an Offer to
Purchase, no later than the fifteenth Business Day of such month, and consummate
such Offer to Purchase with the Holders, and if required by the terms of any
Indebtedness that is pari passu with the Notes ("Pari Passu
52
Indebtedness"), from the holders of such Pari Passu Indebtedness on a pro
rata basis, an aggregate principal amount of Notes, and Pari Passu
Indebtedness, if any, equal to the Excess Proceeds on such date, at a
purchase price equal to 100% of the principal amount thereof, plus, in each
case, accrued and unpaid interest, if any, to the payment date. If the
aggregate principal amount of Notes and any such Pari Passu Indebtedness
validly tendered by holders thereof exceeds the amount of Excess Proceeds,
the Notes and Pari Passu Indebtedness shall be purchased on a pro rata basis.
Upon the completion of any such Offers to Purchase, the amount of Excess
Proceeds shall be reset at zero.
Section 4.10. GUARANTEES.
The Parent Guarantor shall cause any new domestic Restricted Subsidiary
subsequent to the Closing Date to become a Guarantor and execute a Note
Guarantee if and so long as the new domestic Restricted Subsidiary provides a
Guarantee in respect of Senior Indebtedness of the Company. Notwithstanding the
foregoing, to the extent that such domestic Restricted Subsidiary ceases to
provide such Guarantee in respect of Senior Indebtedness of the Company, such
Guarantor shall be released from its Note Guarantee.
Section 4.11. REPORTS.
So long as any of the Notes are outstanding, the Company or the Parent
Guarantor will provide to the Trustee and the Holders of Notes and file with the
SEC, to the extent such submissions are accepted for filing by the SEC, copies
of the annual reports and other such information, documents and other reports
that the Company and the Parent Guarantor would have been required to file with
the SEC pursuant to Sections 13 or 15(d) of the Exchange Act, regardless of
whether either of them is then obligated to file such reports. The Company
shall supply the Trustee and each Holder or shall supply to the Trustee for
forwarding to each such Holder, without cost to such Holder, copies of such
reports and other information within 15 days after the date it would have been
required to file such reports or other information with the SEC had it been
subject to such Sections. The Company also shall comply with the other
provisions of TIA Section 314(a).
53
Section 4.12. CORPORATE EXISTENCE.
Subject to Article 5 hereof, each of the Company and Parent Guarantor
shall do or cause to be done all things necessary to preserve and keep in
full force and effect (i) its corporate existence, and the corporate,
partnership or other existence of each of its Subsidiaries, in accordance
with the respective organizational documents (as the same may be amended from
time to time) of the Company, Parent Guarantor or any such Subsidiary and
(ii) the rights (charter and statutory), licenses and franchises of the
Company, Parent Guarantor and their respective Subsidiaries; PROVIDED,
HOWEVER, that the Company and Parent Guarantor shall not be required to
preserve any such right, license or franchise, or the corporate, partnership
or other existence of any of their respective Subsidiaries (other than the
Company), if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company
and Parent Guarantor and their respective Subsidiaries, taken as a whole, and
that the loss thereof is not adverse in any material respect to the Holders
of the Notes. The foregoing does not prohibit any mergers or consolidations
between Subsidiaries or between the Company and Parent Guarantor and one or
more of their respective Subsidiaries so long as any such merger or
consolidation involving the Company or Parent Guarantor complies with Article
5.
Section 4.13. OFFER TO REPURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control Triggering Event, each
Holder of Notes will have the right to require the Company to repurchase all
or any part (equal to $1,000 or an integral multiple thereof) of such
Holder's Notes pursuant to the offer described below (the "Change of Control
Offer") at an offer price in cash equal to 101% of the aggregate principal
amount thereof plus accrued and unpaid interest and Additional Interest
thereon, if any, to the date of purchase (the "Change of Control Payment").
Within ten days following any Change of Control Triggering Event, the Company
shall mail a notice to each Holder describing the transaction or transactions
that constitute the Change of Control Triggering Event and offering to
repurchase Notes on the date specified in such notice, which date shall be no
earlier than 30 days and no later than 60 days from the date such notice is
mailed (the "Change of Control Payment Date"), pursuant to the procedures
required by this Indenture and described in such notice. The Company will
comply with the requirements of Rule 14e-1 under the Exchange Act and any
other securities laws and regulations thereunder to the extent such laws and
regulations are applicable in connection with the repurchase of the Notes as
a result of a Change of Control Triggering Event. To the extent that the
provisions of any securities laws or regulations conflict with the provisions
for the Change of Control Offer, the Company will comply with the applicable
securities laws and regulations and will not be deemed to have breached its
obligations with respect to the Change of Control Offer by virtue thereof.
(b) On the Change of Control Payment Date, the Company shall, to the
extent lawful, (1) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of
54
Control Offer, (2) deposit with the Paying Agent an amount equal to the
Change of Control Payment in respect of all Notes or portions thereof so
tendered and (3) deliver or cause to be delivered to the Trustee the Notes so
accepted together with an Officers' Certificate stating the aggregate
principal amount of Notes or portions thereof being purchased by the Company.
The Paying Agent will promptly mail to each Holder of Notes so tendered the
Change of Control Payment for such Notes, and the Trustee will promptly
authenticate and mail (or cause to be transferred by book-entry) to each
Holder a new Note equal in principal amount to any unpurchased portion of the
Notes surrendered, if any; PROVIDED, HOWEVER, that each such new Note will be
in a principal amount of $1,000 or an integral multiple thereof. The Company
will publicly announce the results of the Change of Control Offer on or as
soon as practicable after the Change of Control Payment Date.
(c) Prior to the giving of the notice referred to in Section 4.13(a),
but in any event within 30 days following the date on which the Parent
Guarantor becomes aware that a Change of Control Triggering Event has
occurred, if the purchase of the Notes under Section 4.13(a) would violate or
constitute a default under any other Indebtedness of the Parent Guarantor or
its Restricted Subsidiaries, the Parent Guarantor shall, or shall cause its
Restricted Subsidiaries, to the extent needed to permit such purchase of
Notes under Section 4.13(a), either (i) repay all such Indebtedness and
terminate all commitments outstanding thereunder or (ii) obtain the requisite
consents, if any, under such Indebtedness to permit the purchase of the Notes
under Section 4.13(a). The Parent Guarantor will first comply with the
covenant in this Section 4.13(c) before it will be required to cause the
Company to make the Change of Control Offer or purchase the Notes pursuant to
the Section 4.13(a); PROVIDED that the Parent Guarantor's failure to comply
with the covenant described in this Section 4.13(c) shall constitute an Event
of Default described under clause (c) under Section 6.01 and not under clause
(b) under Section 6.01.
(d) Notwithstanding anything to the contrary in this Section 4.13, the
Company shall not be required to make a Change of Control Offer upon a Change
of Control Triggering Event if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Section 4.13 and all other provisions of this
Indenture applicable to a Change of Control Offer made by the Company and
purchases all Notes validly tendered and not withdrawn under such Change of
Control Offer.
(e) The Company shall not be required to make an Offer to Purchase
pursuant to this Section 4.13 if, in contemplation of any Change of Control,
it has made an offer to purchase any and all Notes validly tendered at a cash
price equal to or higher than the Change of Control offer price and has
purchased all Notes properly tendered in accordance with the terms of such
offer to purchase.
55
Section 4.14. MONEY FOR PAYMENTS TO BE HELD IN TRUST.
If the Company shall at any time act as its own Paying Agent with
respect to any Notes, it will, on or before each due date of the principal,
premium, or interest, including Additional Interest, if any, on any of the
Notes, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum (except as otherwise specified in this Indenture) sufficient to
pay the principal, premium, or interest, including Additional Interest, so
becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided and will promptly notify the Trustee of its
action or failure so to act.
Whenever the Company shall have one or more Paying Agents for the Notes,
it will, prior to or on each due date of the principal, premium, if any, or
interest, including Additional Interest, on any Notes, deposit with a Paying
Agent a sum sufficient to pay the principal, premium, or interest, including
Additional Interest, so becoming due, such sum to be held in trust for the
benefit of the Persons entitled to such principal, premium, or interest,
including Additional Interest, and (unless such Paying Agent is the Trustee)
the Company will promptly notify the Trustee of its action or failure so to
act.
The Company will cause each Paying Agent (other than the Trustee) for
the Notes to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee, subject to the provisions of this
Section 4.14, that such Paying Agent will:
(1) hold all sums held by it for the payment of the principal,
premium, and interest, including Additional Interest, on Notes in trust for
the benefit of the Persons entitled thereto until such sums shall be paid
to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Notes) in the making of any payment of principal,
premium, if any, or interest, including Additional Interest, on the Notes;
and
(3) at any time during the continuance of any such default, upon
the written request of the Trustee, forthwith pay to the Trustee all sums
so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay,
or by Company Order direct any Paying Agent to pay, to the Trustee all sums
held in trust by the Company or such Paying Agent, such sums to be held by
the Trustee upon the same trusts as those upon which sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to
the Trustee, such Paying Agent shall be released from all further liability
with respect to such sums.
56
Except as otherwise provided in this Indenture, any money deposited with
the Trustee or any Paying Agent, or then held by the Company, in trust for
the payment of the principal, premium, or interest, including Additional
Interest, on any Note and remaining unclaimed for two years after such
principal, premium, or interest has become due and payable shall be paid to
the Company on Company Request, or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as
an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such
trust money, and all liability of the Company as trustee thereof, shall
thereupon cease; PROVIDED, HOWEVER, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Company cause to be published once, in an Authorized Newspaper, notice that
such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
Section 4.15. OFFICER CERTIFICATE AS TO EVENTS OF DEFAULT.
The Company shall deliver to the Trustee, within 120 days after the end of
its fiscal year, a certificate indicating whether the signing officers know of
any Default or Event of Default that occurred during the previous year and
whether the Company has complied with its obligations under this Indenture. In
addition, the Company will be required to notify the Trustee of the occurrence
and continuation of any Default or Event of Default promptly after the Company
becomes aware of the same.
Section 4.16. FALL-AWAY EVENT.
Parent Guarantor's and its Restricted Subsidiaries' obligations to comply
with Sections 4.06, 4.08, 4.09, 4.10 and 4.13 will be terminated in the event
that at any time (i) the Notes attain Investment Grade Status and (ii) no
Default has occurred and is continuing under this Indenture (a "Fall-Away
Event"); PROVIDED, HOWEVER, that such covenants shall be reinstated as to future
events if the Notes cease to have Investment Grade Status from either of the
Rating Agencies (the date of reinstatement being the "Reinstatement Date"). For
avoidance of doubt, any actions taken by the Parent Guarantor and its Restricted
Subsidiaries during the period following a Fall-Away Event and prior to the
Reinstatement Date that fail to comply with Sections 4.06, 4.08, 4.09, 4.10 and
4.13 will not be deemed to constitute an Event of Default for any purposes under
this Indenture.
ARTICLE 5
SUCCESSORS
Section 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.
57
Neither the Company nor the Parent Guarantor shall consolidate with
or merge into any other Person or sell, convey, transfer or lease its
properties and assets substantially as an entirety to any Person, unless:
(a) the Person formed by such consolidation or into which the
Company or the Parent Guarantor, as applicable, is merged or the Person
which acquires by sale, conveyance or transfer, or which leases, the
properties and assets of the Company or the Parent Guarantor, substantially
as an entirety (i) shall be a corporation, partnership, limited liability
company or trust organized and validly existing under the laws of the
United States of America, any state thereof or the District of Columbia and
(ii) shall expressly assume, by an Indenture supplemental thereto, executed
and delivered to the Trustee, in form reasonably satisfactory to the
Trustee, the obligations of the Company and/or the Parent Guarantor, as
applicable, for the due and punctual payment of the principal of, premium,
if any, and interest, including Additional Interest, if any, on all the
Notes and the performance and observance of every covenant of this
Indenture on the part of the Company or on the part of the Parent Guarantor
to be performed or observed;
(b) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing; and
(c) the Company or the Parent Guarantor, as applicable, or such
Person shall have delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and such supplemental Indenture comply with
Article 5 of this Indenture and that all conditions precedent provided for
relating to such transaction have been satisfied;
PROVIDED, HOWEVER, that this Section 5.01 shall apply only to a merger or
consolidation in which the Company or a Guarantor, as applicable, is not the
surviving corporation and to sales, conveyance, leases and transfers by the
Company and the Parent Guarantor as transferor or lessor.
58
Section 5.02. SUCCESSOR PERSON SUBSTITUTED.
Upon consolidation by the Company or the Parent Guarantor, as
applicable, with any other Person or merger by the Company or the Parent
Guarantor as applicable, into any other Person or any sale, conveyance,
transfer or lease of the properties and assets of the Company or the Parent
Guarantor, as applicable, substantially as an entirety to any Person in
accordance with this Section 5.01, the successor Person formed by such
consolidation or into which the Company or Parent Guarantor, as applicable,
is merged or to which such conveyance, transfer or lease is made, shall
succeed to and be substituted for, and may exercise every right and power of,
the Company and the Parent Guarantor under this Indenture and the Parent
Guarantor under its Guarantee, as applicable, with the same effect as if such
successor Person had been named as the Company or the Parent Guarantor
therein, respectively, and in the event of any such conveyance or transfer,
the Company and the Parent Guarantor, as applicable, except in the case of a
lease, shall be discharged of all obligations and covenants under this
Indenture, the Notes and the Guarantee of the Parent Guarantor.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. EVENTS OF DEFAULT.
Any of the following events shall constitute an "Event of Default"
hereunder:
(a) the failure to pay interest on the Notes when the same becomes due
and payable and the Default continues for a period of 30 days, whether or not
such payment is prohibited by the provisions of Article 14;
(b) the failure to pay principal of or premium, if any, on any Notes
when such principal or premium, if any, becomes due and payable, at maturity,
upon redemption or otherwise, whether or not such payment is prohibited by
the provisions of Article 14, and such default continues for five or more
days;
(c) a default in the observance or performance of any other covenant or
agreement contained in the Notes or this Indenture, which default continues
for a period of 60 days after the Company receives written notice thereof
specifying the default from the Trustee or holders of at least 25% in
aggregate principal amount of outstanding Notes and demanding that such
default be remedied;
(d) there occurs with respect to any issue or issues of Indebtedness of
the Parent Guarantor or any Significant Subsidiary having an outstanding
principal amount of $20 million or more in the aggregate for all such issues of
all such Persons, whether such Indebtedness now
59
exists or shall hereafter be created, (i) an event of default that has caused
the holder thereof to declare such Indebtedness to be due and payable prior
to its Stated Maturity and such Indebtedness has not been discharged in full
or such acceleration has not been rescinded or annulled within 60 days of
such acceleration and/or (ii) the failure to make a principal payment at the
final (but not any interim) fixed maturity and such defaulted payment shall
not have been made, waived or extended within 60 days of such payment default;
(e) any of the Note Guarantees ceases to be in full force and effect or
any of the Note Guarantees is declared to be null and void and unenforceable
or any of the Note Guarantees is found to be invalid or any of the Guarantors
denies its liability under its Note Guarantee, other than by reason of
release of a Guarantor in accordance with the terms of this Indenture;
(f) one or more judgments in an aggregate amount in excess of $20
million, which are not covered by insurance as to which the insurer has not
disclaimed coverage, being rendered against Parent Guarantor or any of its
Significant Subsidiaries and such judgment or judgments remain undischarged
or unstayed for a period of 60 days after such judgment or judgments become
final and nonappealable; and
(g) (i) a court having jurisdiction in the premises enters a decree or
order for (A) relief in respect of the Parent Guarantor or any of its
Significant Subsidiaries in an involuntary case under any applicable
bankruptcy, insolvency or other similar law for relief of debtors now or
hereafter in effect, (B) appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Parent Guarantor
or any of its Significant Subsidiaries or for all or substantially all of the
property and assets of the Parent Guarantor or any of its Significant
Subsidiaries or (C) the winding up or liquidation of the affairs of the
Parent Guarantor or any of its Significant Subsidiaries and, in each case,
such decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or (ii) the Parent Guarantor or any of its Significant
Subsidiaries (A) commences a voluntary case under any applicable bankruptcy,
insolvency or other similar law for relief of debtors now or hereafter in
effect, or consents to the entry of an order for relief in an involuntary
case under any such law, (B) consents to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Parent Guarantor or any of its
Significant Subsidiaries or for all or substantially all of the property and
assets of the Parent Guarantor or any of its Significant Subsidiaries or (C)
effects any general assignment for the benefit of creditors.
60
Section 6.02. ACCELERATION.
Upon the happening of any Event of Default (other than an Event of
Default specified in clause (g) of Section 6.01 relating to Parent Guarantor
or the Company), the Trustee may, and the Trustee upon the request of holders
of 25% in principal amount of the outstanding Notes shall, or the holders of
at least 25% in principal amount of outstanding Notes may, declare the
principal of all the Notes, together with all accrued and unpaid interest and
premium, if any, to be due and payable by notice in writing to the Company
and the Trustee specifying the respective Event of Default and that it is a
"notice of acceleration" (the "Acceleration Notice"), and the same (i) shall
become immediately due and payable or (ii) if there are any amounts
outstanding under the Senior Credit Facility, will become due and payable
upon the first to occur of an acceleration under the Senior Credit Facility
or five Business Days after receipt by the Company and the agent under the
Senior Credit facility of such Acceleration Notice (unless all Events of
Default specified in such Acceleration Notice have been cured or waived). If
an Event of Default specified in clause (g) of Section 6.01 relating to
Parent Guarantor or the Company occurs and is continuing, then such amount
will IPSO FACTO become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any holder of the
Notes.
