EXHIBIT 4.10
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PSYCHIATRIC SOLUTIONS, INC.
$150,000,000
10-5/8% SENIOR SUBORDINATED NOTES DUE 2013
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INDENTURE
Dated as of June 30, 2003
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Wachovia Bank, National Association,
as Trustee
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This INDENTURE, dated as of June 30, 2003, is by and among
Psychiatric Solutions, Inc., a Delaware corporation, each Guarantor listed on
the signature pages hereto, and Wachovia Bank, National Association, as trustee
(the "Trustee").
The Company, each Guarantor and the Trustee agree as follows
for the benefit of each other and for the equal and ratable benefit of the
Holders of the 10-5/8% Senior Subordinated Notes due 2013 (the "Notes") issued
under this Indenture:
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:
"144A Global Note" means a Global Note in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee
issued in a denomination equal to the outstanding principal amount of the Notes
sold for initial resale in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person:
(a) Indebtedness of any other Person existing at the time
such other Person is merged with or into or became a Subsidiary of such
specified Person, whether or not such Indebtedness is incurred in
connection with, or in contemplation of, such other Person merging with
or into, or becoming a Subsidiary of, such specified Person; and
(b) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.
"Additional Interest" has the meaning set forth in a
Registration Rights Agreement relating to amounts to be paid in the event the
Company fails to satisfy certain conditions set forth herein. For all purposes
of this Indenture, the term "interest" shall include Additional Interest, if
any, with respect to the Notes.
"Additional Notes" means any Notes (other than Initial Notes,
Exchange Notes and Notes issued under Sections 2.06, 2.07, 2.10 and 3.06 hereof)
issued under this Indenture in accordance with Sections 2.02, 2.15 and 4.09
hereof, as part of the same series as the Initial Notes or as an additional
series.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control," as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person will be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.
"Agent" means any Registrar, co-registrar, Paying Agent or
additional paying agent.
"Applicable Procedures" means, with respect to any transfer,
redemption or exchange of or for beneficial interests in any Global Note, the
rules and procedures of the Depositary, Euroclear and Clearstream that apply to
such transfer, redemption or exchange.
"Asset Sale" means the sale, lease, transfer, conveyance or
other disposition of any assets or rights, other than sales, leases, transfers,
conveyances or other dispositions of inventory in the ordinary course of
business consistent with past practices; provided that the sale, conveyance or
other disposition of all or substantially all of the assets of the Company and
its Restricted Subsidiaries taken as a whole will be governed by Section 4.17
hereof and/or Section 5.01 hereof and not by Section 4.12 hereof.
Notwithstanding the preceding, the following items will not be
deemed to be Asset Sales:
(a) any single transaction or series of related
transactions that involves assets having a fair market value of less
than $1.0 million;
(b) a sale, lease, transfer, conveyance or other
disposition of assets between or among the Company and its Restricted
Subsidiaries;
(c) an issuance of Equity Interests by a Restricted
Subsidiary to the Company or to another Restricted Subsidiary;
(d) a sale, lease, transfer, conveyance or other
disposition effected in compliance with the provisions described in
Article 5 hereof;
(e) a Restricted Payment or Permitted Investment that is
permitted by Section 4.10 hereof;
(f) a transfer of property or assets that are obsolete,
damaged or worn out equipment and that are no longer useful in the
conduct of the Company's or its Subsidiaries' business and that is
disposed of in the ordinary course of business; and
(g) a Permitted Asset Swap.
"Attributable Debt" in respect of a sale and leaseback
transaction means, at the time of determination, the present value of the
obligation of the lessee for net rental payments during the remaining term of
the lease included in such sale and leaseback transaction including any period
for which such lease has been extended or may, at the option of the lessor, be
extended. Such present value shall be calculated using a discount rate equal to
the rate of interest implicit in such transaction, determined in accordance with
GAAP.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors, or the law of any other
jurisdiction relating to bankruptcy, insolvency, winding up, liquidation,
reorganization or relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in
Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as that term is used in Section
13(d)(3) of the Exchange Act), such "person" will be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire by
conversion or exercise of other securities, whether such right is currently
exercisable or is exercisable only upon the occurrence of a subsequent
condition. The terms "Beneficially Owns" and "Beneficially Owned" have a
corresponding meaning.
"Board of Directors" means:
(a) with respect to a corporation, the board of directors
of the corporation;
(b) with respect to a partnership, the Board of Directors
of the general partner of the partnership; and
(c) with respect to any other Person, the board or
committee of such Person serving a similar function.
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"Board Resolution" of a Person means a copy of a resolution
certified by the secretary or an assistant secretary (or individual performing
comparable duties) of the applicable Person to have been duly adopted by the
Board of Directors of such Person and to be in full force and effect on the date
of such certification, and delivered to the Trustee.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any
determination is to be made, the amount of the liability in respect of a capital
lease that would at that time be required to be capitalized on a balance sheet
in accordance with GAAP.
"Capital Stock" means:
(a) in the case of a corporation, corporate stock;
(b) in the case of an association or business entity, any
and all shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(c) in the case of a partnership or limited liability
company, partnership or membership interests (whether general or
limited); and
(d) any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"CapSource Warrant" means the Common Stock Purchase Warrant of
the Company, dated August 5, 2002, in favor of CapitalSource Holdings LLC or its
registered assigns.
"CapSource Put Indebtedness" means Indebtedness of the Company
incurred as a result of the failure of the Company to pay the redemption price
(together with accrued interest) in the event the Company fails to purchase the
CapSource Warrant in certain circumstances involving the acceleration or
prepayment of the Credit Agreement, an initial public offering, or certain
mergers, sales or changes of control involving the Company.
"Cash Equivalents" means:
(a) United States dollars;
(b) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or
instrumentality of the United States government (provided that the full
faith and credit of the United States is pledged in support of those
securities) having maturities of not more than six months from the date
of acquisition;
(c) certificates of deposit and eurodollar time deposits
with maturities of six months or less from the date of acquisition,
bankers' acceptances with maturities not exceeding six months and
overnight bank deposits, in each case, with any lender party to the
Credit Agreement or with any domestic commercial bank having capital
and surplus in excess of $500.0 million and a Thomson Bank Watch Rating
of "B" or better;
(d) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses
(b) and (c) above entered into with any financial institution meeting
the qualifications specified in clause (c) above;
(e) commercial paper rated at least A-1 by Standard &
Poor's Rating Services, or at least P-1 by Xxxxx'x Investors Service,
Inc., and in each case maturing within six months after the date of
acquisition; and
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(f) money market funds at least 95% of the assets of
which constitute Cash Equivalents of the kinds described in clauses (a)
through (e) of this definition.
"Change of Control" means the occurrence of any of the
following:
(a) the direct or indirect sale, transfer, conveyance or
other disposition (other than by way of merger or consolidation), in
one or a series of related transactions, of all or substantially all of
the properties or assets of the Company and its Restricted
Subsidiaries, taken as a whole, to any "person" (as that term is used
in Section 13(d)(3) of the Exchange Act);
(b) the adoption of a plan relating to the liquidation or
dissolution of the Company;
(c) the consummation of any transaction (including,
without limitation, any merger or consolidation) the result of which is
that any "person" (as defined in clause (a) above), other than the
Permitted Group, becomes the Beneficial Owner, directly or indirectly,
of more than 30% of the Voting Stock of the Company, measured by voting
power rather than number of shares;
(d) the consummation by the Company of any "going
private" transaction that would constitute a "Rule 13e-3 transaction"
as defined in the Exchange Act;
(e) the first day on which a majority of the members of
the Board of Directors of the Company are not Continuing Directors; or
(f) the Company consolidates with, or merges with or
into, any Person, or any Person consolidates with, or merges with or
into, the Company, in any such event pursuant to a transaction in which
any of the outstanding Voting Stock of the Company or such other Person
is converted into or exchanged for cash, securities or other property,
other than any such transaction where the Voting Stock of the Company
outstanding immediately prior to such transaction is converted into or
exchanged for Voting Stock (other than Disqualified Stock) of the
surviving or transferee Person constituting a majority of the
outstanding shares of such Voting Stock of such surviving or transferee
Person (immediately after giving effect to such issuance).
"Clearstream" means Clearstream Banking S.A. and any successor
thereto.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission.
"Company" means Psychiatric Solutions, Inc., and any successor
thereto.
"Consolidated Cash Flow" means, with respect to any specified
Person for any period, the Consolidated Net Income of such Person for such
period plus:
(a) an amount equal to any extraordinary loss plus any
net loss realized by such Person or any of its Subsidiaries in
connection with an Asset Sale, to the extent such losses were deducted
in computing such Consolidated Net Income; plus
(b) provision for taxes based on income or profits of
such Person and its Restricted Subsidiaries for such period, to the
extent that such provision for taxes was deducted in computing such
Consolidated Net Income; plus
(c) consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued and
whether or not capitalized (including, without limitation, amortization
of debt issuance costs and original issue discount, non-cash interest
payments, the interest component of any deferred payment obligations,
the interest component of all payments associated with Capital Lease
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Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect
of letter of credit or bankers' acceptance financings, and net of the
effect of all payments made or received pursuant to Hedging
Obligations), to the extent that any such expense was deducted in
computing such Consolidated Net Income; plus
(d) depreciation, amortization (including amortization of
goodwill and other intangibles but excluding amortization of prepaid
cash expenses that were paid in a prior period) and other non-cash
expenses (excluding any such non-cash expense to the extent that it
represents an accrual of or reserve for expenses to be paid in cash in
any future period) of such Person and its Restricted Subsidiaries for
such period to the extent that such depreciation, amortization and
other non-cash expenses were deducted in computing such Consolidated
Net Income; minus
(e) non-cash items increasing such Consolidated Net
Income for such period, other than the accrual of revenue in the
ordinary course of business,
in each case, on a consolidated basis and determined in accordance with
GAAP.
"Consolidated Net Income" means, with respect to any specified
Person for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that:
(a) the Net Income (but not loss) of any Person that is
not a Restricted Subsidiary or that is accounted for by the equity
method of accounting will be included only to the extent of the amount
of dividends or distributions paid in cash to the specified Person or a
Restricted Subsidiary of the Person;
(b) the Net Income of any Restricted Subsidiary will be
excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that Net Income
is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary or its
stockholders;
(c) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such
acquisition will be excluded; and
(d) the cumulative effect of a change in accounting
principles will be excluded.
"Consolidated Net Tangible Assets" means, as of any date of
determination, the sum of the amounts that would appear on a consolidated
balance sheet of the Company and its consolidated Restricted Subsidiaries as the
total assets (less accumulated depreciation and amortization, allowances for
doubtful receivables, other applicable reserves and other properly deductible
items) of the Company and its Restricted Subsidiaries, after giving effect to
purchase accounting, and after deducting therefrom consolidated current
liabilities and, to the extent otherwise included, the amounts of (without
duplication):
(a) the excess of cost over fair market value of assets
or businesses acquired;
(b) any revaluation or other write-up in book value of
assets subsequent to the last day of the fiscal quarter of the Company
immediately preceding the date of issuance of the notes as a result of
a change in the method of valuation in accordance with GAAP;
(c) unamortized debt discount and expenses and other
unamortized deferred charges, goodwill, patents, trademarks, service
marks, trade names, copyrights, licenses, organization or developmental
expenses and other intangible items;
(d) minority interests in consolidated subsidiaries held
by Persons other than the Company or any Restricted Subsidiary;
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(e) treasury stock;
(f) cash or securities set aside and held in a sinking or
other analogous fund established for the purpose of redemption or other
retirement of Capital Stock to the extent such obligation is not
reflected in Consolidated Current Liabilities; and
(g) Investments in and assets of Unrestricted
Subsidiaries.
"Continuing Directors" means, as of any date of determination,
any member of the Board of Directors of the Company who:
(a) was a member of such Board of Directors on the date
of this Indenture; or
(b) 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.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 13.02 hereof, or such other address
as to which the Trustee may give notice to the Company.
"Credit Agreement" means the Second Amended and Restated
Revolving Credit and Term Loan Agreement, dated as of the date hereof, by and
among the Company, the guarantors party thereto, CapitalSource Finance LLC and
the lenders from time to time party thereto, providing for up to $50.0 million
of revolving credit borrowings and $17.0 million of term borrowings, including
any related notes, guarantees, collateral documents, instruments and agreements
executed in connection therewith, and in each case as amended, restated,
modified, renewed, refunded, replaced or refinanced (in whole or in part) from
time to time, whether or not with the same lenders or agent.
"Credit Facilities" means, one or more debt facilities or
agreements (including, without limitation, the Credit Agreement) or commercial
paper facilities, in each case with banks or other institutional lenders or
investors providing for revolving credit loans, term loans, receivables
financing (including through the sale of receivables to such lenders or to
special purpose entities formed to borrow from such lenders against such
receivables) or letters of credit, in each case, as amended, restated, modified,
renewed, refunded, replaced or refinanced (including any agreement to extend the
maturity thereof and adding additional borrowers or guarantors) in whole or in
part from time to time under the same or any other agent, lender or group of
lenders and including increasing the amount of available borrowings thereunder;
provided that such increase is permitted by Section 4.09 hereof.
"Custodian" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section
2.03(c) hereof as Custodian with respect to the Notes, and any and all
successors thereto appointed as custodian hereunder and having become such
pursuant to the applicable provisions of this Indenture.
"Default" means any event that is, or with the passage of time
or the giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06 or 2.10
hereof, in substantially the form of Exhibit A hereto except that such Note
shall not bear the Global Note Legend and shall not have the "Schedule of
Exchanges of Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section
2.03(b) hereof as the Depositary with respect to the Notes, and any and all
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successors thereto appointed as depositary hereunder and having become such
pursuant to the applicable provisions of this Indenture.
"Designated Senior Debt" means (a) any Indebtedness
outstanding under the Credit Agreement and (b) any other Senior Debt permitted
hereunder the principal amount of which is $25.0 million or more and that has
been designated by the Company as "Designated Senior Debt."
"Disqualified 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, in each case at the option of the holder of the
Capital Stock), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder of the Capital Stock, in whole or in part, on or prior
to the date that is 91 days after the date on which the Notes mature.
Notwithstanding the preceding sentence, any Capital Stock that would constitute
Disqualified Stock solely because the holders of the Capital Stock have the
right to require the Company to repurchase such Capital Stock upon the
occurrence of a Change of Control or an Asset Sale will not constitute
Disqualified Stock if the terms of such Capital Stock provide that the Company
may not repurchase or redeem any such Capital Stock pursuant to such provisions
unless such repurchase or redemption complies with the Section 4.10 hereof.
"Domestic Subsidiary" means any Restricted Subsidiary of the
Company that was formed under the laws of the United States or any state or
territory of the United States or the District of Columbia or that guarantees or
otherwise provides direct credit support for any Indebtedness of the Company.
"Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means any private or public sale of common
stock of the Company.
"Euroclear" means Euroclear Bank, S.A./N.V., as operator of
the Euroclear systems, and any successor thereto.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means notes issued in exchange for the
Initial Notes or any Additional Notes pursuant to a Registration Rights
Agreement.
"Exchange Offer" has the meaning set forth in a Registration
Rights Agreement relating to an exchange of Notes registered under the
Securities Act for Notes not so registered.
"Exchange Offer Registration Statement" has the meaning set
forth in a Registration Rights Agreement.
"Existing Indebtedness" means Indebtedness existing on the
Issue Date (other than Indebtedness under this Indenture and the Credit
Agreement).
"Fixed Charges" means, with respect to any specified Person
for any period, the sum, without duplication, of:
(a) the consolidated interest expense of such Person and
its Restricted Subsidiaries for such period, whether paid or accrued,
including, without limitation, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, imputed
interest with respect to Attributable Debt, commissions, discounts and
other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net of the effect of all payments
made or received pursuant to Hedging Obligations;
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(b) the consolidated interest expense of such Person and
its Restricted Subsidiaries that was capitalized during such period;
plus
(c) any interest expense on Indebtedness of another
Person that is guaranteed by such Person or one of its Restricted
Subsidiaries or secured by a Lien on assets of such Person or one of
its Restricted Subsidiaries, whether or not such Guarantee or Lien is
called upon; plus
(d) the product of (i) all dividends, whether paid or
accrued and whether or not in cash, on any series of preferred stock of
such Person or any of its Restricted Subsidiaries, other than dividends
on Equity Interests payable solely in Equity Interests of the Company
(other than Disqualified Stock) or to the Company or a Restricted
Subsidiary, times (ii) a fraction, the numerator of which is one and
the denominator of which is one minus the then current combined
federal, state and local statutory tax rate of such Person, expressed
as a decimal, in each case, on a consolidated basis and in accordance
with GAAP.
"Fixed Charge Coverage Ratio" means with respect to any
specified Person for any period, the ratio of the Consolidated Cash Flow of such
Person and its Restricted Subsidiaries for such period to the Fixed Charges of
such Person and its Restricted Subsidiaries for such period. In the event that
the specified Person or any of its Restricted Subsidiaries incurs, assumes,
guarantees, repays, repurchases or redeems any Indebtedness (other than ordinary
working capital borrowings) or issues, repurchases or redeems preferred stock
subsequent to the commencement of the period for which the Fixed Charge Coverage
Ratio is being calculated and on or prior to the date on which the event for
which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated
giving pro forma effect to such incurrence, assumption, guarantee, repayment,
repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred stock, and the use of the proceeds therefrom as if the
same had occurred at the beginning of the applicable four-quarter reference
period.
In addition, for purposes of calculating the Fixed Charge
Coverage Ratio:
(a) acquisitions that have been made by the specified
Person or any of its Restricted Subsidiaries, including through mergers
or consolidations and including any related financing transactions,
during the four-quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date will be given
pro forma effect (calculated in accordance with Regulation S-X) as if
they had occurred on the first day of the four-quarter reference period
and Consolidated Cash Flow for such reference period will be calculated
without giving effect to clause (c) of the proviso set forth in the
definition of Consolidated Net Income;
(b) the Consolidated Cash Flow attributable to
discontinued operations, as determined in accordance with GAAP (other
than the treatment of the termination and expiration of management
contracts which shall be governed by Accounting Principles Board
Opinion No. 30 as in effect before the adoption of Financial Accounting
Standards No. 144), and operations or businesses disposed of prior to
the Calculation Date, will be excluded; and
(c) the Fixed Charges attributable to discontinued
operations, as determined in accordance with GAAP (other than the
treatment of the termination and expiration of management contracts
which shall be governed by Accounting Principles Board Opinion No. 30
as in effect before the adoption of Financial Accounting Standards No.
144), and operations or businesses disposed of prior to the Calculation
Date, will be excluded, but only to the extent that the obligations
giving rise to such Fixed Charges will not be obligations of the
specified Person or any of its Restricted Subsidiaries following the
Calculation Date.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect on the Issue Date.
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"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Global Note" means any global Note in the form of Exhibit A
hereto issued in accordance with Article 2 hereof.
"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. The term "guarantee"
used as a verb has a corresponding meaning.
"Guarantors" means each of:
(a) the Company's Domestic Subsidiaries (other than the
HUD Financing Subsidiaries and PSI Surety, Inc.); and
(b) any other Subsidiary that executes a Subsidiary
Guarantee in accordance with the provisions of this Indenture;
and their respective successors and assigns.
"Hedging Obligations" means, with respect to any specified
Person, the obligations of such Person under:
(a) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements; and
(b) other agreements or arrangements designed to protect
such Person against fluctuations in interest rates.
"Holder" means a Person in whose name a Note is registered in
the Security Register.
"HUD Financing" means Indebtedness of HUD Financing
Subsidiaries in an aggregate principal amount at any time outstanding not to
exceed the greater of $22.0 million or 12.5% of Consolidated Net Tangible
Assets, that is insured by the Federal Housing Administration, an organizational
unit of the United States Department of Housing and Urban Development.
"HUD Financing Subsidiaries" means any Domestic Subsidiary
formed solely for the purpose of holding assets pledged as security in
connection with any HUD Financing, including Xxxxx Xxxx Real Estate, LLC, PSI
Cedar Springs Hospital Real Estate, Inc., Psychiatric Solutions of Oklahoma Real
Estate, Inc., Neuro Rehab Real Estate, L.P., Texas Xxxxxx Xxxxx Hospital Real
Estate, L.P., Texas Oaks Psychiatric Hospital Real Estate, L.P., Texas San
Marcos Treatment Center Real Estate, L.P., Cypress Creek Real Estate, L.P., West
Oaks Real Estate, L.P. and Riveredge Real Estate, Inc.; provided that the
designation of a Domestic Subsidiary as a HUD Financing Subsidiary shall be
evidenced by an Officers' Certificate stating that such Domestic Subsidiary
shall be designated as a HUD Financing Subsidiary and certifying that the sole
purpose of such HUD Financing Subsidiary shall be to hold assets pledged as
security in connection with HUD Financing and that the incurrence of the HUD
Financing complies with the provisions of Section 4.09 hereof.
"IAI Global Note" means a Global Note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee
issued in a denomination equal to the outstanding principal amount of the Notes
sold to Institutional Accredited Investors, if any, to the extent required by
the Applicable Procedures.
"Indebtedness" means, with respect to any specified Person,
any indebtedness of such Person, whether or not contingent:
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(a) in respect of borrowed money;
(b) evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in
respect thereof);
(c) in respect of banker's acceptances;
(d) representing Capital Lease Obligations;
(e) representing the balance deferred and unpaid of the
purchase price of any property, except any such balance that
constitutes an accrued expense or trade payable; or
(f) representing any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date will
be:
(i) the accreted value of the Indebtedness, in
the case of any Indebtedness issued with original issue
discount; and
(ii) the principal amount of the Indebtedness,
together with any interest on the Indebtedness that is more
than 30 days past due, in the case of any other Indebtedness.
"Indenture" means this instrument, as originally executed or
as it may from time to time be supplemented or amended in accordance with
Article 9 hereof.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"Initial Notes" means $150,000,000 aggregate principal amount
of Notes issued under this Indenture on the Issue Date.
"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.
"Interest Payment Dates" shall have the meaning set forth in
paragraph 1 of any Note in the form of Exhibit A hereto issued in accordance
with Article 2 hereof.
"Investments" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including Guarantees or other obligations), advances or
capital contributions (excluding commission, travel and similar advances, fees
and compensation paid to officers, directors and employees made in the ordinary
course of business), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities, together with all items that
are or would be classified as investments on a balance sheet prepared in
accordance with GAAP. If the Company or any Subsidiary of the Company sells or
otherwise disposes of any Equity Interests of any direct or indirect Subsidiary
of the Company such that, after giving effect to any such sale or disposition,
such Person is no longer a Subsidiary of the Company, the Company will be deemed
to have made an Investment on the date of any such sale or disposition equal to
the fair market value of the Equity Interests of such Subsidiary not sold or
disposed of in an amount determined as provided in the final paragraph of
Section 4.10. The acquisition by the Company or any Subsidiary of the Company of
a Person that holds an Investment in a third Person will be deemed to be an
Investment by the Company or such
10
Subsidiary in such third Person in an amount equal to the fair market value of
the Investment held by the acquired Person in such third Person in an amount
determined as provided in the final paragraph of Section 4.10.
"Issue Date" means June 30, 2003.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of New York, the city in which the Corporate
Trust Office of the Trustee is located or any other place of payment on the
Notes are authorized by law, regulation or executive order to remain closed.
"Letter of Transmittal" means the letter of transmittal, or
its electronic equivalent in accordance with the Applicable Procedures, to be
prepared by the Company and sent to all Holders of the Initial Notes or any
Additional Notes for use by such Holders in connection with an Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law, including any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction.
"Moody's" means Xxxxx'x Investors Service, Inc. or any
successor to the rating agency business of Xxxxx'x Investors Service, Inc.
"Net Income" means, with respect to any specified Person, the
net income (loss) of such Person, determined in accordance with GAAP and before
any reduction in respect of preferred stock dividends, excluding, however:
(a) any gain (but not loss), together with any related
provision for taxes on such gain (but not loss), realized in connection
with: (i) any Asset Sale; or (ii) the disposition of any securities by
such Person or any of its Restricted Subsidiaries or the extinguishment
of any Indebtedness of such Person or any of its Restricted
Subsidiaries; and
(b) any extraordinary gain (but not loss), together with
any related provision for taxes on such extraordinary gain (but not
loss).
"Net Proceeds" means the aggregate cash proceeds received by
the Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale, including, without limitation,
legal, accounting and investment banking fees, and sales commissions, and any
relocation expenses incurred as a result of the Asset Sale, taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, and
amounts required to be applied to the repayment of Indebtedness, other than
Senior Debt, secured by a Lien on the asset or assets that were the subject of
such Asset Sale, and any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP.
"Non-recourse Debt" means Indebtedness:
(a) as to which neither the Company nor any of its
Restricted Subsidiaries (i) provides credit support of any kind
(including any undertaking, agreement or instrument that would
constitute Indebtedness), (ii) is directly or indirectly liable as a
guarantor or otherwise, or (iii) constitutes the lender;
(b) no default with respect to which (including any
rights that the holders thereof may have to take enforcement action
against an Unrestricted Subsidiary) would permit upon notice, lapse of
time of both any holder of any other Indebtedness (other than the
Notes) of the Company or any of its Restricted Subsidiaries to declare
a default on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity; and
11
(c) as to which the lenders have been notified in writing
that they will not have any recourse to the stock or assets of the
Company or any of its Restricted Subsidiaries.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means the Chief Executive Officer, the President,
the Chief Financial Officer, any Executive Vice President or the Treasurer of
the Company.
"Officers' Certificate" means a certificate, in form and
substance reasonably satisfactory to the Trustee, signed by two Officers of the
Company, at least one of whom shall be the principal executive officer or
principal financial officer of the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion, in form and
substance reasonably satisfactory to the Trustee, from legal counsel who is
acceptable to the Trustee and which meets the requirements of Section 13.05
hereof. The counsel may be an employee of or counsel to the Company or the
Trustee.
"Participant" means, with respect to the Depositary, Euroclear
or Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively, and, with respect to DTC, shall include Euroclear and
Clearstream.
"Permitted Asset Swap" means sales, transfers or other
dispositions of assets, including all of the outstanding Capital Stock of a
Restricted Subsidiary, for consideration at least equal to the fair market value
of the assets sold or disposed of, but only if the consideration received
consists of Capital Stock of a Person that becomes a Restricted Subsidiary
engaged in, or property or assets (other than cash, except to the extent used as
a bona fide means of equalizing the value of the property or assets involved in
the swap transaction) of a nature or type or that are used in, a business having
property or assets of a nature or type, or engaged in a business similar or
related to the nature or type of the property and assets of, or business of, the
Company and the Restricted Subsidiaries existing on the date of such sale or
other disposition.
"Permitted Business" means the lines of business conducted by
the Company and its Restricted Subsidiaries on the Issue Date and the businesses
reasonably related thereto, including the ownership, operation and/or management
of a hospital, outpatient clinic or other facility or business that is used or
useful in or related to the provision of health care services in connection with
the ownership, operation and/or management of such hospital or outpatient clinic
or ancillary to the provision health care services or information or the
investment in or management, lease or operation of a hospital or outpatient
clinic.
"Permitted Group" means Acacia Venture Partners, L.P. and Oak
Investment Partners, together with their respective Affiliates.