At any time after a declaration of acceleration with respect to the
Notes as described in the preceding paragraph, the holders of a majority in
principal amount of the Notes then outstanding (by notice to the Trustee) may
rescind and cancel such declaration and its consequences if (i) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction, (ii) all existing Defaults and Events of Default have
been cured or waived except nonpayment of principal of or interest on the
Notes that has become due solely by such declaration of acceleration, (iii)
to the extent the payment of such interest is lawful, interest (at the same
rate specified in the Notes) on overdue installments of interest and overdue
payments of principal which has become due otherwise than by such declaration
of acceleration has been paid, (iv) the Company has paid the Trustee its
reasonable compensation and reimbursed the Trustee for its reasonable
expenses, disbursements and advances and (v) in the event of the cure or
waiver of a Default or Event of Default of the type described in clause (g)
of Section 6.01, the Trustee has received an Officers' Certificate and
Opinion of Counsel that such Default or Event of Default has been cured or
waived; PROVIDED, HOWEVER, that notwithstanding the foregoing in the event of
any Event of Default specified in clause (d) of Section 6.01, such Event of
Default and all consequences thereof shall be automatically annulled, waived
and rescinded in accordance with Section 6.13.
61
Section 6.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.
The Company covenants that if an Event of Default in payment of
principal, premium or interest specified in clause (a) or (b) of Section 6.01
occurs and is continuing, then the Company will, upon demand of the Trustee,
pay to the Trustee for the benefit of the Holders of such Notes, the whole
amount then due and payable on such Notes for principal, premium, if any, and
interest, and interest on any overdue principal and premium, if any, and to
the extent that payment of such interest is lawful on any overdue interest,
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.
If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the
same against the Company or any other obligor upon such Notes and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon such Notes, wherever
situated.
If an Event of Default with respect to the Notes occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Notes by such appropriate
judicial proceedings as the Trustee shall deem most effectual to protect and
enforce any such rights, whether for the specific enforcement of any covenant
or agreement in this Indenture or in aid of the exercise of any power granted
herein, or to enforce any other proper remedy.
Section 6.04. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company, the Parent Guarantor or any
other obligor upon the Notes or the property of the Company, the Parent
Guarantor or of such other obligor or their creditors, the Trustee
(irrespective of whether the principal of the Notes shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective
of whether the Trustee shall have made any demand on the Company for the
payment of overdue principal, premium, if any, or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of principal,
premium, if any, and interest owing and unpaid in respect of the Notes and to
file such other papers or documents as may be necessary or advisable in order
to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and of the Holders allowed in such judicial proceeding, and
62
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar
official in any such judicial proceeding is hereby authorized by each Holder
to make such payments to the Trustee and, in the event that the Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.06.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement, adjustment or composition affecting the Notes
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 6.05. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF NOTES.
All rights of action and claims under this Indenture or the Notes may be
prosecuted and enforced by the Trustee without the possession of any of the
Notes or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Notes in respect of which such judgment
has been recovered.
Section 6.06 APPLICATION OF MONEY COLLECTED.
Any money collected by the Trustee pursuant to this Article 6 shall be
applied in the following order, at the date or dates fixed by the Trustee
and, in case of the distribution of such money on account of principal,
premium, if any, or interest, upon presentation of the Notes and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
First: To the payment of all amounts due the Trustee under Section
7.06;
Second: To the holders of Senior Indebtedness, and as to the extent
required by Article 14;
Third: To the payment of the amounts then due and unpaid for
principal, premium, if any, and interest on the Notes in respect of which
or for the benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts due and
payable on such Notes for principal, premium, if any, and interest,
respectively; and
63
Fourth: The balance, if any, to the Person or Persons entitled
thereto including, without limitation, the Company.
Section 6.07. LIMITATION ON SUITS.
A Holder may not institute any proceeding, judicial or otherwise, with
respect to this Indenture or the Notes, or for the appointment of a receiver
or trustee, or for any other remedy hereunder, unless:
(i) the Holder has previously given the Trustee written notice of
a continuing Event of Default;
(ii) the Holders of at least 25% in aggregate principal amount of
outstanding Notes shall have made a written request to the Trustee to
pursue such remedy;
(iii) such Holder or Holders offer the Trustee indemnity reasonably
satisfactory to the Trustee against any costs, liability or expense;
(iv) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and
(v) during such 60-day period, the Holders of a majority in
aggregate principal amount of the outstanding Notes do not give the Trustee
a direction that is inconsistent with the request.
For purposes of Section 6.12 of this Indenture and this Section 6.07,
the Trustee shall comply with TIA Section 316(a) in making any determination
of whether the Holders of the required aggregate principal amount of
outstanding Notes have concurred in any request or direction of the Trustee
to pursue any remedy available to the Trustee or the Holders with respect to
this Indenture or the Notes or otherwise under the law.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder.
Section 6.08. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM
AND INTEREST.
Notwithstanding any other provision in this Indenture, the Holder of any
Note shall have the right, which is absolute and unconditional, to receive
payment, as provided herein and in such Note, of the principal, premium, if
any, and interest on, such Note on the Stated Maturity (or, in the case of
redemption, on the redemption date in accordance with Article 3) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
64
Section 6.09. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders of
Notes shall be restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the Trustee and the
Holders shall continue as though no such proceeding had been instituted.
Section 6.10. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Notes in Section 2.06, no right or
remedy herein conferred upon or reserved to the Trustee or to the Holders of
Notes is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of
any right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 6.11. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Holder of any Note to
exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default
or an acquiescence therein. Every right and remedy given by this Article 6
or by law to the Trustee or to the Holders may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.
Section 6.12. CONTROL BY HOLDERS.
The Holders of at least a majority in aggregate principal amount of the
Notes shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any
trust or power conferred on the Trustee, PROVIDED that in each case
(a) such direction shall not be in conflict with any rule of law or
with this Indenture,
(b) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
65
(c) the Trustee need not take any action which might involve it in
personal liability or be unjustly prejudicial to the Holders of Notes not
consenting.
Section 6.13. WAIVER OF PAST DEFAULTS.
Subject to Sections 6.02 and 9.02, the Holders of at least a majority in
principal amount of the outstanding Notes, by notice to the Trustee, may
waive an existing Default or Event of Default and its consequences, except a
Default in the payment of principal of, premium, if any, or interest on any
Note specified in clause (a) or (b) of Section 6.01. In the event of any
Event of Default specified in clause (d) of Section 6.01, such Event of
Default and all consequences thereof (including without limitation any
acceleration or resulting payment default) shall be annulled, waived and
rescinded, automatically and without any action by the Trustee or the holders
of the Notes, if within 60 days after such Event of Default arose (x) the
Indebtedness that is the basis for such Event of Default has been discharged,
or (y) the holders of such Indebtedness have rescinded or waived the
acceleration, notice or action (as the case may be) giving rise to such Event
of Default, or (z) if the default that is the basis for such Event of Default
has been cured.
ARTICLE 7
TRUSTEE
Section 7.01. NOTICE OF DEFAULTS.
(a) 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; but in
the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same 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).
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of
66
care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that
(i) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in principal amount of the
Outstanding Notes, determined as provided herein relating to the time,
method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred upon the Trustee,
under this Indenture with respect to the Notes.
(d) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of
this Section.
Within 45 days after the occurrence of any Default hereunder with
respect to the Notes, the Trustee shall transmit in the manner and to the
extent provided in TIA Section 313(c), notice of such Default hereunder known
to the Trustee, unless such Default shall have been cured or waived;
PROVIDED, HOWEVER, that, except in the case of a Default in the payment of
the principal, premium, if any, or interest on any of such Notes, the Trustee
shall be protected in withholding such notice if and so long as the Trustee
in good faith determines that the withholding of such notice is in the
interest of the Holders of Notes and any related coupons.
Section 7.02. CERTAIN RIGHTS OF TRUSTEE.
Subject to the provisions of TIA Sections 315(a) through 315(d):
(a) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document reasonably believed
by it to be genuine and to have been signed or presented by the proper party
or parties;
67
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith
on its part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(e) 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 of Notes 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;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(h) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Indenture;
(i) the Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such
a Default is received by the Trustee at the Corporate Trust Office of the
Trustee, and such notice references the Notes and this Indenture; and
68
(j) the rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified,
are extended to, and shall be enforceable by, the Trustee in each of its
capacities hereunder, and to each agent, custodian and other Person employed
to act hereunder.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it.
Section 7.03. TRUSTEE NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF NOTES.
The recitals contained herein and in the Notes, except for the Trustee's
certificates of authentication, shall be taken as the statements of the
Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations
as to the validity or sufficiency of this Indenture or of the Notes, except
that the Trustee represents that it is duly authorized to execute and deliver
this Indenture, authenticate the Notes and perform its obligations hereunder
and that the statements made by it in a Statement of Eligibility and
Qualification on Form T-1 supplied to the Company are true and accurate,
subject to the qualifications set forth therein. Neither the Trustee nor any
Authenticating Agent shall be accountable for the use or application by the
Company of Notes or the proceeds thereof.
Section 7.04. MAY HOLD NOTES.
The Trustee, any Authenticating Agent, any Paying Agent, any Registrar
or any other agent of the Company or of the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Notes and, subject to TIA
Sections 310(b) and 311, may otherwise deal with the Company with the same
rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, Registrar or such other agent.
Section 7.05. MONEY HELD IN TRUST.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under
no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
Section 7.06. COMPENSATION AND REIMBURSEMENT.
The Company agrees:
69
(a) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision of
this Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(c) to indemnify the Trustee and any predecessor Trustee for, and to
hold it harmless against, any loss, liability or expense, including taxes
(other than taxes based upon, measured by, or determined by the income of the
Trustee), incurred without negligence or bad faith on its part, arising out
of or in connection with the acceptance or administration of the trust or
trusts hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder.
The obligations of the Company under this Section 7.06 to compensate the
Trustee, to pay or reimburse the Trustee for expenses, disbursements and
advances and to indemnify and hold harmless the Trustee shall constitute
additional indebtedness hereunder and shall survive the satisfaction and
discharge of this Indenture. As security for the performance of such
obligations of the Company, the Trustee shall have a claim prior to the Notes
upon all property and funds held or collected by the Trustee as such, except
funds held in trust for the payment of principal, premium, if any, or
interest on particular Notes.
Section 7.07. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY; CONFLICTING
INTEREST.
There shall at all times be a Trustee hereunder which shall be eligible
to act as Trustee under TIA Section 310(a)(1). Each successor trustee shall
have a combined capital and surplus of at least $50,000,000. If such
corporation publishes reports of condition at least annually, pursuant to law
or to the requirements of federal, state, territorial or District of Columbia
supervising or examining authority, then for the purposes of this Section
7.07, the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published.
If at any time the Trustee acquires any conflicting interest, it must
eliminate such conflict within 90 days, apply to the SEC for permission to
continue, or resign. If at any time the Trustee shall cease to be eligible
in accordance with the provisions of this Section 7.07, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article 7.
70
Section 7.08. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) Resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article 7 shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 7.09.
(b) The Trustee may resign at any time with respect to the Notes by
giving written notice thereof to the Company. If the instrument of
acceptance by a successor Trustee required by Section 7.09 shall not have
been delivered to the Trustee within 30 days after the giving of such notice
of resignation removal, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee with
respect to the Notes.
(c) If at any time:
(i) the Trustee shall fail to comply with the provisions of TIA
Section 310(b) after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Note for at least six months,
or
(ii) the Trustee shall cease to be eligible under Section 7.07(a)
and shall fail to resign after written request therefor by the Company or
by any Holder who has been a bona fide Holder of a Note for at least six
months, or
(iii) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (1) the Company, by a Board Resolution, may remove
the Trustee with respect to all Notes, or (2) subject to TIA Section 315(e),
any Holder who has been a bona fide Holder of a Note for at least six months
may, on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee with respect
to the Notes and the appointment of a successor Trustee or Trustees.
The Company also may remove the Trustee with or without cause if the
Company so notifies the Trustee three months in advance and if no Default
occurs during the three-month period.
If the instrument of acceptance by a successor Trustee required by
Section 7.09 shall not have been delivered to the Trustee within 30 days
after receipt of a notice of removal, the removed Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Notes.
71
(d) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause,
with respect to the Notes, the Company, by a Board Resolution, shall promptly
appoint a successor Trustee or Trustees with respect to the Notes. If no
successor Trustee with respect to the Notes shall have been so appointed by
the Company or the Holders and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a Note for at least
six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a
successor Trustee with respect to the Notes.
(e) The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Notes and each appointment of a successor
Trustee with respect to the Notes to the Holders of Notes in the manner
provided for in Section 14.02. Each notice shall include the name of the
successor Trustee with respect to the Notes and the address of its Corporate
Trust Office.
Section 7.09. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor Trustee with
respect to the Notes, the Company, the retiring Trustee and each successor
Trustee with respect to the Notes shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such
appointment and which (1) shall contain such provisions as shall be necessary
or desirable to transfer and confirm to, and to vest in, each successor
Trustee all the rights, powers, trusts and duties of the retiring Trustee
with respect to the Notes to which the appointment of such successor Trustee
relates; and upon the execution and delivery of such supplemental indenture
to resignation or removal of the retiring Trustee shall become effective to
the extent provided therein and each such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee with respect to the Notes;
but, on request of the Company or any successor Trustee, such retiring
Trustee shall duly assign, transfer and deliver to such successor Trustee all
property and money held by such retiring Trustee hereunder with respect to
the Notes.
(b) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all rights, powers and trusts referred
to in paragraph (a) of this Section 7.09.
(c) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and
eligible under this Article 7.
Section 7.10. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
72
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any further act
on the part of any of the parties hereto. In case any Notes shall have been
authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating
Trustee may adopt such authentication and deliver the Notes so authenticated
with the same effect as if such successor Trustee had itself authenticated
such Notes; and in case at that time any of the Notes shall not have been
authenticated, any successor Trustee may authenticate such Notes either in
the name of any predecessor hereunder or in the name of the successor
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 the Trustee shall have; PROVIDED, HOWEVER, that the right to
adopt the certificate of authentication of any predecessor Trustee or to
authenticate Notes in the name of any predecessor Trustee shall apply only to
its successor or successors by merger, conversion or consolidation.
73
Section 7.11. APPOINTMENT OF AUTHENTICATING AGENT.
At any time when any of the Notes remain Outstanding, the Trustee may
appoint an Authenticating Agent or Agents with respect to the Notes which
shall be authorized to act on behalf of the Trustee to authenticate the Notes
and the Trustee shall give written notice of such appointment to all Holders
of Notes with respect to which such Authenticating Agent will serve. Notes
so authenticated shall be entitled to the benefits of this Indenture and
shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Any such appointment shall be evidenced by an instrument
in writing signed by a Responsible Officer of the Trustee, and a copy of such
instrument shall be promptly furnished to the Company. Wherever reference is
made in this Indenture to the authentication and delivery of Notes by the
Trustee or the Trustee's certificate of authentication, such reference shall
be deemed to include authentication and delivery on behalf of the Trustee by
an Authenticating Agent and a certificate of authentication executed on
behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent
shall be acceptable to the Company and shall at all times be a corporation
organized and doing business under the laws of the United States of America,
any state thereof or the District of Columbia, authorized under such laws to
act as Authenticating Agent, having a combined capital and surplus of not
less than $50,000,000 and subject to supervision or examination by federal or
state authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section 7.11, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this Section 7.11, it shall resign
immediately in the manner and with the effect specified in this Section 7.11.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating
Agent shall be a party, or any corporation succeeding to the corporate agency
or corporate trust business of an Authenticating Agent, shall continue to be
an Authenticating Agent, PROVIDED such corporation shall be otherwise
eligible under this Section 7.11, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating
Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such
a notice of resignation or upon such a termination, or in case at any time
such Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 7.11, the Trustee may appoint a successor
Authenticating Agent which shall be acceptable to the Company and shall give
written notice of such appointment to all Holders of Notes with respect to
which such Authenticating Agent will serve. Any successor Authenticating
74
Agent upon acceptance of its appointment hereunder shall become vested with
all the rights, powers and duties of its predecessor hereunder, with like
effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless eligible under the provisions
of this Section 7.11.
The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section 7.11, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 7.06.
If an appointment is made pursuant to this Section 7.11, the Notes may
have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternate certificate of authentication in the following
form:
This is one of the Notes referred to
in the within-mentioned Indenture.
Dated:
The Bank of New York
By
------------------------------------
as Authenticating Agent
By
------------------------------------
as Authenticating Agent
ARTICLE 8
DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. OPTION TO EFFECT DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
Section 8.02. DEFEASANCE AND DISCHARGE.
75
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.04
hereof, be deemed to have been discharged from its obligations with respect
to all Outstanding Notes on the date the conditions set forth below are
satisfied (hereinafter, "Defeasance"). For this purpose, Defeasance means
that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by the Outstanding Notes, which shall thereafter be
deemed to be Outstanding only for the purposes of Section 8.05 hereof and the
other Sections of this Indenture referred to in (a) and (b) below, and to
have satisfied all its other obligations under such Notes, the Note
Guarantees and this Indenture (and the Trustee, on demand of and at the
expense of the Company, shall execute proper instruments acknowledging the
same), except for the following provisions which shall survive until
otherwise terminated or discharged hereunder: (a) the rights of Holders of
such Outstanding Notes to receive, solely from the trust fund described in
Section 8.04 hereof, and as more fully set forth in such Section, payments in
respect of the principal of (and premium, if any, on) and interest and
Additional Interest, if any, on such Notes when such payments are due, (b)
the Company's obligations with respect to such Notes under Article 2 and
Section 4.02 hereof, (c) the rights, powers, trusts, duties and immunities of
the Trustee hereunder and the Company's obligations in connection therewith
and (d) this Article 8.
Section 8.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.04
hereof, be released from their respective obligations under the covenants
contained in Sections 4.06 through 4.10 and Section 4.13 hereof with respect
to the outstanding Notes on and after the date the conditions set forth in
Section 8.04 are satisfied (hereinafter, "Covenant Defeasance"), and the
Notes shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it
being understood that such Notes shall not be deemed outstanding for
accounting purposes). For this purpose, Covenant Defeasance means that, with
respect to the outstanding Notes, the Company and the Guarantors may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any
other document and such omission to comply shall not constitute a Default or
an Event of Default under Section 6.01 hereof, but, except as specified
above, the remainder of this Indenture and such Notes shall be unaffected
thereby. In addition, upon the Company's exercise under Section 8.01 hereof
of the option applicable to this Section 8.03, subject to the satisfaction of
the conditions set forth in Section 8.04 hereof, Sections 6.01(c) and (f)
hereof shall not constitute Events of Default.
76
Section 8.04. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either defeasance or covenant defeasance:
(a) the Company shall irrevocably deposit or cause to be deposited with
the Trustee, in trust, for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the benefit of
the Holders of such Notes, (A) money in an amount (in such currency in which
such Notes are then specified as payable at Stated Maturity), or (B) U.S.
Government Obligations applicable to such Notes which through the scheduled
payment of principal, premium, if any, and interest in respect thereof in
accordance with their terms will provide, not later than one day before the
due date of any payment of principal (including any premium) and interest, if
any, under such Notes, money in an amount or (C) a combination thereof,
sufficient, in the opinion of a nationally recognized firm of independent
public accountants to pay and discharge (i) the principal of and premium, if
any, on and interest on the outstanding Notes on the Stated Maturity or any
Redemption Date selected by the Company, if applicable of such principal and
premium, if any or installment or interest, as well as the Trustee's fees and
expenses;
(b) such defeasance or covenant defeasance shall not result in a breach
or violation of, or constitute a default under, this Indenture or any other
material agreement or instrument to which the Company is a party or by which
it is bound;
(c) the Company has delivered to the Trustee (1) either (x) an Opinion of
Counsel to the effect that Holders will not recognize income, gain or loss for
federal income tax purposes as a result of the Company's exercise of its option
under this Section 8.04 and will be subject to federal income tax on the same
amount and in the same manner and at the same times as would have been the case
if such option had not been exercised, which Opinion of Counsel shall be based
upon (and accompanied by a copy of) a ruling of the Internal Revenue Service
directed to the Company to the same effect unless there has been a change in
applicable federal income tax law after the Closing Date such that a ruling is
no longer required or (y) a ruling directed to the Company received from the
Internal Revenue Service to the same effect as the aforementioned Opinion of
Counsel and (2) an Opinion of Counsel to the effect that the creation of the
defeasance trust does not violate the Investment Company Act of 1940 and that
after the passage of 123 days following the deposit (except, with respect to any
trust funds for the account of any Holder who may be deemed to be an "insider"
for purposes of the United States Bankruptcy Code, after one year following the
deposit), the trust funds will not be subject to the effect of Xxxxxxx 000 xx
xxx Xxxxxx Xxxxxx Bankruptcy Code or Section 15 of the New York Debtor and
Creditor Law in a case commenced by or against the Company under either such
statute, PROVIDED, that in delivering any such Opinion of Counsel, such counsel
shall be entitled to rely
77
upon the statements of experts as to the solvency of the Company, and either
(I) the trust funds will no longer remain the property of the Company (and
therefore will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally) or (II) if a court were to rule under any such law in any case or
proceeding that the trust funds remained property of the Company, (A)
assuming such trust funds remained in the possession of the Trustee prior to
such court ruling to the extent not paid to the Holders, the Trustee will
hold, for the benefit of the Holders, a valid and perfected security interest
in such trust funds that is not avoidable in bankruptcy or otherwise except
for the effect of Section 552(b) of the United States Bankruptcy Code on
interest on the trust funds accruing after the commencement of a case under
such statute and (B) the Holders will be entitled to receive adequate
protection of their interests in such trust funds if such trust funds are
used in such case or proceeding;
(d) an Officers' Certificate and an Opinion of Counsel to the effect
that the Company has complied with all condition precedent to the defeasance;
and
(e) such defeasance or covenant defeasance shall be effected in
compliance with any additional or substitute terms, conditions or limitations
in connection therewith pursuant to this Indenture.
Section 8.05. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding
Notes shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Notes and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as Paying
Agent) as the Trustee may determine, to the Holders of such Notes of all sums
due and to become due thereon in respect of principal, premium, if any, and
interest, but such money need not be segregated from other funds except to
the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or U.S. Government
Obligations deposited pursuant to Section 8.04 hereof or the principal,
premium, if any, and interest received in respect thereof other than any such
tax, fee or other charge which by law is for the account of the Holders of
the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or U.S. Government Obligations held by it as provided in
Section 8.04 hereof which, in the opinion of a
77
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee (which may be the
opinion delivered under Section 8.04(a) hereof), are in excess of the amount
thereof that would then be required to be deposited to effect an equivalent
Defeasance or Covenant Defeasance.
Section 8.06. REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, premium, if
any, or interest or Additional Interest, if any, on any Note and remaining
unclaimed for two years after such principal, and premium, if any, or
interest or Additional Interest, if any, has become due and payable shall be
paid to the Company on its request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; PROVIDED, HOWEVER, that
the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in
the New York Times and The Wall Street Journal (national edition), notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such notification or
publication, any unclaimed balance of such money then remaining will be
repaid to the Company.
Section 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or U.S. Government Obligations in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's and the Guarantors'
obligations under this Indenture, the Notes and the Note Guarantees shall be
revived and reinstated as though no deposit had occurred pursuant to Section
8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.02 or 8.03
hereof, as the case may be; PROVIDED, HOWEVER, that, if the Company makes any
payment of principal of, premium, if any, or interest or Additional Interest,
if any, on any Note following the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money held by the Trustee or Paying Agent.
79
ARTICLE 9
AMENDMENTS AND SUPPLEMENTS TO THE INDENTURE
Section 9.01. WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company, when authorized by or
pursuant to a Board Resolution, the Parent Guarantor, when authorized by or
pursuant to a resolution of its board of directors, and the Trustee, at any
time and from time to time, may amend or supplement this Indenture, in form
satisfactory to the Trustee, for any of the following purposes:
(a) to cure ambiguities, defects or inconsistencies, or to make any
other provisions with respect to questions or matters arising under this
Indenture;
(b) to effect or maintain the qualification of this Indenture under the
Trust Indenture Act;
(c) to secure the Notes;
(d) to add any additional Note Guarantees;
(e) to evidence the succession of another Person to the Company or any
Guarantor and the assumption by any such successor of the obligations of the
Company or Guarantor, as applicable, contained herein and in the Notes;
(f) to add any additional Events of Default;
(g) to add to the covenants of the Company or any Guarantee for the
benefit of the Holders of the Notes; or
(h) to make any other change to the provisions of this Indenture that,
in the good faith opinion of the Board of Directors of the Parent Guarantor,
does not materially and adversely affect the rights of Holders of the Notes
hereunder.
80
Section 9.02. WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority in principal
amount of all Outstanding Notes by Act of said Holders delivered to the
Company and the Trustee, the Company, when authorized by or pursuant to a
Board Resolution, and the Trustee may supplement or amend this Indenture for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture which affect such Notes
or of modifying in any manner the rights of the Holders of Notes under this
Indenture; PROVIDED, HOWEVER, that, without the consent of each holder of the
Notes affected thereby, no amendment or supplement may, directly or
indirectly, (i) reduce the amount of Notes whose holders must consent to an
amendment; (ii) reduce the rate of or change the time for payment of
interest, including defaulted interest, on any Notes; (iii) reduce the
principal of or change the fixed maturity of any Notes, or change the date on
which any Notes may be subject to redemption or repurchase, or reduce the
redemption or repurchase price therefor; (iv) make any Notes payable in money
other than that stated in the Notes and this Indenture; (v) make any change
in provisions of this Indenture protecting the right of each holder of a Note
to receive payment of principal of, premium on and interest on such Note on
or after the due date thereof or to bring suit to enforce such payment or
permitting holders of a majority in principal amount of the Notes to waive a
Default or Event of Default; or (vi) after the Company's obligation to
purchase the Notes arises under this Indenture, amend, modify or change the
obligation of the Company to make or consummate an Offer to Purchase or waive
any default in the performance thereof or modify any of the provisions or
definitions with respect to any such offer.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Persons entitled to consent to any amendment
or supplement hereto. If a record date is fixed, the Holders on such record
date, or their duly designated proxies, and only such Persons, shall be
entitled to consent to such supplemental indenture, whether or not such
Holders remain Holders after such record date; PROVIDED that, unless such
consent shall have become effective by virtue of the requisite percentage
having been obtained prior to the date which is 90 days after such record
date, any such consent previously given shall automatically and without
further action by any Holder be canceled and of no further effect.
It shall not be necessary for any Act of Holders under this Section 9.02
to approve the particular form of any proposed amendment or supplement, but
it shall be sufficient if such Act shall approve the substance thereof.
81
Section 9.03. EXECUTION OF AMENDMENTS AND SUPPLEMENTS.
In executing, or accepting the additional trusts created by, any
amendment or supplement permitted by this Article 9 or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be
entitled to receive, and shall be fully protected in relying upon, an Opinion
of Counsel stating that the execution of such amendment or supplement is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such amendment or supplement which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 9.04. EFFECT OF AMENDMENTS AND SUPPLEMENTS.
Upon the execution of any amendment or supplement to this indenture
under this Article 9, this Indenture shall be modified in accordance
therewith, and such amendment or supplement to this indenture shall form a
part of this Indenture for all purposes; and every Holder of Notes
theretofore or thereafter authenticated and delivered hereunder shall be
bound thereby.
Section 9.05. CONFORMITY WITH TRUST INDENTURE ACT.
Every amendment or supplement executed pursuant to this Article 9 shall
conform to the requirements of the Trust Indenture Act as then in effect.
Section 9.06. REFERENCE IN NOTES TO AMENDMENTS AND SUPPLEMENTS.
Notes authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article 9 may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture. If the Company shall so
determine, new Notes so modified as to conform, in the opinion of the Trustee
and the Company, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Notes.
82
ARTICLE 10
NOTE GUARANTEES
Section 10.01. NOTE GUARANTEE.
Subject to the provisions of this Article 10, each Guarantor hereby,
jointly and severally, fully, unconditionally and irrevocably Guarantees to
each Holder of Notes hereunder and to the Trustee on behalf of the Holders:
(i) the due and punctual payment of the principal of, premium, if any, and
interest and Additional Interest, if any, on each Note, when and as the same
shall become due and payable, whether at maturity, by acceleration,
redemption or otherwise, the due and punctual payment of interest and
Additional Interest, if any, on the overdue principal and premium, if any, of
and interest and Additional Interest, if any, on the Notes, to the extent
lawful, and the due and punctual performance of all other obligations of the
Company to the Holders or the Trustee, all in accordance with the terms of
such Note and this Indenture and (ii) in the case of any extension of time of
payment or renewal of any Notes or any of such other obligations, that the
same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, at maturity, by acceleration or
otherwise, subject, however, in the case of clauses (i) and (ii) above, to
the limitations set forth in the next succeeding paragraph.
Each Note Guarantee shall be Guaranteed on a senior subordinated basis
in accordance with Article 15 hereof.
Each Guarantor and by its acceptance hereof each Holder hereby confirms
that it is the intention of all such parties that the Guarantee by such
Guarantor pursuant to its Note Guarantee not constitute a fraudulent transfer
or conveyance for purposes of the United States Bankruptcy Code, the Uniform
Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
Federal or state law. To effectuate the foregoing intention, the Holders and
such Guarantor hereby irrevocably agree that the obligations of such
Guarantor under its Note Guarantee 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 its Note Guarantee or pursuant to the following
paragraph, result in the obligations of such Guarantor under its Note
Guarantee not constituting such fraudulent transfer or conveyance.
In order to provide for just and equitable contribution among the
Guarantors, the Guarantors agree, inter se, that in the event any payment or
distribution is made by any Guarantor (a "Funding Guarantor") under its Note
Guarantee, such Funding Guarantor shall be entitled to a contribution from
all other Guarantors in a pro rata amount based on the Adjusted Net Assets of
each Guarantor (including the Funding Guarantor) for all payments, damages
and expenses incurred by that Funding Guarantor in discharging the Company's
obligations with respect to the Notes or any other Guarantor's obligations
with respect to its Note Guarantee.
83
"Adjusted Net Assets" of such Guarantor at any date shall mean the lesser of
the amount by which (x) the fair value of the property of such Guarantor
exceeds the total amount of liabilities, including, without limitation,
contingent liabilities (after giving effect to all other fixed and contingent
liabilities incurred or assumed on such date), but excluding liabilities
under the Note Guarantee, of such Guarantor at such date and (y) the present
fair salable value of the assets of such Guarantor at such date exceeds the
amount that will be required to pay the probable liability of such Guarantor
on its debts (after giving effect to all other fixed and contingent
liabilities incurred or assumed on such date and after giving effect to any
collection from any Subsidiary of such Guarantor in respect of the
obligations of such Subsidiary under the Note Guarantee of such Guarantor),
excluding debt in respect of its Note Guarantee, as they become absolute and
matured.
Each Guarantor hereby waives diligence, presentment, demand of payment,
filing of claims with a court in the event of merger or bankruptcy of the
Company, any requirement that the Trustee or any of the Holders protect,
secure, perfect or insure any security interest in or other Lien upon any
property subject thereto or exhaust any right or take any action against the
Issuer or any other Person, any right to require a proceeding first against
the Company, the benefit of discussion, protest or notice with respect to any
such Note or the debt evidenced thereby and all demands whatsoever (except as
specified above), and covenants that this Note Guarantee will not be
discharged as to any such Note except by payment in full of the principal
thereof and interest thereon and as provided in Section 11.01. The maturity
of the obligations Guaranteed hereby may be accelerated as provided in
Article 6 for the purposes of this Article 10. 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 the Guarantors for the purpose of this Article 10. In
addition, without limiting the foregoing provisions, upon the effectiveness
of an acceleration under Article 6, the Trustee shall promptly make a demand
for payment on the Notes under the Note Guarantee provided for in this
Article 10.
The obligations of each Guarantor under this Note Guarantee are
independent of the obligations Guaranteed by such Guarantor hereunder, and a
separate action or actions may be brought and prosecuted by the Trustee on
behalf of, or by, the Holders, subject to the terms and conditions set forth
in this Indenture, against a Guarantor to enforce this Guaranty, irrespective
of whether any action is brought against the Company or whether the Company
is joined in any such action or actions.
If the Trustee or the Holder is required by any court or otherwise to
return to the Company or any Guarantor, or any custodian, receiver, liquidator,
trustee, sequestrator or other similar official acting in relation to the
Company or such Guarantor, any amount paid to the Trustee or such Holder in
respect of a Note, this Note Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each of the Guarantors further
agrees, to the fullest extent that it may lawfully do so, that, as between it,
on the one hand, and the Holders and the Trustee, on the other hand, the
maturity of the obligations Guaranteed hereby may be
84
accelerated as provided in Article 6 hereof for the purposes of this Note
Guarantee, notwithstanding any stay, injunction or other prohibition extant
under any applicable bankruptcy law preventing such acceleration in respect
of the obligations Guaranteed hereby.
Each of the Guarantors hereby irrevocably waives any claim or other
rights which it may now or hereafter acquire against the Company or any other
Guarantor that arise from the existence, payment, performance or enforcement
of its obligations under this Note Guarantee and this Indenture, including,
without limitation, any right of subrogation, reimbursement, exoneration,
contribution, indemnification, any right to participate in any claim or
remedy of the Holders against the Company or any Guarantor or any collateral
which any such Holder or the Trustee on behalf of such Holder hereafter
acquires, whether or not such claim, remedy or right arises in equity, or
under contract, statute or common law, including, without limitation, the
right to take or receive from the Company or a Guarantor, directly or
indirectly, in cash or other property or by set-off or in any other manner,
payment or security on account of such claim or other rights. If any amount
shall be paid to a Guarantor in violation of the preceding sentence and the
principal of and accrued interest on the Notes shall not have been paid in
full, such amount shall be deemed to have been paid to such Guarantor for the
benefit of, and held in trust for the benefit of, the Holders, and shall
forthwith be paid to the Trustee for the benefit of the Holders to be
credited and applied upon the principal of and accrued interest on the Notes.
Each of the Guarantors acknowledges that it will receive direct and indirect
benefits from the issuance of the Notes pursuant to this Indenture and that
the waivers set forth in this Section 10.01 are knowingly made in
contemplation of such benefits.
Section 10.02. OBLIGATIONS UNCONDITIONAL.
Nothing contained in this Article 10 or elsewhere in this Indenture or
in the Notes is intended to or shall impair, as among any Guarantor and the
Holders of the Notes, the obligation of such Guarantor, which is absolute and
unconditional, upon failure by the Company to pay to the Holders of the Notes
the principal of and interest on the Notes as and when the same shall become
due and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the Holders and creditors of such Guarantor,
nor shall anything herein or therein prevent any Holder or the Trustee on
their behalf from exercising all remedies otherwise permitted by applicable
law upon default under this Indenture.