"Permitted Investments" means:
(a) any Investment in the Company or a Restricted
Subsidiary;
(b) any Investment in Cash Equivalents;
(c) any Investment by the Company or any Restricted
Subsidiary in a Person, if as a result of such Investment:
(i) such Person becomes a Restricted Subsidiary;
or
(ii) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the
Company or a Subsidiary;
(d) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and
in compliance with Section 4.12 hereof;
12
(e) any acquisition of assets solely in exchange for the
issuance of Equity Interests (other than Disqualified Stock) of the
Company;
(f) any Investments received in compromise of obligations
of such persons incurred in the ordinary course of trade creditors or
customers that were incurred in the ordinary course of business,
including pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of any trade creditor or customer;
(g) Hedging Obligations;
(h) Investments the payment for which is Capital Stock
(other than Disqualified Stock) of the Company;
(i) Physician Support Obligations;
(j) Investments in prepaid expenses, negotiable
instruments held for collection, utility and workers compensation,
performance and similar deposits made in the ordinary course of
business;
(k) Investments existing on the date of this Indenture;
and
(l) other Investments in any Person having an aggregate
fair market value (measured on the date each such investment was made
and without giving effect to subsequent changes in value), when taken
together with all other Investments made pursuant to this clause (l)
that are at the time outstanding, not to exceed $10.0 million.
"Permitted Junior Securities" means:
(a) Equity Interests in the Company or any Guarantor; or
(b) debt securities that are subordinated to all Senior
Debt and any debt securities issued in exchange for Senior Debt to
substantially the same extent as, or to a greater extent than, the
notes and the Subsidiary Guarantees are subordinated to Senior Debt
under this Indenture.
"Permitted Refinancing Indebtedness" means any Indebtedness of
the Company or any of its Restricted Subsidiaries issued in exchange for, or the
net proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided, however, that:
(a) the principal amount (or accreted value, if
applicable) of such Permitted Refinancing Indebtedness does not exceed
the principal amount (or accreted value, if applicable) of the
Indebtedness extended, refinanced, renewed, replaced, defeased or
refunded (plus all accrued interest on the Indebtedness and the amount
of all expenses and premiums incurred in connection therewith);
(b) in the case of Indebtedness other than Senior Debt,
such Permitted Refinancing Indebtedness has a final maturity date the
same as or later than the final maturity date of, and has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded;
(c) if Subordinated Obligations are being extended,
refinanced, renewed, replaced, defeased or refunded, such Permitted
Refinancing Indebtedness has a final maturity date later than the final
maturity date of, and is subordinated in right of payment to, the notes
on terms at least as favorable to the holders of notes as those
contained in the documentation governing the Subordinated Obligations
being extended, refinanced, renewed, replaced, defeased or refunded;
and
13
(d) such Indebtedness is incurred either by the Company
or by the Subsidiary who is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.
"Physician Support Obligation" means a loan to or on behalf
of, or a guarantee of indebtedness of a Qualified Physician made or given by the
Company or any of its Subsidiaries, (a) in the ordinary course of its business,
and (b) pursuant to a written agreement having a period not to exceed five
years; provided, however, that any such guarantee of Indebtedness of a Qualified
Physician shall be expressly subordinated in right of payment to the notes or
the Subsidiary Guarantees, as the case may be.
"Predecessor Note" of any particular Note means every previous
Note evidencing all or a portion of the same Debt as that evidenced by such
particular Note; and any Note authenticated and delivered under Section 2.07 in
lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same
Debt as the lost, destroyed or stolen Note.
"Private Placement Legend" means the legend set forth in
Section 2.06(g)(i) hereof to be placed on all Notes issued under this Indenture
except as otherwise permitted by the provisions of this Indenture.
"Put Price Notes" means those certain Put Price Notes
contemplated by the Securities Purchase Agreement.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Qualified Physicians" means one or more physicians or health
care professionals providing service to patients in a health care facility
owned, operated or managed by the Company or any of its Restricted Subsidiaries.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date hereof, among the Company, the Guarantors,
Xxxxxx Brothers Inc., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated and
Xxxxxxxxx & Company, Inc. as such agreement may be amended, modified or
supplemented from time to time and, with respect to any additional notes, one or
more registration rights agreements between the Company and the other parties
thereto, as such agreement(s) may be amended, modified or supplemented from time
to time, relating to rights given by the Company to the purchasers of additional
notes to register such additional notes, or exchange such additional notes for
registered notes, under the Securities Act.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the applicable date specified as a "Record Date" on the face
of any Note in the form of Exhibit A hereto issued in accordance with Article 2
hereof.
"Regulation S" means Regulation S promulgated under the
Securities Act.
"Regulation S Global Note" means a Global Note in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with and registered in the name of the Depositary or its nominee
issued in a denomination equal to the outstanding principal amount of the Notes
sold for initial resale in reliance on Rule 904 of Regulation S.
"Representative" means the Trustee, agent or representative
expressly authorized to act in such capacity, if any, for an issue of Senior
Debt.
"Responsible Officer," when used with respect to the Trustee,
means any officer within the Corporate Trust Office of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his or her knowledge of and familiarity with the particular subject.
14
"Restricted Definitive Note" means one or more Definitive
Notes bearing the Private Placement Legend.
"Restricted Global Notes" means 144A Global Notes, IAI Global
Notes and Regulation S Global Notes.
"Restricted Investment" means an Investment other than a
Permitted Investment.
"Restricted Subsidiary" means any Subsidiary of the Company
other than an Unrestricted Subsidiary.
"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 under the Securities
Act.
"S&P" means Standard & Poor's Ratings Services, a division of
McGraw Hill, Inc., or any successor to the rating agency business thereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Purchase Agreement" means the Securities Purchase
Agreement dated as of June 28, 2002 between the Company and The 1818 Mezzanine
Fund II, L.P., as amended to the Issue Date.
"Senior Debt" means:
(a) all Indebtedness of the Company or any Guarantor
outstanding under Credit Facilities and all Hedging Obligations with
respect thereto;
(b) all Indebtedness of the Company or any Guarantor
outstanding under HUD Financing;
(c) any other Indebtedness of the Company or any
Guarantor permitted to be incurred under the terms of this Indenture,
unless the instrument under which such Indebtedness is incurred
expressly provides that it is on a parity with or subordinated in right
of payment to the notes or any Subsidiary Guarantee;
(d) all Obligations with respect to the items listed in
the preceding clauses (a), (b) and (c); and
(e) the CapSource Put Indebtedness.
Notwithstanding anything to the contrary in the preceding,
Senior Debt will not include:
(i) any liability for federal, state, local or
other taxes owed or owing by the Company;
(ii) any Indebtedness of the Company to any of
its Subsidiaries or other Affiliates;
(iii) any trade payables; or
(iv) the portion of any Indebtedness that is
incurred in violation of this Indenture.
15
"Senior Subordinated Indebtedness" means (a) with respect to
the Company, the notes and any other Indebtedness of the Company that
specifically provides that such Indebtedness is to have the same rank as 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 Debt and (b) with respect to any Guarantor, the Subsidiary Guarantees and
any other Indebtedness of such Guarantor that specifically provides that such
Indebtedness is to have the same rank as the Subsidiary Guarantees in right of
payment and is not subordinated by its terms in right of payment to any
Indebtedness or other obligation of such Guarantor which is not Senior Debt, and
(c) the Put Price Notes.
"Series A Preferred Stock" means the Series A Convertible
Preferred Stock of the Company issued pursuant to a Certificate of Designation
filed with the Secretary of State of Delaware on March 24, 2003.
"Shelf Registration Statement" means the registration
statement relating to the registration of the Notes under Rule 415 of the
Securities Act, as may be set forth in a Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such regulation is in effect on
the date hereof.
"Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which the
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and will not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.
"Subordinated Obligations" means any Indebtedness of the
Company (whether outstanding on the date hereof or thereafter incurred) that is
subordinate or junior in right of payment to the notes pursuant to a written
agreement to that effect.
"Subsidiary" means, with respect to any specified Person:
(a) any corporation, association or other business entity
of which more than 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees of the
corporation, association or other business entity is at the time owned
or controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person (or a combination thereof); and
(b) any partnership (i) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of
such Person or (ii) the only general partners of which are that Person
or one or more Subsidiaries of that Person (or any combination
thereof).
"Subsidiary Guarantee" means the Guarantee of the notes by
each of the Guarantors pursuant to Article 10 hereof and in the form of the
Guarantee endorsed on the form of note attached as Exhibit E hereto and any
additional Guarantee of the notes to be executed by any Subsidiary of the
Company pursuant to Section 4.19 hereof.
"Surviving Person" means the surviving Person formed by a
merger, consolidation or amalgamation and, for purposes of Section 5.01 hereof,
a Person to whom all or substantially all of the properties or assets of the
Company or any Guarantor is sold, assigned, transferred, conveyed or otherwise
disposed of.
"TIA" means the Trust Indenture Act of 1939, as amended, and
the rules and regulations thereunder.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
16
"Unrestricted Definitive Notes" means one or more Definitive
Notes that do not and are not required to bear the Private Placement Legend.
"Unrestricted Global Notes" means one or more Global Notes
that do not and are not required to bear the Private Placement Legend and are
deposited with and registered in the name of the Depositary or its nominee.
"Unrestricted Subsidiary" means any Subsidiary of the Company
or any successor to any of them) that is designated by the Board of Directors as
an Unrestricted Subsidiary pursuant to a Board Resolution, but only to the
extent that such Subsidiary:
(a) has no Indebtedness other than Non-Recourse Debt;
(b) is not party to any agreement, contract, arrangement
or understanding with the Company or any Restricted Subsidiary unless
the terms of any such agreement, contract, arrangement or understanding
are no less favorable to the Company or such Restricted Subsidiary than
those that might be obtained at the time from Persons who are not
Affiliates of the Company;
(c) is a Person with respect to which neither the Company
nor any of its Restricted Subsidiaries has any direct or indirect
obligation (i) to subscribe for additional Equity Interests or (ii) to
maintain or preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results;
(d) has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the Company
or any of its Restricted Subsidiaries; and
(e) has at least one director on its Board of Directors
that is not a director or executive officer of the Company or any of
its Restricted Subsidiaries and has at least one executive officer that
is not a director or executive officer of the Company or any of its
Restricted Subsidiaries.
"U.S. Government Securities" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"Voting Stock" of any Person as of any date means the Capital
Stock of such Person that is at the time entitled to vote in the election of the
Board of Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(a) the sum of the products obtained by multiplying (i)
the amount of each then remaining installment, sinking fund, serial
maturity or other required payments of principal, including payment at
final maturity, in respect of the Indebtedness, by (ii) the number of
years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment; by
(b) the then outstanding principal amount of such
Indebtedness.
Section 1.02. OTHER DEFINITIONS.
Defined in
Term Section
---- -------
"Acceleration Notice"......................................................6.02
"Affiliate Transaction"....................................................4.14
"Asset Sale Offer".........................................................4.12
17
"Authentication Order".....................................................2.02
"Benefited Party"..........................................................10.01
"Change of Control Offer"..................................................4.17
"Change of Control Purchase Price".........................................4.17
"Covenant Defeasance"......................................................8.03
"DTC"......................................................................2.03
"Event of Default".........................................................6.01
"Legal Defeasance".........................................................8.02
"losses"...................................................................7.07
"Offer Amount".............................................................3.09
"Offer Period".............................................................3.09
"Offer to Purchase"........................................................3.09
"Paying Agent".............................................................2.03
"Payment Blockage Notice"..................................................12.03
"Payment Blockage Period"..................................................12.03
"pay the Notes"............................................................12.03
"Purchase Date"............................................................3.09
"Purchase Price............................................................3.09
"Registrar"................................................................2.03
"Security Register"........................................................2.03
Section 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
(a) Whenever this Indenture refers to a provision of the
TIA, the provision is incorporated by reference in and made a part of this
Indenture.
(b) The following TIA terms used in this Indenture have
the following meanings:
"indenture securities" means the Notes and the 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 means the Company and any successor
obligor upon the Notes.
(c) All other terms used in this Indenture that are
defined by the TIA, defined by TIA reference to another statute or defined by
Commission rule under the TIA and not otherwise defined herein have the meanings
so assigned to them.
Section 1.04. RULES OF CONSTRUCTION.
(a) Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined herein has the
meaning assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and in the
plural include the singular;
18
(v) all references in this instrument to "Articles,"
"Sections" and other subdivisions are to the designated Articles,
Sections and subdivisions of this instrument as originally executed;
(vi) 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.
(vii) "including" means "including without limitation;"
(viii) provisions apply to successive events and transactions;
and
(ix) references to sections of or rules under the Securities
Act, the Exchange Act or the TIA shall be deemed to include substitute,
replacement or successor sections or rules adopted by the Commission
from time to time thereunder.
ARTICLE 2.
THE NOTES
Section 2.01. FORM AND DATING.
(a) GENERAL. The Notes and the Trustee's certificate of
authentication shall be substantially in the form included in Exhibit A hereto,
which is hereby incorporated in and expressly made part of this Indenture. The
Notes may have notations, legends or endorsements required by law, exchange rule
or usage in addition to those set forth on Exhibit A. Each Note shall be dated
the date of its authentication. The Notes shall be in denominations of $1,000
and integral multiples thereof. The terms and provisions contained in the Notes
shall constitute a part of this Indenture and the Company, the Guarantors and
the Trustee, by their execution and delivery of this Indenture, expressly agree
to such terms and provisions and to be bound thereby. To the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.
(b) FORM OF NOTES. Notes shall be issued initially in global
form and shall be substantially in the form of Exhibit A attached hereto
(including the Global Note Legend thereon and the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Notes issued in definitive form
shall be substantially in the form of Exhibit A attached hereto (but without the
Global Note Legend thereon and without the "Schedule of Exchanges of Interests
in the Global Note" attached thereto). Each Global Note shall represent such
aggregate principal amount of the outstanding Notes as shall be specified
therein and each shall provide that it shall represent the aggregate principal
amount of outstanding Notes from time to time endorsed thereon and that the
aggregate principal amount of outstanding Notes represented thereby may from
time to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions and transfers of interests therein. Any endorsement of a Global Note
to reflect the amount of any increase or decrease in the aggregate principal
amount of outstanding Notes represented thereby shall be made by the Trustee or
the Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06 hereof.
(c) BOOK-ENTRY PROVISIONS. This Section 2.01(c) shall apply
only to Global Notes deposited with the Trustee, as custodian for the
Depositary. Participants and Indirect Participants shall have no rights under
this Indenture or any Global Note with respect to any Global Note held on their
behalf by the Depositary or by the Trustee as custodian for the Depositary, and
the Depositary shall 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 Participants or
Indirect Participants, the Applicable Procedures or the operation of customary
practices of the Depositary governing the exercise of the rights of a holder of
a beneficial interest in any Global Note.
19
(d) EUROCLEAR AND CLEARSTREAM PROCEDURES APPLICABLE. The
provisions of the "Operating Procedures of the Euroclear System" and "Terms and
Conditions Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream, or any successor
publications, shall be applicable to transfers of beneficial interests in Global
Notes that are held by Participants through Euroclear or Clearstream.
(e) CERTIFICATED SECURITIES. The Company shall exchange
Global notes for Definitive Notes if: (i) at any time the Depositary notifies
the Company that it is unwilling or unable to continue to act as Depositary for
the Global Notes or if at any time the Depositary shall no longer be eligible to
act as such because it ceases to be a clearing agency registered under the
Exchange Act, and, in either case, the Company shall not have appointed a
successor Depositary within 120 days after the Company receives such notice or
becomes aware of such ineligibility, (ii) the Company, at its option, determines
that the Global Notes shall be exchanged for Definitive Notes and delivers a
written notice to such effect to the Trustee or (iii) upon written request of a
Holder or the Trustee if a Default or Event of Default shall have occurred and
be continuing.
Upon the occurrence of any of the events set forth in clauses
(i), (ii) or (iii) above, the Company shall execute, and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate and deliver, Definitive Notes, in authorized denominations, in an
aggregate principal amount equal to the principal amount of the Global Notes in
exchange for such Global Notes.
Upon the exchange of a Global Note for Definitive Notes, such
Global Note shall be cancelled by the Trustee or an agent of the Company or the
Trustee. Definitive Notes issued in exchange for a Global Note pursuant to this
Section 2.01 shall be registered in such names and in such authorized
denominations as the Depositary, pursuant to instructions from its Participants
or its Applicable Procedures, shall instruct the Trustee or an agent of the
Company or the Trustee in writing. The Trustee or such agent shall deliver such
Definitive Notes to or as directed by the Persons in whose names such Definitive
Notes are so registered or to the Depositary.
Section 2.02. EXECUTION AND AUTHENTICATION
(a) One Officer shall execute the Notes on behalf of the
Company by manual or facsimile signature.
(b) If an Officer whose signature is on a Note no longer
holds that office at the time a Note is authenticated by the Trustee, the Note
shall nevertheless be valid.
(c) A Note shall not be valid until authenticated by the
manual signature of the Trustee. The signature shall be conclusive evidence that
the Note has been authenticated under this Indenture.
(d) The Trustee shall, upon a written order of the Company
signed by an Officer (an "AUTHENTICATION ORDER"), authenticate Notes for
issuance.
(e) The Trustee may appoint an authenticating agent
acceptable to the Company to authenticate Notes. Unless otherwise provided in
such appointment, 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 agent. An authenticating agent shall
have the same rights as the Trustee to deal with Holders, the Company or an
Affiliate of the Company.
Section 2.03. REGISTRAR AND PAYING AGENT.
(a) The Company shall maintain an office or agency where
Notes may be presented for registration of transfer or for exchange
("REGISTRAR") and an office or agency where Notes may be presented for payment
("PAYING AGENT"). The Registrar shall keep a register (the "SECURITY REGISTER")
of the Notes and of their transfer and exchange. The Company may appoint one or
more co-registrars and one or more additional paying agents. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes any
additional paying agent. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company shall
20
notify the Trustee in writing of the name and address of any Agent not a party
to this Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
(b) The Company initially appoints The Depository Trust
Company ("DTC") to act as Depositary with respect to the Global Notes.
(c) The Company initially appoints the Trustee to act as
Registrar and Paying Agent and to act as Custodian with respect to the Global
Notes, and the Trustee hereby agrees so to initially act.
Section 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium, if any, or interest on the Notes, and shall
notify the Trustee of any default by the Company in making any such payment.
While any such default continues, the Trustee may require a Paying Agent to pay
all funds held by it relating to the Notes to the Trustee. The Company at any
time may require a Paying Agent to pay all funds held by it to the Trustee. Upon
payment over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for such funds. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all funds held by it as Paying Agent. Upon
any Event of Default under Sections 6.01(i) and (j) hereof relating to the
Company, the Trustee shall serve as Paying Agent for the Notes.
Section 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA ss.312(a). If the
Trustee is not the Registrar, the Company shall furnish or cause to be furnished
to the Trustee at least seven Business Days before each Interest Payment Date
and at such other times as the Trustee may request in writing, a list in such
form and as of such date or such shorter time as the Trustee may allow, as the
Trustee may reasonably require of the names and addresses of the Holders and the
Company shall otherwise comply with TIA ss.312(a).
Section 2.06. TRANSFER AND EXCHANGE.
(a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note may
not be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. Upon the
occurrence of any of the events set forth in Section 2.01(e) above, Definitive
Notes shall be issued in denominations of $1,000 or integral multiples thereof
and in such names as the Depositary shall instruct the Trustee in writing.
Global Notes also may be exchanged or replaced, in whole or in part, as provided
in Sections 2.07 and 2.10 hereof. Except as provided above, every Note
authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof,
shall be authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as provided
in this Section 2.06(a), and beneficial interests in a Global Note may not be
transferred and exchanged other than as provided in Section 2.06(b), (c) or (f)
hereof.
(b) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN THE
GLOBAL NOTES. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial interests
in the Restricted Global Notes shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either clause (i) or (ii) below, as applicable, as well as one
or more of the other following clauses, as applicable:
(i) Transfer of Beneficial Interests in the Same Global
Note. Beneficial interests in any Restricted Global Note may be
transferred to Persons who take delivery thereof in the form of a
beneficial
21
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend and any
Applicable Procedures. Beneficial interests in any Unrestricted Global
Note may be transferred to Persons who take delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note. Except as
may be required by any Applicable Procedures, no written orders or
instructions shall be required to be delivered to the Registrar to
effect the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section
2.06(b)(i) above, the transferor of such beneficial interest must
deliver to the Registrar either (A)(1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
credit or cause to be credited a beneficial interest in another Global
Note in an amount equal to the beneficial interest to be transferred or
exchanged and (2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant account to
be credited with such increase or (B)(1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Registrar containing information
regarding the Person in whose name such Definitive Note shall be
registered to effect the transfer or exchange referred to in (B)(1)
above. Upon consummation of an Exchange Offer by the Company in
accordance with Section 2.06(f) hereof, the requirements of this
Section 2.06(b)(ii) shall be deemed to have been satisfied upon receipt
by the Registrar of the instructions contained in the Letter of
Transmittal delivered by the Holder of such beneficial interests in the
Restricted Global Notes. Upon satisfaction of all of the requirements
for transfer or exchange of beneficial interests in Global Notes
contained in this Indenture and the Notes or otherwise applicable under
the Securities Act, the Trustee shall adjust the principal amount of
the relevant Global Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests in a Restricted Global
Note to Another Restricted Global Note. A holder of a beneficial
interest in a Restricted Global Note may transfer such beneficial
interest to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form
of a beneficial interest in the 144A Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (1) thereof or,
if permitted by the Applicable Procedures, item (3) thereof;
(B) if the transferee will take delivery in the form
of a beneficial interest in the Regulation S Global Note, then
the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2)
thereof; and
(C) if the transferee is required by the Applicable
Procedures to take delivery in the form of a beneficial
interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto,
including the certifications and certificates and Opinion of
Counsel required by item (3) thereof, if applicable.
(iv) Transfer or Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in an Unrestricted
Global Note. A holder of a beneficial interest in a Restricted Global
Note may exchange such beneficial interest for a beneficial interest in
an Unrestricted Global Note or may transfer such beneficial interest to
a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note only if the exchange or
transfer complies with the requirements of Section 2.06(b)(ii) above
and:
22
(A) such exchange or transfer is effected pursuant
to the Exchange Offer in accordance with a Registration Rights
Agreement and the holder of the beneficial interest, in the
case of an exchange, or the transferee, in the case of a
transfer, makes any and all certifications required in the
applicable Letter of Transmittal (or is deemed to have made
such certifications if delivery is made through the Applicable
Procedures) as may be required by such Registration Rights
Agreement;
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration
Rights Agreement;
(C) such transfer is effected by a broker-dealer
pursuant to an Exchange Offer Registration Statement in
accordance with a Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof;
or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note,
a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests or if the Applicable Procedures so require, an Opinion of
Counsel in form reasonably acceptable to the Registrar to the effect that such
exchange or transfer complies with the Securities Act and that the restrictions
on transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to clause (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall execute and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
clause (B) or (D) above.
(v) Transfer or Exchange of Beneficial Interests in an
Unrestricted Global Note for Beneficial Interests in a Restricted
Global Note Prohibited. Beneficial interests in an Unrestricted Global
Note may not be exchanged for, or transferred to Persons who take
delivery thereof in the form of, beneficial interests in a Restricted
Global Note.
(c) Transfer and Exchange of Beneficial Interests in Global
Notes for Definitive Notes.
(i) Transfer or Exchange of Beneficial Interests in
Restricted Global Notes to Restricted Definitive Notes. Subject to
Section 2.06(a) hereof, if any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest
for a Restricted Definitive Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of a
Restricted Definitive Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
23
(B) if such beneficial interest is being transferred
to a QIB in accordance with Rule 144A, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being transferred
to a "Non-U.S. Person" in an offshore transaction (as defined
in Section 902(k) of Regulation S) in accordance with Rule 903
or Rule 904, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (3)(a)
thereof;
(E) if such beneficial interest is being transferred
to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities
Act other than those listed in clauses (B) through (D) above,
a certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of
Counsel required by item (3)(d) thereof, if applicable; or
(F) if such beneficial interest is being transferred
to the Company or any of its Subsidiaries, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof,
the Trustee shall reduce or cause to be reduced in a corresponding
amount pursuant to Section 2.06(h) hereof, the aggregate principal
amount of the applicable Restricted Global Note, and the Company shall
execute and, upon receipt of an Authentication Order in accordance with
Section 2.02 hereof, the Trustee shall authenticate and deliver a
Restricted Definitive Note in the appropriate principal amount to the
Person designated by the holder of such beneficial interest in the
instructions delivered to the Registrar by the Depositary and the
applicable Participant or Indirect Participant on behalf of such
holder. Any Restricted Definitive Note issued in exchange for
beneficial interests in a Restricted Global Note pursuant to this
Section 2.06(c)(i) shall be registered in such name or names and in
such authorized denomination or denominations as the holder of such
beneficial interest shall designate in such instructions. The Trustee
shall deliver such Restricted Definitive Notes to the Persons in whose
names such Notes are so registered. Any Restricted Definitive Note
issued in exchange for a beneficial interest in a Restricted Global
Note pursuant to this Section 2.06(c)(i) shall bear the Private
Placement Legend and shall be subject to all restrictions on transfer
contained therein.
(ii) Transfer or Exchange of Beneficial Interests in
Restricted Global Notes to Unrestricted Definitive Notes. Subject to
Section 2.06(a) hereof, a holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such exchange or transfer is effected pursuant
to an Exchange Offer in accordance with a Registration Rights
Agreement and the holder of such beneficial interest, in the
case of an exchange, or the transferee, in the case of a
transfer, makes any and all certifications in the applicable
Letter of Transmittal (or is deemed to have made such
certifications if delivery is made through the Applicable
Procedures) as may be required by such Registration Rights
Agreement;
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration
Rights Agreement;
24
(C) such transfer is effected by a broker-dealer
pursuant to an Exchange Offer Registration Statement in
accordance with a Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for an Unrestricted Definitive Note, a certificate
from such holder in the form of Exhibit C hereto, including
the certifications in item (1)(b) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of an Unrestricted Definitive Note, a certificate from
such holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
complies with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend
are no longer required in order to maintain compliance with
the Securities Act.
Upon satisfaction of any of the conditions of any of the
clauses of this Section 2.06(c)(ii), the Company shall execute and,
upon receipt of an Authentication Order in accordance with Section 2.02
hereof, the Trustee shall authenticate and deliver an Unrestricted
Definitive Note in the appropriate principal amount to the Person
designated by the holder of such beneficial interest in instructions
delivered to the Registrar by the Depositary and the applicable
Participant or Indirect Participant on behalf of such holder, and the
Trustee shall reduce or cause to be reduced in a corresponding amount
pursuant to Section 2.06(h), the aggregate principal amount of the
applicable Restricted Global Note.
(iii) Transfer or Exchange of Beneficial Interests in
Unrestricted Global Notes to Unrestricted Definitive Notes. Subject to
Section 2.06(a) hereof, if any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest
for an Unrestricted Definitive Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note, then, upon satisfaction of the applicable
conditions set forth in Section 2.06(b)(i) hereof, the Trustee shall
reduce or cause to be reduced in a corresponding amount pursuant to
Section 2.06(h) hereof, the aggregate principal amount of the
applicable Unrestricted Global Note, and the Company shall execute,
and, upon receipt of an Authentication Order in accordance with Section
2.02 hereof, the Trustee shall authenticate and deliver an Unrestricted
Definitive Note in the appropriate principal amount to the Person
designated by the holder of such beneficial interest in instructions
delivered to the Registrar by the Depositary and the applicable
Participant or Indirect Participant on behalf of such holder. Any
Unrestricted Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iii) shall be registered in
such name or names and in such authorized denomination or denominations
as the holder of such beneficial interest shall designate in such
instructions. The Trustee shall deliver such Unrestricted Definitive
Notes to the Persons in whose names such Notes are so registered. Any
Unrestricted Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iii) shall not bear the
Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests in the Global Notes.