Without limiting the foregoing, nothing contained in this Article 10
will restrict the right of the Trustee or the Holders to take any action to
declare the Note Guarantee to be due and payable prior to the maturity of any
Notes pursuant to Section 6.01 or to pursue any rights or remedies hereunder.
Section 10.03. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
85
(a) Nothing contained in this Indenture or in any of the Notes shall
prevent any consolidation or merger of a Guarantor with or into the Company or
another Guarantor or shall prevent any sale or conveyance of the property of a
Guarantor, as an entirety or substantially as an entirety, to the Company or the
Guarantor. Upon any such consolidation, merger, sale or conveyance, the
Guarantee given by such Guarantor shall no longer have any force or effect.
(b) Nothing contained in this Indenture or in any of the Notes shall
prevent any consolidation or merger of a Guarantor with or into a Person
(provided such Person is a corporation, partnership or trust) other than the
Company or another guarantor or shall prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety to any
such Person (whether or not an Affiliate of the Guarantor). Upon the sale or
disposition of a Guarantor (or all or substantially all of its assets) to a
Person which is not a Subsidiary of the Company, which is otherwise in
compliance with this Indenture, such Guarantor shall be deemed released from all
its obligations under this Indenture and its Guarantee and such Guarantee shall
terminate; PROVIDED, HOWEVER, that any such termination shall occur only to the
extent that all obligations of such Guarantor under all its guarantees of, and
under all of its pledges of assets or other security interests which secure,
Indebtedness of the Company shall also terminate upon such release, sale or
transfer.
(c) The Trustee shall, at the Company's expense, deliver an appropriate
instrument evidencing such release upon receipt of a request by the Company
accompanied by an Officers' Certificate certifying as to the compliance with
this Section 10.03. Any Guarantor not so released remains liable for the full
amount of principal of an interest on the Notes as provided in this Article Ten.
Section 10.04. NOTICE TO TRUSTEE.
A Guarantor shall give prompt written notice to the Trustee of any fact
known to such Guarantor which would prohibit the making of any payment to or by
the Trustee in respect of the Note Guarantee pursuant to the provisions of this
Article 10.
Section 10.05. EXECUTION AND DELIVERY OF NOTE GUARANTEE.
To evidence its Note Guarantee set forth in Section 10.01, each Guarantor
hereby agrees that a notation of such Note Guarantee substantially in the form
included in Exhibit E shall be endorsed by an Officer of such Guarantor on each
Note authenticated and delivered by the Trustee and that this Indenture shall be
executed on behalf of such Guarantor by its President or one of its Vice
Presidents.
Each Guarantor hereby agrees that its Note Guarantee set forth in Section
10.01 shall remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such Note Guarantee.
86
If an Officer whose signature is on this Indenture or on the Note Guarantee
no longer holds that office at the time the Trustee authenticates the Note on
which a Note Guarantee is endorsed, the Note Guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of the Note Guarantee set forth in this
Indenture on behalf of the Guarantors.
Section 10.06. ADDITIONAL GUARANTORS.
Any Person may become a Guarantor (pursuant to Section 4.10 or otherwise)
by executing and delivering to the Trustee (a) a supplemental indenture, in form
and substance substantially in the form of Exhibit F attached hereto, which
subjects such Person to the provisions of this Indenture as a Guarantor, and
(b) an Opinion of Counsel to the effect that such supplemental indenture has
been duly authorized and executed by such Person and constitutes the legal,
valid, binding and enforceable obligation of such Person (subject to such
customary exceptions concerning fraudulent conveyance laws, creditors' rights
and equitable principles as may be acceptable to the Trustee in its discretion).
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01. SATISFACTION AND DISCHARGE.
This Indenture shall upon Company Request cease to be of further effect
with respect to any Notes (except as to any surviving rights of registration of
transfer or exchange of Notes herein expressly provided for) and the Trustee
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture as to such Notes when
(a) either
(i) all Notes theretofore authenticated and delivered (other than
(A) Notes which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 2.07, and (B) Notes for whose
payment money has theretofore been deposited in trust with the Trustee or
any Paying Agent or segregated and held in trust by the Company and
thereafter repaid to the Company, as provided in Section 4.14) have been
delivered to the Trustee for cancellation; or
(ii) all Notes not theretofore delivered to the Trustee for
cancellation
87
(A) have become due and payable, or
(B) will become due and payable at their Stated Maturity
within one year, or
(C) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company, and the Company,
in the case of (i), (ii) or (iii) above, has irrevocably deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose an amount, in U.S. dollars or in U.S. Government Obligations,
sufficient to pay and discharge the entire indebtedness on such Notes not
theretofore delivered to the Trustee for cancellation, for principal,
premium, if any, and interest to the date of such deposit (in the case of
Notes which have become due and payable) or to the Stated Maturity or
Redemption Date, as the case may be;
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(c) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been satisfied.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 7.06, the obligations of
the Trustee to any Authenticating Agent under Section 7.11 and, if money shall
have been deposited with the Trustee pursuant to subclause (ii) of clause (a) of
this Section 11.01, the obligations of the Trustee under Section 11.02 and the
last paragraph of Section 4.14 shall survive.
Section 11.02. APPLICATION OF TRUST MONEY.
Subject to the provisions of the last paragraph of Section 4.14, all money
deposited with the Trustee pursuant to Section 11.01 shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal, premium, if any,
and interest for whose payment such money has been deposited with the Trustee,
but such money need not be segregated from other funds except to the extent
required by law.
88
Section 11.03. REPAYMENT OF TRUST MONEY.
The Trustee and the Paying Agent shall promptly turn over to the Company
upon request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon request any
money held by them for the payment of principal or interest that remains
unclaimed for two years. After payment to the Company, Holders entitled to the
money must look to the Company for payment as unsecured general creditors unless
an abandoned property law designates another person.
ARTICLE 12
MISCELLANEOUS
Section 12.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA Section 318(c), the imposed duties shall control.
Section 12.02. NOTICES.
Any notice or communication by the Company, 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:
If to the Company and/or any Guarantor:
Protection One Alarm Monitoring, Inc.
0000 Xxxxxxx Xxxxxxx
Xxxxxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: President
With a copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
89
If to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration
The Company, any Guarantor or the Trustee, by notice to the others may
designate additional or different addresses for subsequent notices or
communications.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other documents provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(a) the Trustee by any Holder or by the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing and
mailed, first-class postage prepaid or transmitted via facsimile, to or with the
Trustee at its Corporate Trust Office, or
(b) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid or transmitted via facsimile, to
the Company addressed to it at the address of its principal office specified in
the first paragraph of this Indenture or at any other address previously
furnished in writing to the Trustee by the Company.
ARTICLE 13
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 13.01. DISCLOSURE OF NAMES AND ADDRESSES OF HOLDERS.
Every Holder of Notes, by receiving and holding the same, agrees with the
Company and the Trustee that none of the Company or the Trustee or any agent of
either of them shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders in accordance with TIA
Section 312, regardless of the source from which such information was derived,
and that the Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under TIA Section 312(b).
Section 13.02. REPORTS BY TRUSTEE.
90
Within 60 days after May 15 of each year commencing with the first May 15
after the first issuance of Notes pursuant to this Indenture, the Trustee shall
transmit to the Holders of Notes, in the manner and to the extent provided in
TIA Section 313(c), a brief report dated as of such May 15 if required by TIA
Section 313(a).
Section 13.03. REPORTS BY COMPANY.
The Company shall:
(a) file with the Trustee such information as is required pursuant to
Section 4.11;
(b) file with the Trustee and the SEC, in accordance with rules and
regulations prescribed from time to time by the SEC, such additional
information, documents and reports with respect to compliance by the Company
with the conditions and covenants of this Indenture as may be required from time
to time by such rules and regulations; and
(c) transmit to all Holders, in the manner and to the extent provided in
TIA Section 313(c), within 30 days after the filing thereof with the Trustee,
such summaries of any information, documents and reports required to be filed by
the Company pursuant to clauses (a) and (b) of this Section 13.03 as may be
required by rules and regulations prescribed from time to time by the SEC.
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 or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
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.
Where this Indenture provides for notice of any event to Holders of Notes
by the Company or the Trustee, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed, first-class
postage prepaid, to each such Holder affected by such event, at his address as
it appears in the Security Register within the time prescribed for the giving of
such notice. In any case where notice to Holders of Notes is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed,
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders of Notes given as provided. Any notice mailed to a
Holder in the manner herein prescribed shall be
91
conclusively deemed to have been received by such Holder, whether or not such
Holder actually receives such notice.
In case, by reason of the suspension of or irregularities in regular mail
service or by reason of any other cause, it shall be impractical to mail notice
of any event to Holders of Notes when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Trustee shall be deemed to be sufficient
giving of such notice for every purpose hereunder.
Any request, demand, authorization, direction, notice, consent or waiver
required or permitted under this Indenture shall be in the English language.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
Section 13.04. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA Section 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company,
the Trustee, the Registrar and anyone else shall have the protection of TIA
Section 312(c).
Section 13.05. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably satisfactory
to the Trustee stating that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been satisfied; and
(b) 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 and covenants have been satisfied.
Section 13.06. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA
Section 314(e) and shall include:
92
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she 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
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been satisfied.
Section 13.07. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 13.08. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No past, present or future director, officer, employee, incorporator or
stockholder of the Company or any Guarantor, as such, shall have any liability
for any obligations of the Company or such Guarantor under the Notes, the Note
Guarantees, this Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
Section 13.09. GOVERNING LAW.
THE LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS
INDENTURE, THE NOTES AND THE NOTE GUARANTEES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 13.10. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
93
Section 13.11. SUCCESSORS.
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors. All agreements of each Guarantor in this Indenture shall bind its
successors, except as otherwise provided in Section 10.03.
Section 13.12. 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 13.13. COUNTERPART 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.
Section 13.14. TABLE OF CONTENTS, HEADINGS, ETC.
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 to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
Section 13.15. ACTS OF HOLDERS.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders of
the Outstanding Notes may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agents duly appointed in writing. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
or record or both are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument or instruments and any such record
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders signing such instrument or instruments
or so voting at any such meeting.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of authority. The fact
94
and date of the execution of any such instrument or writing, or the
authority of the Person executing the same, may also be proved in any other
manner which the Trustee deems sufficient.
(c) The principal amount and serial numbers of Notes held by any Person,
and the date of holding the same, shall be proved by the Security Register.
(d) If the Company shall solicit from the Holders of Notes any request,
demand, authorization, direction, notice, consent, waiver or other Act, the
Company may, at its option, by or pursuant to Board Resolution, fix in advance a
record date for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other Act, but the
Company shall have no obligation to do so. Notwithstanding TIA Section 316(c),
such record date shall be the record date specified in or pursuant to such Board
Resolution, which shall be a date not earlier than the date 60 days prior to the
first solicitation of Holders generally in connection therewith and not later
than the date such solicitation is completed. If such a record date is fixed,
such request, demand, authorization, direction, notice, consent, waiver or other
Act may be given before or after such record date, but only the Holders of
record at the close of business on such record date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of Outstanding Notes have authorized or agreed or consented to such
request, demand, authorization, direction, notice, consent, waiver or other Act,
and for that purpose the Outstanding Notes shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than eleven months after
the record date.
(e) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Note shall bind every future Holder of the
same Note and the Holder of every Note issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Note.
Section 13.16. LEGAL HOLIDAYS.
In any case where any interest payment date, redemption date, or Stated
Maturity or Maturity of any Note shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of any
Note) payment of interest or principal, premium, if any, need not be made at
such Place of Payment on such date, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if made
on the interest payment date or redemption date or at the Stated Maturity or
Maturity; provided, however that no interest shall accrue for the period from
and after such interest payment date, redemption date, Stated Maturity or
Maturity, as the case may be.
95
Section 13.17. BENEFITS OF INDENTURE.
Nothing in this Indenture or in the Notes, express or implied, shall give
to any Person, other than the parties hereto, any Authenticating Agent, any
Paying Agent, any Registrar and their successors hereunder and the Holders of
Notes, any benefit or any legal or equitable right, remedy or claim under this
Indenture.
ARTICLE 14
SUBORDINATION OF NOTES
Section 14.01. NOTES SUBORDINATED TO SENIOR INDEBTEDNESS.
The Company, each Guarantor and the Trustee each covenants and agrees, and
each Holder, by its acceptance of a Note, likewise covenants and agrees that all
Notes shall be issued subject to the provisions of this Article 14; and each
Person holding any Note, whether upon original issue or upon transfer,
assignment or exchange thereof, accepts and agrees that the payments of
principal of, premium if any, and interest, including Additional Interest, if
any, on the Notes, and all other Obligations on the Notes shall, to the extent
and in the manner set forth in this Article 14, be subordinated in right of
payment to the prior payment in full, in cash, of all existing and future Senior
Indebtedness of the Company (including any interest accruing on or subsequent
to, or which would have accrued but for the occurrence of, an event specified in
Section 6.01(g) of this Indenture, whether or not such interest is an allowed
claim enforceable against the debtor under the United States Bankruptcy Code);
PROVIDED, HOWEVER, that payment from the money or the proceeds of U.S.
Government Obligations held in any defeasance trust described in Article 8 is
not subordinated to any Senior Indebtedness or subject to the restrictions
described herein.
Section 14.02. NO PAYMENT ON NOTES IN CERTAIN CIRCUMSTANCES.
(a) The Company may not pay principal of, premium, if any, or interest,
including Additional Interest, if any, or other Obligations with respect to the
Notes or make any deposit pursuant to Article 8 and may not otherwise redeem,
purchase or retire any Notes (collectively, "pay the Notes") if:
(i) any Senior Indebtedness is not paid when due; or
(ii) any other default on Senior Indebtedness occurs and the
maturity of such Senior Indebtedness is accelerated in accordance with its
terms unless, in either case, the default has been cured or waived and/or
any such acceleration has been rescinded or such Senior Indebtedness has
been paid;
96
PROVIDED, HOWEVER, that the Company may pay the Notes without regard to the
foregoing if the Company and the Trustee receive written notice approving such
payment from the Representative of the Senior Indebtedness with respect to which
either of the events set forth in subclause (i) or (ii) of this Section 14.02(a)
has occurred and is continuing; and PROVIDED, FURTHER, that Holders of the Notes
may receive: (A) Qualified Capital Stock issued by Parent Guarantor or any of
its Restricted Subsidiaries to pay interest on the Notes or issued in exchange
for the Notes; (B) securities substantially identical to the Notes issued by the
Company in payment of interest accrued thereon; or (C) securities issued by the
Company which are subordinated to Senior Indebtedness at least to the same
extent as the Notes and having a Weighted Average Life to Maturity at least
equal to the remaining Weighted Average Life to Maturity of the Notes.
(b) During the continuance of any other default, other than a default
described in subclause (i) or (ii) of Section 14.02(a), with respect to any
Designated Senior Indebtedness pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be
required to effect such acceleration) or the expiration of any applicable grace
periods, the Company may not pay the Notes (except that holders of the notes may
receive (i) Qualified Capital Stock issued by Parent Guarantor or any of its
Restricted Subsidiaries to pay interest on the Notes or issued in exchange for
the Notes, (ii) securities substantially identical to the Notes issued by the
Company in payment of interest accrued thereon or (iii) securities issued by the
Company which are subordinated to Senior Indebtedness at least to the same
extent as the Notes and having a Weighted Average Life to Maturity at least
equal to the remaining Weighted Average Life to Maturity of the Notes) for a
period (a "Payment Blockage Period") commencing upon the receipt by the Trustee
(with a copy to the Company) of written notice (a "Blockage Notice") of such
default from the Representative of the holders of such Designated Senior
Indebtedness specifying an election to effect a Payment Blockage Period and
ending 179 days thereafter (or earlier if such Payment Blockage Period is
terminated (i) by written notice to the Trustee and the Company from the Person
or Persons who gave such Blockage Notice, (ii) because the default giving rise
to such Blockage Notice has been cured or waived or is no longer continuing or
(iii) because such Designated Senior Indebtedness has been repaid in full).
(c) Notwithstanding clause (b) of this Section 14.02, but subject to
clause (a) of Section 14.02 and clause of (a) Section 14.03, the Company may
resume payments on the Notes after the end of such Payment Blockage Period.
(d) Not more than one Blockage Notice may be given, and not more than one
Payment Blockage Period may occur, in any consecutive 360-day period,
irrespective of the number of defaults with respect to Designated Senior
Indebtedness during such period. However, if any Blockage Notice within such
360-day period is given by or on behalf of any holders of Designated Senior
Indebtedness (other than the agent under the Senior Credit Facility), the agent
under the Senior Credit Facility may give another Blockage Notice within such
period. In no event, however, may the total number of days during which any
Payment
97
Blockage Period or Payment Blockage Periods is in effect exceed 179 days in
the aggregate during any 360-consecutive-day period. No nonpayment default
that existed or was continuing on the date of delivery of any Blockage Notice
to the Trustee shall be, or be made, the basis for a subsequent Blockage
Notice unless such default shall have been cured or waived for a period of
not less than 90 consecutive days. The failure of the Company to pay
principal for more than five days after the date due or to pay interest,
including Additional Interest, if any, on the Notes for more than 30 days
after the scheduled payment date therefor as a result of the occurrence of a
Payment Blockage Period shall nevertheless constitute an Event of Default
under this Indenture. For the purposes of this Article 14 (but without
limiting the effect of any other provision of this Article 14), paying any
Obligation on the Notes shall include any payment or distribution of any kind
or character by the Company or Guarantor, by set-off or otherwise, including,
without limitation, any repurchase, redemption or acquisition of the Notes
and any direct or indirect payment payable by reason of any other
Indebtedness or Obligation being subordinated to the Notes.
(e) In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee or any Holder when such payment is prohibited by Section
14.02 of this Indenture, the Trustee shall promptly notify the representatives
of such Senior Indebtedness of such prohibited payment and such payment shall be
held in trust for the benefit of, and shall be paid over or delivered to, the
holders of Senior Indebtedness or their respective representatives, or to the
trustee or trustees under any indenture pursuant to which any of such Senior
Indebtedness may have been issued, as their respective interests may appear, but
only to the extent that, upon notice from the Trustee to the representatives of
such Senior Indebtedness that such prohibited payment has been made, such
representatives within 30 days of receipt of such notice from the Trustee
notifies the Trustee of the amounts then due and owing on the Senior
Indebtedness, if any, and only the amounts specified in such notice to the
Trustee shall be paid to the representatives of such Senior Indebtedness and any
excess above such amounts due and owing on Senior Indebtedness shall be paid to
the Company.
Section 14.03. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
(a) Upon any payment or distribution of assets or securities of the
Company of any kind or character, whether in cash, property or securities (other
than with the money, securities or proceeds held under any defeasance trust
established in accordance with this Indenture), in connection with any
dissolution or winding-up or total or partial liquidation or reorganization of
the Company, whether voluntary or involuntary, or in bankruptcy, insolvency,
receivership or other similar proceedings, any assignment for the benefit of
creditors or any marshalling of assets for the benefit of creditors, all amounts
due or to become due upon all Senior Indebtedness (including any interest
accruing on or subsequent to, or which would have accrued but for the occurrence
of, an event specified in Section 6.01(g), whether or not such interest is an
allowed claim enforceable against the debtor under the United States Bankruptcy
Code) shall first be paid in full, in cash, before the Holders or the Trustee on
their behalf shall be entitled to receive any
98
payment by (or on behalf of) the Company on account of Note Obligations, or
any payment to acquire any of the Notes for cash, property or securities, or
any distribution with respect to the Notes of any cash, property or
securities. Before any payment may be made by, or on behalf of, the Company
on any Note Obligations (other than with the money, securities or proceeds
held under any defeasance trust established in accordance with this
Indenture) in connection with any such dissolution, winding-up, liquidate,
reorganization, assignment, marshalling or proceeding, any payment or
distribution of assets or securities for the Company of any kind or
character, whether in cash, property or securities, to which the Holders or
the Trustee on their behalf would be entitled, but for the provisions of this
Article 14, shall be made by the Company or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other similar Person making such
payment or distribution, or by the Holders or the Trustee if received by them
or it, directly to the representatives of such Senior Indebtedness (PRO RATA
to such holders on the basis of the respective amounts of Senior Indebtedness
held by such holders) or their representatives or to any trustee or trustees
under any other indenture pursuant to which any such Senior Indebtedness may
have been issued, as their respective interests appear, to the extent
necessary to pay all such Senior Indebtedness in full, in cash or cash
equivalents after giving effect to any concurrent payment, distribution or
provision therefor to or for the representatives of such Senior Indebtedness
except that Holders of the Notes may receive:
(i) Qualified Capital Stock issued by Parent Guarantor or any of
its Restricted Subsidiaries to pay interest on the Notes or issued in
exchange for the Notes;
(ii) securities substantially identical to the Notes issued by the
Company in payment of interest accrued thereon; or
(iii) securities issued by the Company which are subordinated to
Senior Indebtedness at least to the same extent as the Notes and having a
Weighted Average Life to Maturity at least equal to the remaining Weighted
Average Life to Maturity of the Notes.
(b) To the extent any payment of Senior Indebtedness (whether by or on
behalf of the Company, as proceeds of security or enforcement of any right of
setoff or otherwise) is declared to be fraudulent or preferential, set aside or
required to be paid to any receiver, trustee in bankruptcy, liquidating trustee,
agent or other similar Person under any bankruptcy, insolvency, receivership,
fraudulent conveyance or similar law, then if such payment is recovered by, or
paid over to, such receiver, trustee in bankruptcy, liquidating trustee or other
similar Person, the Senior Indebtedness or part thereof originally intended to
be satisfied shall be deemed to be reinstated and outstanding as if such payment
had not occurred. To the extent the obligation to repay any Senior Indebtedness
is declared to be fraudulent, invalid, or otherwise set aside under any
bankruptcy, insolvency, receivership, fraudulent conveyance or similar law, then
the obligation so declared fraudulent, invalid or otherwise set aside (and all
other amounts that
99
would come due with respect thereto had such obligation not been so affected)
shall be deemed to be reinstated and outstanding as Senior Indebtedness for
all purposes hereof as if such declaration, invalidity or setting aside had
not occurred.
(c) In the event that, notwithstanding the foregoing provision prohibiting
such payment or distribution, any payment or distribution of assets or
securities of the Company of any kind or character, whether in cash, property or
securities, shall be received by the Trustee or any Holder at a time when such
payment or distribution is prohibited by Section 14.03(a) of this Indenture and
before all obligations in respect of Senior Indebtedness are paid in full, in
cash, such payment or distribution shall be received and held in trust for the
benefit of, and shall be paid over or delivered to, the representatives of such
Senior Indebtedness (PRO RATA to such holders on the basis of such respective
amount of Senior Indebtedness held by such holders) or their representatives, or
to the trustee or trustees under any indenture pursuant to which any such Senior
Indebtedness may have been issued, as their respective interests appear, for
application to the payment of Senior Indebtedness remaining unpaid until all
such Senior Indebtedness has been paid in full, in cash, after giving effect to
any concurrent payment, distribution or provision therefor to or for the holders
of such Senior Indebtedness.
(d) For purposes of this Section 14.03, the words "cash, property or
securities" shall not be deemed to include, so long as the effect of this clause
is not to cause the Notes to be treated in any case or proceeding or similar
event described in this Section 14.03 as part of the same class of claims as the
Senior Indebtedness or any class of claims PARI PASSU with, or senior to, the
Senior Indebtedness for any payment or distribution, securities of the Company
or any other corporation provided for by a plan of reorganization or
readjustment that are subordinated, at least to the extent that the Notes are
subordinated, to the payment of all Senior Indebtedness then outstanding;
PROVIDED that (1) if a new corporation results from such reorganization or
readjustment, such corporation assumes the Senior Indebtedness and (2) the
rights of the holders of the Senior Indebtedness are not, without the consent of
such holders, altered by such reorganization or readjustment. The consolidation
of the Company with, or the merger of the Company with or into, another
corporation or the liquidation or dissolution of the Company following the sale,
conveyance, transfer, lease or other disposition of all or substantially all of
its property and assets to another corporation upon the terms and conditions
provided in Article Five of this Indenture shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section 14.03
if such other corporation shall, as a part of such consolidation, merger, sale,
conveyance, transfer, lease or other disposition, comply (to the extent
required) with the conditions stated in Article Five of this Indenture.
Section 14.04. SUBROGATION.
(a) Upon the payment in full of all Senior Indebtedness in cash, the
Holders shall be subrogated to the rights of the holders of Senior Indebtedness
to receive payments or distributions of cash, property or securities of the
Company made on such Senior Indebtedness
100
until the principal of, premium, if any, and interest on the Notes shall be
paid in full; and, for the purposes of such subrogation, no payments or
distributions to the representatives of the holders of the Senior
Indebtedness of any cash, property or securities to which the Holders or the
Trustee on their behalf would be entitled except for the provisions of this
Article 14, and no payment pursuant to the provisions of this Article 14 to
the holders of Senior Indebtedness by Holders or the Trustee on their behalf
shall, as between the Company, its creditors other than holders of Senior
Indebtedness, and the Holders, be deemed to be a payment by the Company to or
on account of the Senior Indebtedness. It is understood that the provisions
of this Article 14 are intended solely for the purpose of defining the
relative rights of the Holders, on the one hand, and the holders of the
Senior Indebtedness, on the other hand.
(b) If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article 14 shall have been
applied, pursuant to the provisions of this Article 14, to the payment of all
amounts payable under Senior Indebtedness, then, and in such case, the Holders
shall be entitled to receive from the holders of such Senior Indebtedness any
payments or distributions received by such holders of Senior Indebtedness in
excess of the amount required to make payment in full, in cash, of such Senior
Indebtedness of such holders.
Section 14.05. OBLIGATIONS OF COMPANY UNCONDITIONAL.
(a) Nothing contained in this Article 14 or elsewhere in this Indenture or
in the Notes is intended to or shall impair, as among the Company and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay to the Holders the principal of, premium, if any, and interest on the Notes
as and when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of the Holders and
creditors of the Company other than the holders of the Senior Indebtedness, nor
shall anything herein or therein prevent the Holders or the Trustee on their
behalf from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under this Article
14 of the holders of the Senior Indebtedness.
(b) Without limiting the generality of the foregoing, nothing contained in
this Article 14 will restrict the right of the Trustee or the Holders to take
any action to declare the Notes to be due and payable prior to their stated
maturity pursuant to Section 6.01 of this Indenture or to pursue any rights or
remedies hereunder; PROVIDED, HOWEVER, that all Senior Indebtedness then due and
payable or thereafter declared to be due and payable shall first be paid in
full, in cash, before the Holders or the Trustee on behalf of the Holders are
entitled to receive any direct or indirect payment from the Company of Note
Obligations.
Section 14.06. NOTICE TO TRUSTEE.
101
(a) The Company shall give prompt written notice to the Trustee of any
fact known to the Company that would prohibit the making of any payment to or
by the Trustee in respect of the Notes pursuant to the provisions of this
Article 14. The Trustee shall not be charged with the knowledge of the
existence of any default or event of default with respect to any Senior
Indebtedness or of any other facts that would prohibit the making of any
payment to or by the Trustee unless and until the Trustee shall have received
notice in writing the Corporate Trust Office of the Trustee to that effect
signed by an Officer of the Company, or by a holder of Senior Indebtedness or
trustee or agent thereof; and prior to the receipt of any such written
notice, the Trustee shall, subject to Article 7, be entitled to assume that
no such facts exist; PROVIDED that, if the Trustee shall not have received
the notice provided for in this Section 14.06 at least three Business Days
prior to the date upon which, by the terms of this Indenture, any monies
shall become payable for any purpose (including, without limitation, the
payment of the principal of, premium, if any, or interest on any Note), then,
notwithstanding anything herein to the contrary, the Trustee shall have full
power and authority to receive any monies from the Company and to apply the
same to the purpose for which they were received, and shall not be affected
by any notice to the contrary that may be received by it on or after such
prior date except for an acceleration of the Notes prior to such application.
Nothing contained in this Section 14.06 shall limit the right of the holders
of Senior Indebtedness to recover payments as contemplated by this Article
14. The foregoing shall not apply if the Paying Agent is the Company. The
Trustee shall be entitled to rely in good faith on the delivery to it of a
written notice by a Person representing himself or itself to be a holder of
any Senior Indebtedness (or a trustee on behalf of, or other representative
of, such holder) to establish that such notice has been given by a holder of
such Senior Indebtedness or a trustee or representative on behalf of any such
holder.
(b) In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
this Article 14, the Trustee may request such Person to furnish evidence to
the reasonable satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such Person, the extent to which such Person is entitled
to participate in such payment or distribution and any other facts pertinent
to the rights of such Person under this Article 14 and, if such evidence is
not furnished to the Trustee, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to
receive such payment.
Section 14.07. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT.
102
Upon any payment or distribution of assets or securities referred to in
this Article 14, the Trustee and the Holders shall be entitled to rely upon
any order or decree made by any court of competent jurisdiction in which
bankruptcy, dissolution, winding-up, liquidation or reorganization
proceedings are pending, or upon a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, custodian, assignee for the benefit of
creditors, agent or other similar Person making such payment or distribution,
delivered to the Trustee or to the Holders for the purpose of ascertaining
the persons entitled to participate in such distribution, the holders of the
Senior Indebtedness and other Indebtedness of the Company, the amount thereof
or payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article 14, PROVIDED that such
court, trustee, receiver, custodian, assignee, agent or other Person has been
apprised of, or the order, decree or certificate makes reference to, the
provisions of this Article.
Section 14.08. TRUSTEE'S RELATION TO SENIOR INDEBTEDNESS.
(a) The Trustee and any Paying Agent shall be entitled to all the
rights set forth in this Article 14 with respect to any Senior Indebtedness
that may at any time be held by it in its individual or any other capacity to
the same extent as any other holder of Senior Indebtedness and nothing in
this Indenture shall deprive the Trustee or any Paying Agent of any of its
rights as such holder.
(b) With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article 14, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness
(except as provided in Sections 14.02(c) and 14.03(c) of this Indenture) and
shall not be liable to any such holders if the Trustee shall in good faith
mistakenly pay over or distribute to Holders of Notes or to the Company or to
any other person cash, property or securities to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article 14 or otherwise.
Section 14.09. SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS OF THE
COMPANY OR HOLDERS OF SENIOR INDEBTEDNESS.
No right of any present or future holders of any Senior Indebtedness to
enforce subordination as provided in this Article 14 will at any time in any
way be prejudiced or impaired by any act or failure to act on the part of the
Company or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Company with the terms of this Indenture,
regardless of any knowledge thereof that any such holder may have or
otherwise be charged with. The provisions of this Article 14 are intended to
be for the benefit of, and shall be enforceable directly by, the holders of
Senior Indebtedness.
103
Section 14.10. HOLDERS AUTHORIZE TRUSTEE TO EFFECTUATE SUBORDINATION OF
NOTES.
Each Holder by his acceptance of any Notes authorizes and expressly
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article 14, and
appoints the Trustee his attorney-in-fact for such purposes, including, in
the event of any dissolution, winding-up, liquidation or reorganization of
the Company (whether in bankruptcy, insolvency, receivership, reorganization
or similar proceedings or upon an assignment for the benefit of creditors or
otherwise) tending towards liquidation of the property and assets of the
Company, the filing of a claim for the unpaid balance of its Notes in the
form required in those proceedings. If the Trustee does not file a proper
claim or proof in indebtedness in the form required in such proceeding at
least 30 days before the expiration of the time to file such claim or claims,
each holder of Senior Indebtedness is hereby authorized to file an
appropriate claim for and on behalf of the Holders.
Section 14.11. NOT TO PREVENT EVENTS OF DEFAULT.
The failure to make a payment on account of principal of, premium, if
any, or interest on the Notes by reason of any provision of this Article 14
will not be construed as preventing the occurrence of an Event of Default.
Section 14.12. TRUSTEE'S COMPENSATION NOT PREJUDICED.
Nothing in this Article 14 will apply to amounts due to the Trustee
pursuant to other sections of this Indenture, including without limitation
Section 7.07.
Section 14.13. NO WAIVER OF SUBORDINATION PROVISIONS.
Without in any way limiting the generality of Section 14.09, 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 Holders, without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article 14 or the obligations hereunder of the
Holders to the holders of Senior Indebtedness, do any one or more of the
following: (a) change the manner, place or terms of payment or extend or
shorten the time of payment of, or renew or alter, Senior Indebtedness or any
instrument evidencing the same or any agreement under which Senior
Indebtedness is outstanding or secured; (b) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing
Senior Indebtedness; (c) release any Person liable in any manner for the
collection of Senior Indebtedness; and (d) exercise or refrain from
exercising any rights against the Company and any other Person.
Section 14.14. PAYMENTS MAY BE PAID PRIOR TO DISSOLUTION.
104
Nothing contained in this Article 14 or elsewhere in this Indenture
shall prevent (i) the Company except under the conditions described in
Section 14.02 or 14.03, from making payments of principal of, premium, if
any, and interest on the Notes, or from depositing with the Trustee any money
for such payments, or (ii) the application by the Trustee of any money
deposited with it for the purpose of making such payments of principal of,
premium, if any, and interest on the Notes to the holders entitled thereto
unless, at least three Business Days prior to the date upon which such
payment becomes due and payable, the Trustee shall have received the written
notice provided for in Section 14.02(b) of this Indenture (or there shall
have been an acceleration of the Notes prior to such application) or in
Section 14.06 of this Indenture. The Company shall give prompt written
notice to the Trustee of any dissolution, winding up, liquidation or
reorganization of, or similar proceeding (including any assignment for the
benefit of creditors or any marshalling of assets) with respect to, the
Company.
Section 14.15. CONSENT OF HOLDERS OF SENIOR INDEBTEDNESS UNDER THE SENIOR
CREDIT FACILITY.
The provisions of this Article 14 (including the definitions contained
in this Article and references to this Article contained in this Indenture)
shall not be amended in a manner that would adversely affect the rights of
the holders of Senior Indebtedness under the Senior Credit Facility, and no
such amendment shall become effective unless the holders of Senior
Indebtedness under the Senior Credit Facility shall have consented (in
accordance with the provisions of the Senior Credit Facility) to such
amendment. The Trustee shall be entitled to receive and rely on an Officers'
Certificate stating that such consent has been given.
Section 14.16. 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 Eight by the Trustee for the payment of principal of, premium, if
any, and interest on the Notes shall not be subordinated to the prior payment
of any Senior Indebtedness, and none of the Holders shall be obligated to pay
over any such amount to any holder of Senior Indebtedness.
Section 14.17. NOTICE TO REPRESENTATIVE OF DESIGNATED SENIOR INDEBTEDNESS.