(i) Transfer or Exchange of Restricted Definitive Notes to
Beneficial Interests in Restricted Global Notes. If any holder of a
Restricted Definitive Note proposes to exchange such Restricted
Definitive Note for a beneficial interest in a Restricted Global Note
or to transfer such Restricted Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in a Restricted
Global Note, then, upon receipt by the Registrar of the following
documentation:
25
(A) if the holder of such Restricted Definitive Note
proposes to exchange such Restricted Definitive Note for a
beneficial interest in a Restricted Global Note, a certificate
from such holder in the form of Exhibit C hereto, including
the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being
transferred to a "non-U.S. Person" in an offshore transaction
(as defined in Rule 902(k) of Regulation S) in accordance with
Rule 903 or Rule 904, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (2)
thereof;
(D) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of
the Securities Act other than those listed in clauses (B)
through (D) above, a certificate to the effect set forth in
Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3)(d) thereof, if
applicable; or
(F) if such Restricted Definitive Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or
cause to be increased in a corresponding amount pursuant to Section
2.06(h) hereof, the aggregate principal amount of, in the case of
clause (A) above, the appropriate Restricted Global Note, in the case
of clause (B) above, a 144A Global Note, in the case of clause (C)
above, a Regulation S Global Note, and in all other cases, a IAI Global
Note.
(ii) Transfer or Exchange of Restricted Definitive Notes to
Beneficial Interests in Unrestricted Global Notes. A holder of a
Restricted Definitive Note may exchange such Restricted Definitive Note
for a beneficial interest in an Unrestricted Global Note or transfer
such Restricted Definitive Note to a Person who takes delivery thereof
in the form of a beneficial interest in an Unrestricted Global Note
only if:
(A) such exchange or transfer is effected pursuant
to an Exchange Offer in accordance with a Registration Rights
Agreement and the holder of such beneficial interest, in the
case of an exchange, or the transferee, in the case of a
transfer, makes any and all certifications in the applicable
Letter of Transmittal (or is deemed to have made such
certifications if delivery is made through the Applicable
Procedures) as may be required by such Registration Rights
Agreement;
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration
Rights Agreement;
(C) such transfer is effected by a broker-dealer
pursuant to an Exchange Offer Registration Statement in
accordance with a Registration Rights Agreement; or
26
(D) the Registrar receives the following:
(1) if the holder of such Restricted Definitive Note
proposes to exchange such Restricted Definitive Note for a
beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit C hereto,
including the certifications in item (1)(c) thereof; or
(2) if the holder of such Restricted Definitive Note
proposes to transfer such Restricted Definitive Note to a
Person who shall take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note, a
certificate from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
shall be effected in compliance with the Securities Act and
that the restrictions on transfer contained herein and in the
Private Placement Legend shall no longer be required in order
to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the clauses in
this Section 2.06(d)(ii), the Trustee shall cancel such Restricted Definitive
Note and increase or cause to be increased in a corresponding amount pursuant to
Section 2.06(h) hereof, the aggregate principal amount of the Unrestricted
Global Note.
(iii) Transfer or Exchange of Unrestricted Definitive Notes to
Beneficial Interests in Unrestricted Global Notes. A holder of an
Unrestricted Definitive Note may exchange such Unrestricted Definitive
Note for a beneficial interest in an Unrestricted Global Note or
transfer such Unrestricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note at any time. Upon receipt of a request for
such an exchange or transfer, the Trustee shall cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased in a
corresponding amount pursuant to Section 2.06(h) hereof the aggregate
principal amount of one of the Unrestricted Global Notes.
(iv) Transfer or Exchange of Unrestricted Definitive Notes to
Beneficial Interests in Restricted Global Notes Prohibited. An
Unrestricted Definitive Note may not be exchanged for, or transferred
to Persons who take delivery thereof in the form of, beneficial
interests in a Restricted Global Note.
(v) Issuance of Unrestricted Global Notes. If any such
exchange or transfer of a Definitive Note for a beneficial interest in
an Unrestricted Global Note is effected pursuant to clause (ii)(B),
(ii)(D) or (iii) above at a time when an Unrestricted Global Note has
not yet been issued, the Company shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the
Trustee shall authenticate one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of Definitive
Notes so transferred.
(e) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR DEFINITIVE
NOTES. Upon request by a holder of Definitive Notes and such holder's compliance
with the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such holder. In
addition, the requesting holder shall provide any additional certifications,
documents and information, as applicable, required pursuant to the following
provisions of this Section 2.06(e).
(i) Transfer of Restricted Definitive Notes to Restricted
Definitive Notes. Any Restricted Definitive Note may be transferred to
and registered in the name of Persons who take delivery thereof in the
form of a Restricted Definitive Note if the Registrar receives the
following:
(A) if the transfer will be made pursuant to Rule
144A, a certificate in the form of Exhibit B hereto, including
the certifications in item (1) thereof;
27
(B) if the transfer will be made pursuant to Rule
903 or Rule 904, a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof; and
(C) if the transfer will be made pursuant to any
other exemption from the registration requirements of the
Securities Act, a certificate in the form of Exhibit B hereto,
including the certifications, certificates and Opinion of
Counsel required by item (3) thereof, if applicable.
(ii) Transfer or Exchange of Restricted Definitive Notes to
Unrestricted Definitive Notes. Any Restricted Definitive Note may be
exchanged by the holder thereof for an Unrestricted Definitive Note or
transferred to a Person or Persons who take delivery thereof in the
form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant
to an Exchange Offer in accordance with a Registration Rights
Agreement and the holder, in the case of an exchange, or the
transferee, in the case of a transfer, makes any and all
certifications in the applicable Letter of Transmittal (or is
deemed to have made such certifications if delivery is made
through the Applicable Procedures) as may be required by a
Registration Rights Agreement;
(B) any such transfer is effected pursuant to a
Shelf Registration Statement in accordance with a Registration
Rights Agreement;
(C) any such transfer is effected by a broker-dealer
pursuant to an Exchange Offer Registration Statement in
accordance with a Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such Restricted Definitive Note
proposes to exchange such Restricted Definitive Notes for an
Unrestricted Definitive Note, a certificate from such holder
in the form of Exhibit C hereto, including the certifications
in item (1)(d) thereof; or
(2) if the holder of such Restricted Definitive
Notes proposes to transfer such Restricted Definitive Notes to
a Person who shall take delivery thereof in the form of an
Unrestricted Definitive Note, a certificate from such holder
in the form of Exhibit B hereto, including the certifications
in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that such
exchange or transfer complies with the Securities Act and that
the restrictions on transfer contained herein and in the
Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the clauses of
this Section 2.06(e)(ii), the Trustee shall cancel the prior Restricted
Definitive Note and the Company shall execute, and upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate and deliver an Unrestricted Definitive Note in the appropriate
aggregate principal amount to the Person designated by the holder of such prior
Restricted Definitive Note in instructions delivered to the Registrar by such
holder.
(iii) Transfer of Unrestricted Definitive Notes to
Unrestricted Definitive Notes. A holder of Unrestricted Definitive
Notes may transfer such Unrestricted Definitive Notes to a Person who
takes delivery thereof in the form of an Unrestricted Definitive Note.
Upon receipt of a request to register such a
28
transfer, the Registrar shall register the Unrestricted Definitive
Notes pursuant to the instructions from the holder thereof.
(f) EXCHANGE OFFER. Upon the occurrence of an Exchange Offer
in accordance with a Registration Rights Agreement, the Company shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02 hereof,
the Trustee shall authenticate (A) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the aggregate principal amount of the
beneficial interests in the applicable Restricted Global Notes (1) tendered for
acceptance by Persons that make any and all certifications in the applicable
Letters of Transmittal (or are deemed to have made such certifications if
delivery is made through the Applicable Procedures) as may be required by such
Registration Rights Agreement and (2) accepted for exchange in such Exchange
Offer and (B) Unrestricted Definitive Notes in an aggregate principal amount
equal to the aggregate principal amount of the Restricted Definitive Notes
tendered for acceptance by Persons who made the foregoing certifications and
accepted for exchange in the Exchange Offer. Concurrently with the issuance of
such Notes, the Trustee shall reduce or cause to be reduced in a corresponding
amount the aggregate principal amount of the applicable Restricted Global Notes,
and the Company shall execute and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver
to the Persons designated by the holders of Restricted Definitive Notes so
accepted Unrestricted Definitive Notes in the appropriate aggregate principal
amount.
(g) LEGENDS. The following legends shall appear on the face
of all Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by clause (B) below, each
Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the
legend in substantially the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY
STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES,
ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS
PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY PRIOR
TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT PURCHASES
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO
WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE OF THE
UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E)
TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR
(7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR
ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF
$250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO
ANY SUCH
29
OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE
THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE."
(B) Notwithstanding the foregoing, any Global Note
or Definitive Note issued pursuant to clauses (b)(iv),
(c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f)
to this Section 2.06 (and all Notes issued in exchange
therefor or substitution thereof) shall not bear the Private
Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend
in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF
THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES
IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY BE REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS
AN INTEREST HEREIN."
(h) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL NOTES. At such
time as all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed, repurchased
or cancelled in whole and not in part, each such Global Note shall be returned
to or retained and cancelled by the Trustee in accordance with Section 2.11
hereof. At any time prior to such cancellation, if any beneficial interest in a
Global Note is exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Note or for
Definitive Notes, the aggregate principal amount of Notes represented by such
Global Note shall be reduced accordingly and an endorsement shall be made on
such Global Note by the Trustee or by the Depositary at the direction of the
Trustee to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note, the aggregate principal
amount of such other Global Note shall be increased accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) GENERAL PROVISIONS RELATING TO TRANSFERS AND EXCHANGES.
(i) No service charge shall be made to a holder of a
beneficial interest in a Global Note or to a Holder of a Definitive
Note for any registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection
30
therewith (other than any such transfer taxes or similar governmental
charge payable upon exchange or transfer pursuant to Sections 2.10,
3.06, 4.12, 4.17 and 9.05 hereof).
(ii) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the
same debt as the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange and shall be entitled to all of
the benefits of this Indenture equally and proportionately with all
other Notes duly issued hereunder.
(iii) Neither the Registrar nor the Company shall be required
(A) to issue, to register the transfer of or to exchange any Notes
during a period beginning at the opening of business 15 days before the
day of any selection of Notes for redemption under Section 3.02 hereof
and ending at the close of business on the date of selection, (B) to
register the transfer of or to exchange any Note so selected for
redemption in whole or in part, except the unredeemed portion of any
Note being redeemed in part or (C) to register the transfer of or to
exchange a Note between a record date (including a Regular Record Date)
and the next succeeding Interest Payment Date.
(iv) Prior to due presentment for the registration of
transfer of any Note, the Trustee, any Agent and the Company may deem
and treat the Person in whose name any Note is registered as the
absolute owner of such Note for the purpose of receiving payment of
principal of, premium, if any, and interest on such Note and for all
other purposes, in each case regardless of any notice to the contrary.
(v) All certifications, certificates and Opinions of
Counsel required to be submitted to the Registrar pursuant to this
Section 2.06 to effect a registration of transfer or exchange may be
submitted by facsimile.
(vi) The Trustee is hereby authorized and directed to enter
into a letter of representation with the Depositary in the form
provided by the Company and to act in accordance with such letter.
(vii) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restriction on
transfer imposed under this Indenture or under applicable law with
respect to any transfer of any interest in any Note (including
transfers between or among beneficial owners of interests in any Global
Note) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if
and when expressly required by the terms of, this Indenture, and to
examine the same to determine substantial compliance as to form with
the express requirements hereof.
Section 2.07. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and, upon
receipt of an Authentication Order in accordance with Section 2.02 hereof, the
Trustee shall authenticate a replacement Note. If required by the Trustee or the
Company, the Holder of such Note shall provide an affidavit of loss and
indemnity that is sufficient, in the judgment of the Trustee or the Company, to
protect the Company, the Trustee, any Agent and any authenticating agent from
any loss that any of them may suffer in connection with such replacement. If
required by the Company, such Holder shall reimburse the Company for its
reasonable expenses in connection with such replacement.
Every replacement Note issued in accordance with this Section
2.07 shall be the valid obligation of the Company, evidencing the same debt as
the destroyed, lost or stolen Note, and shall be entitled to all of the benefits
of this Indenture equally and proportionately with all other Notes duly issued
hereunder.
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Section 2.08. OUTSTANDING NOTES.
(a) The Notes outstanding at any time shall be the entire
principal amount of Notes represented by all of the Global Notes and Definitive
Notes authenticated by the Trustee except for those cancelled by it, those
delivered to it for cancellation, those subject to reductions in beneficial
interests effected by the Trustee in accordance with Section 2.06 hereof, and
those described in this Section 2.08 as not outstanding. Except as set forth in
Section 2.09 hereof, a Note shall not cease to be outstanding because the
Company or an Affiliate of the Company holds the Note; provided, however, that
Notes held by the Company or a Subsidiary of the Company shall be deemed not to
be outstanding for purposes of Section 3.07(c) hereof.
(b) If a Note is replaced pursuant to Section 2.07 hereof,
it shall cease to be outstanding unless the Trustee receives proof satisfactory
to it that the replaced note is held by a bona fide purchaser.
(c) If the principal amount of any Note is considered paid
under Section 4.01 hereof, it shall cease to be outstanding and interest on it
shall cease to accrue.
(d) If the Paying Agent (other than the Company, a
Subsidiary or an Affiliate of any thereof) holds, on a redemption date, a
Purchase Date or a maturity date, funds sufficient to pay Notes payable on that
date, then on and after that date such Notes shall be deemed to be no longer
outstanding and shall cease to accrue interest.
Section 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company, or by any Affiliate of the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned shall be so disregarded.
Section 2.10. TEMPORARY NOTES.
Until certificates representing Notes are ready for delivery,
the Company may prepare and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate temporary
Notes. Temporary Notes shall be substantially in the form of Definitive Notes
but may have variations that the Company considers appropriate for temporary
Notes and as shall be reasonably acceptable to the Trustee. Without unreasonable
delay, the Company shall prepare and the Trustee shall authenticate Global Notes
or Definitive Notes in exchange for temporary Notes, as applicable. After
preparation of Definitive Notes, the Temporary Notes will be exchangeable for
Definitive Notes upon surrender of the Temporary Notes.
Holders of temporary Notes shall be entitled to all of the
benefits of this Indenture equally and proportionately with all other Notes duly
issued hereunder.
Section 2.11. CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment.
Upon sole direction of the Company, the Trustee and no one else shall cancel all
Notes surrendered for registration of transfer, exchange, payment, replacement
or cancellation and shall destroy cancelled Notes (subject to the record
retention requirements of the Exchange Act or other applicable laws) unless by
written order, signed by an Officer of the Company, the Company directs them to
be returned to it. Certification of the destruction of all cancelled Notes shall
be delivered to the Company from time to time upon request. The Company may not
issue new Notes to replace Notes that it has paid or that have been delivered to
the Trustee for cancellation.
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Section 2.12. PAYMENT OF INTEREST; DEFAULTED INTEREST
If the Company defaults in a payment of interest on the Notes,
it shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date; provided that no such special
record date shall be less than 10 days prior to the related Interest Payment
Date for such defaulted interest. At least 15 days before the special record
date, the Company (or, upon the written request of the Company, the Trustee in
the name and at the expense of the Company) shall mail or cause to be mailed to
Holders a notice that states the special record date, the related Interest
Payment Date and the amount of such interest to be paid.
Section 2.13. CUSIP OR ISIN NUMBERS.
The Company in issuing the Notes may use "CUSIP" and/or "ISIN"
numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP"
and/or "ISIN" numbers in notices of redemption or Offers to Purchase as a
convenience to Holders; provided, however, that any such notice may state that
no representation is made as to the correctness of such numbers either as
printed on the Notes or as contained in any notice of a redemption or notice of
an Offer to Purchase and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption or Offer to
Purchase shall not be affected by any defect in or omission of such numbers. The
Company shall promptly notify the Trustee of any change in the "CUSIP" and/or
"ISIN" numbers.
Section 2.14. ADDITIONAL INTEREST
If Additional Interest is payable by the Company pursuant to a
Registration Rights Agreement and paragraph 1 of the Notes, the Company shall
deliver to the Trustee a certificate to that effect stating (i) the amount of
such Additional Interest that is payable and (ii) the date on which such
interest is payable pursuant to Section 4.01 hereof. Unless and until a
Responsible Officer of the Trustee receives such a certificate or instruction or
direction from the Holders in accordance with the terms of this Indenture, the
Trustee may assume without inquiry that no Additional Interest is payable. The
foregoing shall not prejudice the rights of the Holders with respect to their
entitlement to Additional Interest as otherwise set forth in this Indenture or
the Notes and pursuing any action against the Company directly or otherwise
directing the Trustee to take any such action in accordance with the terms of
this Indenture and the Notes. If the Company has paid Additional Interest
directly to the Persons entitled to it, the Company shall deliver to the Trustee
an Officers' Certificate setting forth the details of such payment.
Section 2.15. ISSUANCE OF ADDITIONAL NOTES
The Company shall be entitled, subject to its compliance with
Section 4.09 hereof, to issue Additional Notes under this Indenture which shall
have identical terms as the Initial Notes issued on the date hereof, other than
with respect to the date of issuance, issue price and rights under a related
Registration Rights Agreement, if any. The Initial Notes issued on the date
hereof, any Additional Notes and all Exchange Notes issued in exchange therefor
shall be treated as a single class for all purposes under this Indenture,
including directions, waivers, amendments, consents, redemptions and Offers to
Purchase.
With respect to any Additional Notes, the Company shall set
forth in a Board Resolution and an Officers' Certificate, a copy of each of
which shall be delivered to the Trustee, the following information:
(a) the aggregate principal amount of such Additional Notes
to be authenticated and delivered pursuant to this Indenture;
(b) the issue price, the Issue Date and the CUSIP and/or
ISIN number of such Additional Notes; provided, however, that no Additional
Notes may be issued at a price that would cause such Additional Notes to
33
have "original issue discount" within the meaning of Section 1273 of the Code,
other than a de minimis original issue discount within the meaning of Section
1273 of the Code; and
(c) whether such Additional Notes shall be subject to the
restrictions on transfer set forth in Section 2.06 hereof relating to Restricted
Global Notes and Restricted Definitive Notes.
Section 2.16. Record Date.
The record date for purposes of determining the identity of
Holders of Notes entitled to vote or consent to any action by vote or consent or
permitted under this Indenture shall be determined as provided for in TIA
Section 316(c).
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days but not more than 60 days before a redemption date (or such
shorter period as allowed by the Trustee), an Officers' Certificate setting
forth (a) the applicable section of this Indenture pursuant to which the
redemption shall occur, (b) the redemption date, (c) the principal amount of
Notes to be redeemed and (d) 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,
the Trustee shall select the Notes to be redeemed among the Holders of the Notes
in compliance with the requirements of the principal national securities
exchange, if any, on which the Notes are listed or, if the Notes are not so
listed, on a pro rata basis, by lot or in accordance with any other method the
Trustee deems fair and appropriate. 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 integral multiples
thereof; 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 an integral
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.
Section 3.03. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days prior to 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
such Holder's registered address appearing in the Security Register, except that
redemption notices may be mailed more than 60 days prior to a redemption date if
the notice is issued in connection with a defeasance pursuant to Article 8
hereof or a satisfaction and discharge pursuant to Article 11 hereof.
The notice shall identify the Notes to be redeemed and shall
state:
(a) the redemption date;
34
(b) the appropriate method for calculation of the redemption
price, but need not include the redemption price itself; the actual redemption
price shall be set forth in an Officers' Certificate delivered to the Trustee no
later than two (2) Business Days prior to the redemption date;
(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, if applicable, 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 applicable 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 of
the CUSIP and/or ISIN numbers, if any, listed in such notice or printed on the
Notes.
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 (or such shorter
period allowed by the Trustee), prior to the redemption date, an Officers'
Certificate requesting that the Trustee give such notice (in the name and at the
expense of the Company) and setting forth the information to be stated in such
notice as provided in this Section 3.03.
Section 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section
3.03 hereof, Notes called for redemption shall become irrevocably due and
payable on the redemption date at the redemption price. A notice of redemption
may not be conditional.
Section 3.05. DEPOSIT OF REDEMPTION PRICE.
On or prior to 11:00 a.m. Eastern time on the Business Day
prior to any redemption date, the Company shall deposit with the Trustee or with
the Paying Agent money sufficient to pay the redemption price of and, if
applicable, accrued and unpaid interest on all Notes to be redeemed on that
date. The Trustee or the Paying Agent shall promptly, and in any event within
two (2) Business Days after the redemption date, 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 and unpaid
interest, if any, 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 purchase or redemption in
accordance with Section 2.08(d) hereof, whether or note such Notes are presented
for payment. If a Note is redeemed on or after a Regular Record Date but on or
prior to the related Interest Payment Date, then any accrued and unpaid
interest, if any, shall be paid to the Person in whose name such Note was
registered at the close of business on such Regular 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, 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.
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Section 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company
shall issue and, upon receipt of an authentication order in accordance with
Section 2.02 hereof, 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 3.07. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 3.07,
the Notes shall not be redeemable at the option of the Company prior to June 15,
2008. Beginning on June 15, 2008, the Company may redeem all or a portion of the
Notes, at once or over time, after giving the notice required pursuant to
Section 3.03 hereof, at the redemption prices (expressed as percentages of
principal amount) set forth below, plus accrued and unpaid interest and
Additional Interest, if any, on the Notes redeemed, to the applicable redemption
date (subject to the right of Holders of record on the relevant Regular Record
Date to receive interest due on the relevant Interest Payment Date), if redeemed
during the twelve-month period commencing on June 15 of the years indicated
below:
Year Percentage
---- ----------
2008...........................................................................105.313%
2009...........................................................................103.542%
2010...........................................................................101.771%
2011 and thereafter............................................................100.000%
(b) At any time and from time to time prior to June 15,
2006, the Company may redeem up to 35% of the aggregate principal amount of the
Notes (including Additional Notes) issued under this Indenture at a redemption
price (expressed as a percentage of principal amount) equal to 110.625% of the
principal amount thereof, plus accrued and unpaid interest and Additional
Interest, if any, to the redemption date (subject to the right of Holders of
record on the relevant Regular Record Date to receive interest due on the
relevant Interest Payment Date) with the net cash proceeds of any Equity
Offering of common stock of the Company; provided, however, that (i) at least
65% of the aggregate principal amount of the Notes initially issued under this
Indenture (excluding Notes held by the Company and its Subsidiaries) remains
outstanding immediately after giving effect to such redemption and (ii) any such
redemption shall be made within 90 days of such Equity Offering.
(c) Any prepayment pursuant to this Section 3.07 shall be
made pursuant to the provisions of Sections 3.01 through 3.06 hereof.
Section 3.08. MANDATORY REDEMPTION.
Except as set forth in Sections 4.12 and 4.17 hereof, the
Company shall not be required to make mandatory redemption or sinking fund
payments with respect to, or offer to purchase, the Notes.
Section 3.09. OFFER TO PURCHASE.
(a) In the event that, pursuant to Section 4.12 or 4.17
hereof, the Company shall be required to commence an Asset Sale Offer or a
Change of Control Offer (each, an "OFFER TO PURCHASE"), it shall follow the
procedures specified below.
(b) The Company shall cause a notice of the Offer to
Purchase to be sent at least once to the Dow Xxxxx News Service or similar
business news service in the United States.
(c) The Company shall commence the Offer to Purchase by
sending, by first-class mail, with a copy to the Trustee, to each Holder at such
Holder's address appearing in the Security Register, a notice the terms of which
shall govern the Offer to Purchase stating:
(i) that the Offer to Purchase is being made pursuant to
this Section 3.09 and Section 4.12 or Section 4.17, as the case may be,
and, in the case of a Change of Control Offer, that a Change of Control
36
has occurred, the circumstances and relevant facts regarding the Change
of Control and that a Change of Control Offer is being made pursuant to
Section 4.17;
(ii) the principal amount of Notes required to be purchased
pursuant to Section 4.12 or Section 4.17, as the case may be (the
"OFFER AMOUNT"), the purchase price set forth in Section 4.12 or
Section 4.17 hereof, as applicable (the "PURCHASE PRICE"), the Offer
Period and the Purchase Date (each as defined below);
(iii) except as provided in clause (ix), that all Notes timely
tendered and not withdrawn shall be accepted for payment;
(iv) that any Note not tendered or accepted for payment shall
continue to accrue interest;
(v) that, unless the Company defaults in making such
payment, any Note accepted for payment pursuant to the Offer to
Purchase shall cease to accrue interest after the Purchase Date;
(vi) that Holders electing to have a Note purchased pursuant
to an Offer to Purchase may elect to have Notes purchased in integral
multiples of $1,000 only;
(vii) that Holders electing to have a Note purchased pursuant
to any Offer to Purchase shall be required to surrender the Note, with
the form entitled "Option of Holder to Elect Purchase" on the reverse
of the Note completed, or transfer by book-entry transfer, to the
Company, the Depositary, if appointed by the Company, or a Paying Agent
at the address specified in the notice before the close of business on
the third Business Day before the Purchase Date;
(viii) that Holders shall be entitled to withdraw their
election if the Company, the Depositary or the Paying Agent, as the
case may be, receives, not later than the expiration of the Offer
Period, a telegram, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Note (or portions
thereof) the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(ix) that, in the case of an Asset Sale Offer, if the
aggregate principal amount of Notes surrendered by Holders exceeds the
Offer Amount, the Company shall select the Notes to be purchased on a
pro rata basis (with such adjustments as may be deemed appropriate by
the Company so that only Notes in denominations of $1,000 or integral
multiples thereof shall be purchased);
(x) that Holders whose Notes were purchased in part shall be
issued new Notes equal in principal amount to the unpurchased portion
of the Notes surrendered (or transferred by book-entry transfer); and
(xi) any other procedures the Holders must follow in order to
tender their Notes (or portions thereof) for payment and the procedures
that Holders must follow in order to withdraw an election to tender
Notes (or portions thereof) for payment.
(d) The Offer to Purchase shall remain open for a period of
at least 30 days but no more than 60 days following its commencement, except to
the extent that a longer period is required by applicable law (the "OFFER
PERIOD"). No later than five (5) Business Days (and in any event no later than
the 60th day following the Change of Control) after the termination of the Offer
Period (the "PURCHASE DATE"), the Company shall purchase the Offer Amount or, if
less than the Offer Amount has been tendered, all Notes tendered in response to
the Offer to Purchase. Payment for any Notes so purchased shall be made in the
same manner as interest payments are made. The Company shall publicly announce
the results of the Offer to Purchase on the Purchase Date.
(e) On or prior to the Purchase Date, the Company shall, to
the extent lawful:
37
(i) accept for payment (on a pro rata basis to the extent
necessary in connection with an Asset Sale Offer), the Offer Amount of
Notes or portions of Notes properly tendered and not withdrawn pursuant
to the Offer to Purchase, or if less than the Offer Amount has been
tendered, all Notes tendered;
(ii) deposit with the Paying Agent funds in an amount equal
to the Purchase Price in respect of all Notes or portions of Notes
properly tendered; and
(iii) deliver or cause to be delivered to the Trustee the
Notes properly accepted together with an Officers' Certificate stating
the aggregate principal amount of Notes or portions of Notes being
purchased by the Company and that such Notes or portions thereof were
accepted for payment by the Company in accordance with the terms of
this Section 3.09.
(f) The Paying Agent shall promptly (but in the case of a
Change of Control not later than 60 days from the date of the Change of Control)
execute and issue a new Note, and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver
(or cause to be transferred by book-entry) such new Note to such Holder, in a
principal amount equal to any unpurchased portion of the Note surrendered;
provided, however, that each such new Note shall be in a principal amount of
$1,000 or an integral multiple thereof. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof.