If payment of the Notes is accelerated because of an Event of Default,
the Company or the Trustee shall promptly notify the Representative (if any)
of any issue of Designated Senior Indebtedness which is then outstanding;
PROVIDED, HOWEVER, that the Company and the Trustee shall be obligated to
notify such a Representative (other than with respect to the Senior Credit
Facility) only if such Representative has delivered or caused to be delivered
an address for the service of such a notice to the Company and the Trustee
(and the Company and the Trustee shall be obligated only to deliver the
notice to the address so specified). If a notice is required pursuant to the
immediately preceding sentence, the Company may not pay the Notes (except
payment (i) in Qualified Capital Stock issued by Parent Guarantor or any of
its Restricted
105
Subsidiaries to pay interest on the Notes or issued in exchange for the
Notes, (ii) in securities substantially identical to the Notes issued by the
Company in payment of interest accrued thereon or (iii) in securities issued
by the Company which are subordinated to the Senior Indebtedness at least to
the same extent as the Notes and have a Weighted Average Life to Maturity at
least equal to the remaining Weighted Average Life to Maturity of the Notes),
until five Business Days after the respective Representative of the
Designated Senior Indebtedness receives notice (at the address specified in
the preceding sentence) of such acceleration and, thereafter, may pay the
Notes only if the subordination provisions of this Indenture otherwise permit
payment at that time.
ARTICLE 15
SUBORDINATION OF NOTE GUARANTEES
Section 15.01. NOTE GUARANTEES SUBORDINATED TO GUARANTOR SENIOR INDEBTEDNESS.
Each Guarantor and the Trustee each covenants and agrees, and each
Holder, by its acceptance of a Note Guarantee, likewise covenants and agrees
that all Note Guarantees shall be issued subject to the provisions of this
Article 15; and each Person holding any Note, whether upon original issue or
upon transfer, assignment or exchange thereof, accepts and agrees that all
Obligations on the Note Guarantees shall, to the extent and in the manner set
forth in this Article 15, be subordinated in right of payment to the prior
payment in full, in cash, of all existing and future Guarantor Senior
Indebtedness of such Guarantor (including any interest accruing on or
subsequent to, or which would have accrued but for the occurrence of an event
specified in Section 6.01(g) of this Indenture, whether or not such interest
is an allowed claim enforceable against the debtor under the United States
Bankruptcy Code).
Section 15.02. NO PAYMENT ON NOTE GUARANTEES IN CERTAIN CIRCUMSTANCES.
(a) A Guarantor may not fulfill any Obligations with respect to such
Guarantor's Note Guarantee if:
(i) any Guarantor Senior Indebtedness of such Guarantor is not
paid when due; or
(ii) any other default on such Guarantor Senior Indebtedness occurs
and the maturity of such Guarantor Senior Indebtedness is accelerated in
accordance with its terms unless, in either case, the default has been
cured or waived and/or any such acceleration has been rescinded or such
Guarantor Senior Indebtedness has been paid;
PROVIDED, HOWEVER, that such Guarantor may fulfill its Obligations on such
Note Guarantee without regard to the foregoing if such Guarantor and the
Trustee receive written notice approving such fulfillment from the
Representative of such Guarantor Senior Indebtedness with respect to which
either of the events set forth in subclause (i) or (ii) of this Section
15.02(a) has
106
occurred and is continuing; and provided, further, that Holders of the Notes
may receive: (A) Qualified Capital Stock issued by Parent Guarantor or any of
its Restricted Subsidiaries to pay interest on the Notes or issued in
exchange for the Notes; (B) guarantees by the Guarantors of securities
substantially identical to the Notes; or (C) guarantees by the Guarantors of
securities issued by the Company which are subordinated to Guarantor Senior
Indebtedness at least to the same extent as the Note Guarantees and having a
Weighted Average Life to Maturity at least equal to the remaining Weighted
Average Life to Maturity of the Note Guarantees.
(b) During the continuance of any other default, other than a default
described in subclause (i) or (ii) of Section 15.02(a), with respect to any
Designated Guarantor 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 fulfill
its Obligations on such Note Guarantee (except that Holders of the Notes may
receive: (A) Qualified Capital Stock issued by Parent Guarantor or any of its
Restricted Subsidiaries to pay interest on the Notes or issued in exchange
for the Notes; (B) guarantees by the Guarantors of securities substantially
identical to the Notes; or (C) guarantees by the Guarantors of securities
issued by the Company which are subordinated to Guarantor Senior Indebtedness
at least to the same extent as the Note Guarantees and having a Weighted
Average Life to Maturity at least equal to the remaining Weighted Average
Life to Maturity of the Note Guarantees) for a period (a "Guarantee Payment
Blockage Period") commencing upon the receipt by the Trustee (with a copy to
such Guarantor) of written notice (a "Guarantee Blockage Notice") of such
default from the Representative of the holders of such Designated Guarantor
Senior Indebtedness specifying an election to effect a Guarantee Payment
Blockage Period and ending 179 days thereafter (or earlier if such Guarantee
Payment Blockage Period is terminated (i) by written notice to the Trustee
and such Guarantor from the Person or Persons who gave such Guarantee
Blockage Notice, (ii) because the default giving rise to such Guarantee
Blockage Notice has been cured or waived or is no longer continuing or (iii)
because such Designated Guarantor Senior Indebtedness has been repaid in
full).
(c) Notwithstanding clause (b) of this Section 15.02, but subject to
clause (a) of Section 15.02 and clause (a) and Section 15.03, such Guarantor
may resume fulfillment of its Obligations on such Note Guarantee after the
end of such Guarantee Payment Blockage Period.
(d) Not more than one Guarantee Blockage Notice may be given, and not
more than one Guarantee Payment Blockage Period may occur, in any consecutive
360-day period, irrespective of the number of defaults with respect to
Designated Guarantor Senior Indebtedness during such period. However, if any
Guarantee Blockage Notice within such 360-day period is given by or on behalf
of any holders of Designated Guarantor Senior Indebtedness (other than the
agent under the Senior Credit Facility), the agent under the Senior Credit
Facility may give another Guarantee Blockage Notice within such period. In
no event, however, may the total number of days during which any Guarantee
Payment Blockage Period or Guarantee Payment
107
Blockage Periods is in effect exceed 179 days in the aggregate during any
360-consecutive-day period. No nonpayment default that existed or was
continuing on the date of delivery of any Guarantee Blockage Notice to the
Trustee shall be, or be made, the basis for a subsequent Guarantee Blockage
Notice unless such default shall have been cured or waived for a period of
not less than 90 consecutive days. For the purposes of this Article 15 (but
without limiting the effect of any other provision of this Article 15),
paying any Obligation on the Note Guarantee shall include any payment or
distribution of any kind or character by such Guarantor, by set-off or
otherwise, including, without limitation, any repurchase, redemption or
acquisition of the Notes and any direct or indirect payment payable by reason
of any other Indebtedness or Obligation being subordinated to the Notes.
(e) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by
Section 15.02 of this Indenture, the Trustee shall promptly notify the
representatives of such Guarantor Senior Indebtedness of such prohibited
payment and such payment shall be held in trust for the benefit of, and shall
be paid over or delivered to, the holders of Guarantor Senior Indebtedness or
their respective representatives, or to the trustee or trustees under any
indenture pursuant to which any of such Guarantor Senior Indebtedness may
have been issued, as their respective interests may appear, but only to the
extent that, upon notice from the Trustee to the representatives of such
Guarantor Senior Indebtedness that such prohibited payment has been made,
such representatives within 30 days of receipt of such notice from the
Trustee notifies the Trustee of the amounts then due and owing on the
Guarantor Senior Indebtedness, if any, and only the amounts specified in such
notice to the Trustee shall be paid to the representatives of such Guarantor
Senior Indebtedness and any excess above such amounts due and owing on
Guarantor Senior Indebtedness shall be paid to such Guarantor.
Section 15.03. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
(a) Upon any payment or distribution of the assets of a Guarantor upon
a total or partial liquidation or dissolution or bankruptcy or reorganization
or similar proceeding relating to such Guarantor or its property, an
assignment for the benefit of creditors or any marshaling of such Guarantor's
assets and liabilities, the holders of Guarantor Senior Indebtedness will be
entitled to receive payment in full in cash of the Guarantor Senior
Indebtedness before the holders of the Note Guarantees are entitled to
receive any payment or distribution, and until the Guarantor Senior
Indebtedness is paid in full in cash, any payment or distribution to which
holders of the Note Guarantees would be entitled but for this Article 15 will
be made to holders of the Guarantor Senior Indebtedness as their interests
may appear (except that holders of the Note Guarantees may receive: (A)
Qualified Capital Stock issued by Parent Guarantor or any of its Restricted
Subsidiaries to pay interest on the Notes or issued in exchange for the
Notes; (B) guarantees by the Guarantors of securities substantially identical
to the Notes; or (C) guarantees by the Guarantors of securities issued by the
Company which are subordinated to Guarantor Senior Indebtedness at least to
the same extent as the Note Guarantees and having a
108
Weighted Average Life to Maturity at least equal to the remaining Weighted
Average Life to Maturity of the Note Guarantees).
(b) To the extent any payment of Guarantor Senior Indebtedness (whether
by or on behalf of such Guarantor, as proceeds of security or enforcement of
any right of setoff or otherwise) is declared to be fraudulent or
preferential, set aside or required to be paid to any receiver, trustee in
bankruptcy, liquidating trustee, agent or other similar Person under any
bankruptcy, insolvency, receivership, fraudulent conveyance or similar law,
then if such payment is recovered by, or paid over to, such receiver, trustee
in bankruptcy, liquidating trustee or other similar Person, the Guarantor
Senior Indebtedness or part thereof originally intended to be satisfied shall
be deemed to be reinstated and outstanding as if such payment had not
occurred. To the extent the obligation to repay any Guarantor Senior
Indebtedness is declared to be fraudulent, invalid, or otherwise set aside
under any bankruptcy, insolvency, receivership, fraudulent conveyance or
similar law, then the obligation so declared fraudulent, invalid or otherwise
set aside (and all other amounts that would come due with respect thereto had
such obligation not been so affected) shall be deemed to be reinstated and
outstanding as Guarantor Senior Indebtedness for all purposes hereof as if
such declaration, invalidity or setting aside had not occurred.
(c) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of
assets or securities of such Guarantor of any kind or character, whether in
cash, property or securities, shall be received by the Trustee or any Holder
at a time when such payment or distribution is prohibited by Section 15.03(a)
of this Indenture and before all obligations in respect of Guarantor Senior
Indebtedness are paid in full, in cash, such payment or distribution shall be
received and held in trust for the benefit of, and shall be paid over or
delivered to, the representatives of such Guarantor Senior Indebtedness (PRO
RATA to such holders on the basis of such respective amount of Guarantor
Senior Indebtedness held by such holders) or their representatives, or to the
trustee or trustees under any indenture pursuant to which any such Guarantor
Senior Indebtedness may have been issued, as their respective interests
appear, for application to the payment of Guarantor Senior Indebtedness
remaining unpaid until all such Guarantor Senior Indebtedness has been paid
in full, in cash, after giving effect to any concurrent payment, distribution
or provision therefor to or for the holders of such Guarantor Senior
Indebtedness.
(d) For purposes of this Section 15.03, the words "cash, property or
securities" shall not be deemed to include, so long as the effect of this clause
is not to cause the Note Guarantees to be treated in any case or proceeding or
similar event described in this Section 15.03 as part of the same class of
claims as the Guarantor Senior Indebtedness or any class of claims PARI PASSU
with, or senior to, the Guarantor Senior Indebtedness for any payment or
distribution, securities of such Guarantor or any other corporation provided for
by a plan of reorganization or readjustment that are subordinated, at least to
the extent that the Note Guarantees are subordinated, to the payment of all
Guarantor Senior Indebtedness then outstanding; PROVIDED
109
that (1) if a new corporation results from such reorganization or
readjustment, such corporation assumes the Guarantor Senior Indebtedness and
(2) the rights of the holders of the Guarantor Senior Indebtedness are not,
without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Parent Guarantor with, or the merger
of the Parent Guarantor with or into, another corporation or the liquidation
or dissolution of the Parent Guarantor following the sale, conveyance,
transfer, lease or other disposition of all or substantially all of its
property and assets to another corporation upon the terms and conditions
provided in Article 5 of this Indenture shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section
15.03 if such other corporation shall, as a part of such consolidation,
merger, sale, conveyance, transfer, lease or other disposition, comply (to
the extent required) with the conditions stated in Article 5 of this
Indenture.
Section 15.04. SUBROGATION.
(a) Upon the payment in full of all Guarantor Senior Indebtedness of a
Guarantor in cash, the Holders shall be subrogated to the rights of the
holders of such Guarantor Senior Indebtedness to receive payments or
distributions of cash, property or securities of such Guarantor made on such
Guarantor Senior Indebtedness until the Obligations on the Note Guarantee of
such Guarantor is fulfilled; and, for the purposes of such subrogation, no
payments or distributions to the representatives of the holders of such
Guarantor Senior Indebtedness of any cash, property or securities to which
the Holders or the Trustee on their behalf would be entitled except for the
provisions of this Article 15, and no payment pursuant to the provisions of
this Article 15 to the holders of Guarantor Senior Indebtedness by Holders or
the Trustee on their behalf shall, as between such Guarantor, its creditors
other than holders of such Guarantor Senior Indebtedness, and the Holders, be
deemed to be a payment by such Guarantor to or on account of such Guarantor
Senior Indebtedness. It is understood that the provisions of this Article 15
are intended solely for the purpose of defining the relative rights of the
Holders, on the one hand, and the holders of such Guarantor Senior
Indebtedness, on the other hand.
(b) If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article 15 shall have been
applied, pursuant to the provisions of this Article 15, to the payment of all
amounts payable under Guarantor Senior Indebtedness, then, and in such case,
the Holders shall be entitled to receive from the holders of such Guarantor
Senior Indebtedness any payments or distributions received by such holders of
Guarantor Senior Indebtedness in excess of the amount required to make
payment in full, in cash, of such Guarantor Senior Indebtedness of such
holders.
Section 15.05. OBLIGATIONS OF GUARANTOR UNCONDITIONAL.
(a) Nothing contained in this Article 15 or elsewhere in this Indenture or
in the Notes is intended to or shall impair, as among a Guarantor and the
Holders, the obligation of such Guarantor, which is absolute and unconditional,
to fulfill its Obligations on the Note Guarantee
110
as and when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of the Holders
and creditors of such Guarantor other than the holders of such Guarantor
Senior Indebtedness, nor shall anything herein or therein prevent the Holders
or the Trustee on their behalf from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article 15 of the holders of such Guarantor Senior
Indebtedness.
(b) Without limiting the generality of the foregoing, nothing contained
in this Article 15 will restrict the right of the Trustee or the Holders to
take any action to declare the Notes to be due and payable prior to their
stated maturity pursuant to Section 6.01 of this Indenture or to pursue any
rights or remedies hereunder; PROVIDED, HOWEVER, that all Guarantor Senior
Indebtedness then due and payable or thereafter declared to be due and
payable shall first be paid in full, in cash, before the Holders or the
Trustee on behalf of the Holders are entitled to receive any direct or
indirect payment from such Guarantor of Obligations on such Note Guarantee.
Section 15.06. NOTICE TO TRUSTEE.
(a) A Guarantor shall give prompt written notice to the Trustee of any
fact known to such Guarantor that would prohibit the making of any payment to
or by the Trustee in respect of the Note Guarantee of such Guarantor pursuant
to the provisions of this Article 15. The Trustee shall not be charged with
the knowledge of the existence of any default or event of default with
respect to any Guarantor Senior Indebtedness or of any other facts that would
prohibit the making of any payment to or by the Trustee unless and until the
Trustee shall have received notice in writing the Corporate Trust Office of
the Trustee to that effect signed by an Officer of such Guarantor, or by a
holder of Guarantor Senior Indebtedness or trustee or agent thereof; and
prior to the receipt of any such written notice, the Trustee shall, subject
to Article 7, be entitled to assume that no such facts exist. Nothing
contained in this Section 15.06 shall limit the right of the holders of
Guarantor Senior Indebtedness to recover payments as contemplated by this
Article 15. The Trustee shall be entitled to rely in good faith on the
delivery to it of a written notice by a Person representing himself or itself
to be a holder of any Guarantor Senior Indebtedness (or a trustee on behalf
of, or other representative of, such holder) to establish that such notice
has been given by a holder of such Guarantor Senior Indebtedness or a trustee
or representative on behalf of any such holder.
(b) In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Guarantor Senior Indebtedness to participate in any payment or distribution
pursuant to this Article 15, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Guarantor Senior Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this Article 15 and,
if such evidence is not furnished to the Trustee, the Trustee
111
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
Section 15.07. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT.
Upon any payment or distribution of assets or securities referred to in
this Article 15, the Trustee and the Holders shall be entitled to rely upon
any order or decree made by any court of competent jurisdiction in which
bankruptcy, dissolution, winding-up, liquidation or reorganization
proceedings are pending, or upon a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, custodian, assignee for the benefit of
creditors, agent or other similar Person making such payment or distribution,
delivered to the Trustee or to the Holders for the purpose of ascertaining
the persons entitled to participate in such distribution, the holders of the
Guarantor Senior Indebtedness and other Indebtedness of a 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 15, PROVIDED
that such court, trustee, receiver, custodian, assignee, agent or other
Person has been apprised of, or the order, decree or certificate makes
reference to, the provisions of this Article.
Section 15.08. TRUSTEE'S RELATION TO GUARANTOR SENIOR INDEBTEDNESS.
(a) The Trustee and any Paying Agent shall be entitled to all the
rights set forth in this Article 15 with respect to any Guarantor Senior
Indebtedness that may at any time be held by it in its individual or any
other capacity to the same extent as any other holder of Guarantor Senior
Indebtedness and nothing in this Indenture shall deprive the Trustee or any
Paying Agent of any of its rights as such holder.
(b) With respect to the holders of Guarantor Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article 15, and no implied
covenants or obligations with respect to the holders of Guarantor Senior
Indebtedness shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of
Guarantor Senior Indebtedness (except as provided in Sections 15.02(c) and
15.03(c) of this Indenture) and shall not be liable to any such holders if
the Trustee shall in good faith mistakenly pay over or distribute to Holders
of Note Guarantees or to a Guarantor or to any other person cash, property or
securities to which any holders of Guarantor Senior Indebtedness shall be
entitled by virtue of this Article 15 or otherwise.
Section 15.09. SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS OF A
GUARANTOR OR HOLDERS OF GUARANTOR SENIOR INDEBTEDNESS.
No right of any present or future holders of any Guarantor Senior
Indebtedness to enforce subordination as provided in this Article 15 will at any
time in any way be prejudiced or
112
impaired by any act or failure to act on the part of a Guarantor or by any
act or failure to act, in good faith, by any such holder, or by any
noncompliance by such Guarantor with the terms of this Indenture, regardless
of any knowledge thereof that any such holder may have or otherwise be
charged with. The provisions of this Article 15 are intended to be for the
benefit of, and shall be enforceable directly by, the holders of Guarantor
Senior Indebtedness.
Section 15.10. HOLDERS AUTHORIZE TRUSTEE TO EFFECTUATE SUBORDINATION OF NOTE
GUARANTEES.
Each Holder by his acceptance of any Note Guarantees authorizes and
expressly directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article 15, and appoints the Trustee his attorney-in-fact for such purposes,
including, in the event of any dissolution, winding-up, liquidation or
reorganization of a Guarantor (whether in bankruptcy, insolvency,
receivership, reorganization or similar proceedings or upon an assignment for
the benefit of creditors or otherwise) tending towards liquidation of the
property and assets of such Guarantor, the filing of a claim for the unpaid
balance in connection with a Note Guarantee of such Guarantor in the form
required in those proceedings. If the Trustee does not file a proper claim
or proof in indebtedness in the form required in such proceeding at least 30
days before the expiration of the time to file such claim or claims, each
holder of Guarantor Senior Indebtedness is hereby authorized to file an
appropriate claim for and on behalf of the Holders.
Section 15.11. NOT TO PREVENT EVENTS OF DEFAULT.
The failure to fulfill all of the Obligations on the Note Guarantees by
reason of any provision of this Article 15 will not be construed as
preventing the occurrence of an Event of Default.
Section 15.12. TRUSTEE'S COMPENSATION NOT PREJUDICED.
Nothing in this Article 15 will apply to amounts due to the Trustee
pursuant to other sections of this Indenture, including without limitation
Section 7.07.
Section 15.13. NO WAIVER OF SUBORDINATION PROVISIONS.
Without in any way limiting the generality of Section 15.09, the holders
of Guarantor Senior Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders, without
incurring responsibility to the Holders and without impairing or releasing
the subordination provided in this Article 15 or the obligations hereunder of
the Holders to the holders of Guarantor Senior Indebtedness, do any one or
more of the following: (a) change the manner, place or terms of payment or
extend or shorten the time of payment of, or renew or alter, Guarantor Senior
Indebtedness or any instrument evidencing the same or any agreement under
which Guarantor Senior Indebtedness is outstanding or secured; (b) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing
113
Guarantor Senior Indebtedness; (c) release any Person liable in any manner
for the collection of Guarantor Senior Indebtedness; and (d) exercise or
refrain from exercising any rights against a Guarantor and any other Person.
Section 15.14. PAYMENTS MAY BE PAID PRIOR TO DISSOLUTION.
Nothing contained in this Article 15 or elsewhere in this Indenture
shall prevent a Guarantor, except under the conditions described in Section
15.02 or 15.03, from fulfilling its Obligations on the Note Guarantee of such
Guarantor. Such Guarantor shall give prompt written notice to the Trustee of
any dissolution, winding up, liquidation or reorganization of, or similar
proceeding (including any assignment for the benefit of creditors or any
marshalling of assets) with respect to, such Guarantor.
Section 15.15. CONSENT OF HOLDERS OF GUARANTOR SENIOR INDEBTEDNESS UNDER THE
SENIOR CREDIT FACILITY.
The provisions of this Article 15 (including the definitions contained
in this Article and references to this Article contained in this Indenture)
shall not be amended in a manner that would adversely affect the rights of
the holders of Guarantor Senior Indebtedness under the Senior Credit
Facility, and no such amendment shall become effective unless the holders of
Guarantor Senior Indebtedness under the Senior Credit Facility shall have
consented (in accordance with the provisions of the Senior Credit Facility)
to such amendment. The Trustee shall be entitled to receive and rely on an
officers' certificate of a Guarantor stating that such consent has been given.
Section 15.16. NOTICE TO REPRESENTATIVE OF DESIGNATED GUARANTOR SENIOR
INDEBTEDNESS.
If the Obligations on the Note Guarantee of a Guarantor is accelerated
because of an Event of Default, such Guarantor or the Trustee shall promptly
notify the Representative (if any) of any issue of Designated Guarantor
Senior Indebtedness which is then outstanding; PROVIDED, HOWEVER, that such
Guarantor and the Trustee shall be obligated to notify such a Representative
(other than with respect to the Senior Credit Facility) only if such
Representative has delivered or caused to be delivered an address for the
service of such a notice to such Guarantor and the Trustee (and such
Guarantor and the Trustee shall be obligated only to deliver the notice to
the address so specified). If a notice is required pursuant to the
immediately preceding sentence, such Guarantor may not fulfill its
Obligations on such Note Guarantee (except payment in Qualified Capital Stock
issued by the Parent Guarantor or any of its Restricted Subsidiaries to pay
interest on the Notes or issued in exchange for the Notes until five Business
Days after the respective Representative of the Designated Guarantor Senior
Indebtedness receives notice (at the address specified in the preceding
sentence) of such acceleration and, thereafter, may fulfill its Obligations
on such Note Guarantee only if the subordination provisions of this Indenture
otherwise permit payment at that time.
114
SIGNATURES
Dated as of December 21, 1998
PROTECTION ONE ALARM MONITORING, INC.
By: /s/ Xxxx X. Xxxxx
--------------------------------
Name: Xxxx X. Xxxxx
Title: Executive Vice President
PROTECTION ONE, INC.
By: /s/ Xxxx X. Xxxxx
--------------------------------
Name: Xxxx X. Xxxxx
Title: Executive Vice President
PROTECTION ONE INTERNATIONAL, INC.
By: /s/ Xxxxxxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxxxxxx X. Xxxxxxx
Title: Vice President
PROTECTION ONE INVESTMENTS, INC.
By: /s/ Xxxxxxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxxxxxx X. Xxxxxxx
Title: Vice President
DSC ENTERPRISES, INC.
By: /s/ Xxxxxxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxxxxxx X. Xxxxxxx
Title: Vice President
NETWORK MULTI-FAMILY SECURITY CORPORATION
By: /s/ Xxx XxXxxxxx
--------------------------------
Name: Xxx XxXxxxxx
Title: Vice President and
Chief Financial Officer
COMSEC NARRAGANSETT SECURITY, INC.
By: /s/ Xxxxxxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxxxxxx X. Xxxxxxx
Title: Vice President
THE BANK OF NEW YORK
/s/ Xxxx X. Xxxxx
--------------------------------
Name: Xxxx X. Xxxxx
Title: Assistant Vice President
EXHIBIT A
[APPLICABLE LEGENDS]
[FACE OF NOTE]
PROTECTION ONE ALARM MONITORING, INC.
8 1/8% Senior Subordinated Note due 2009
CUSIP [__________]
No. ____ $_________
PROTECTION ONE ALARM MONITORING, INC., a Delaware corporation (the
"Company", which term includes any successor under the Indenture hereinafter
referred to), for value received, promises to pay to _____________, or its
registered assigns, the principal sum of ______________________ ($____________)
on January 15, 2009.
Interest Payment Dates: January 15 and July 15, commencing July 15, 1999
Regular Record Dates: January 1 and July 1.
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.
A-2
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
or by facsimile by its duly authorized officers.
PROTECTION ONE ALARM MONITORING, INC.
By:
------------------------------------
Name:
Title:
(Trustee's Certificate of Authentication)
This is one of the 8 1/8% Senior Subordinated Notes due 2009 described in the
within-mentioned Indenture.
Date:
THE BANK OF NEW YORK,
as Trustee
By:
------------------------------------
Authorized Signatory
A-3
[REVERSE SIDE OF NOTE]
PROTECTION ONE ALARM MONITORING, INC.
8 1/8% Senior Subordinated Note due 2009
1. PRINCIPAL AND INTEREST.
The Company will pay the principal of this Note on January 15, 2009.
The Company promises to pay interest on the principal amount of this Note
on each Interest Payment Date, as set forth below, at the rate per annum shown
above.
Interest will be payable semiannually (to the holders of record of the
Notes at the close of business on the January 1 or July 1 immediately preceding
the Interest Payment Date) on each Interest Payment Date, commencing July 15,
1999.
If an exchange offer (the "Exchange Offer") registered under the Securities
Act is not consummated and a shelf registration statement (the "Shelf
Registration Statement") under the Securities Act with respect to resales of the
Notes is not declared effective by the SEC, on or before June 21, 1999 in
accordance with the terms of the Registration Rights Agreement dated
December 21, 1998 between the Company and Xxxxxx Xxxxxxx & Co. Incorporated,
Chase Securities Inc., First Union Capital Markets, a division of Wheat First
Securities, Inc., NationsBanc Xxxxxxxxxx Securities LLC and TD Securities (USA)
Inc., the annual interest rate borne by the Notes shall be increased by 0.5% per
annum from the rate shown above accruing from June 21, 1999, payable in cash
semiannually, in arrears, on each Interest Payment Date, commencing January 15,
2000 until the Exchange Offer is consummated or the Shelf Registration Statement
is declared effective. The Holder of this Note is entitled to the benefits of
such Registration Rights Agreement.
Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from December 21, 1998,
PROVIDED that, if there is no existing default in the payment of interest and
this Note is authenticated between a Regular Record Date referred to on the face
hereof and the next succeeding Interest Payment Date, interest shall accrue from
such Interest Payment Date. Interest will be computed on the basis of a 360-day
year of twelve 30-day months.
2. METHOD OF PAYMENT.
A-4
The Company will pay interest on the principal amount of the Notes as
provided above on each January 15 and July 15, commencing July 15, 1999 to the
persons who are Holders (as reflected in the Security Register at the close of
business on the January 1 or July 1 immediately preceding the Interest Payment
Date), in each case, even if the Note is cancelled on registration of transfer
or registration of exchange after such record date; PROVIDED that, with respect
to the payment of principal, the Company will make payment to the Holder that
surrenders this Note to a Paying Agent on or after January 15, 2009.
The Company will pay principal, premium, if any, and as provided above,
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the Company may pay
principal, premium, if any, and interest by its check payable in such money. It
may mail an interest check to a Holder's registered address (as reflected in the
Security Register). If a payment date is a date other than a Business Day at a
place of payment, payment may be made at that place on the next succeeding day
that is a Business Day and no interest shall accrue for the intervening period.
3. PAYING AGENT AND REGISTRAR.
Initially, the Trustee will act as authenticating agent, a Paying Agent and
the Registrar. The Company may change any authenticating agent, Paying Agent or
Transfer Agent without notice. The Company, any Subsidiary or any Affiliate of
any of them may act as a Paying Agent or a Transfer Agent.
4. INDENTURE; LIMITATIONS.
The Company issued the Notes under an Indenture dated as of December 21,
1998 (the "Indenture"), between the Company and The Bank of New York, as trustee
(the "Trustee"). Capitalized terms herein are used as defined in the Indenture
unless otherwise indicated. 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. The Notes are subject to all such terms, and Holders are
referred to the Indenture and the Trust Indenture Act for a statement of all
such terms. 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.
The Notes are general unsecured obligations of the Company.
5. OPTIONAL REDEMPTION.
The Company has the option to redeem the Notes, in whole or in part, at any
time at the redemption price equal to the greater of (i) 100% of the principal
amount of the Notes to be
A-5
redeemed or (ii) as determined by an Independent Investment Banker, the sum
of the present values of the Remaining Scheduled Payments discounted to the
redemption date on a semiannual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Adjusted Treasury Rate, plus, in each case,
accrued and unpaid interest (including Additional Interest), if any, on the
Notes to be redeemed to the date of redemption.
6. REPURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control Triggering Event, each
Holder of Notes will have the right to require the Company to repurchase all or
any part (equal to $1,000 or an integral multiple thereof) of such Holder's
Notes pursuant to the offer described in Section 4.13 of the Indenture at an
offer price in cash equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest and Additional Interest thereon, if any, to the date
of purchase. Within ten days following any Change of Control Triggering Event,
the Company shall mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control Triggering Event and offering
to repurchase Notes on the date specified in such notice, which date shall be no
earlier than 30 days and no later than 60 days from the date such notice is
mailed. The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change of Control Triggering Event. To
the extent that the provisions of any securities laws or regulations conflict
with the provisions for the Change of Control Offer, the Company will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations with respect to the Change of Control Offer by
virtue thereof.
(b) On the Change of Control Payment Date, the Company shall, to the
extent lawful, (1) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (2) deposit with the Paying
Agent an amount equal to the Change of Control Payment in respect of all Notes
or portions thereof so tendered and (3) deliver or cause to be delivered to the
Trustee the Notes so accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions thereof being purchased by the
Company. The Paying Agent will promptly mail to each Holder of Notes so
tendered the Change of Control Payment for such Notes, and the Trustee will
promptly authenticate and mail (or cause to be transferred by book-entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; PROVIDED, HOWEVER, that each such new Note will
be in a principal amount of $1,000 or an integral multiple thereof. The Company
will publicly announce the results of the Change of Control Offer on or as soon
as practicable after the Change of Control Payment Date.
7. DENOMINATIONS; TRANSFER; EXCHANGE.
The Notes are in registered form without coupons in denominations of $1,000
of principal amount and multiples of $1,000 in excess thereof. A Holder may
register the transfer
A-6
or exchange of Notes in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted
by the Indenture. The Registrar need not register the transfer or exchange
of any Notes selected for redemption. Also, it need not register the
transfer or exchange of any Notes for a period of 15 days before the day of
mailing of a notice of redemption of Notes selected for redemption.
8. PERSONS DEEMED OWNERS.
A Holder shall be treated as the owner of a Note for all purposes.
9. UNCLAIMED MONEY.
If money for the payment of principal, premium, if any, or interest remains
unclaimed for two years, the Trustee and the Paying Agent will pay the money
back to the Company at its request. After that, Holders entitled to the money
must look to the Company for payment, unless an abandoned property law
designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.
10. DISCHARGE PRIOR TO REDEMPTION OR MATURITY.
Under certain circumstances, if the Company deposits with the Trustee
money, U.S. Government Obligations or a combination thereof sufficient to pay
the then outstanding principal of, premium, if any, and accrued interest on the
Notes to redemption or maturity of the Notes, the Company may, under certain
circumstances, be discharged from the Indenture and the Notes, except in certain
circumstances for certain provisions thereof, or from certain covenants set
forth in the Indenture.
11. AMENDMENT; SUPPLEMENT; WAIVER.
Subject to certain exceptions, the Indenture or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in principal
amount of the Notes then outstanding, and any existing default or compliance
with any provision may be waived with the consent of the Holders of at least a
majority in principal amount of the Notes then outstanding. Without notice to
or the consent of any Holder, the parties thereto may amend or supplement the
Indenture or the Notes to, among other things, cure any ambiguity, defect or
inconsistency and make any change that, in the good faith opinion of the Board
of Directors of the Parent Guarantor, does not materially and adversely affect
the rights of any Holder.
12. RESTRICTIVE COVENANTS.
The Indenture imposes certain limitations on the ability of the Company and
its Restricted Subsidiaries, among other things, to incur additional
Indebtedness or make Restricted
A-7
Payments, and imposes certain limitations on the Parent Guarantor's or the
Company's ability to merge, consolidate or transfer substantially all of its
assets. Within 120 days after the end of the Company's fiscal year, the
Company shall deliver to the Trustee an Officers' Certificate stating whether
or not the signers thereof know of any Default or Event of Default under such
restrictive covenants.
13. SUCCESSOR PERSONS.
When a successor person or other entity assumes all the obligations of its
predecessor under the Notes and the Indenture, the predecessor person will be
released from those obligations.