(g) If the Purchase Date is on or after a Regular Record
Date and on or before the related Interest Payment Date, any accrued and unpaid
interest shall be paid to the Person in whose name a Note is registered at the
close of business on such Regular Record Date, and no additional interest shall
be payable to Holders who tender Notes pursuant to the Offer to Purchase.
(h) The Company shall comply, to the extent applicable, with
the requirements of Rule 14e-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent those laws and regulations are
applicable in connection with the Offer to Purchase. To the extent that the
provisions of any securities laws or regulations conflict with Sections 4.12 or
4.17, as applicable, this Section 3.09 or other provisions of this Indenture,
the Company shall comply with applicable securities laws and regulations and
shall not be deemed to have breached its obligations under Sections 4.12 or
4.17, as applicable, this Section 3.09 or such other provision by virtue of such
compliance.
(i) Other than as specifically provided in this Section
3.09, any purchase pursuant to this Section 3.09 shall be made in accordance
with the provisions of Section 3.01 through 3.06 hereof.
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 on, the Notes on the dates and in the manner
provided in this Indenture and 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 11:00 a.m. Eastern Time on
the due date money deposited by the Company in immediately available United
States dollars and designated for and sufficient to pay all principal, premium,
if any, and interest then due. Such Paying Agent shall return to the Company
promptly, and in any event, no later than five (5) Business Days following the
date of payment, any money (including accrued interest) that exceeds such amount
of principal, premium, if any, and interest paid on the Notes. The Company shall
pay Additional Interest, if any, in the same manner, on the dates and in the
amounts set forth in a Registration Rights Agreement, the Notes and this
Indenture. If a payment date is a Legal Holiday at a place of payment, payment
may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue on such payment for the intervening
period.
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The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time on demand at a rate that is 1% per annum in
excess of the rate then in effect; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace periods), from
time to time on demand at the same rate to the extent lawful.
Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.
Section 4.02. MAINTENANCE OF OFFICE OR AGENCY.
(a) The Company shall maintain in the Borough of Manhattan,
The City of New York, an office or agency (which may be an office or drop
facility of the Trustee or an affiliate of the Trustee, Registrar or
co-registrar) where Notes may be presented or 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
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
(b) 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. 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.
(c) The Company hereby designates the Corporate Trust Office
of the Trustee, as one such office, drop facility or agency of the Company in
accordance with Section 2.03 hereof.
Section 4.03. REPORTS.
(a) Whether or not required by the Commission, so long as
any Notes are outstanding, the Company will furnish to the Holders, within the
time periods specified in the Commission's rules and regulations:
(i) all quarterly and annual financial information
that would be required to be contained in a filing with the
Commission on Forms 10-Q and 10-K if the Company were required
to file such Forms, including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations"
and, with respect to the annual information only, a report on
the annual financial statements by the Company's certified
independent accountants; and
(ii) all current reports that would be required to be
filed with the Commission on Form 8-K if the Company were
required to file such reports.
(b) If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by the preceding paragraph will include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes
thereto, and if the Company or any of its Restricted Subsidiaries has made an
Investment of at least $0.1 million in such Unrestricted Subsidiary, in
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," of the financial condition and results of operations of the Company
and its Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries of the Company.
(c) In addition, following the consummation of the Exchange
Offer contemplated by the Registration Rights Agreement, whether or not required
by the Commission, the Company will file a copy of all of the information and
reports referred to in clauses (a)(i) and (a)(ii) above with the Commission for
public availability within the time periods specified in the Commission's rules
and regulations (unless the Commission will not accept such a filing) and make
such information available to securities analysts and prospective investors upon
request. In
39
addition, the Company and the Guarantors have agreed that, for so long as any
Notes remain outstanding, they will furnish to the holders and to securities
analysts and prospective investors, upon their request, the information required
to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(d) The Trustee shall not be under a duty to review or
evaluate any report or information delivered to the Trustee pursuant to the
provisions of this Section 4.03 for the purposes of making such reports
available to it and to the Holders of Notes who may request such information.
Delivery of such reports, information and documents to the Trustee as may be
required pursuant to this Section 4.03 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).
Section 4.04. COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 90 days
after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company, the Guarantors and their respective
Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the
Company, the Guarantors and their respective Subsidiaries have kept, observed,
performed and fulfilled their obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company, the Guarantors and their respective
Subsidiaries have kept, observed, performed and fulfilled each and every
covenant contained in this Indenture and are not in default in the performance
or observance of any of the terms, provisions and conditions of this Indenture
(or, if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company is taking or proposes to take with respect thereto) and that
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of, premium,
if any, or interest on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.
(b) The Company shall otherwise comply with TIA
ss.314(a)(2).
(c) The Company shall deliver to the Trustee, within 30 days
after the occurrence thereof, written notice in the form of an Officers'
Certificate of any event that with the giving of notice and/or the lapse of time
would become an Event of Default, its status and what action the Company is
taking or proposes to take with respect thereto.
Section 4.05. TAXES.
The Company shall pay, and shall cause each of its
Subsidiaries to pay, prior to delinquency, all material taxes, assessments and
governmental levies, except such as are being contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders.
Section 4.06. STAY, EXTENSION AND USURY LAWS.
The Company 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 (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.
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Section 4.07. CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall do or cause to
be done all things necessary to preserve and keep in full force and effect (a)
its corporate existence, and the corporate, partnership or other existence of
each Restricted Subsidiary, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Restricted Subsidiary and (b) the rights (charter and statutory), licenses
and franchises of the Company and its Restricted Subsidiaries; provided,
however, that the Company shall not be required to preserve any such right,
license or franchise, or the corporate, partnership or other existence of any
Restricted Subsidiary, 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 its Restricted Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the Notes, or
that such preservation is not necessary in connection with any transaction not
prohibited by this Indenture.
Section 4.08. PAYMENTS FOR CONSENT.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to or for the
benefit of any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to be paid and is paid to all Holders that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
Section 4.09. INCURRENCE OF ADDITIONAL DEBT AND ISSUANCE OF CAPITAL STOCK.
The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, create, incur, issue, assume, Guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt), and the Company will not issue any Disqualified Stock and will not permit
any Restricted Subsidiary to issue any shares of preferred stock (including
Disqualified Stock) other than to the Company; provided, however, that the
Company may incur Indebtedness (including Acquired Debt) or issue Disqualified
Stock, any of the Company's Restricted Subsidiaries that are Guarantors may
incur Indebtedness (including Acquired Indebtedness) and the HUD Financing
Subsidiaries may incur HUD Financing, if the Fixed Charge Coverage Ratio for the
Company's most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Disqualified Stock is issued would
have been at least 2.00 to 1 for the period from the Issue Date through June 30,
2006 and 2.25 to 1 thereafter, determined on a pro forma basis (including a pro
forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred or the preferred stock or Disqualified Stock had
been issued, as the case may be, at the beginning of such four-quarter period.
The first paragraph of this covenant will not prohibit the
incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):
(1) the incurrence by the Company or any Guarantor of
additional Indebtedness and letters of credit under one or more Credit
Facilities and Guarantees thereof by the Guarantors; provided that the
aggregate principal amount of all Indebtedness and letters of credit of
the Company and the Guarantors incurred pursuant to this clause (1)
(with letters of credit being deemed to have a principal amount equal
to the maximum potential liability of the Company and the Guarantors
thereunder) does not exceed the greater of (A) $85.0 million or (B) 85%
of the net book value of receivables and 65% of the net book value of
real property (other than real property pledged in connection with any
HUD Financing) of the Company and the Restricted Subsidiaries on a
consolidated basis at the time the Indebtedness is incurred, as
determined in accordance with GAAP, less the aggregate amount of Net
Proceeds from an Asset Sale applied by the Company and its Subsidiaries
to repay Indebtedness thereunder, pursuant to Section 4.12 hereof;
41
(2) the incurrence by the Company and the Restricted
Subsidiaries of the Existing Indebtedness;
(3) the incurrence by the Company and the Guarantors of
Indebtedness represented by the Initial Notes (and the related Exchange
Notes to be issued pursuant to the Registration Rights Agreement) and
the incurrence by the Guarantors of the Subsidiary Guarantees of those
notes;
(4) the incurrence by the Company or any Restricted
Subsidiary of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations, in each case
incurred for the purpose of financing all or any part of the purchase
price or cost of construction or improvement of property, plant or
equipment used in the business of the Company or such Restricted
Subsidiary, in an aggregate principal amount, including all Permitted
Refinancing Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (4), not to exceed $15.0
million at any time outstanding;
(5) the incurrence by the Company or any Restricted
Subsidiary of Permitted Refinancing Indebtedness in exchange for, or
the net proceeds of which are used to extend, defease, renew, refund,
refinance or replace Indebtedness (other than intercompany
Indebtedness) that was incurred under the first paragraph of this
Section 4.09 or clauses (2), (3), (6) or (10) of this paragraph;
(6) the incurrence by the Company or any Restricted
Subsidiary of intercompany Indebtedness between or among the Company
and any Restricted Subsidiary; provided, however, that:
(i) if the Company or a Guarantor is the obligor on
such Indebtedness, such Indebtedness is expressly subordinated
to the prior payment in full in cash of all Obligations with
respect to the Notes or the Subsidiary Guarantees, as the case
may be; and;
(ii) (A) any subsequent issuance or transfer of
Equity Interests that results in any such Indebtedness being
held by a Person other than the Company or a Restricted
Subsidiary and (B) any subsequent sale or other transfer of
any such Indebtedness to a Person that is not either the
Company or a Restricted Subsidiary shall be deemed, in each
case, to constitute an incurrence of such Indebtedness by the
Company or such Restricted Subsidiary, as the case may be,
that was not permitted by this clause (6);
(7) the incurrence of any Physician Support Obligations by
the Company or any Restricted Subsidiary;
(8) the incurrence of Indebtedness of the Company or any
Restricted Subsidiary consisting of guarantees, indemnities, holdbacks
or obligations in respect of purchase price adjustments in connection
with the acquisition or disposition of assets, including without
limitation, shares of Capital Stock of Restricted Subsidiaries or
contingent payment obligations incurred in connection with the
acquisition of assets which are contingent on the performance of the
assets acquired, other than guarantees of Indebtedness incurred by any
Person acquiring all or any portion of such assets or shares of Capital
Stock of such Restricted Subsidiary for the purpose of financing such
acquisition;
(9) the incurrence of Indebtedness of the Company or any
Restricted Subsidiary represented by (i) letters of credit for the
account of the Company or any Restricted Subsidiary or (ii) other
obligations to reimburse third parties pursuant to any surety bond or
other similar arrangements, which letters of credit or other
obligations, as the case may be, are intended to provide security for
workers' compensation claims, payment obligations in connection with
sales tax and insurance or other similar requirements in the ordinary
course of business;
42
(10) the incurrence by the Company or any Restricted
Subsidiary of Hedging Obligations that are incurred in the normal
course of business and consistent with past business practices for the
purpose of fixing or hedging currency or interest rate risk (including
with respect to any floating rate Indebtedness that is permitted by the
terms of this Indenture to be outstanding in connection with the
conduct of their respective businesses) and not for speculative
purposes;
(11) the Guarantee by the Company or any of the Guarantors of
Indebtedness of the Company or a Restricted Subsidiary that was
permitted to be incurred by another provision of this Section 4.09;
(12) the incurrence by the Company's Unrestricted
Subsidiaries of Non-recourse Debt; provided, however, that if any such
Indebtedness ceases to be Non-recourse Debt of an Unrestricted
Subsidiary, such event shall be deemed to be an incurrence of
Indebtedness by a Restricted Subsidiary of the Company that was not
permitted by this clause (12);
(13) the incurrence of the Put Price Notes or the CapSource
Put Indebtedness; and
(14) the incurrence by the Company or any Guarantor of
additional Indebtedness in an aggregate principal amount (or accreted
value, as applicable) at any time outstanding, including all Permitted
Refinancing Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (14), not to exceed $15.0
million.
For purposes of determining compliance with this Section 4.09,
in the event that an item of Indebtedness meets the criteria of more than one of
the categories of Permitted Debt described in clauses (1) through (14) above or
is entitled to be incurred pursuant to the first paragraph of this Section 4.09,
in each case, as of the date of incurrence thereof, the Company shall, in its
sole discretion, classify (or later reclassify in whole or in part, in its sole
discretion) such item of Indebtedness in any manner that complies with this
Section 4.09 and such Indebtedness will be treated as having been incurred
pursuant to such clauses or the first paragraph hereof, as the case may be,
designated by the Company. Indebtedness under Credit Facilities outstanding on
the date on which the notes are first issued and authenticated under this
Indenture will be deemed to have been incurred on such date in reliance of the
exception provided by clause (1) of the definition of Permitted Debt. Accrual of
interest or dividends, the accretion of accreted value or liquidation preference
and the payment of interest or dividends in the form of additional Indebtedness
or Disqualified Stock will not be deemed to be an incurrence of Indebtedness or
an issuance of Disqualified Stock for purposes of this Section 4.09.
Section 4.10. RESTRICTED PAYMENTS.
The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly:
(1) declare or pay any dividend or make any other payment or
distribution (A) on account of the Company's or any Restricted
Subsidiary's Equity Interests (including, without limitation, any
payment in connection with any merger or consolidation involving the
Company or any Restricted Subsidiary) or (B) to the direct or indirect
holders of the Company's or any Restricted Subsidiary's Equity
Interests in their capacity as such (other than dividends or
distributions (i) payable in Equity Interests (other than Disqualified
Stock) of the Company or (ii) to the Company or a wholly owned
Restricted Subsidiary or to all holders of Capital Stock of such
Restricted Subsidiary on a pro rata basis);
(2) purchase, redeem or otherwise acquire or retire for
value (including, without limitation, in connection with any merger or
consolidation involving the Company) any Equity Interests of the
Company;
(3) make any payment on or with respect to, or purchase,
redeem, defease or otherwise acquire or retire for value any
Subordinated Obligations, except a payment of interest or principal at
the Stated Maturity thereof; or
43
(4) make any Restricted Investment (all such payments and
other actions set forth in these clauses (1) through (4) above being
collectively referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such
Restricted Payment:
(i) no Default or Event of Default has occurred and
is continuing; and
(ii) the Company would, at the time of such Restricted
Payment and after giving pro forma effect thereto as if such
Restricted Payment had been made at the beginning of the most
recently ended four-quarter period, have been permitted to
incur at least $1.00 of additional Indebtedness pursuant to
the Fixed Charge Coverage Ratio test set forth in the first
paragraph of Section 4.09 hereof; and
(iii) such Restricted Payment, together with the
aggregate amount of all other Restricted Payments made by the
Company and the Restricted Subsidiaries after the date of this
Indenture (excluding Restricted Payments permitted by clauses
(2), (3) and (4) of the next succeeding paragraph), is less
than the sum, without duplication, of:
(A) 50% of the Consolidated Net Income of
the Company for the period (taken as one accounting
period) from the beginning of the first fiscal
quarter after which the Notes are first issued to the
end of the Company's most recently ended fiscal
quarter for which internal financial statements are
available at the time of such Restricted Payment (or,
if such Consolidated Net Income for such period is a
deficit, less 100% of such deficit), plus
(B) 100% of the aggregate net cash proceeds
received by the Company since the date of this
Indenture as a contribution to its common equity
capital or from the issue or sale of Equity Interests
of the Company (other than Disqualified Stock) or
from the issue or sale of convertible or exchangeable
Disqualified Stock or convertible or exchangeable
debt securities of the Company, in either case, that
have been converted into or exchanged for such Equity
Interests of the Company (other than Equity Interests
or Disqualified Stock or debt securities) sold to a
Subsidiary of the Company), plus
(C) to the extent that any Restricted
Investment that was made after the date of this
Indenture is sold for cash or otherwise liquidated or
repaid for cash, the lesser of (i) the cash proceeds
with respect to such Restricted Investment (less the
cost of disposition, if any) and (ii) the initial
amount of such Restricted Investment, plus
(D) in case, after the date hereof, any
Unrestricted Subsidiary has been redesignated as a
Restricted Subsidiary under the terms of this
Indenture or has been merged, consolidated or
amalgamated with or into, or transfers or conveys
assets to, or is liquidated into the Company or a
Restricted Subsidiary, an amount equal to the lesser
of (1) the net book value at the date of the
redesignation, combination or transfer of the
aggregate Investments made by the Company and the
Restricted Subsidiaries in the Unrestricted
Subsidiary (or of the assets transferred or conveyed,
as applicable), and (2) the fair market value of the
Investments owned by the Company and the Restricted
Subsidiaries in such Unrestricted Subsidiary at the
time of the redesignation, combination or transfer
(or of the assets transferred or conveyed, as
applicable).
So long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, the preceding provisions will not
prohibit:
(1) the payment of any dividend within 60 days after the
date of declaration of the dividend, if at the date of declaration the
dividend payment would have complied with the provisions of this
Indenture;
44
(2) the redemption, repurchase, retirement, defeasance or
other acquisition of any Subordinated Obligations of the Company or any
Guarantor or of any Equity Interests of the Company in exchange for, or
out of the net cash proceeds of the substantially concurrent sale
(other than to a Restricted Subsidiary) of, Equity Interests of the
Company (other than Disqualified Stock); provided, however, that the
amount of any such net cash proceeds that are utilized for any such
redemption, repurchase, retirement, defeasance or other acquisition
will be excluded from clause (iii)(B) of the preceding paragraph;
(3) the redemption, repurchase, retirement, defeasance or
other acquisition of any Subordinated Obligations of the Company or any
Guarantor with the net cash proceeds from an incurrence of Permitted
Refinancing Indebtedness; provided, however, that the amount of any
such net cash proceeds that are utilized for any such redemption,
repurchase, retirement, defeasance or other acquisition will be
excluded from clause (iii)(B) of the preceding paragraph;
(4) the redemption, repurchase or other acquisition or
retirement for value of any Equity Interests of the Company or any
Restricted Subsidiary (i) held by any member of the Company's (or any
Restricted Subsidiary's) management pursuant to any management equity
subscription plan or agreement, stock option or stock purchase plan or
agreement or employee benefit plan as may be adopted by the Company
from time to time or pursuant to any agreement with any director or
officer in existence on the date of this Indenture or (ii) from an
employee of the Company upon the termination of such employee's
employment with the Company; provided, however, that the aggregate
price paid for all such repurchased, redeemed, acquired or retired
Equity Interests in reliance on this clause (4) may not exceed $3.0
million in any twelve-month period;
(5) repurchases, acquisitions or retirements of Capital
Stock of the Company deemed to occur upon the exercise of stock options
or similar rights under employee benefit plans of the Company or its
Subsidiaries if such Capital Stock represents all or a portion of the
exercise price thereof;
(6) the repurchase or retirement of common stock of the
Company purchased by The 1818 Mezzanine Fund II, L.P. pursuant to the
Securities Purchase Agreement; provided, however, that notwithstanding
that a Default or Event of Default shall have occurred and be
continuing, the Company shall be permitted to issue the Put Price Notes
in satisfaction of its obligations under the Securities Purchase
Agreement;
(7) the repurchase or retirement of common stock of the
Company held by CapSource pursuant to the terms of the CapSource
Warrant; and
(8) other Restricted Payments in an aggregate amount since
the Issue Date not to exceed $10.0 million.
The amount of all Restricted Payments (other than cash) will
be the fair market value on the date of the Restricted Payment of the assets,
property or securities proposed to be transferred or issued by the Company or
such Restricted Subsidiary, as the case may be, pursuant to the Restricted
Payment. The fair market value of any assets or securities that are required to
be valued by this covenant will be determined by the Board of Directors whose
resolution with respect thereto will be delivered to the Trustee. The Board of
Directors' determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if the
fair market value exceeds $7.5 million. Not later than the date of making any
Restricted Payment, the Company will deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the calculations required by this Section 4.10 were
computed, together with a copy of any fairness opinion or appraisal required by
this Indenture. If the Company or a Restricted Subsidiary makes a Restricted
Payment which at the time of the making of such Restricted Payment would in the
good faith determination of the Company be permitted under the provisions of
this Indenture, such Restricted Payment shall be deemed to have been made in
compliance with this Indenture notwithstanding any subsequent adjustments made
in good faith to the Company financial statements affecting Consolidated Net
Income of the Company for any period.
45
Section 4.11. LIENS.
The Company will not, and will not permit any Restricted
Subsidiary to, create, incur or assume any consensual Liens of any kind against
or upon any of their respective properties or assets, or any proceeds, income or
profit therefrom that secure Senior Subordinated Indebtedness or Subordinated
Obligations; provided that:
(a) in the case of Liens securing Subordinated Obligations,
the notes are secured by a Lien on such property, assets, proceeds,
income or profit that is senior in priority to such Liens; and
(b) in the case of Liens securing Senior Subordinated
Indebtedness, the notes are equally and ratably secured by a Lien on
such property, assets, proceeds, income or profit.
Section 4.12. ASSET SALES.
The Company will not, and will not permit any Restricted
Subsidiary to, consummate an Asset Sale unless:
(a) the Company (or the Restricted Subsidiary, as the case
may be) receives consideration at the time of the Asset Sale at least
equal to the fair market value (evidenced by a resolution of the Board
of Directors set forth in an Officers' Certificate delivered to the
Trustee) of the assets sold, leased, transferred, conveyed or otherwise
disposed of or Equity Interests of any Restricted Subsidiary issued,
sold, transferred, conveyed or otherwise disposed of;
(b) at least 75% of the consideration received in the Asset
Sale by the Company or such Restricted Subsidiary is in the form of
cash. For purposes of this clause (b), each of the following will be
deemed to be cash:
(i) any liabilities, as shown on the Company's or
such Restricted Subsidiary's most recent balance sheet, of the
Company or any Restricted Subsidiary (other than contingent
liabilities and liabilities that are by their terms
subordinated to the notes or any Subsidiary Guarantee) that
are assumed by the transferee of any such assets pursuant to a
customary novation agreement that releases the Company or such
Restricted Subsidiary from further liability;
(ii) any securities, notes or other obligations
received by the Company or any such Restricted Subsidiary from
such transferee that are converted by the Company or such
Restricted Subsidiary into cash within 90 days, to the extent
of the cash received in that conversion; and
(iii) with respect to any sale of Capital Stock of a
Restricted Subsidiary to one or more Qualified Physicians,
promissory notes or similar obligations from such physicians
or health care professionals; provided that the aggregate
amount of such promissory notes or other similar obligations
held by the Company and its Restricted Subsidiaries shall not
exceed $2.5 million outstanding at any one time; and
(c) the Company delivers an Officers' Certificate to the
Trustee certifying that such Asset Sale complies with the foregoing
clauses (a) and (b).
Within 365 days after the receipt of any Net Proceeds from an
Asset Sale, the Company may apply those Net Proceeds at its option:
(1) to repay Senior Debt (other than Indebtedness owed to
the Company, any Guarantor or any Affiliate of the Company) and, if the
Senior Debt repaid is revolving credit Indebtedness, to correspondingly
reduce commitments with respect thereto if so required pursuant to the
terms of the Credit Agreement governing such revolving credit
Indebtedness;
46
(2) to acquire all or substantially all of the assets of, or
all of the Voting Stock of, another Person engaged in a Permitted
Business; or
(3) to acquire other long-term assets or property that are
used in a Permitted Business.
Pending the final application of any Net Proceeds, the Company
may temporarily reduce revolving credit borrowings or otherwise invest the Net
Proceeds in any manner that is not prohibited by this Indenture.
Any Net Proceeds from Asset Sales that are not applied or
invested as provided in the preceding paragraph will constitute "EXCESS
PROCEEDS." When the aggregate amount of Excess Proceeds exceeds $7.5 million,
the Company will make an offer to all Holders of Notes to purchase the maximum
principal amount of Notes and, if the Company is required to do so under the
terms of any other Indebtedness that is pari passu with the Notes, such other
Indebtedness on a pro rata basis with the Notes, that may be purchased out of
the Excess Proceeds (an "ASSET SALE OFFER"). The offer price in any Asset Sale
Offer will be equal to 100% of principal amount plus accrued and unpaid interest
and Additional Interest, if any, to the date of purchase, and will be payable in
cash. If any Excess Proceeds remain after consummation of the purchase of all
properly tendered and not withdrawn Notes pursuant to an Asset Sale Offer, the
Company may use such remaining Excess Proceeds for any purpose not otherwise
prohibited by this Indenture. If the aggregate principal amount of Notes and
other pari passu Indebtedness tendered into such Asset Sale Offer exceeds the
amount of Excess Proceeds, the Trustee will select the Notes and such other pari
passu Indebtedness to be purchased on a pro rata basis. Upon completion of each
Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
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 those laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the Asset Sale
provisions of this Indenture, the Company will comply with the applicable
securities laws and regulations and will not be deemed to have breached its
obligations under the Asset Sale provisions of this Indenture by virtue of such
conflict.
Section 4.13. RESTRICTIONS ON DISTRIBUTIONS FROM RESTRICTED SUBSIDIARIES.
The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(a) pay dividends or make any other distributions on its
Capital Stock to the Company or any Restricted Subsidiary, or with
respect to any other interest or participation in, or measured by, its
profits, or pay any indebtedness owed to the Company or any Restricted
Subsidiary;
(b) make loans or advances to the Company or any Restricted
Subsidiary; or
(c) transfer any of its properties or assets to the Company
or any Restricted Subsidiary.
However, the preceding restrictions will not apply to
encumbrances or restrictions existing under or by reason of:
(1) agreements governing Existing Indebtedness, Credit
Facilities (including the Credit Agreement) and other agreements
relating to the Financing Transactions as in effect on the date of this
Indenture and any amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings of
those agreements; provided that the amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacement
or refinancings are no more restrictive, taken as a whole, with respect
to such dividend and other payment restrictions than those contained in
those agreements on the date of this Indenture;
47
(2) agreements governing the Series A Preferred Stock as in
effect on the date of this Indenture;
(3) this Indenture, the Notes and the Subsidiary Guarantees;
(4) the Securities Purchase Agreement;
(5) agreements related to HUD Financing and any amendments
of those agreements;
(6) applicable law;
(7) any instrument governing Indebtedness or Capital Stock
of a Person acquired by the Company or any Restricted Subsidiary as in
effect at the time of such acquisition (except to the extent such
Indebtedness or Capital Stock was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is
not applicable to any Person, or the properties or assets of any
Person, other than the Person, or the property or assets of the Person,
so acquired; provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be
incurred;
(8) customary non-assignment provisions in leases and other
contracts entered into in the ordinary course of business and
consistent with industry practices;
(9) purchase money obligations for property acquired in the
ordinary course of business that impose restrictions on that property
of the nature described in clause (c) of the first paragraph of this
Section 4.13;
(10) any agreement for the sale or other disposition of a
Restricted Subsidiary or the assets of a Restricted Subsidiary that
restricts distributions by that Restricted Subsidiary pending its sale
or other disposition or the sale or other disposition of its assets; or
(11) Permitted Refinancing Indebtedness; provided, however,
that the restrictions contained in the agreements governing such
Permitted Refinancing Indebtedness are not materially more restrictive,
taken as a whole, than those contained in the agreements governing the
Indebtedness being refinanced;
(12) Liens securing Indebtedness otherwise permitted to be
incurred under the provisions of the covenant described above under
Section 4.11 hereof; and
(13) provisions with respect to the disposition or
distribution of assets or property in joint venture agreements, asset
sale agreements, stock sale agreements and other similar agreements
entered into in the ordinary course of business.
Section 4.14. AFFILIATE TRANSACTIONS.
The Company will not, and will not permit any Restricted
Subsidiary to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or Guarantee with, or for the benefit
of, any Affiliate (each, an "AFFILIATE TRANSACTION"), unless:
(a) the Affiliate Transaction (i) is evidenced in writing if
it involves transactions of $1.0 million or more and (ii) is on terms
that are no less favorable to the Company or the relevant Restricted
Subsidiary than those that would have been obtained in a comparable
transaction by the Company or such Restricted Subsidiary with an
unrelated Person; and
(b) the Company delivers to the Trustee:
48
(i) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate
consideration in excess of $2.5 million, a resolution of the
Board of Directors set forth in an Officers' Certificate
certifying that such Affiliate Transaction complies with this
covenant and that such Affiliate Transaction has been approved
by a majority of the disinterested members of the Board of
Directors; and
(ii) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate
consideration in excess of $5.0 million, an opinion as to the
fairness to the Company or such Restricted Subsidiary from a
financial point of view issued by an accounting, appraisal or
investment banking firm of national standing.
The following items will not be deemed to be Affiliate
Transactions and, therefore, will not be subject to the provisions of the prior
paragraph:
(1) transactions between or among the Company and/or any
Restricted Subsidiary;
(2) sales of Equity Interests (other than Disqualified
Stock) to Affiliates of the Company;
(3) reasonable and customary directors' fees,
indemnification and similar arrangements, consulting fees, employee
salaries, bonuses or employment agreements, compensation or employee
benefit arrangements and incentive arrangements with any officer,
director or employee of the Company or a Restricted Subsidiary entered
into in the ordinary course of business;
(4) any transactions made in compliance with Section 4.10
hereof;
(5) transactions pursuant to the Securities Purchase
Agreement;
(6) loans and advances to non-executive officers and
employees of the Company or any Restricted Subsidiary in the ordinary
course of business in accordance with the past practices of the Company
or any Restricted Subsidiary; and
(7) any agreement as in effect as of the date of this
Indenture or any amendment thereto so long as any such amendment is not
more disadvantageous to the holders in any material respect than the
original agreement as in effect on the date of this Indenture.
Section 4.15. ISSUANCE OR SALE OF CAPITAL STOCK OF RESTRICTED SUBSIDIARIES
The Company:
(a) will not, and will not permit any Restricted Subsidiary
to, transfer, convey, sell, lease or otherwise dispose of any Capital
Stock of any Restricted Subsidiary to any Person (other than to the
Company or to any Restricted Subsidiary), unless:
(i) such transfer, conveyance, sale, lease or other
disposition is of all the Capital Stock of such Restricted
Subsidiary, and
(ii) the Net Proceeds from such transfer, conveyance,
sale, lease or other disposition are applied in accordance
with Section 4.12 hereof;
provided, however, that this clause (a) will not apply to any pledge of
Capital Stock of any Restricted Subsidiary securing any Permitted Debt
or any exercise of remedies in connection therewith; provided that the
Lien securing such Permitted Debt is not prohibited by Section 4.11
hereof;
49
(b) will not permit any Restricted Subsidiary to issue any
of its Equity Interests (other than, if necessary, shares of its
Capital Stock constituting directors' qualifying shares) to any Person
other than the Company or any Restricted Subsidiary;
provided, however, that clauses (a) and (b) shall not prohibit any issuance,
sale or other disposition of Common Stock of a Restricted Subsidiary to one or
more Qualified Physicians if, immediately after giving effect thereto, such
Restricted Subsidiary would remain a Restricted Subsidiary and the Company will,
directly or indirectly, retain at least 80% of the Capital Stock of such
Restricted Subsidiary, and the Net Proceeds from such issuance, sale or other
disposition are applied in accordance with Section 4.12 hereof.
Section 4.16. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
The Board of Directors of the Company may designate any
Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would
not cause a Default. If a Restricted Subsidiary is designated as an Unrestricted
Subsidiary, the aggregate fair market value of all outstanding Investments owned
by the Company and its Restricted Subsidiaries in the Subsidiary properly
designated will be deemed to be an Investment made as of the time of the
designation and will reduce the amount available for (x) Restricted Payments
under the first paragraph of Section 4.10 hereof, or (y) Permitted Investments,
as determined by the Company. That designation will only be permitted if the
Investment would be permitted at that time and if the Restricted Subsidiary
otherwise meets the definition of an Unrestricted Subsidiary. The Board of
Directors may redesignate any Unrestricted Subsidiary to be a Restricted
Subsidiary if the redesignation would not cause a Default.
Any designation of a Subsidiary of the Company as an
Unrestricted Subsidiary will be evidenced to the Trustee by filing with the
Trustee a certified copy of the Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted by Section 4.10 hereof.
If, at any time, any Unrestricted Subsidiary would fail to meet the preceding
requirements as an Unrestricted Subsidiary, it will thereafter cease to be an
Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of
such Subsidiary will be deemed to be incurred by a Restricted Subsidiary as of
such date and, if such Indebtedness is not permitted to be incurred as of such
date under Section 4.09 hereof, the Company will be in default of such covenant.
The Board of Directors of the Company may at any time designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided that such designation will be
deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of any
outstanding Indebtedness of such Unrestricted Subsidiary and such designation
will only be permitted if (i) such Indebtedness is permitted under Section 4.09
hereof, calculated on a pro forma basis as if such designation had occurred at
the beginning of the four-quarter reference period; and (ii) no Default or Event
of Default would be in existence following such designation.
Section 4.17. REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, the Company
shall, within 10 days of a Change of Control, make an offer (the "CHANGE OF
CONTROL OFFER") pursuant to the procedures set forth in Section 3.09. Each
Holder shall have the right to accept such offer and require the Company to
repurchase all or any portion (equal to $1,000 or an integral multiple of
$1,000) of such Holder's Notes pursuant to the Change of Control Offer at a
purchase price, in cash, equal to 101% of the aggregate principal amount of
Notes repurchased, plus accrued and unpaid interest (the "CHANGE OF CONTROL
PURCHASE PRICE") on the Notes repurchased, to the Purchase Date (subject to the
right of Holders of record on the relevant Regular Record Date) to receive
interest to, but excluding, the Purchase Date).
(b) Prior to complying with any of the provisions of this
"Change of Control" covenant, but in any event within 90 days following a Change
of Control, the Company will either repay all outstanding Senior Debt or obtain
the requisite consents, if any, under all agreements governing outstanding
Senior Debt to permit the repurchase of Notes required by this covenant. 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) The Company will not be required to make a Change of
Control Offer upon a Change of Control if a third party makes the Change of
Control Offer in the manner, at the times and otherwise in compliance
50
with the requirements set forth in this Indenture applicable to a Change of
Control Offer made by the Company and purchases all notes properly tendered and
not withdrawn under the Change of Control Offer.
Section 4.18. FUTURE SUBSIDIARY GUARANTORS
If the Company or any Restricted Subsidiary acquires or
creates another Subsidiary after the date of this Indenture that (1) is formed
under the laws of the United States or any State of the United States or the
District of Columbia and in which the Company or any Restricted Subsidiary has
made an Investment of at least $0.1 million or (2) incurs, guarantees or
otherwise provides direct credit support for any Indebtedness of the Company or
any of the Company's domestic subsidiaries, then that newly acquired or created
Subsidiary will become a Guarantor and execute a supplemental indenture and
deliver an Opinion of Counsel satisfactory to the Trustee within 10 business
days of the date on which it was acquired or created; provided, however, that
the foregoing shall not apply to (i) HUD Financing Subsidiaries and (ii)
Subsidiaries that have properly been designated as Unrestricted Subsidiaries in
accordance with this Indenture. The Subsidiary Guarantee of any such newly
acquired or created Subsidiary that becomes a Guarantor will be subordinated to
all Indebtedness under the Credit Agreement and all other Senior Debt of such
Guarantor to the same extent as the Notes are subordinated to the Senior Debt of
the Company.
Section 4.19. BUSINESS ACTIVITIES.
The Company will not, and will not permit any Subsidiary to,
engage in any business other than Permitted Businesses, except to such extent as
would not be material to the Company and its Subsidiaries taken as a whole.
Section 4.20. NO SENIOR SUBORDINATED DEBT.
The Company will not incur, create, issue, assume, Guarantee
or otherwise become liable for any Indebtedness that is subordinate or junior in
right of payment to any Senior Debt of the Company and senior in any respect in
right of payment to the Notes; provided, however, that no Indebtedness of the
Company will be deemed to be contractually subordinated in right of payment
solely by virtue of being unsecured. No Guarantor will incur, create, issue,
assume, Guarantee or otherwise become liable for any Indebtedness that is
subordinate or junior in right of payment to the Senior Debt of such Guarantor
and senior in any respect in right of payment to such Guarantor's Subsidiary
Guarantee; provided, however, that no Indebtedness of a Guarantor will be deemed
to be contractually subordinated in right of payment solely by virtue of being
unsecured.
ARTICLE 5.
SUCCESSORS
Section 5.01. MERGER, CONSOLIDATION AND SALE OF ASSETS.
(a) Neither the Company nor any Guarantor may, directly or
indirectly: (1) consolidate or merge with or into another Person (whether or not
the Company or such Guarantor, as the case may be, is the surviving corporation)
or (2) sell, assign, transfer, convey or otherwise dispose of all or
substantially all of the properties or assets of the Company or any Guarantor,
in one or more related transactions, to another Person, unless:
(i) either
(A) the Company or such Guarantor, as the
case may be, shall be the Surviving Person; or
(B) the Person formed by or surviving any
such consolidation or merger (if other than the Company or
such Guarantor, as the case may be) or to which such sale,
assignment, transfer, conveyance or other disposition has been
51
made shall be a corporation organized and existing under the
laws of the United States of America, any State thereof or the
District of Columbia;
(ii) the Person formed by or surviving any such consolidation
or merger (if other than the Company or such Guarantor, as the case may
be) or the Person to which such sale, assignment, transfer conveyance
or other disposition has been made assumes, by supplemental indenture
in form reasonably satisfactory to the Trustee, executed and delivered
to the Trustee by such Person, the obligations of the Company or such
Guarantor, as the case may be, under this Indenture, the Notes and the
Subsidiary Guarantees;
(iii) immediately after such transaction, no Default or Event
of Default exists; and
(iv) except with respect to a consolidation or merger of the
Company with or into a Guarantor, or a Guarantor with or into another
Guarantor, the Company or such Guarantor, as the case may be, or the
Person formed by or surviving any such consolidation or merger (if
other than the Company or such Guarantor), or to which such sale,
assignment, transfer, conveyance or other disposition has been made
will, on the date of such transaction after giving pro forma effect
thereto and any related financing transactions as if the same had
occurred at the beginning of the applicable four-quarter period, be
permitted to incur at least $1.00 of additional Indebtedness pursuant
to the Fixed Charge Coverage Ratio test set forth in the first
paragraph of Section 4.09.
(b) Notwithstanding the preceding clause (iv), any
Restricted Subsidiary of the Company may consolidate with, merge into or
transfer all or part of its properties and assets to the Company or a Guarantor,
and notwithstanding the preceding clause (ii), any Guarantor may transfer real
property that is the subject of a HUD Financing to a HUD Financing Subsidiary in
connection with a HUD Financing permitted to be incurred pursuant to Section
4.09.
(c) The Company may not, directly or indirectly,
lease all or substantially all of its properties or assets, in one or more
related transactions, to any other Person.
Section 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
Except as described with respect to the release of Subsidiary
Guarantees of Guarantors pursuant to Article 10, the Surviving Person shall
succeed to, and be substituted for, and may exercise every right and power of
the Company or a Guarantor, as applicable, under this Indenture; provided,
however, that the predecessor entity shall not be released from any of the
obligations or covenants under this Indenture, including with respect to the
payment of the Notes and obligations under the Subsidiary Guarantee, as the case
may be, in the case of:
(a) a sale, transfer, assignment, conveyance or other
disposition (unless such sale, transfer, assignment, conveyance or
other disposition is of all or substantially all of the assets of the
Company, taken as a whole, or
(b) a lease.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01. EVENTS OF DEFAULT.
Each of the following constitutes an "Event of Default" with
respect to the Notes:
(a) default for 30 days in the payment when due of interest
on, or Additional Interest with respect to, the Notes (whether or not
prohibited by Article 12 hereof);
52
(b) default in the payment when due of the principal of, or
premium, if any, on, any of the Notes when the same becomes due and
payable at its Stated Maturity, upon acceleration, redemption, optional
redemption, required repurchase or otherwise (whether or not prohibited
by Article 12 hereof);
(c) failure by the Company or any Restricted Subsidiary to
comply with Section 4.09, Section 4.10 or Section 5.01 hereof;
(d) failure by the Company or any Restricted Subsidiary to
comply with Section 4.12 or Section 4.17 hereof, and such failure
continues for 30 days after written notice is given to the Company as
provided below ;
(e) failure by the Company or any Restricted Subsidiary to
comply with any other covenant or agreement in the Notes or in this
Indenture (other than a failure that is the subject of the foregoing
clause (a), (b), (c) or (d)), and such failure continues for 60 days
after written notice is given to the Company as provided below;
(f) a default under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any
Restricted Subsidiary (or the payment of which is guaranteed by the
Company or any Restricted Subsidiary) whether such Indebtedness or
Guarantee now exists, or is created after the date of this Indenture,
if that default:
(i) is caused by a failure to pay principal of, or
interest or premium, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness
on the date of such default (a "PAYMENT DEFAULT"); or
(ii) results in the acceleration of such Indebtedness
prior to its express maturity
and in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness under
which there has been a Payment Default or the maturity of which has
been so accelerated, aggregates $5.0 million or more;
(g) failure by the Company or any Restricted Subsidiary to
pay final judgments aggregating in excess of $5.0 million, which
judgments are not paid, discharged or stayed for a period of 60 days;
(h) except as permitted by this Indenture, any Subsidiary
Guarantee of a Guarantor shall be held in any judicial proceeding to be
unenforceable or invalid or shall cease for any reason to be in full
force and effect or any Guarantor shall deny or disaffirm its
obligations under its Subsidiary Guarantee;
(i) the Company or any of its Significant Subsidiaries or
any group of Subsidiaries that, when taken together, would constitute a
Significant Subsidiary pursuant to or within the meaning of any
Bankruptcy Law:
(A) commences a voluntary case or gives notice of
intention to make a proposal under any Bankruptcy Law;
(B) consents to the entry of an order for relief
against it in an involuntary case or consents to its
dissolution or winding up;
(C) consents to the appointment of a receiver,
interim receiver, receiver and manager, liquidator, Trustee or
custodian of it or for all or substantially all of its
property;
(D) makes a general assignment for the benefit of
its creditors; or
53
(E) admits in writing its inability to pay its debts
as they become due or otherwise admits its insolvency; and
(j) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that,
when taken together, would constitute a Significant Subsidiary
in an involuntary case; or
(B) appoints a receiver, interim receiver, receiver
and manager, liquidator, Trustee or custodian of the Company
or any of its Significant Subsidiaries or any group of
Subsidiaries that, when taken together, would constitute a
Significant Subsidiary or for all or substantially all of the
property of the Company or any of its Significant Subsidiaries
or any group of Subsidiaries that, when taken together, would
constitute a Significant Subsidiary; or
(C) orders the liquidation of the Company or any of
its Significant Subsidiaries or any group of Subsidiaries
that, when taken together, would constitute a Significant
Subsidiary;
and such order or decree remains unstayed and in effect for 60
consecutive days.
Section 6.02. ACCELERATION.
If any Event of Default (other than those of the type
described in Section 6.01(i) or (j)) occurs and is continuing, 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, 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 such notice is a notice of acceleration (the "ACCELERATION
NOTICE"), and the same shall become immediately due and payable.
In the case of an Event of Default specified in Section 6.01
(i) or (j), all outstanding Notes shall become due and payable immediately
without any further declaration or other act on the part of the Trustee or the
Holders. Holders may not enforce this Indenture or the Notes except as provided
in this Indenture.
At any time after a declaration of acceleration with respect
to the Notes, 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:
(a) the rescission would not conflict with any judgment or
decree of a court of competent jurisdiction;
(b) 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 reason of such declaration of
acceleration;
(c) 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;
(d) the Company has paid the Trustee its reasonable
compensation and reimbursed the Trustee for its reasonable expenses,
disbursements and advances; and
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(e) in the event of the cure or waiver of an Event of
Default of the type described in Section 6.01(i) or (j), the Trustee
has received an Officers' Certificate and Opinion of Counsel that such
Event of Default has been cured or waived.
In the case of an Event of Default with respect to the Notes
occurring by reason of any willful action or inaction taken or not taken by the
Company or on the Company's behalf with the intention of avoiding payment of the
premium that the Company would have been required to pay if the Company had then
elected to redeem the Notes pursuant to Section 3.07 hereof, an equivalent
premium shall also become and be immediately due and payable to the extent
permitted by law upon the acceleration of the Notes. If an Event of Default
occurs prior to June 15, 2008, by reason of any willful action or inaction taken
or not taken by the Company or on the Company's behalf with the intention of
avoiding the premium required upon a redemption of the Notes prior to June 15,
2008, then the premium specified in Section 3.07(a) shall also become
immediately due and payable to the extent permitted by law upon acceleration of
the Notes.
Section 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies
shall be cumulative to the extent permitted by law.
Section 6.04. WAIVER OF DEFAULTS.
The Holders of at least a majority in aggregate principal
amount of the Notes then outstanding by notice to the Trustee may on behalf of
the Holders of all of the Notes, waive any existing Default or Event of Default,
and its consequences, except a continuing Default or Event of Default (i) in the
payment of the principal of, premium, if any, or interest, on the Notes and (ii)
in respect of a covenant or provision which under this Indenture cannot be
modified or amended without the consent of the Holder of each Note affected by
such modification or amendment. In the event of any Event of Default specified
in clause (f) of Section 6.01, such Event of Default and all consequences of
that Event of Default, 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 the Event of Default arose:
(a) the Indebtedness that is the basis for the Event of
Default has been discharged;
(b) the holders of such Indebtedness have rescinded or
waived the acceleration, notice or action, as the case may be, giving
rise to the Event of Default; or
(c) the default that is the basis for such Event of Default
has been cured.
Upon any waiver of a Default or Event of Default, such Default shall cease to
exist, and any Event of Default arising therefrom shall be deemed cured for
every purpose of this Indenture but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereon.
Section 6.05. CONTROL BY MAJORITY.
Subject to Section 7.01, Section 7.02(f), Section 7.02(i)
(including the Trustee's receipt of the security or indemnification described
therein) and Section 7.07 hereof, in case an Event of Default shall occur and be
continuing, the Holders of at least a majority in aggregate principal amount of
the Notes then outstanding 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 with respect to the
Notes. The Trustee shall be
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entitled to take any other action deemed proper by the Trustee which is not
inconsistent with such direction or this Indenture.
Section 6.06. LIMITATION ON SUITS.
No Holder shall have any right to institute any proceeding
with respect to this Indenture, or for the appointment of a receiver or trustee,
or for any remedy thereunder, unless:
(a) such Holder has previously given to the Trustee written
notice of a continuing Event of Default or the Trustee receives the
notice from the Company,
(b) Holders of at least 25% in aggregate principal amount of
the Notes then outstanding have made written request and offered
reasonable indemnity to the Trustee to institute such proceeding as
Trustee, and
(c) the Trustee shall not have received from the Holders of
a majority in aggregate principal amount of the Notes then outstanding
a written direction inconsistent with such request and shall have
failed to institute such proceeding within 60 days.
The preceding limitations shall not apply to a suit instituted
by a Holder for enforcement of payment of principal of, and premium, if any, or
interest on, a Note on or after the respective due dates for such payments set
forth in such Note.
A Holder may not use this Indenture to affect, disturb or
prejudice the rights of another Holder or to obtain a preference or priority
over another Holder.
Section 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture
(including Section 6.06) other than as set forth in Article 12 hereof, the right
of any Holder to receive payment of principal, premium, if any, and interest on
the Notes held by such Holder, on or after the respective due dates expressed in
the Notes (including in connection with an offer to purchase), or to bring suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of such Holder.
Section 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b)
occurs and is continuing, the Trustee shall be authorized to recover judgment in
its own name and as trustee of an express trust against the Company for the
whole amount of principal of, premium, if any, and interest then due and owing
(together with interest on overdue principal and, to the extent lawful,
interest) and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee shall be authorized to file such proofs of claim
and other papers or documents as may be necessary or advisable in order to have
the claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and
the Holders allowed in any judicial proceedings relative to the Company (or any
other obligor upon the Notes), its creditors or its property and shall be
entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and
56
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee and its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof out
of the estate in any such proceeding, shall be denied for any reason, payment of
the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, moneys, securities and any other properties that the Holders may
be entitled to receive in such proceeding whether in liquidation or under any
plan of reorganization or arrangement or otherwise. 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, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
Section 6.10. PRIORITIES.
Subject to Article 12 hereof, if the Trustee collects any
money pursuant to this Article 6, it shall pay out the money in the following
order:
First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07 hereof, including payment of all compensation,
expenses and liabilities incurred, and all advances made, by the
Trustee and the costs and expenses of collection;
Second: to Holders for amounts due and unpaid on the Notes
for principal, premium, if any, and interest ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium, if any, and interest,
respectively; and
Third: to the Company or to such party as a court of
competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any
payment to Holders pursuant to this Section 6.10.
Section 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in such suit of an undertaking to pay the costs of such suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 shall not apply to a suit by the Trustee, a suit by
the Company, a suit by a Holder pursuant to Section 6.07 hereof, or a suit by
Holders of more than 10% in principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01. DUTIES OF TRUSTEE
(a) If an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent Person would exercise or use under the circumstances in the conduct of
such Person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee shall be
determined solely by the express provisions of this Indenture
and the Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no
implied covenants or obligations shall be read into this
Indenture against the Trustee; and
57
(2) in the absence of bad faith on its part,
the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture.
However, in the case of any such certificates or opinions
which by any provisions hereof are specifically required to be
furnished to the Trustee, the Trustee shall examine the
certificates and opinions to determine whether or not they
conform to the requirements of this Indenture (but need not
confirm or investigate the accuracy of mathematical
calculations or other facts stated therein).
(c) The Trustee may not be relieved from liabilities for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect
of paragraph (b) of this Section;
(2) the Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer,
unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with
respect to any action it takes or omits to take in good faith
in accordance with a direction received by it pursuant to
Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b) and (c) of this Section 7.01.
(e) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability.
(f) The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in writing with the
Company. Money held in trust by the Trustee need not be segregate from other
funds except to the extent required by law.
Section 7.02. RIGHTS OF TRUSTEE.
Subject to TIA Section 315:
(a) The Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by
the proper Person. The Trustee need not investigate any fact or matter
stated in any such document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both. The
Trustee shall not be liable for any action it takes or omits to take in
good faith in reliance on such Officers' Certificate or Opinion of
Counsel. The Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection from liability in respect of any action
taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee shall not be liable for any action it takes
or omits to take in good faith that it believes to be authorized or
within the rights or powers conferred upon it by this Indenture.
(d) Unless otherwise specifically provided in this
Indenture, any demand, request, direction or notice from the Company
shall be sufficient if signed by an Officer of the Company.
(e) 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
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which is in fact such a Default or Event of Default is received by a
Responsible Officer of the Trustee at the Corporate Trust Office of the
Trustee from the Company or the Holders of 25% in aggregate principal
amount of the outstanding Notes, and such notice references the
specific Default or Event of Default, the Notes and this Indenture.
(f) The Trustee shall not be required to give any bond or
surety in respect of the performance of its power and duties hereunder.
(g) The Trustee shall have no duty to inquire as to the
performance of the Company's covenants herein.
(h) 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.
(i) The Trustee will 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 unless such Holders have offered to
the Trustee reasonable security or indemnity against the costs,
expenses and liabilities that might be incurred by it in compliance
with such request or direction.
(j) The rights, privileges, immunities and benefits given to
the Trustee hereunder, 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 by the Trustee consistent with the terms of this
Indenture to act hereunder.
(k) Any permissive right or authority granted to the Trustee
shall not be construed as a mandatory duty.
Section 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the Commission
for permission to continue as Trustee or resign. Any Agent may do the same with
like rights and duties. The Trustee shall also be subject to Sections 7.10 and
7.11 hereof.
Section 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it
shall not be accountable for the Company's use of the proceeds from the Notes or
any money paid to the Company or upon the Company's direction under any
provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.
Section 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and
if it is known to the Trustee, the Trustee shall mail to Holders a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders.
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Section 7.06. REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders a brief report dated as of
such reporting date that complies with TIA ss.313(a) (but if no event described
in TIA ss.313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA
ss.313(b)(2) to the extent applicable. The Trustee shall also transmit by mail
all reports as required by TIA ss.313(c).
A copy of each report at the time of its mailing to the
Holders shall be mailed to the Company and filed with the Commission and each
stock exchange on which the Notes are listed in accordance with TIA ss.313(d).
The Company shall promptly notify the Trustee when the Notes are listed on any
stock exchange and any delisting thereof.
Section 7.07. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time
reasonable compensation for its acceptance of this Indenture and services
hereunder. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee (in its capacity as
Trustee) or any predecessor Trustee (in its capacity as Trustee) against any and
all losses, claims, damages, penalties, fines, liabilities or expenses,
including incidental and out-of-pocket expenses and reasonable attorneys fees
(for purposes of this Article, "losses") incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Company (including this Section 7.07) and defending itself against any claim
(whether asserted by the Company or any Holder or any other Person) or liability
in connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent such losses may be attributable to its
negligence, bad faith or willful misconduct. The Trustee shall notify the
Company promptly of any claim for which it may seek indemnity. Failure by the
Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder, to the extent the Company has not been prejudiced
thereby. The Company shall defend the claim, and the Trustee shall cooperate in
the defense. The Trustee may have separate counsel if the Trustee has been
reasonably advised by counsel that there may be one or more legal defenses
available to it that are different from or additional to those available to the
Company and in the reasonable judgment of such counsel it is advisable for the
Trustee to engage separate counsel, and the Company shall pay the reasonable
fees and expenses of such separate counsel. The Company need not pay for any
settlement made without its consent, which consent shall not be unreasonably
withheld. The Company need not reimburse any expense or indemnify against any
loss incurred by the Trustee through the Trustee's own willful misconduct,
negligence or bad faith.
The obligations of the Company under this Section 7.07 shall
survive the satisfaction and discharge of this Indenture, the resignation or
removal of the Trustee and payment in full of the Notes through the expiration
of the applicable statute of limitations.
To secure the Company's payment obligations in this Section,
the Trustee shall have a Lien prior to the Notes on all money or property held
or collected by the Trustee, except that held in trust to pay principal,
premium, if any, and interest on particular Notes. Such Lien shall survive the
satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(i) or (j) hereof occurs, the expenses
and the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration under
any Bankruptcy Law.
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Section 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.
The Trustee may resign in writing at any time upon 30 days'
prior notice to the Company and be discharged from the trust hereby created by
so notifying the Company. The Holders of a majority in aggregate principal
amount of the then outstanding Notes may remove the Trustee by so notifying the
Trustee and the Company in writing. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged bankrupt or insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(c) a custodian or public officer takes charge of the
Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
If a successor Trustee does not take office within 30 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company, or the Holders of at least 10% in aggregate principal amount of the
then outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has
been a Holder for at least six months, fails to comply with Section 7.10 hereof,
such Holder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. Subject to the Lien provided for in Section 7.07 hereof,
the retiring Trustee shall promptly transfer all property held by it as Trustee
to the successor Trustee; provided, however, that all sums owing to the Trustee
hereunder shall have been paid. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08, the Company's obligations under Section 7.07
hereof shall continue for the benefit of the retiring Trustee.
In the case of an appointment hereunder of a separate or
successor Trustee with respect to the Notes, the Company, the Guarantors, any
retiring Trustee and each successor or separate Trustee with respect to the
Notes shall execute and deliver a supplemental indenture hereto (1) which shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of any retiring Trustee with
respect to the Notes as to which any such retiring Trustee is not retiring shall
continue to be vested in such retiring Trustee and (2) that shall add to or
change any of the provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts hereunder by more than one
Trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such Trustee co-trustees of the same trust and that
each such separate, retiring or successor Trustee shall be Trustee of a trust or
trusts hereunder separate and apart from any trust or trusts hereunder
administered by any such other Trustee.
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Section 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation or banking association, the successor corporation or banking
association without any further act shall, if such successor corporation or
banking association is otherwise eligible hereunder, be the successor Trustee.
Section 7.10. ELIGIBILITY; DISQUALIFICATION
There shall at all times be a Trustee hereunder that is a
Person organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $50.0 million (or a wholly-owned subsidiary of a bank or trust company, or
of a bank holding company, the principal subsidiary of which is a bank or trust
company having a combined capital and surplus of at least $50.0 million) as set
forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss.310(a)(1), (2) and (5). The Trustee is subject to TIA
ss.310(b).
Section 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA ss.311(a), excluding any
creditor relationship listed in TIA ss.311(b). A Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at its option and 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 in this Article 8.
Section 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04, 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, "LEGAL DEFEASANCE") and
each Guarantor shall be released from all of its obligations under its
Guarantee. For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Debt represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 and the other Sections of this Indenture referred
to in (a) and (b) below, and to have satisfied all its other obligations under
the Notes 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 outstanding Notes to receive,
solely from the trust fund described in Section 8.04, and as more fully set
forth in such Section, payments in respect of the principal of, premium, if any,
or interest on such Notes when such payments are due, (b) the Company's
obligations with respect to such Notes under Article 2 and Sections 4.01 and
4.02, (c) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and the Company's and the Guarantors' obligations in connection
therewith and (d) this Article 8. If the Company exercises under Section 8.01
the option applicable to this Section 8.02, subject to the satisfaction of the
conditions set forth in Section 8.04, payment of the Notes may not be
accelerated because of an Event of Default. Subject to compliance with this
Article 8, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03.
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Section 8.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04, be released from its obligations
under the covenants contained in Sections 4.08 through 4.20 hereof, and the
operation of Section 5.01(a)(iv), 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 each Guarantor shall be released from
all of its obligations under its Guarantee with respect to such covenants in
connection with such outstanding Notes 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 may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 6.01, but, except as specified above, the
remainder of this Indenture and such Notes shall be unaffected thereby. If the
Company exercises under Section 8.01 the option applicable to this Section 8.03,
subject to the satisfaction of the conditions set forth in Section 8.04, payment
of the Notes may not be accelerated because of an Event of Default specified in
clause (c) (with respect to the covenants contained in Sections 4.09, 4.10 or
5.01(a)(iv)), clause (d) (with respect to the covenants contained in Sections
4.12 and 4.17), clause (e) (with respect to the covenants contained in Sections
4.08 and 4.11 through 4.20), (f), (g), (h) and (i) (but in the case of (h) and
(i) of Section 6.01, with respect to Significant Subsidiaries only).
Section 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of
either Section 8.02 or 8.03 to the outstanding Notes.
Legal Defeasance or Covenant Defeasance may be exercised only
if:
(a) the Company irrevocably deposits with the Trustee, in
trust (the "DEFEASANCE TRUST"), for the benefit of the Holders, cash in
U.S. dollars, non-callable U.S. Government Securities, or a combination
of cash in U.S. dollars and non-callable U.S. Government Securities, in
an amount sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, or premium, if
any, and interest on the outstanding Notes on the Stated Maturity or on
the next redemption date, as the case may be, and the Company shall
specify whether the Notes are being defeased to maturity or to such
particular redemption date;
(b) in the case of Legal Defeasance under Section 8.02 hereof,
the Company shall deliver to the Trustee an Opinion of Counsel
reasonably acceptable to the Trustee confirming that (i) the Company
has received from, or there has been published by, the Internal Revenue
Service a ruling or (ii) subsequent to the Issue Date, there has been a
change in the applicable federal income tax law, in either case to the
effect that, and based thereon such Opinion of Counsel shall confirm
that, the Holders of the outstanding Notes will not recognize income,
gain or loss for federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred;
(c) in the case of Covenant Defeasance under Section 8.03
hereof, the Company shall deliver to the Trustee an Opinion of Counsel
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Covenant
Defeasance had not occurred;
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(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event
of Default resulting from the borrowing of funds to be applied to such
deposit);
(e) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under, any
material agreement or instrument (other than this Indenture) to which
the Company or any Subsidiary is a party or by which the Company or any
Subsidiary is bound;
(f) the Company shall deliver to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with
the intent of preferring the Holders over other creditors of the
Company with the intent of defeating, hindering, delaying or defrauding
such other creditors; and
(g) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent relating to the Legal Defeasance or the Covenant Defeasance
have been complied with.
Section 8.05. DEPOSITED CASH AND U.S. GOVERNMENT SECURITIES TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06, all cash and non-callable U.S.
Government Securities (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 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 all sums due and to become due thereon
in respect of principal, premium, if any, and interest but such cash and
securities 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 non-callable
U.S. Government Securities deposited pursuant to Section 8.04 hereof or the
principal 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 cash or non-callable U.S. Government Securities held
by it as provided in Section 8.04 which, in the opinion of a nationally
recognized firm of independent certified public accountants expressed in a
written certification thereof delivered to the Trustee (which may be the
certification delivered under Section 8.04(a)), are in excess of the amount
thereof that would then be required to be deposited to effect an equivalent
Legal Defeasance or Covenant Defeasance.
Section 8.06. REPAYMENT TO COMPANY.
The Trustee shall promptly, and in any event, no later than
five (5) Business Days, pay to the Company after request therefor, any excess
money held with respect to the Notes at such time in excess of amounts required
to pay any of the Company's Obligations then owing with respect to the Notes.
Any cash or non-callable U.S. Government Securities deposited
with the Trustee or any Paying Agent, or then held by the Company, in trust for
the payment of the principal, premium, if any, or interest on any Note and
remaining unclaimed for one year after such principal, premium, if any, or
interest has become due and payable shall be paid to the Company on its written
request or (if then held by the Company) shall be discharged from such trust;
and the Holder shall thereafter, as an unsecured creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such cash and securities, 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 cash and securities
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such
64
notification or publication, any unclaimed balance of such cash and securities
then remaining shall be repaid to the Company.
Section 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any cash or
non-callable U.S. Government Securities in accordance with Section 8.02 or 8.03,
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 obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 until such time as the Trustee or Paying Agent is permitted
to apply all such cash and securities in accordance with Section 8.02 or 8.03,
as the case may be; provided, however, that, if the Company makes any payment of
principal of, premium, if any, or interest on any Note following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders to receive such payment from the cash and securities held by the
Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company,
the Guarantors and the Trustee may amend or supplement this Indenture or the
Notes without the consent of any Holder to:
(a) cure any ambiguity, omission, defect or inconsistency;
(b) provide for the assumption by a Surviving Person of the
obligations of the Company under this Indenture;
(c) provide for uncertificated Notes in addition to or in
place of certificated Notes; provided that the uncertificated Notes are
issued in registered form for purposes of Section 163(f) of the Code,
or in a manner such that the uncertificated Notes are described in
Section 163(f)(2)(B) of the Code;
(d) add additional Guarantees or additional obligors with
respect to the Notes or release Guarantors from Guarantees as permitted
by the terms of this Indenture;
(e) secure the Notes;
(f) add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power conferred upon the Company;
(g) make any other change that would provide additional rights
or benefits to the Holders or that does not adversely affect the legal
rights hereunder of any such Holder;
(h) make any change to comply with any requirement of the
Commission in order to effect or maintain the qualification of this
Indenture under the TIA; or
(i) provide for or confirm the issuance of Additional Notes in
accordance with this Indenture.
Upon the request of the Company accompanied by a Board
Resolution authorizing the execution of any such amended or supplemental
indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee will join with the Company and the Guarantors in the
execution of any amended or supplemental indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee will not be
obligated to enter into such
65
amended or supplemental indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02. WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, the Company,
the Guarantors and the Trustee may amend or supplement this Indenture and the
Notes with the consent of the Holders of at least a majority in aggregate
principal amount of the Notes, including Additional Notes, if any, then
outstanding voting as a single class (including, without limitation, consents
obtained in connection with a purchase of or tender offer or exchange offer for
the Notes), and, subject to Sections 6.04 and 6.07, any existing Default or
Event of Default (except a continuing Default or Event of Default in (i) the
payment of principal, premium, if any, or interest on the Notes and (ii) in
respect of a covenant or provision which under this Indenture cannot be modified
or amended without the consent of the Holder of each Note affected by such
modification or amendment) or compliance with any provision of this Indenture or
the Notes may be waived with the consent of the Holders of at least a majority
in aggregate principal amount of the Notes, including Additional Notes, if any,
then outstanding voting as a single class (including consents obtained in
connection with a purchase of or tender offer or exchange offer for the Notes).
Upon the request of the Company accompanied by a Board
Resolution authorizing the execution of any such amended or supplemental
indenture, and upon receipt by the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders as aforesaid and the documents described
in Section 7.02 hereof, the Trustee will join with the Company and the
Guarantors in the execution of any amended or supplemental indenture authorized
or permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but the Trustee will
not be obligated to enter into such amended or supplemental indenture that
affects its own rights, duties or immunities under this Indenture or otherwise.
Without the consent of each Holder affected, an amendment or
waiver under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(b) reduce the principal of, or change the Stated Maturity of,
any Note or alter the provisions with respect to the redemption or
repurchase of the Notes relating to Section 4.17 (including the
applicable definitions);
(c) reduce the rate of, or change the time for payment of,
interest, if any, on, any Note;
(d) waive a Default or Event of Default in the payment of
principal of, or interest or premium, or Additional Interest, if any,
on the Notes (except a recission of acceleration of the Notes by the
Holders of at least a majority in aggregate principal amount of the
Notes and a waiver of the payment default that resulted from such
acceleration); (e) make any Note payable in currency other than that
stated in the Note;
(f) make any change in the provisions (including applicable
definitions) of this Indenture relating to waivers of past defaults or
the rights of Holders of Notes to receive payments of principal of, or
interest or premium or Additional Interest, if any, on, such Holder's
Notes;
(g) waive a redemption or repurchase payment with respect to
any Note (including the payment required by the provisions of Section
4.12 and Section 4.17 hereof);
(h) make any change in any Subsidiary Guarantees that would
adversely affect the Holders or release any Guarantor from any of its
obligations under its Subsidiary Guarantee or the Indenture, except in
accordance with the provisions of Article 10 hereof;
66
(i) make any change to Article 12 hereof (including applicable
definitions) that would adversely affect the Holders;
(j) make any change in this Section 9.02.
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
supplemental indenture. 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 120 days after such record date, any such consent
previously given shall automatically and without further action by any Holder be
cancelled and of no further effect.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section
9.02 becomes effective, the Company shall mail to the Holder of each Note
affected thereby to such Holder's address appearing in the Security Register a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
indenture or waiver.
Section 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes
shall be set forth in an amended or supplemental indenture that complies with
the TIA as then in effect.
Section 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion thereof that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder or subsequent Holder may revoke the
consent as to its Note or portion thereof if the Trustee receives written notice
of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver shall become effective in
accordance with its terms and thereafter shall bind every Holder.
Section 9.05. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. The
Company in exchange for all Notes may issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate new Notes that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
Section 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
None of the Company nor any Guarantor may sign an amendment or supplemental
indenture until its board of directors (or committee serving a similar function)
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully
protected in
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relying upon an Officers' Certificate and an Opinion of Counsel stating that the
execution of such amended or supplemental indenture is authorized or permitted
by this Indenture and that such amended or supplemental indenture is the legal,
valid and binding obligations of the Company enforceable against it in
accordance with its terms, subject to customary exceptions and that such amended
or supplemental indenture complies with the provisions hereof (including Section
9.03).
ARTICLE 10.
GUARANTEES
Section 10.01. GUARANTEE.
Subject to this Article 10, the Guarantors hereby
unconditionally guarantee to each Holder of a Note authenticated and delivered
by the Trustee and to the Trustee and its successors and assigns: (a) the due
and punctual payment of the principal of, premium, if any, and interest on the
Notes, subject to any applicable grace period, whether at Stated Maturity, by
acceleration, redemption or otherwise, the due and punctual payment of interest
on the overdue principal of and premium, if any, and, to the extent permitted by
law, interest, and the due and punctual performance of all other obligations of
the Company to the Holders or the Trustee under this Indenture, the Registration
Rights Agreement or any other agreement with or for the benefit of the Holders
or the Trustee, all in accordance with the terms hereof and thereof; and (b) in
case of any extension of time of payment or renewal of any Notes or any of such
other obligations, that same shall be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
Stated Maturity, by acceleration pursuant to Section 6.02, redemption or
otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors shall be jointly
and severally obligated to pay the same immediately. Each Guarantor agrees that
this is a guarantee of payment and not a guarantee of collection.
Each Guarantor hereby agrees that its obligations with regard
to its Guarantee shall be joint and several, unconditional, irrespective of the
validity or enforceability of the Notes or the obligations of the Company under
this Indenture, the absence of any action to enforce the same, the recovery of
any judgment against the Company or any other obligor with respect to this
Indenture, the Notes or the Obligations of the Company under this Indenture or
the Notes, any action to enforce the same or any other circumstances (other than
complete performance) which might otherwise constitute a legal or equitable
discharge or defense of a Guarantor. Each Guarantor further, to the extent
permitted by law, waives and relinquishes all claims, rights and remedies
accorded by applicable law to guarantors and agrees not to assert or take
advantage of any such claims, rights or remedies, including but not limited to:
(a) any right to require any of the Trustee, the Holders or
the Company (each a "BENEFITED PARTY"), as a condition of payment or
performance by such Guarantor, to
(1) proceed against the Company, any other guarantor
(including any other Guarantor) of the Obligations under the
Guarantees or any other Person,
(2) proceed against or exhaust any security held from
the Company, any such other guarantor or any other Person,
(3) proceed against or have resort to any balance of
any deposit account or credit on the books of any Benefited
Party in favor of the Company or any other Person, or
(4) pursue any other remedy in the power of any
Benefited Party whatsoever;
(b) any defense arising by reason of the incapacity, lack of
authority or any disability or other defense of the Company including
any defense based on or arising out of the lack of validity or the
unenforceability of the Obligations under the Guarantees or any
agreement or instrument relating thereto or by reason of the cessation
of the liability of the Company from any cause other than payment in
full of the Obligations under the Guarantees;
68
(c) any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in
amount nor in other respects more burdensome than that of the
principal;
(d) any defense based upon any Benefited Party's errors or
omissions in the administration of the Obligations under the
Guarantees, except behavior which amounts to bad faith;
(e) (1) any principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms of
the Guarantees and any legal or equitable discharge of such
Guarantor's obligations hereunder,
(2) the benefit of any statute of limitations
affecting such Guarantor's liability hereunder or the
enforcement hereof,
(3) any rights to set-offs, recoupments and
counterclaims and
(4) promptness, diligence and any requirement that
any Benefited Party protect, secure, perfect or insure any
security interest or lien or any property subject thereto;
(f) notices, demands, presentations, protests, notices of
protest, notices of dishonor and notices of any action or inaction,
including acceptance of the Guarantees, notices of Default under the
Notes or any agreement or instrument related thereto, notices of any
renewal, extension or modification of the Obligations under the
Guarantees or any agreement related thereto, and notices of any
extension of credit to the Company and any right to consent to any
thereof;
(g) to the extent permitted under applicable law, the benefits
of any "One Action" rule and
(h) any defenses or benefits that may be derived from or
afforded by law which limit the liability of or exonerate guarantors or
sureties, or which may conflict with the terms of the Guarantees.
Except to the extent expressly provided herein, including Sections
8.02, 8.03 and 10.05, each Guarantor hereby covenants that its
Guarantee shall not be discharged except by complete performance of the
obligations contained in its Guarantee and this Indenture.
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
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.
Each Guarantor agrees that it 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.
Each Guarantor further agrees that, 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 Section 6.02
hereof for the purposes of this 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 Section 6.02 hereof, such obligations (whether
or not due and payable) shall forthwith become due and payable by the Guarantors
for the purpose of this Guarantee. 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.
Section 10.02. LIMITATION ON GUARANTOR LIABILITY.
(a) Each Guarantor, and by its acceptance of Notes, each
Holder, hereby confirms that it is the intention of all such parties that the
guarantee of such Guarantor not constitute a fraudulent transfer or conveyance
for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the
extent applicable to any guarantee. To effectuate the foregoing intention, the
Trustee, the Holders and the Guarantors hereby irrevocably agree that each
Guarantor's liability shall be that amount
69
from time to time equal to the aggregate liability of such Guarantor under the
guarantee, but shall be limited to the lesser of (a) the aggregate amount of the
Company's obligations under the Notes and this Indenture or (b) the amount, if
any, which would not have (1) rendered the Guarantor "insolvent" (as such term
is defined in the Federal Bankruptcy Code and in the Debtor and Creditor Law of
the State of New York) or (2) left it with unreasonably small capital at the
time its guarantee with respect to the Notes was entered into, after giving
effect to the incurrence of existing Debt immediately before such time;
provided, however, it shall be a presumption in any lawsuit or proceeding in
which a Guarantor is a party that the amount guaranteed pursuant to the
guarantee with respect to the Notes is the amount described in clause (a) above
unless any creditor, or representative of creditors of the Guarantor, or debtor
in possession or Trustee in bankruptcy of the Guarantor, otherwise proves in a
lawsuit that the aggregate liability of the Guarantor is limited to the amount
described in clause (b).
(b) In making any determination as to the solvency or
sufficiency of capital of a Guarantor in accordance with the proviso of Section
10.02(a), the right of each Guarantor to contribution from other Guarantors and
any other rights such Guarantor may have, contractual or otherwise, shall be
taken into account.
Section 10.03. EXECUTION AND DELIVERY OF GUARANTEE.
To evidence its Guarantee set forth in Section 10.01, each
Guarantor hereby agrees that a notation of such Guarantee in substantially the
form included in Exhibit E attached hereto 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 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 Guarantee.
If an Officer whose signature is on this Indenture or on the
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Guarantee is endorsed, the Guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the Guarantee
set forth in this Indenture on behalf of the Guarantors.
The Company hereby agrees that it shall cause each Person that
becomes obligated to provide a Guarantee pursuant to Section 4.17 to execute a
supplemental indenture in form and substance reasonably satisfactory to the
Trustee, pursuant to which such Person provides the guarantee set forth in this
Article 10 and otherwise assumes the obligations and accepts the rights of a
Guarantor under this Indenture, in each case with the same effect and to the
same extent as if such Person had been named herein as a Guarantor. The Company
also hereby agrees to cause each such new Guarantor to evidence its guarantee by
endorsing a notation of such guarantee on each Note as provided in this Section
10.03.
Section 10.04. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
Except as otherwise provided in Section 10.05, no Guarantor
may consolidate with or merge with or into (whether or not such Guarantor is the
Surviving Person) another Person whether or not affiliated with such Guarantor
unless:
(a) subject to Section 10.05, the Person formed by or
surviving any such consolidation or merger (if other than a Guarantor
or the Company) unconditionally assumes all the obligations of such
Guarantor, pursuant to a supplemental indenture in form and substance
reasonably satisfactory to the Trustee, under this Indenture, the
Guarantee and any Registration Rights Agreements on the terms set forth
herein or therein; and
(b) the Guarantor complies with the requirements of Article 5
hereof.
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In case of any such consolidation, merger, sale or conveyance
and upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the Guarantee endorsed upon the Notes and the due and punctual performance of
all of the covenants and conditions of this Indenture to be performed by the
Guarantor, such successor Person shall succeed to and be substituted for the
Guarantor with the same effect as if it had been named herein as a Guarantor.
Such successor Person thereupon may cause to be signed any or all of the
Guarantees to be endorsed upon all of the Notes issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Trustee. All the Guarantees so issued shall in all respects have the same legal
rank and benefit under this Indenture as the Guarantees theretofore and
thereafter issued in accordance with the terms of this Indenture as though all
of such Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5, and notwithstanding
clauses (a) and (b) above, 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 another Guarantor.
Section 10.05. RELEASES FOLLOWING MERGER, CONSOLIDATION OR SALE OF
ASSETS, ETC.
In the event of a sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all of the Capital
Stock of any Guarantor, in each case to a Person that is not (either before or
after giving effect to such transactions) a Subsidiary of the Company, then such
Guarantor (in the event of a sale or other disposition, by way of merger,
consolidation or otherwise, of all of the Capital Stock of such Guarantor) or
the corporation acquiring the property (in the event of a sale or other
disposition of all or substantially all of the assets of such Guarantor) shall
be released and relieved of any obligations under its Guarantee; provided that
the net proceeds of such sale or other disposition shall be applied in
accordance with the applicable provisions of this Indenture, including without
limitation Section 4.12. If a Restricted Subsidiary is designated as an
Unrestricted Subsidiary in accordance with the provisions of Section 4.16, such
Subsidiary shall be released and relieved of any obligations under its
Subsidiary Guarantee. Upon delivery by the Company to the Trustee of an
Officers' Certificate and an Opinion of Counsel to the effect that such sale or
other disposition was made by the Company in accordance with the provisions of
this Indenture, including without limitation Section 4.12, the Trustee shall
execute any documents reasonably required in order to evidence the release of
any Guarantor from its obligations under its Guarantee.
Any Guarantor not released from its obligations under its
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under this Indenture
as provided in this Article 10.
ARTICLE 11.
SATISFACTION AND DISCHARGE
Section 11.01. SATISFACTION AND DISCHARGE.
This Indenture shall be discharged and shall cease to be of
further effect, except as to surviving rights of registration of transfer or
exchange of the Notes, as to all Notes issued hereunder, when:
(a) either:
(i) all Notes that have been previously authenticated
and delivered (except lost, stolen or destroyed Notes that
have been replaced or paid and Notes for whose payment money
has previously been deposited in trust or segregated and held
in trust by the Company and is thereafter repaid to the
Company or discharged from the trust) have been delivered to
the Trustee for cancellation; or
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(ii) all notes that have not been delivered to the
Trustee for cancellation have become due and payable by reason
of the mailing of a notice of redemption or otherwise or will
become due and payable within one year, and the Company has
irrevocably deposited or caused to be deposited with the
Trustee as trust funds in trust solely for the benefit of the
holders, cash in U.S. dollars, non-callable U.S. Government
Securities, or a combination of cash in U.S. dollars and
non-callable U.S. Government Securities, in such amounts as
will be sufficient without consideration of any reinvestment
of interest, to pay and discharge the entire indebtedness on
the notes not delivered to the trustee for cancellation for
principal, premium and Additional Interest, if any, and
accrued interest to the date of maturity or redemption;
(b) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or shall occur as a result of
such deposit and such deposit will not result in a breach or violation
of, or constitute a default under, any other instrument to which the
Company or any other Guarantor is a party or by which the Company or
any other Guarantor is bound;
(c) the Company has paid or caused to be paid all sums payable
by it hereunder;
(d) the Company has delivered irrevocable instructions to the
Trustee to apply the deposited money toward the payment of the Notes at
Stated Maturity or the redemption date, as the case may be; and
(e) the Company shall have delivered to the Trustee an
Officers' Certificate and Opinion of Counsel stating that all
conditions precedent relating to the satisfaction and discharge of this
Indenture have been satisfied.
Section 11.02. DEPOSITED CASH AND U.S. GOVERNMENT SECURITIES TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 11.03, all cash and non-callable U.S.
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
11.02, the "Trustee") pursuant to Section 11.01 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 cash and securities 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 or assessed against the Trustee with respect to
money deposited with the Trustee pursuant to Section 11.01 hereof.
Section 11.03. REPAYMENT TO COMPANY.
Any cash or non-callable U.S. Government Securities 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 on, any Note and
remaining unclaimed for two years after such principal, and premium, if any, or
interest 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 shall thereafter, as an unsecured creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such cash and securities, 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 cash and securities
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 cash and securities then remaining shall be repaid to
the Company.
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ARTICLE 12.
SUBORDINATION
Section 12.01. AGREEMENT TO SUBORDINATE.
The Company and each Guarantor agrees, and each Holder by
accepting a Note agrees, that the Indebtedness evidenced by, and all "payments"
on and "distributions" on or with respect to, the Notes (including any
obligation to repurchase the Notes) and any Subsidiary Guarantees, is
subordinated in right of payment, to the extent and in the manner provided in
this Article 12, to the prior payment in full in cash of all Senior Debt
(including interest, fees and expenses after the commencement of any bankruptcy
proceeding as specified in the documents evidencing the applicable Senior Debt,
whether or not recoverable in such a proceeding, outstanding on the date hereof
or hereafter created, incurred, assumed or guaranteed). This Article 12 shall
constitute a continuing agreement with all Persons who become holders of, or
continue to hold Senior Debt, and such provisions are made for the benefit of
the holders of Senior Debt.
Section 12.02. LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any payment or distribution of the assets of the Company
or a Guarantor to creditors of the Company or the relevant Guarantor (1) in a
liquidation or dissolution of the Company or the Guarantor, (2) in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Company or the Guarantor or its respective property, (3) in an assignment for
the benefit of creditors of the Company or Guarantor or (4) any marshaling of
assets and liabilities of the Issuer or any Guarantor, the holders of Senior
Debt shall be entitled to receive payment in full in cash of all Obligations due
in respect of such Senior Debt (including interest, fees and expenses after the
commencement of any such proceeding as specified in the documents evidencing the
applicable Senior Debt, whether or not the claim for such interest, fees and
expenses are allowed as a claim in such proceeding), before the Holders shall be
entitled to receive any payment or distribution with respect to the Notes or
Subsidiary Guarantees, and until all Obligations with respect to Senior Debt are
paid in full in cash, any payment or distribution to which the Holders would be
entitled but for this Article 12 shall be made to the holders of Senior Debt
(except that Holders may receive and retain Permitted Junior Securities and
payments made from the trust described under Article 8 or Section 11.02 if such
funds were deposited in accordance with, and to the extent permitted by, this
Article 12).
Section 12.03. DEFAULT ON DESIGNATED SENIOR DEBT.
(a) Neither the Company nor any Guarantor may make any payment
in respect of the Notes (except in Permitted Junior Securities or from the trust
described under Article 8 hereof) if:
(1) a payment Default on Designated Senior Debt
occurs and is continuing beyond any applicable grace period;
or
(2) any other default occurs and is continuing on any
series of Designated Senior Debt that permits holders of that
series of Designated Senior Debt to accelerate its maturity
and the Trustee receives a notice of such other default (a
"Payment Blockage Notice") from the Company or (i) with
respect to Designated Senior Debt arising under the Credit
Agreement, from the agent for the lenders thereunder, or (ii)
with respect to any other Designated Senior Debt, from the
holders of any such Designated Senior Debt.
(b) Payments on the Notes or the guarantees may and shall be
resumed:
(1) in the case of a payment Default on Designated
Senior Debt, upon the earlier of the date on which such
default is cured or waived or such Designated Senior Debt has
been discharged and paid in full; and
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(2) in the case of a nonpayment Default on Designated
Senior Debt, upon the earlier of (i) the date on which such
nonpayment Default is cured or waived, (ii) 179 days after the
date on which the applicable Payment Blockage Notice is
received, unless the maturity of any Designated Senior Debt
has been accelerated, (iii) the date on which such Payment
Blockage Period shall have been terminated by written notice
to the Trustee by the party initiating such Payment Blockage
Period or (iv) the date on which such Designated Senior Debt
has been discharged or paid in full.
(c) No new Payment Blockage Notice shall be delivered unless
and until (i) 360 days have elapsed since the delivery of the
immediately prior Payment Blockage Notice and (ii) all scheduled
payments of principal, interest and premium on the Notes that have come
due have been paid in full in cash. No nonpayment default on Designated
Senior Debt that existed or was continuing on the date of delivery of
any Payment Blockage Notice to the Trustee shall be, or be made, the
basis for a subsequent Payment Blockage Notice unless such default
shall have been waived for a period of not less than 90 days. Following
the expiration of any period during which the Company or the Guarantors
are prohibited from making payments on the Notes pursuant to a Payment
Blockage Notice, the Company or the Guarantors shall be obligated to
resume making any and all required payments in respect of the Notes,
including any missed payments, unless a payment default on Designated
Senior Debt exists or the maturity of any Designated Senior Debt has
been accelerated, and such acceleration remains in full force and
effect.
(d) The Company shall give prompt written notice to the
Trustee of any default in the payment of any Senior Debt or any
acceleration under any Senior Debt or under any agreement pursuant to
which Senior Debt may have been issued. Failure to give such notice
shall not affect the subordination of the Notes to the Senior Debt or
the application of the other provisions provided in this Article 12.
(e) So long as any Indebtedness is outstanding under the
Credit Agreement, only the agent under such Credit Agreement shall be
permitted to deliver a Payment Blockage Notice or to otherwise act as
the Representative of the holders of Designated Senior Debt.
Section 12.04. ACCELERATION OF NOTES.
If payment of the Notes is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Debt (including,
without limitation, the agent under the Credit Agreement) or the Representative
of the acceleration.
Section 12.05. WHEN DISTRIBUTION MUST BE PAID OVER.
In the event that the Trustee receives or is holding, or any
Holder receives, any payment or distribution with respect to the Notes or any
Subsidiary Guarantee of the Notes, and such payment is prohibited by Section
12.02 or 12.03 hereof, such payment or distribution shall be held by the Trustee
or such Holder, in trust for the benefit of, and shall be paid forthwith over
and delivered to, the holders of Senior Debt as their interests may appear or
their Representative under the Credit Agreement or other agreement (if any)
pursuant to which Senior Debt may have been issued, as their respective
interests may appear, for application to the payment of all Obligations with
respect to the Senior Debt remaining unpaid to the extent necessary to pay such
Obligations in full in cash in accordance with their terms, after giving effect
to any concurrent payment or distribution to or for the holders of Senior Debt.
With respect to the holders of Senior Debt, the Trustee
undertakes to perform only such obligations on the part of the Trustee as are
specifically set forth in this Article 12, and no implied covenants or
obligations with respect to the holders of Senior Debt 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 Debt, and shall not be liable to any
such holders if the Trustee shall mistakenly pay over or distribute to or on
behalf of Holders or the Company, any Guarantor, or any other Person money or
assets to which any holders of Senior Debt shall be entitled by virtue of this
Article 12, unless a Responsible Officer of the Trustee has received a Payment
Blockage Notice and such payment is made as a result of the willful misconduct
or gross negligence of the Trustee.
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Section 12.06. NOTICE BY THE COMPANY.
The Company shall promptly notify the Trustee and the Paying
Agent of any facts known to the Company that would cause a payment of any
Obligations with respect to the Notes or guarantees to violate this Article 12,
but failure to give such notice shall not affect the subordination of the Notes
or the guarantees to the Senior Debt as provided in Article 12.
Section 12.07. SUBROGATION.
After all Senior Debt is paid in full in cash and until the
Notes are paid in full, Holders shall be subrogated (equally and ratably with
all other Indebtedness pari passu with the Notes) to the rights of holders of
Senior Debt to receive distributions applicable to Senior Debt. A distribution
made under this Article 12 to holders of Senior Debt that otherwise would have
been made to Holders is not, as between the Company and Holders, a payment by
the Company on the Notes.
If any payment or distribution to which the Holders would
otherwise have been entitled but for the provisions of this Article 12 shall
have been applied, pursuant to the provisions of this Article 12, to the payment
of all amounts payable under the Senior Debt, then and in such case the Holders
shall be entitled to receive from the holders of such Senior Debt at the time
outstanding any payments or distributions received by such holders of such
Senior Debt in excess of the amount sufficient to pay all amounts payable under
or in respect of such Senior Debt in full in cash; provided, however, that such
payments or distributions shall be paid first pro rata to Holders that
previously paid amounts and then pro rata to all Holders.
Section 12.08. RELATIVE RIGHTS.
This Article 12 defines the relative rights of Holders and
holders of Senior Debt. Nothing in this Indenture shall:
(a) impair, as between the Company and Holders, the Obligation
of the Company, which is absolute and unconditional, to pay principal,
premium and interest on the Notes in accordance with their terms;
(b) affect the relative rights of Holders and creditors of the
Company other than their rights in relation to holders of Senior Debt;
or
(c) prevent the Trustee or any Holder from exercising its
available remedies upon a Default, subject to the rights of holders and
owners of Senior Debt to receive distributions and payments otherwise
payable to Holders.
If the Company fails because of this Article 12 to pay
principal, premium and interest on a Note on the due date, the failure is still
a Default.
Section 12.09. SUBORDINATION MAY NOT BE IMPAIRED BY THE COMPANY.
No right of any Holder of Senior Debt to enforce the
subordination of the Indebtedness evidenced by the Notes shall be impaired by
any act or failure to act by the Company or by the failure of the Company to
comply with this Indenture.
Subject to the other provisions of this Indenture, the holders
of the Senior Debt 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 12, or the obligations hereunder of the Holders to the holders of
the Senior Debt, do any one or more of the following: (a) change in the manner,
place, or terms of payment, or extend the time of payment of, or renew or alter,
Senior Debt or any instrument evidencing the same or any agreement under which
the Senior Debt is outstanding or secured; (b) sell, exchange, release, or
otherwise deal with any property pledged, mortgaged, or otherwise securing the
Senior Debt;
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(c) release any Person liable in any manner for the collection of Senior Debt;
and (d) exercise or refrain from exercising any rights against the Company, the
Guarantor or any other Person; provided, however, that this provision shall not
in any way permit the Company or any Guarantor to take any action otherwise
prohibited by this Indenture.
Section 12.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to
holders of Senior Debt, the distribution may be made and the notice given to
their Representative.
Upon any payment or distribution of assets of the Company or
any Guarantor referred to in this Article 12, the Trustee and the Holders shall
be entitled to rely upon any order or decree made by any court of competent
jurisdiction or upon any certificate of the Representative for the purpose of
ascertaining the Persons entitled to participate in such distribution (so long
as the existence of the subordination provisions of this Article 12 have been
brought to the attention of such court or Representative), the holders of the
Senior Debt 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 12.
Section 12.11. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article 12 or any other
provision of this Indenture, the Trustee shall not be charged with knowledge or
notice of the existence of any facts that would prohibit the making of any
payment to or distribution by the Trustee, and the Trustee and the Paying Agent
may continue to make payments on the Notes, unless and until the Trustee shall
have received no later than three (3) Business Days prior to the due date of
such payment written notice of facts that would cause the payment of any
principal, premium and interest with respect to the Notes to violate this
Article 12 and, prior to the receipt of any such written notice, the Trustee,
shall be entitled in all respects conclusively to presume that no such fact
exists. Unless the Trustee shall have received the notice provided for in the
preceding sentence, the Trustee shall have full power and authority to receive
such payment and to apply the same to the purpose for which it was received, and
shall not be affected by any notice to the contrary which may be received by it
on or after such date. Only the Company or a Representative may give the notice.
Nothing in this Article 12 shall impair the claims of, or payments to, the
Trustee under or pursuant to Section 7.07 hereof.
The Trustee in its individual or any other capacity may hold
Senior Debt with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights.
Section 12.12. AUTHORIZATION TO EFFECT SUBORDINATION.
Each Holder of a Note by the Holder's acceptance thereof
authorizes and directs the Trustee on the Holder's behalf to take such action as
may be necessary or appropriate to acknowledge and effectuate the subordination
as provided in this Article 12, and appoints the Trustee to act as the Holder's
attorney-in-fact for any and all such purposes. If the Trustee does not file a
proper proof of claim or proof of debt in the form required in any proceeding
referred to in Section 6.09 hereof at least 30 days before the expiration of the
time to file such claim, a Representative of Designated Senior Debt is hereby
authorized to file an appropriate claim for and on behalf of the Holders of the
Notes and the Trustee shall have no liability therefor.
Section 12.13. TRUST MONEYS NOT SUBORDINATED.
Notwithstanding anything contained herein to the contrary,
payments from cash or the proceeds of U.S. Government Securities held in trust
under Article 8 or Section 11.02 hereof by the Trustee (or other qualifying
trustee) not in violation of Section 12.03 hereof for the payment of principal
of (and premium, if any) and interest on the Notes shall not be subordinated to
the prior payment of any Senior Debt or subject to the restrictions set forth in
this Article 12, and none of the Holders shall be obligated to pay over any such
amount to the Issuers or any Holder of Senior Debt or any other creditor of the
Company.
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Section 12.14. PAYMENT AND DISTRIBUTION.
For purposes of this Article 12, the term "payment" and/or
"distribution" means any payment or distribution (whether direct or indirect,
whether in cash, property, securities, or otherwise, and whether obtained or
distributed by set-off, liquidation, bankruptcy distribution, settlement, or
otherwise) made by any Person (including, without limitation, any payments or
distributions made pursuant to Section 4.17 or by any court or governmental body
or agency, any trustee in bankruptcy, or any liquidating trustee) with respect
to any Note or any guarantees or otherwise under this Indenture, including,
without limitation, payment of principal, premium or interest, on the Notes or
any payments under or with respect to any note guarantees, any depositing of
funds with the Trustee or any Paying Agent (including, without limitation, a
deposit in respect of defeasance or redemption, any payment on account of any
optional or mandatory redemptions or repurchase provisions, any payment or
recovery on any claim under this Indenture, any note guarantees, any Note, or
relating to or arising out of the offer, sale, or purchase of any Note (whether
for rescission or damages and whether based on contract, tort, duty imposed by
law, or any other theory of liability); provided that, for the purposes of this
Article 12, all Obligations now or hereafter existing under any Senior Debt,
(including, without limitation, the Credit Agreement, any Hedging Obligations or
agreements with respect to the issuance of letters of credit) shall not be
deemed to have been paid in full unless the holders thereof shall have received
payment in full and all commitments thereunder and all letters of credit issued
thereunder have expired.
Section 12.15. NO CLAIMS.
No holder of Subordinated Obligations shall have any claim to
any property or assets of the Company, any Guarantor, or any Subsidiary of the
Company or any Guarantor, unless and until the Senior Debt shall have been fully
paid in cash.
Section 12.16. ACKNOWLEDGEMENT OF HOLDERS.
Each holder of Subordinated Obligations by accepting a Note or
a guarantee acknowledges and agrees that the foregoing subordination provisions
are, and are intended to be, an inducement and consideration to each holder of
Senior Debt, whether such Senior Debt was created or acquired before or after
the issuance of the Notes or the guarantees, to acquire and continue to hold, or
to continue to hold, such Senior Debt, and such holder of Senior Debt shall be
deemed conclusively to have relied on such subordination provisions in acquiring
and continuing to hold, or in continuing to hold, such Senior Debt.
ARTICLE 13.
MISCELLANEOUS
Section 13.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or
conflicts with another provision which is required to be included in this
Indenture by the TIA, the provision required by the TIA shall control.
Section 13.02. NOTICES.
Any notice or communication by the Company or the Trustee to
the other is duly given if in writing and delivered in person or mailed by first
class mail (registered or certified, return receipt requested), facsimile
transmission or overnight air courier guaranteeing next-day delivery, to the
other's address:
If to the Company:
Psychiatric Solutions, Inc.
000 Xxxxxxxx Xxxx, Xxxxx X-000
Xxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Telecopier No.: (000) 000-0000
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With a copy to:
Xxxxxx Xxxxxxx Xxxxxx & Xxxxx, PLLC
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000-0000
Attention: Xxxxxx Xxxx, Esq.
Telecopier No.: (615) 244-
If to the Trustee:
Wachovia Bank, National Association
NC5780
0000 Xxxx Xxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust Administration
Telecopier No.: (000) 000-0000
The Company or the Trustee, by notice to the other, may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to the
Trustee or 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
sent by facsimile transmission; and the next Business Day after timely delivery
to the courier, if sent by overnight air courier guaranteeing next-day delivery.
All notices and communications to the Trustee or Holders shall be deemed duly
given and effective only upon receipt.
Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next-day delivery to its address shown on the
Security Register. Any notice or communication shall also be so mailed to any
Person described in TIA ss. 313(c), to the extent required by the TIA. Failure
to mail a notice or communication to a Holder or any defect in it shall not
affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.
Section 13.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA ss.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 ss.312(c).
Section 13.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 13.05 hereof) stating that, in the opinion of the signers, all
conditions
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precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 13.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been complied with.
Section 13.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss.314(a)(4)) shall comply with the provisions of TIA
ss.314(e) and shall include:
(a) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable
such Person to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with.
With respect to matters of fact, an Opinion of Counsel may rely on an Officers'
Certificate, certificates of public officials or reports or opinions of experts.
Section 13.06. 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 13.07. 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 of the Guarantors under the
Notes, this Indenture, the Guarantees or for any claim based on, in respect of,
or by reason of, such obligations or their creation. Each Holder of 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. The waiver and release
may not be effective to waive or release liabilities under the federal
securities laws.
Section 13.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE AND THE NOTES 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 13.09. 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.
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Section 13.10. SUCCESSORS.
All covenants and agreements of the Company in this Indenture
and the Notes shall bind its successors. All covenants and agreements of the
Trustee in this Indenture shall bind its successors.
Section 13.11. 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 13.12. 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 13.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings in
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 13.14. QUALIFICATION OF THIS INDENTURE
The Company shall qualify this Indenture under the TIA in
accordance with the terms and conditions of any Registration Rights Agreement
and shall pay all reasonable costs and expenses (including attorneys' fees and
expenses for the Company, the Trustee and the Holders) incurred in connection
therewith, including, but not limited to, costs and expenses of qualification of
this Indenture and the Notes and printing this Indenture and the Notes. The
Trustee shall be entitled to receive from the Company any such Officers'
Certificates, Opinions of Counsel or other documentation as it may reasonably
request in connection with any such qualification of this Indenture under the
TIA.
[Signatures on following page]
80
SIGNATURES
Dated as of June 30, 2003
PSYCHIATRIC SOLUTIONS, INC.
By: /s/ Xxxx X. Xxxxxx
-----------------------------------------------
Name: Xxxx X. Xxxxxx
Title: President and Chief Executive Officer
PSYCHIATRIC SOLUTIONS HOSPITALS, INC.
INFOSCRIBER CORPORATION
COLLABORATIVE CARE CORPORATION
PSYCHIATRIC SOLUTIONS OF ALABAMA, INC.
PSYCHIATRIC SOLUTIONS OF FLORIDA, INC.
PSYCHIATRIC SOLUTIONS OF TENNESSEE, INC.
SOLUTIONS CENTER OF LITTLE ROCK, INC.
PSYCHIATRIC SOLUTIONS OF NORTH CAROLINA, INC.
PSI COMMUNITY MENTAL HEALTH AGENCY MANAGEMENT, INC.
PSYCHIATRIC MANAGEMENT RESOURCES, INC.
PSI-EAP, INC.
SUNSTONE BEHAVIORAL HEALTH, INC.
THE COUNSELING CENTER OF MIDDLE TENNESSEE, INC.
PSI CEDAR SPRINGS HOSPITAL, INC.
PSYCHIATRIC SOLUTIONS OF OKLAHOMA, INC.
AERIES HEALTHCARE CORPORATION
AERIES HEALTHCARE OF ILLINOIS, INC.
PSI HOSPITALS, INC.
PSYCHIATRIC PRACTICE MANAGEMENT OF ARKANSAS, INC.
BOUNTIFUL PSYCHIATRIC HOSPITAL, INC.
EAST CAROLINA PSYCHIATRIC SERVICES CORPORATION
GREAT PLAINS HOSPITAL, INC.
GULF COAST TREATMENT CENTER, INC.
HAVENWYCK HOSPITAL INC.
H.C. CORPORATION
HSA HILL CREST CORPORATION
HSA OF OKLAHOMA, INC.
MICHIGAN PSYCHIATRIC SERVICES, INC.
RAMSAY MANAGED CARE, INC.
RAMSAY TREATMENT SERVICES, INC.
PSYCHIATRIC SOLUTIONS OF CORAL GABLES, INC.
RAMSAY YOUTH SERVICES OF ALABAMA, INC.
RAMSAY YOUTH SERVICES OF FLORIDA, INC.
RAMSAY YOUTH SERVICES OF GEORGIA, INC.
RAMSAY YOUTH SERVICES PUERTO RICO, INC.
RAMSAY YOUTH SERVICES OF SOUTH CAROLINA, INC.
RHCI SAN ANTONIO, INC.
TRANSITIONAL CARE VENTURES, INC.
TRANSITIONAL CARE VENTURES (TEXAS), INC.
By: /s/ Xxxx X. Xxxxxx
-----------------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
THERAPEUTIC SCHOOL SERVICES, LLC
BY: PSYCHIATRIC SOLUTIONS OF OKLAHOMA, INC., AS
SOLE MEMBER
By: /s/ Xxxx X. Xxxxxx
------------------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
PSI TEXAS HOSPITALS, LLC
BY: PSYCHIATRIC SOLUTIONS HOSPITALS, INC., AS SOLE
MEMBER
By: /s/ Xxxx X. Xxxxxx
------------------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
H.C. PARTNERSHIP
BY: H.C. CORPORATION, AS GENERAL PARTNER
By: /s/ Xxxx X. Xxxxxx
------------------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
BY: HSA HILL CREST CORPORATION, AS GENERAL PARTNER
By: /s/ Xxxx X. Xxxxxx
------------------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
TEXAS CYPRESS CREEK HOSPITAL, L.P.
TEXAS WEST OAKS HOSPITAL, L.P.
NEURO INSTITUTE OF AUSTIN, L.P.
TEXAS XXXXXX XXXXX HOSPITAL, L.P.
TEXAS OAKS PSYCHIATRIC HOSPITAL, L.P.
TEXAS SAN MARCOS TREATMENT CENTER, L.P.
BY: PSI TEXAS HOSPITALS, LLC, AS GENERAL PARTNER
BY: PSYCHIATRIC SOLUTIONS HOSPITAL, INC., AS
SOLE MEMBER
By: /s/ Xxxx X. Xxxxxx
----------------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
TRUSTEE:
WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxx Xxxxxx
------------------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
EXHIBIT A
================================================================================
(Face of Note)
10-5/8% SENIOR SUBORDINATED NOTES DUE 2013
CUSIP _____________
NO.______ $_____________
PSYCHIATRIC SOLUTIONS, INC.
promises to pay to CEDE & CO., INC. or registered assigns, the principal sum of
_________________ Dollars ($______________) on June 15, 2013.
Interest Payment Dates: June 15 and December 15, commencing December 15, 2003.
Record Dates: June 1 and December 1.
Dated: ______________, 20[ ].
IN WITNESS WHEREOF, the Company has caused this Note to be
signed manually or by facsimile by its duly authorized officer.
PSYCHIATRIC SOLUTIONS, INC.
By:
--------------------------------------------------
Name:
Title:
This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Trustee
By:
---------------------------------
Authorized Signatory
Dated _____________, 20__
(Back of Note)
10-5/8% SENIOR SUBORDINATED NOTES DUE 2013
[Insert the Global Note Legend, if applicable pursuant to the terms of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the terms of the
Indenture]
[Insert the following legend if the Notes are issued with original issue
discount: FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, THIS NOTE IS BEING ISSUED WITH ORIGINAL ISSUE
DISCOUNT: FOR EACH $1,000 PRINCIPAL AMOUNT OF THIS NOTE, THE ISSUE PRICE IS
$[ ], THE AMOUNT OF ORIGINAL ISSUE DISCOUNT IS $[ ], THE ISSUE DATE IS [ ] AND
THE YIELD TO MATURITY IS [ ]% PER ANNUM.]
Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. PSYCHIATRIC SOLUTIONS, INC., a Delaware corporation
(the "COMPANY"), promises to pay interest on the principal amount of this Note
at 10-5/8% per annum until maturity and shall pay Additional Interest, if any,
as provided in Section 5 of the Registration Rights Agreement. The Company shall
pay interest semi-annually on June 15 and December 15 of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each an
"INTEREST PAYMENT DATE"). Interest on the Notes shall accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from June 30, 2003; provided, however, that if there is no existing Default in
the payment of interest, and if this Note is authenticated between a record date
referred to on the face hereof and the next succeeding Interest Payment Date,
interest shall accrue from such next succeeding Interest Payment Date; provided,
further, that the first Interest Payment Date shall be the first of June 15 or
December 15 to occur after the date of issuance, unless such June 15 or December
15 occurs within one calendar month of such date of issuance, in which case the
first Interest Payment Date shall be the second of June 15 and December 15 to
occur after the date of issuance. The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time at a rate that is 1% per annum
in excess of the interest rate then in effect under the Indenture and this Note;
it shall pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue installments of interest and Additional Interest,
if any (without regard to any applicable grace periods), from time to time at
the same rate to the extent lawful. Interest shall be computed on the basis of a
360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons in whose name this Note (or one or
more Predecessor Notes) is registered at the close of business on the June 1 or
December 1 next preceding the Interest Payment Date, even if such Notes are
cancelled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes shall be payable as to principal, premium, if any, and
interest and Additional Interest, if any, at the office or agency of the Company
maintained for such purpose, or, at the option of the Company, payment of
interest may be made by check mailed to the Holders at their addresses set forth
in the Security Register; provided, however, that payment by wire transfer of
immediately available funds shall be required with respect to principal of and
interest and Additional Interest, if any, and premium, if any, on, all Global
Notes and all other Notes the Holders of which shall have provided wire transfer
instructions to the Company or the Paying Agent. Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, Wachovia Bank, National
Association, the Trustee under the Indenture, shall act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without notice
to any Holder. The Company or any of its Subsidiaries may act in any such
capacity.
4. INDENTURE. The Company issued the Notes under an Indenture
dated as of June 30, 2003 ("INDENTURE") among the Company, the guarantors party
thereto (the "GUARANTORS") and the Trustee. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code xx.xx. 77aaa-77bbbb). The
Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Paragraph 5, the
Notes will not be redeemable at the option of the Company prior to June 15,
2008. Starting on that date, the Company may redeem all or a portion of the
Notes, at once or over time, after giving the required notice under the
Indenture at the redemption prices (expressed as percentages of principal
amount) set forth below, plus accrued and unpaid interest and Additional
Interest, if any, on the Notes redeemed, to the applicable redemption date
(subject to the right of Holders of record on the relevant Regular Record Date
to receive interest due on the relevant Interest Payment Date), if redeemed
during the twelve-month period commencing on June 15 of the years indicated
below:
Year Percentage
----------
2008.............................................. 105.313%
2009.............................................. 103.542%
2010.............................................. 101.771%
2011 and thereafter............................... 100.000%
(b) At any time and from time to time prior to June 15, 2006,
the Company may redeem up to 35% of the aggregate principal amount of the Notes
(including Additional Notes) issued under this Indenture at a redemption price
(expressed as a percentage of principal amount) equal to 110.625% of the
principal amount thereof, plus accrued and unpaid interest and Additional
Interest, if any, to the redemption date (subject to the right of Holders of
record on the relevant Regular Record Date to receive interest due on the
relevant Interest Payment Date) with the net cash proceeds of any Equity
Offering of common stock of the Company; provided, however, that (i) at least
65% of the aggregate principal amount of the Notes initially issued under this
Indenture (excluding Notes held by the Company and its Subsidiaries) remains
outstanding immediately after giving effect to such redemption and (ii) any such
redemption shall be made within 90 days of such Equity Offering.
(c) Any prepayment pursuant to this paragraph shall be made
pursuant to the provisions of Sections 3.01 through 3.06 of the Indenture.
6. MANDATORY REDEMPTION. Except as set forth in Sections 4.12 and
4.17 of the Indenture, the Company shall not be required to make mandatory
redemption or sinking fund payments with respect to, or Offer to Purchase, the
Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) Upon the occurrence of a Change of Control, each
Holder shall have the right to require the Company to repurchase all or any part
(equal to $1,000 or an integral multiple of $1,000) of such Holder's Notes (a
"CHANGE OF CONTROL OFFER") at a purchase price, in cash, equal to 101% of the
aggregate principal amount of the Notes repurchased, plus accrued and unpaid
interest and Additional Interest, if any, on the Notes repurchased to the
purchase date (subject to the right of Holders of record on the relevant Regular
Record Date to receive interest to, but excluding, the Purchase Date).
(b) If the Company or one of its Restricted Subsidiaries
consummates any Asset Sales, any Net Proceeds from Asset Sales that are not
applied or invested as provided in Section 4.12 of the Indenture will constitute
"EXCESS PROCEEDS." When the aggregate amount of Excess Proceeds exceeds $7.5
million, the Company will make an offer to all Holders of Notes to purchase the
maximum principal amount of Notes and, if the Company is required to do so under
the terms of any other Indebtedness that is pari passu with the Notes, such
other Indebtedness on a pro rata basis with the Notes, that may be purchased out
of the Excess Proceeds (an "ASSET SALE OFFER"). The offer price in any Asset
Sale Offer will be equal to 100% of principal amount plus accrued and unpaid
interest and Additional Interest, if any, to the date of purchase, and will be
payable in cash. If any Excess Proceeds remain after consummation of the
purchase of all properly tendered and not withdrawn Notes pursuant to an Asset
Sale Offer, the Company may use such remaining Excess Proceeds for any purpose
not otherwise prohibited by the
Indenture. If the aggregate principal amount of Notes and other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee will select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds will be reset at zero. Holders of
Notes that are the subject of an offer to purchase will receive an Asset Sale
Offer from the Company prior to any related purchase date and may elect to have
such Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Notes.
8. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at
least 30 days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. This Note shall represent the aggregate principal amount of outstanding
Notes from time to time endorsed hereon and the aggregate principal amount of
Notes represented hereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. The transfer of Notes may be
registered and Notes may be exchanged as provided in the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
The Company need not exchange or register the transfer of any Note or portion of
a Note selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Notes for a period beginning at the opening of business 15 days
before the day of any selection of Notes for redemption, or during the period
between a record date (including a Regular Record Date) and the next succeeding
Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Company, the Guarantors and the Trustee may amend or supplement
the Indenture and the Notes with the consent of the Holders of at least a
majority in aggregate principal amount of the then outstanding Notes, including
Additional Notes, if any, then outstanding voting as a single class (including,
without limitation, consents obtained in connection with a purchase of or tender
offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07
of the Indenture, any existing Default or Event of Default (except a continuing
Default or Event of Default in (i) the payment of principal, premium, if any, or
interest on the Notes and (ii) in respect of a covenant or provision which under
the Indenture cannot be modified or amended without the consent of the Holder of
each Note affected by such modification or amendment) or compliance with any
provision of the Indenture or the Notes may be waived with the consent of the
Holders of at least a majority in aggregate principal amount of the Notes,
including Additional Notes, if any, then outstanding voting as a single class
(including consents obtained in connection with a purchase of or tender offer or
exchange offer for the Notes).
Without the consent of any Holder, the Company, the Guarantors
and the Trustee may amend or supplement the Indenture or the Notes to (a) cure
any ambiguity, omission, defect or inconsistency, (b) provide for the assumption
by a Surviving Person of the obligations of the Company under the Indenture, (c)
provide for uncertificated Notes in addition to or in place of certificated
Notes, provided that the uncertificated Notes are issued in registered form for
purposes of Section 163(f) of the Code, or in a manner such that the
uncertificated Notes are described in Section 163(f)(2)(B) of the Code; (d) add
additional Guarantees or additional obligors with respect to the Notes or
release Guarantors from Guarantees as permitted by the terms of the Indenture,
(e) secure the Notes, (f) add to the covenants of the Company for the benefit of
the Holders or surrender any right or power conferred upon the Company, (g) make
any other change that would provide any additional rights or benefits to the
Holders or that does not adversely affect the legal rights under the Indenture
of any such Holder, (h) make any change to comply with any requirement of the
Commission in order to effect or maintain the qualification of the Indenture
under the TIA, or (i) provide for or confirm the issuance of Additional Notes.
12. DEFAULTS AND REMEDIES. Each of the following is an Event of
Default under the Indenture: (a) default for 30 days in the payment when due of
interest on, or Additional Interest with respect to, the Notes; (b) default in
the payment when due of the principal of, or premium, if any, on, any of the
Notes when the same becomes due and payable at its Stated Maturity, upon
acceleration, redemption, optional redemption, required repurchase or otherwise
(whether or not prohibited by Article 12 of the Indenture); (c) failure by the
Company or any Restricted Subsidiary to comply with Section 4.09, Section 4.10
or Section 5.01 of the Indenture; (d) failure by the Company or any Restricted
Subsidiary to comply with Section 4.12 or Section 4.17 of the Indenture, and
such failure continues for 30 days after written notice is given to the Company
as provided in the Indenture; (e) failure by the Company or any Restricted
Subsidiary to comply with any other covenant or agreement in the Notes or in the
Indenture (other than a failure that is the subject of the foregoing clause (a),
(b), (c) or (d)), and such failure continues for 60 days after written notice is
given to the Company as provided in the Indenture; (f) a default under any
mortgage, indenture or instrument under which there may be issued or by which
there may be secured or evidenced any Indebtedness for money borrowed by the
Company or any Restricted Subsidiary (or the payment of which is guaranteed by
the Company or any Restricted Subsidiary) whether such Indebtedness or Guarantee
now exists, or is created after the date of the Indenture, if that default (i)
is caused by a failure to pay principal of, or interest or premium, if any, on
such Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "PAYMENT DEFAULT"), or (ii) results
in the acceleration of such Indebtedness prior to its express maturity, and in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$5.0 million or more; (g) failure by the Company or any Restricted Subsidiary to
pay final judgments aggregating in excess of $5.0 million, which judgments are
not paid, discharged or stayed for a period of 60 days; (h) except as permitted
by the Indenture, any Subsidiary Guarantee of a Guarantor shall be held in any
judicial proceeding to be unenforceable or invalid or shall cease for any reason
to be in full force and effect or any Guarantor shall deny or disaffirm its
obligations under its Subsidiary Guarantee; and (i) certain events of
bankruptcy, insolvency or reorganization affecting the Company or any of its
Significant Subsidiaries.
If any Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in principal amount of the then outstanding Notes
may declare all the Notes to be due and payable. Notwithstanding the foregoing,
in the case of an Event of Default arising from certain events of bankruptcy or
insolvency described in the Indenture, all outstanding Notes shall become due
and payable without further action or notice. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. The Trustee may
withhold from Holders notice of any continuing Default or Event of Default
(except a Default or Event of Default relating to the payment of principal or
interest or Additional Interest) if it determines that withholding notice is in
their interest. The Holders of a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture, except a continuing Default or Event of
Default (i) in the payment of the principal of, premium, if any, or interest on,
the Notes and (ii) in respect of a covenant or provision which under the
Indenture cannot be modified or amended without the consent of the Holder of
each Note affected by such modification or amendment. The Company is required to
deliver to the Trustee annually a statement regarding compliance with the
Indenture, and the Company is required upon becoming aware of any Default or
Event of Default, to deliver to the Trustee a statement specifying such Default
or Event of Default.
13. SUBORDINATION. Payment of principal, interest and premium and
Additional Interest, if any, on the Notes is subordinated to the prior payment
of Senior Debt on the terms provided in the Indenture.
14. TRUSTEE DEALINGS WITH COMPANY. Subject to certain limitations,
the Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee.
15. NO RECOURSE AGAINST OTHERS. No past, present or future
director, officer, employee, incorporator or stockholder of the Company or of
any Guarantor, as such, shall have any liability for any obligations of the
Company or any Guarantor under the Indenture, the Notes, the Guarantees 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.
16. AUTHENTICATION. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
17. 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).
18. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes that are Initial Notes shall have all the rights set forth in
the Registration Rights Agreement, dated as of June 30, 2003, between the
Company and the parties named on the signature pages thereto or, in the case of
Additional Notes, Holders of Restricted Global Notes and Restricted Definitive
Notes shall have the rights set forth in one or more registration rights
agreement, if any, among the Company and the other parties thereto, relating to
rights given by the Company to the purchasers of any Additional Notes.
19. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and has directed the Trustee to use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be placed
only on the other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request
and without charge a copy of the Indenture. Requests may be made to:
Psychiatric Solutions, Inc.
000 Xxxxxxxx Xxxx, Xxxxx X-000
Xxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Telecopier No.: (000) 000-0000
20. GOVERNING LAW. The internal law of the State of New York shall
govern and be used to construe this Note without giving effect to applicable
principals of conflicts of law to the extent that the application of the laws of
another jurisdiction would be required thereby.
Option of Holder to Elect Purchase
If you want to elect to have this Note purchased by the Company pursuant to
Section 4.12 or 4.17 of the Indenture, check the box below:
[ ] Section 4.12
[ ] Section 4.17
If you want to elect to have only part of the Note purchased by the Company
pursuant to Section 4.12 or Section 4.17 of the Indenture, state the amount you
elect to have purchased: $_____________________
Date:_________________ Your Signature:________________________________
(Sign exactly as your name appears on the Note)
Tax Identification No.:
-----------------------------------------------
SIGNATURE GUARANTEE:
-----------------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting the
requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer Agent
Medallion Program ("STAMP") or such other
"signature guarantee program" as may be
determined by the Registrar in addition to,
or in substitution for, STAMP, all in
accordance with the Securities Exchange Act
of 1934, as amended.
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to
--------------------------------------------------------------------------------
(Insert assignee's social security or other tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
as agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
--------------------------------------------------------------------------------
Date: ______________
Your Signature:_______________________________
(Sign exactly as your name appears on the
face of this Note)
Signature Guarantee: *
--------------------------
* Participant in a recognized Signature Guarantee Medallion Program.
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Principal Amount
Amount of of this Global Note Signature of
decrease in Amount of increase following such authorized signatory
Principal Amount in Principal Amount decrease (or of Trustee or
Date of Exchange of this Global Note of this Global Note increase) Note Custodian
---------------- ------------------- ------------------- ------------------- --------------------
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Psychiatric Solutions, Inc.
000 Xxxxxxxx Xxxx
Xxxxx X-000
Xxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Wachovia Bank, National Association
0000 Xxxx Xxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust Department
Telecopier No.: (000) 000-0000
Re: 10-5/8% Senior Subordinated Notes due 2013
Reference is hereby made to the Indenture, dated as of June
30, 2003 (the "Indenture"), among Psychiatric Solutions, Inc., as issuer (the
"Company"), the Guarantors party thereto and Wachovia Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
___________________, (the "Transferor") owns and proposes to
transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in
the principal amount of $___________ in such Note[s] or interests (the
"Transfer"), to ___________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] Check if Transferee will take delivery of a beneficial
interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and
in the Indenture and the Securities Act.
2. [ ] Check if Transferee will take delivery of a beneficial
interest in the Regulation S Global Note or a Definitive Note pursuant to
Regulation S. The Transfer is being effected pursuant to and in accordance with
Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a Person in
the United States and (x) at the time the buy order was originated, the
Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(a) of Regulation S under the Securities Act, and (iii) the transaction is
not part of a plan or scheme to evade the registration requirements of the
Securities Act. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the restrictions on Transfer enumerated in the
B-1
Private Placement Legend printed on the Regulation S Global Note, the Temporary
Regulation S Global Note and/or the Definitive Note and in the Indenture and the
Securities Act.
3. [ ] Check and complete if Transferee will take delivery of
a beneficial interest in the IAI Global Note or a Definitive Note pursuant to
any provision of the Securities Act other than Rule 144A or Regulation S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant
to and in accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the
Company or a subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant
to an effective registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the Securities
Act;
or
(d) [ ] such Transfer is being effected to an
Institutional Accredited Investor and pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A,
Rule 144 or Rule 904, and the Transferor hereby further certifies that
it has not engaged in any general solicitation within the meaning of
Regulation D under the Securities Act and the Transfer complies with
the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the
requirements of the exemption claimed, which certification is supported
by (1) a certificate executed by the Transferee in the form of Exhibit
D to the Indenture and (2) if such Transfer is in respect of a
principal amount of Notes at the time of transfer of less than
$250,000, an Opinion of Counsel provided by the Transferor or the
Transferee (a copy of which the Transferor has attached to this
certification), to the effect that such Transfer is in compliance with
the Securities Act. Upon consummation of the proposed transfer in
accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the IAI
Global Note and/or the Definitive Notes and in the Indenture and the
Securities Act.
4. [ ] Check if Transferee will take delivery of a beneficial
interest in an Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The
Transfer is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not
B-2
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will no longer
be subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Restricted Global Notes, on Restricted Definitive Notes
and in the Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i)
The Transfer is being effected pursuant to and in compliance with an exemption
from the registration requirements of the Securities Act other than Rule 144,
Rule 903 or Rule 904 and in compliance with the transfer restrictions contained
in the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
-----------------------------------------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
Dated:
-----------------------------------
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE OF (a), (b) OR (c)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(iv) [ ] Unrestricted Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Psychiatric Solutions, Inc.
000 Xxxxxxxx Xxxx
Xxxxx X-000
Xxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Wachovia Bank, National Association
0000 Xxxx Xxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust Department
Telecopier No.: (000) 000-0000
Re: 10-5/8% Senior Subordinated Notes due 2013
Reference is hereby made to the Indenture, dated as of June
30, 2003 (the "Indenture"), among Psychiatric Solutions, Inc., as issuer (the
"Company"), the Guarantors party thereto and Wachovia Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
__________________________, (the "Owner") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $____________ in such Note[s] or interests (the "Exchange").
In connection with the Exchange, the Owner hereby certifies that:
1. [ ] Exchange of Restricted Definitive Notes or Beneficial
Interests in a Restricted Global Note for Unrestricted Definitive Notes or
Beneficial Interests in an Unrestricted Global Note
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Restricted Global Note and pursuant to and in accordance with the United States
Securities Act of 1933, as amended (the "Securities Act"), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest in an Unrestricted Global Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted
Definitive Note is being acquired for the Owner's own account without transfer,
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Restricted Global Note and pursuant to and in
accordance with the Securities Act, (iii) the restrictions on transfer contained
in the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Unrestricted Definitive
Note is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE
TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE
TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the
C-1
Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act,
(iii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Unrestricted Definitive Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
2. Exchange of Restricted Definitive Notes or Beneficial
Interests in Restricted Global Notes for Restricted Definitive Notes or
Beneficial Interests in Restricted Global Notes
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Note and in
the Indenture and the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE
TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the
Exchange of the Owner's Restricted Definitive Note for a beneficial interest in
the [CIRCLE ONE] 144A Global Note, Regulation S Global Note, IAI Global Note
with an equal principal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer and (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Definitive Note and pursuant to and in accordance
with the Securities Act, and in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the beneficial
interest issued will be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the relevant Restricted Global Note and
in the Indenture and the Securities Act.
C-2
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
--------------------------------------
[Insert Name of Transferor]
By:
----------------------------------
Name:
Title:
Dated:
--------------------------------
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Psychiatric Solutions, Inc.
000 Xxxxxxxx Xxxx
Xxxxx X-000
Xxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Wachovia Bank, National Association
0000 Xxxx Xxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust Department
Telecopier No.: (000) 000-0000
Re: 10-5/8% Senior Subordinated Notes due 2013
Reference is hereby made to the Indenture, dated as of June
30, 2003 (the "Indenture"), among Psychiatric Solutions, Inc., as issuer (the
"Company"), the Guarantors party thereto and Wachovia Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________
aggregate principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the
Notes or any interest therein is subject to certain restrictions and conditions
set forth in the Indenture and the undersigned agrees to be bound by, and not to
resell, pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as 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 and any
interest therein 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 the Notes or any
interest therein, 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 a principal amount of Notes, at the time of transfer
of less than $250,000, an Opinion of Counsel in form reasonably acceptable to
the Company to the effect 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 provisions of Rule
144(k) under the Securities Act or (F) pursuant to an effective registration
statement under the Securities Act, and we further agree to provide to any
Person purchasing the Definitive Note or beneficial interest in a Global Note
from us in a transaction meeting the requirements of clauses (A) through (E) of
this paragraph a notice advising such purchaser that resales thereof are
restricted as stated herein.
3. We understand that, on any proposed resale of the
Notes or beneficial interest therein, 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
D-1
which we are acting are each able to bear the economic risk of our or its
investment. We have had access to such financial and other information and have
been afforded the opportunity to ask such questions of representatives of the
Company and receive answers thereto, as we deem necessary in connection with our
decision to purchase the Notes.
5. We are acquiring the Notes or beneficial interest
therein 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 and are not acquiring the Notes with a view to any
distribution thereof in a transaction that would violate the Securities Act of
the securities laws of any state of the United States or any other applicable
jurisdiction.
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. This letter shall be governed by,
and construed in accordance with, the laws of the State of New York.
------------------------------------------
[Insert Name of Accredited Investor]
By:
--------------------------------------
Name:
Title:
Dated:
----------------
D-2
EXHIBIT E
FORM OF NOTATION OF GUARANTEE
For value received, each Guarantor (which term includes any
successor Person under the Indenture), jointly and severally, unconditionally
guarantees, to the extent set forth in the Indenture and subject to the
provisions in the Indenture, dated as of June 30, 2003 (the "Indenture"), among
Psychiatric Solutions, Inc., as issuer (the "Company"), the Guarantors listed on
the signature pages thereto and Wachovia Bank, National Association, as trustee
(the "Trustee"), (a) the due and punctual payment of the principal of, premium,
if any, and interest and Additional Interest, if any, on the Notes, whether at
maturity, by acceleration, redemption or otherwise, the due and punctual payment
of interest 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 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, whether at stated
maturity, by acceleration or otherwise. The obligations of the Guarantors to the
Holders of Notes and to the Trustee pursuant to the 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 Guarantee. This Guarantee is
subject to release as and to the extent set forth in Sections 8.02, 8.03 and
10.05 of the Indenture. Each Holder of a Note, by accepting the same agrees to
and shall be bound by such provisions. Capitalized terms used herein and not
defined are used herein as so defined in the Indenture.
PSYCHIATRIC SOLUTIONS HOSPITALS, INC.
INFOSCRIBER CORPORATION
COLLABORATIVE CARE CORPORATION
PSYCHIATRIC SOLUTIONS OF ALABAMA, INC.
PSYCHIATRIC SOLUTIONS OF FLORIDA, INC.
PSYCHIATRIC SOLUTIONS OF TENNESSEE, INC.
SOLUTIONS CENTER OF LITTLE ROCK, INC.
PSYCHIATRIC SOLUTIONS OF NORTH CAROLINA, INC.
PSI COMMUNITY MENTAL HEALTH AGENCY MANAGEMENT, INC.
PSYCHIATRIC MANAGEMENT RESOURCES, INC.
PSI-EAP, INC.
SUNSTONE BEHAVIORAL HEALTH, INC.
THE COUNSELING CENTER OF MIDDLE TENNESSEE, INC.
PSI CEDAR SPRINGS HOSPITAL, INC.
PSYCHIATRIC SOLUTIONS OF OKLAHOMA, INC.
AERIES HEALTHCARE CORPORATION
AERIES HEALTHCARE OF ILLINOIS, INC.
PSI HOSPITALS, INC.
PSYCHIATRIC PRACTICE MANAGEMENT OF ARKANSAS, INC.
BOUNTIFUL PSYCHIATRIC HOSPITAL, INC.
EAST CAROLINA PSYCHIATRIC SERVICES CORPORATION
GREAT PLAINS HOSPITAL, INC.
GULF COAST TREATMENT CENTER, INC.
HAVENWYCK HOSPITAL INC.
H.C. CORPORATION
HSA HILL CREST CORPORATION
HSA OF OKLAHOMA, INC.
MICHIGAN PSYCHIATRIC SERVICES, INC.
RAMSAY MANAGED CARE, INC.
RAMSAY TREATMENT SERVICES, INC.
PSYCHIATRIC SOLUTIONS OF CORAL GABLES, INC.
RAMSAY YOUTH SERVICES OF ALABAMA, INC.
RAMSAY YOUTH SERVICES OF FLORIDA, INC.
RAMSAY YOUTH SERVICES OF GEORGIA, INC.
RAMSAY YOUTH SERVICES PUERTO RICO, INC.
RAMSAY YOUTH SERVICES OF SOUTH CAROLINA, INC.
RHCI SAN ANTONIO, INC.
TRANSITIONAL CARE VENTURES, INC.
TRANSITIONAL CARE VENTURES (TEXAS), INC.
By:
-----------------------------------------------
Name:
Title:
THERAPEUTIC SCHOOL SERVICES, LLC
BY: PSYCHIATRIC SOLUTIONS OF OKLAHOMA, INC.,
AS SOLE MEMBER
By:
-----------------------------------------------
Name:
Title:
PSI TEXAS HOSPITALS, LLC
BY: PSYCHIATRIC SOLUTIONS HOSPITALS, INC., AS
SOLE MEMBER
By:
-----------------------------------------------
Name:
Title:
H.C. PARTNERSHIP
BY: H.C. CORPORATION, AS GENERAL PARTNER
By:
-----------------------------------------------
Name:
Title:
4
BY: HSA HILL CREST CORPORATION, AS GENERAL PARTNER
By:
----------------------------------------------
Name:
Title:
TEXAS CYPRESS CREEK HOSPITAL, L.P.
TEXAS WEST OAKS HOSPITAL, L.P.
NEURO INSTITUTE OF AUSTIN, L.P.
TEXAS XXXXXX XXXXX HOSPITAL, L.P.
TEXAS OAKS PSYCHIATRIC HOSPITAL, L.P.
TEXAS SAN MARCOS TREATMENT CENTER, L.P.
BY: PSI TEXAS HOSPITALS, LLC, AS GENERAL PARTNER
BY: PSYCHIATRIC SOLUTIONS HOSPITAL, INC., AS
SOLE MEMBER
By:
----------------------------------------------
Name:
Title:
5
TABLE OF CONTENTS
PAGE
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE........................................1
Section 1.01. Definitions.........................................................1
Section 1.02. Other Definitions..................................................17
Section 1.03. Incorporation by Reference of Trust Indenture Act..................18
Section 1.04. Rules of Construction..............................................18
ARTICLE 2. THE NOTES........................................................................19
Section 2.01. Form and Dating....................................................19
Section 2.02. Execution and Authentication.......................................20
Section 2.03. Registrar and Paying Agent.........................................20
Section 2.04. Paying Agent to Hold Money in Trust................................21
Section 2.05. Holder Lists.......................................................21
Section 2.06. Transfer and Exchange..............................................21
Section 2.07. Replacement Notes..................................................31
Section 2.08. Outstanding Notes..................................................32
Section 2.09. Treasury Notes.....................................................32
Section 2.10. Temporary Notes....................................................32
Section 2.11. Cancellation.......................................................32
Section 2.12. Payment of Interest; Defaulted Interest............................33
Section 2.13. CUSIP or ISIN Numbers..............................................33
Section 2.14. Additional Interest................................................33
Section 2.15. Issuance of Additional Notes.......................................33
Section 2.16. Record Date........................................................34
ARTICLE 3. REDEMPTION AND PREPAYMENT........................................................34
Section 3.01. Notices to Trustee.................................................34
Section 3.02. Selection of Notes to Be Redeemed..................................34
Section 3.03. Notice of Redemption...............................................34
Section 3.04. Effect of Notice of Redemption.....................................35
Section 3.05. Deposit of Redemption Price........................................35
Section 3.06. Notes Redeemed in Part.............................................36
Section 3.07. Optional Redemption................................................36
Section 3.08. Mandatory Redemption...............................................36
Section 3.09. Offer To Purchase..................................................36
ARTICLE 4. COVENANTS........................................................................38
Section 4.01. Payment of Notes...................................................38
i
TABLE OF CONTENTS
(CONTINUED)
PAGE
Section 4.02. Maintenance of Office or Agency....................................39
Section 4.03. Reports............................................................39
Section 4.04. Compliance Certificate.............................................40
Section 4.05. Taxes..............................................................40
Section 4.06. Stay, Extension and Usury Laws.....................................40
Section 4.07. Corporate Existence................................................41
Section 4.08. Payments for Consent...............................................41
Section 4.09. Incurrence of Additional Debt and Issuance of Capital Stock........41
Section 4.10. Restricted Payments................................................43
Section 4.11. Liens..............................................................46
Section 4.12. Asset Sales........................................................46
Section 4.13. Restrictions on Distributions from Restricted Subsidiaries.........47
Section 4.14. Affiliate Transactions.............................................49
Section 4.15. Issuance or Sale of Capital Stock of Restricted Subsidiaries.......49
Section 4.16. Designation of Restricted and Unrestricted Subsidiaries............50
Section 4.17. Repurchase at the Option of Holders Upon a Change of Control.......50
Section 4.18. Future Subsidiary Guarantors.......................................51
Section 4.19. Business Activities................................................51
Section 4.20. No Senior Subordinated Debt........................................51
ARTICLE 5. SUCCESSORS.......................................................................52
Section 5.01. Merger, Consolidation and Sale of Assets...........................52
Section 5.02. Successor Corporation Substituted..................................52
ARTICLE 6. DEFAULTS AND REMEDIES............................................................53
Section 6.01. Events of Default..................................................53
Section 6.02. Acceleration.......................................................54
Section 6.03. Other Remedies.....................................................55
Section 6.04. Waiver of Defaults.................................................55
Section 6.05. Control by Majority................................................56
Section 6.06. Limitation on Suits................................................56
Section 6.07. Rights of Holders to Receive Payment...............................56
Section 6.08. Collection Suit by Trustee.........................................56
Section 6.09. Trustee May File Proofs of Claim...................................57
Section 6.10. Priorities.........................................................57
Section 6.11. Undertaking for Costs..............................................57
ii
TABLE OF CONTENTS
(CONTINUED)
PAGE
ARTICLE 7. TRUSTEE..........................................................................58
Section 7.01. Duties of Trustee..................................................58
Section 7.02. Rights of Trustee..................................................58
Section 7.03. Individual Rights of Trustee.......................................59
Section 7.04. Trustee's Disclaimer...............................................60
Section 7.05. Notice of Defaults.................................................60
Section 7.06. Reports by Trustee to Holders......................................60
Section 7.07. Compensation and Indemnity.........................................60
Section 7.08. Replacement of Trustee.............................................61
Section 7.09. Successor Trustee by Merger, etc...................................62
Section 7.10. Eligibility; Disqualification......................................62
Section 7.11. Preferential Collection of Claims Against Company..................62
ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE.........................................62
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance...........62
Section 8.02. Legal Defeasance and Discharge.....................................62
Section 8.03. Covenant Defeasance................................................63
Section 8.04. Conditions to Legal or Covenant Defeasance.........................63
Section 8.05. Deposited Cash and U.S. Government Securities to be Held in
Trust; Other Miscellaneous Provisions..............................64
Section 8.06. Repayment to Company...............................................65
Section 8.07. Reinstatement......................................................65
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER.................................................65
Section 9.01. Without Consent of Holders of Notes................................65
Section 9.02. With Consent of Holders of Notes...................................66
Section 9.03. Compliance with Trust Indenture Act................................67
Section 9.04. Revocation and Effect of Consents..................................67
Section 9.05. Notation on or Exchange of Notes...................................68
Section 9.06. Trustee to Sign Amendments, etc....................................68
ARTICLE 10. GUARANTEES.......................................................................68
Section 10.01. Guarantee..........................................................68
Section 10.02. Limitation on Guarantor Liability..................................70
Section 10.03. Execution and Delivery of Guarantee................................70
Section 10.04. Guarantors May Consolidate, etc., on Certain Terms.................71
Section 10.05. Releases Following Merger, Consolidation or Sale of Assets, etc....71
iii
TABLE OF CONTENTS
(CONTINUED)
PAGE
ARTICLE 11. SATISFACTION AND DISCHARGE.......................................................72
Section 11.01. Satisfaction and Discharge.........................................72
Section 11.02. Deposited Cash and U.S. Government Securities to be Held in
Trust; Other Miscellaneous Provisions.............................72
Section 11.03. Repayment to Company...............................................73
ARTICLE 12. SUBORDINATION....................................................................73
Section 12.01. Agreement to Subordinate...........................................73
Section 12.02. Liquidation; Dissolution; Bankruptcy...............................73
Section 12.03. Default on Designated Senior Debt..................................73
Section 12.04. Acceleration of Notes..............................................74
Section 12.05. When Distribution Must Be Paid Over................................74
Section 12.06. Notice by the Company..............................................75
Section 12.07. Subrogation........................................................75
Section 12.08. Relative Rights....................................................75
Section 12.09. Subordination May Not Be Impaired by the Company...................76
Section 12.10. Distribution or Notice to Representative...........................76
Section 12.11. Rights of Trustee and Paying Agent.................................76
Section 12.12. Authorization to Effect Subordination..............................76
Section 12.13. Trust Moneys Not Subordinated......................................77
Section 12.14. Payment and Distribution...........................................77
Section 12.15. No Claims..........................................................77
Section 12.16. Acknowledgement of Holders.........................................77
ARTICLE 13. MISCELLANEOUS....................................................................77
Section 13.01. Trust Indenture Act Controls.......................................77
Section 13.02. Notices............................................................78
Section 13.03. Communication by Holders of Notes with Other Holders of Notes......79
Section 13.04. Certificate and Opinion as to Conditions Precedent.................79
Section 13.05. Statements Required in Certificate or Opinion......................79
Section 13.06. Rules by Trustee and Agents........................................79
Section 13.07. No Personal Liability of Directors, Officers, Employees and
Stockholders.......................................................79
Section 13.08. Governing Law......................................................80
Section 13.09. No Adverse Interpretation of Other Agreements......................80
Section 13.10. Successors.........................................................80
iv
TABLE OF CONTENTS
(CONTINUED)
PAGE
Section 13.11. Severability.......................................................80
Section 13.12. Counterpart Originals..............................................80
Section 13.13. Table of Contents, Headings, etc...................................80
Section 13.14. Qualification of this Indenture....................................80
v
CROSS-REFERENCE TABLE
TIA SECTION INDENTURE
REFERENCE SECTION
310(a)(1)............................................................................... 7.10
(a)(2).................................................................................. 7.10
(a)(3).................................................................................. N.A.
(a)(4).................................................................................. N.A.
(a)(5).................................................................................. 7.10
(b)..................................................................................... 7.08, 7.10
(c)..................................................................................... N.A.
311(a).................................................................................. 7.11
(b)..................................................................................... 7.11
(c)..................................................................................... N.A.
312(a).................................................................................. 2.05
(b)..................................................................................... 12.03
(c)..................................................................................... 12.03
313(a).................................................................................. 7.06
(b)(1).................................................................................. N.A.
(b)(2).................................................................................. 7.06, 7.07
(c)..................................................................................... 7.06, 12.02
(d)..................................................................................... 7.06
314(a).................................................................................. 4.03, 4.04, 12.02
(b)..................................................................................... N.A.
(c)(1).................................................................................. 12.04
(c)(2).................................................................................. 12.04
(c)(3).................................................................................. N.A.
(d)..................................................................................... N