14. DEFAULTS AND REMEDIES.
Any of the following events constitutes an "Event of Default" under the
Indenture:
(a) the failure to pay interest on the Notes when the same becomes due and
payable and the Default continues for a period of 30 days, whether or not such
payment is prohibited by the provisions of Article 14 of the Indenture;
(b) the failure to pay principal of or premium, if any, on any Notes when
such principal or premium, if any, becomes due and payable, at maturity, upon
redemption or otherwise, whether or not such payment is prohibited by the
provisions of Article 14 of the Indenture, and such default continues for five
or more days;
(c) a default in the observance or performance of any other covenant or
agreement contained in the Notes or the Indenture, which default continues for a
period of 60 days after the Company receives written notice thereof specifying
the default from the Trustee or holders of at least 25% in aggregate principal
amount of outstanding Notes and demanding that such default be remedied;
(d) there occurs with respect to any issue or issues of Indebtedness of
the Parent Guarantor or any Significant Subsidiary having an outstanding
principal amount of $20 million or more in the aggregate for all such issues of
all such Persons, whether such Indebtedness now exists or shall hereafter be
created, (i) an event of default that has caused the holder thereof to declare
such Indebtedness to be due and payable prior to its Stated Maturity and such
Indebtedness has not been discharged in full or such acceleration has not been
rescinded or annulled within 60 days of such acceleration and/or (ii) the
failure to make a principal payment at the final (but not any interim) fixed
maturity and such defaulted payment shall not have been made, waived or extended
within 60 days of such payment default;
A-8
(e) any of the Note Guarantees ceases to be in full force and effect or
any of the Note Guarantees is declared to be null and void and unenforceable or
any of the Note Guarantees is found to be invalid or any of the Guarantors
denies its liability under its Note Guarantee, other than by reason of release
of a Guarantor in accordance with the terms of the Indenture;
(f) one or more judgments in an aggregate amount in excess of $20 million,
which are not covered by insurance as to which the insurer has not disclaimed
coverage, being rendered against Parent Guarantor or any of its Significant
Subsidiaries and such judgment or judgments remain undischarged or unstayed for
a period of 60 days after such judgment or judgments become final and
nonappealable; and
(g) (i) a court having jurisdiction in the premises enters a decree or
order for (A) relief in respect of the Parent Guarantor or any of its
Significant Subsidiaries in an involuntary case under any applicable bankruptcy,
insolvency or other similar law for relief of debtors now or hereafter in
effect, (B) appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Parent Guarantor or any of its
Significant Subsidiaries or for all or substantially all of the property and
assets of the Parent Guarantor or any of its Significant Subsidiaries or (C) the
winding up or liquidation of the affairs of the Parent Guarantor or any of its
Significant Subsidiaries and, in each case, such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or (ii) the Parent
Guarantor or any of its Significant Subsidiaries (A) commences a voluntary case
under any applicable bankruptcy, insolvency or other similar law for relief of
debtors now or hereafter in effect, or consents to the entry of an order for
relief in an involuntary case under any such law, (B) consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Parent Guarantor or
any of its Significant Subsidiaries or for all or substantially all of the
property and assets of the Parent Guarantor or any of its Significant
Subsidiaries or (C) effects any general assignment for the benefit of creditors.
If an Event of Default, as defined in the Indenture, occurs and is
continuing, the Trustee may, and at the direction of the Holders of at least 25%
in aggregate principal amount of the Notes then outstanding shall, declare all
the Notes to be due and payable. If a bankruptcy or insolvency default with
respect to the Company occurs and is continuing, the Notes automatically become
due and payable. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may require indemnity satisfactory to it
before it enforces the Indenture or the Notes. Subject to certain limitations,
Holders of at least a majority in principal amount of the Notes then outstanding
may direct the Trustee in its exercise of any trust or power.
15. SUBORDINATION.
A-9
The payment of the Notes will, to the extent set forth in the Indenture, be
subordinated in right of payment to the prior payment in full, in cash, of all
Senior Indebtedness.
16. GUARANTEE.
The Company's obligations under the Notes are guaranteed on a senior
subordinated basis by each Guarantor. Each Guarantor's obligation with respect
to a Note Guarantee will, to the extent set forth in the Indenture, be
subordinated in right of payment to the prior payment in full, in cash, of all
Guarantor Senior Indebtedness.
17. TRUSTEE DEALINGS WITH THE COMPANY.
The Trustee under the Indenture, in its individual or any other capacity,
may make loans to, accept deposits from and perform services for the Company or
its Affiliates and may otherwise deal with the Company or its Affiliates as if
it were not the Trustee.
18. NO RECOURSE AGAINST OTHERS.
No incorporator or any past, present or future partner, stockholder, other
equityholder, officer, director, employee or controlling person, as such, of the
Company or of any successor Person shall have any liability for any obligations
of the Company under the Notes or the Indenture or for any claim based on, in
respect of or by reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for the issuance of the Notes.
19. AUTHENTICATION.
This Note shall not be valid until the Trustee or 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 right of survivorship and not as tenants in
common), CUST (= Custodian) and U/G/M/A (= Uniform Gifts to Minors Act).
The Company will furnish a copy of the Indenture to any Holder upon written
request and without charge. Requests may be made to Protection One Alarm
Monitoring, Inc., 0000 Xxxxx Xxxxxxx 000, Xxxxx 000, Xxxxxx, Xxxxx 00000;
Attention: General Counsel.
[FORM OF TRANSFER NOTICE]
A-10
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
INSERT TAXPAYER IDENTIFICATION NO.
________________________________________________________________
Please print or typewrite name and address including zip code of assignee
________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ____________________________ attorney to transfer said Note on the
books of the Company with full power of substitution in the premises.
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL NOTES OTHER THAN EXCHANGE NOTES,
UNLEGENDED OFFSHORE GLOBAL NOTES AND
UNLEGENDED OFFSHORE PHYSICAL NOTES]
In connection with any transfer of this Note occurring prior to the date
which is the earlier of (i) the date the Shelf Registration Statement is
declared effective or (ii) the end of the period referred to in Rule 144(k)
under the Securities Act, the undersigned confirms that without utilizing any
general solicitation or general advertising that:
[CHECK ONE]
[ ] (a) this Note is being transferred in compliance with the
exemption from registration under the Securities Act of 1933
provided by Rule 144A thereunder.
OR
[ ] (b) this Note is being transferred other than in accordance with
(a) above and documents are being furnished which comply with
the conditions of transfer set forth in this Note and the
Indenture.
A-11
If none of the foregoing boxes is checked, the Trustee or other Registrar shall
not be obligated to register this Note in the name of any Person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.08 of the Indenture shall have
been satisfied.
Date:
------------- ----------------------------------------------------
NOTICE: The signature to this assignment must
correspond with the name as written upon the face of
the within-mentioned instrument in every particular,
without alteration or any change whatsoever.
Signature Guarantee:
-------------------------------
Signature must be guaranteed by a participant in a recognized signature guaranty
medallion program or other signature guarantor acceptable to the Trustee.
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this Note for
its own account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a "qualified institutional buyer"
within the meaning of Rule 144A under the Securities Act of 1933 and is aware
that the sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as the undersigned has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:
------------- ----------------------------------------------------
NOTICE: To be executed by an executive officer
A-12
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to
Section 4.09 or Section 4.13 of the Indenture, check the Box:
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.09 or Section 4.13 of the Indenture, state the amount:
$___________________.
Date:
------------------------
Your Signature:
-----------------------------------------------------------------
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee:
---------------------------
Signature must be guaranteed by a participant in a recognized signature guaranty
medallion program or other signature guarantor acceptable to the Trustee.
EXHIBIT B
FORM OF CERTIFICATE
_________________, ___
The Bank of New York
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Protection One Alarm Monitoring, Inc.
0000 Xxxxx Xxxxxxx 000, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: General Counsel
Re: Protection One Alarm Monitoring, Inc. (the "Company")
8 1/8% SENIOR SUBORDINATED NOTES DUE 2009 (THE "NOTES")
Dear Sirs:
This letter relates to U.S. $_______________ principal amount of Notes
represented by a Note (the "Legended Note") which bears a legend outlining
restrictions upon transfer of such Legended Note. Pursuant to Section 2.02 of
the Indenture dated as of December 21, 1998 (the "Indenture") relating to the
Notes, we hereby certify that we are (or we will hold such securities 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 U.S. Securities
Act of 1933. Accordingly, you are hereby requested to exchange the legended
certificate for an unlegended certificate representing an identical principal
amount of Notes, all in the manner provided for in the Indenture.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
Very truly yours,
[Name of Holder]
By:
-----------------------------------
Authorized Signature
EXHIBIT C
Form of Certificate to Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
-----------------------------------------
____________________ , ___
The Bank of New York
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Re: Protection One Alarm Monitoring, Inc. (the"Company")
8 1/8% Senior Subordinated Notes due 2009 (the "Notes")
-------------------------------------------------------
Dear Sirs:
In connection with our proposed purchase of $ aggregate
principal amount of the Notes, we confirm that:
1. We understand that any subsequent transfer of the Notes is subject to
certain restrictions and conditions set forth in the Indenture dated as of
December 21, 1998 (the "Indenture") relating to the Notes and the undersigned
agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes
except in compliance with such restrictions and conditions and the Securities
Act of 1933, amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes may not be offered or
sold except as permitted in the following sentence. We agree, on our own behalf
and on behalf of any accounts for which we are acting as hereinafter stated,
that if we should sell any Notes within the time period referred to in Rule
144(k) of the Securities Act, we will do so only (A) to the Company or any
subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to
a "qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and, if such
transfer is in respect of an aggregate principal amount of less than $100,000,
an opinion of counsel acceptable to the Company that such transfer is in
compliance with the Securities Act, (D) outside the United States in accordance
with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the
exemption from registration provided by Rule 144 under the Securities Act (if
available) or (F)
C-2
pursuant to an effective registration statement under the Securities Act, and
we further agree to provide to any person purchasing any of the Notes from us
a notice advising such purchaser that resales of the Notes are restricted as
stated herein.
3. We understand that, on any proposed resale of any Notes, we will be
required to furnish to you and the Company such certifications, legal opinions
and other information as you and the Company may reasonably require to confirm
that the proposed sale complies with the foregoing restrictions. We further
understand that the Notes purchased by us will bear a legend to the foregoing
effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes purchased by us for our own account or for
one or more accounts (each of which is an institutional "accredited investor")
as to each of which we exercise sole investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:
------------------------------------------
Authorized Signature
EXHIBIT D
Form of Certificate to Be Delivered in
Connection with Transfers Pursuant to Regulation S
--------------------------------------------------
__________, ___
The Bank of New York
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Re: Protection One Alarm Monitoring, Inc. (the "Company")
8 1/8% Senior Subordinated Notes due 2009 (the "Notes")
-------------------------------------------------------
Dear Sirs:
In connection with our proposed sale of U.S.$_______________ aggregate
principal amount of the Notes, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the Securities Act of
1933 and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United States;
(2) at the time the buy order was originated, the transferee was
outside the United States or we and any person acting on our behalf
reasonably believed that the transferee was outside the United States;
(3) no directed selling efforts have been made by us in the United
States in contravention of the requirements of Rule 903(b) or Rule 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 U.S. Securities Act of 1933.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official
inquiry with respect to the matters covered hereby. Terms used in this
certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
--------------------------------
Authorized Signature
EXHIBIT E
FORM OF NOTE OF GUARANTEE
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture dated as of December 21,
1998 (the "Indenture") among Protection One Alarm Monitoring, Inc., a
Delaware corporation, the Guarantors listed on the signature page thereto and
The Bank of New York, as trustee (the "Trustee"), and subject to the
provisions in the Indenture, (a) the due and punctual payment of the
principal of, premium, if any, and interest and Additional Interest, if any,
on the Notes, when and as the same shall become due and payable, whether at
maturity, by acceleration, redemption or otherwise, the due and punctual
payment of interest and Additional Interest, if any, on overdue principal and
premium, if any, and, to the extent permitted by law, interest and Additional
Interest, if any, and the due and punctual performance of all other
obligations of the Company to the Holders or the Trustee all in accordance
with the terms of the Notes and the Indenture and (b) in case of any
extension of time of payment or renewal of any Notes or any of such other
obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, at stated
maturity, by acceleration or otherwise. The obligations of the Guarantors to
the Holders of Notes and to the Trustee pursuant to the Note Guarantee and
the Indenture are expressly set forth in Article 10 of the Indenture and
reference is hereby made to the Indenture for the precise terms of the Note
Guarantee. Each capitalized term used but not defined herein shall have the
meaning ascribed thereto in the Indenture.
PROTECTION ONE, INC.
By:
--------------------------------
Name:
Title:
PROTECTION ONE INTERNATIONAL, INC.
By:
--------------------------------
Name:
Title:
PROTECTION ONE INVESTMENTS, INC.
By:
--------------------------------
Name:
Title:
DSC ENTERPRISES, INC.
By:
--------------------------------
Name:
Title:
NETWORK MULTI-FAMILY SECURITY CORPORATION
By:
--------------------------------
Name:
Title:
COMSEC NARRAGANSETT SECURITY, INC.
By:
--------------------------------
Name:
Title:
EXHIBIT F
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
________________, among __________________ (the "Guaranteeing Subsidiary"), a
subsidiary of ____________________ (or its permitted successor), the Company,
the other Guarantors (as defined in the Indenture referred to herein) and The
Bank of New York, as trustee under the indenture referred to below (the
"Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of December 21, 1998
providing for the issuance of its 8 1/8% Senior Subordinated Notes due 2009
(the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a
supplemental indenture pursuant to which the Guaranteeing Subsidiary shall
unconditionally guarantee all of the Company's Obligations under the Notes
and the Indenture on the terms and conditions set forth herein (the "Note
Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees
as follows:
(a) Along with all Guarantors named in the Indenture, to jointly
and severally Guarantee to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
the Notes or the obligations of the Company hereunder or thereunder, that:
(i) the due and punctual payment of the principal of,
premium, if any, and interest and Additional Interest, if any, on each
Note, when and as the same shall become due and payable, whether at
maturity, by acceleration, redemption or otherwise, the due and
punctual payment of interest and Additional Interest, if any, on the
overdue principal and premium, if any, and Additional Interest, if
any, on the Notes, to the extent lawful, and the due and punctual
performance of all other obligations of the Company to the Holders or
the Trustee, all in accordance with the terms of such Note and this
Indenture; and
(ii) in the case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that the same
will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, at maturity, by acceleration or
otherwise.
F-2
(b) The obligations hereunder shall be unconditional, irrespective
of the validity, regularity or enforceability of the Notes or the
Indenture, the absence of any action to enforce the same, any waiver or
consent by any Holder of the Notes with respect to any provisions hereof or
thereof, the recovery of any judgment against the Company, any action to
enforce the same or any other circumstance which might otherwise constitute
a legal or equitable discharge or defense of a guarantor.
(c) The following is hereby waived: diligence, presentment, demand
of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against
the Company, protest, notice and all demands whatsoever.
(d) This Note Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes and the Indenture,
and the Guaranteeing Subsidiary accepts all obligations of a Guarantor
under the Indenture.
(e) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or any Custodian,
Trustee, liquidator or other similar official acting in relation to either
the Company or the Guarantors, any amount paid by either to the Trustee or
such Holder, this Note Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any right
of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed
hereby.
(g) As between the Guarantors, 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 of the
Indenture for the purposes of this Note Guarantee, 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 of
the Indenture, such obligations (whether or not due and payable) shall
forthwith become due and payable by the Guarantors for the purpose of this
Note Guarantee.
(h) The Guarantors shall have the right to seek contribution from
any non-paying Guarantor so long as the exercise of such right does not
impair the rights of the Holders under the Guarantee.
(i) Pursuant to Section 10.02 of the Indenture, after giving
effect to any maximum amount and any other contingent and fixed liabilities
that are relevant under any applicable Bankruptcy or fraudulent conveyance
laws, and after giving effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any other Guarantor
in respect of the obligations of such other Guarantor under Article 10 of
the Indenture, this new Note Guarantee shall be limited to the maximum
amount permissible such that the obligations of such Guarantor under this
Note Guarantee will not constitute a fraudulent transfer or conveyance.
F-3
3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that
the Note Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
4. GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.
(a) Nothing contained in this Supplemental Indenture shall prevent
any consolidation or merger of the Guaranteeing Subsidiary with or into the
Company or another Guarantor or shall prevent any sale or conveyance of the
property of the Guaranteeing Subsidiary, as an entirety or substantially as
an entirety, to the Company or the Guarantor. Upon any such consolidation,
merger, sale or conveyance, the Note Guarantee given by the Guaranteeing
Subsidiary shall no longer have any force or effect.
(b) Nothing contained in this Supplemental Indenture shall prevent
any consolidation or merger of the Guaranteeing Subsidiary with or into a
Person (provided such Person is a corporation, partnership or trust) other
than the Company or another Guarantor or shall prevent any sale or
conveyance of the property of the Guaranteeing Subsidiary as an entirety or
substantially as an entirety to any such Person (whether or not an
Affiliate of the Guarantor). Upon the sale or disposition of the
Guaranteeing Subsidiary (or all or substantially all of its assets) to a
Person which is not a Subsidiary of the Company, which is otherwise in
compliance with this Supplemental Indenture, the Guaranteeing Subsidiary
shall be deemed released from all its obligations under this Supplemental
Indenture and its Note Guarantee and such Note Guarantee shall terminate;
PROVIDED, HOWEVER, that any such termination shall occur only to the extent
that all obligations of the Guaranteeing Subsidiary under all its
guarantees of, and under all of its pledges of assets or other security
interests which secure, Indebtedness of the Company shall also terminate
upon such release, sale or transfer.
(c) The Trustee shall, at the Company's expense, deliver an
appropriate instrument evidencing such release upon receipt of a request by
the Company accompanied by an Officers' Certificate certifying as to the
compliance with this Section 4. If the Guaranteeing Subsidiary is not so
released it remains liable for the full amount of principal of and interest
on the Notes as provided in this the Supplemental Indenture.
5. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the
Company or any Guaranteeing Subsidiary under the Notes, any Note Guarantees,
the Indenture or this Supplemental Indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder
of the Notes by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
F-4
6. NEW YORK LAW TO GOVERN. THE LAW OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
7. COUNTERPARTS The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
8. EFFECT OF HEADINGS. The Section headings herein are for
convenience only and shall not affect the construction hereof.
9. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained herein,
all of which recitals are made solely by the Guaranteeing Subsidiary and the
Company.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: _______________, ____
[GUARANTEEING SUBSIDIARY]
By:
-----------------------------------
Name:
Title:
THE BANK OF NEW YORK
as Trustee
By:
-----------------------------------
Name:
Title:
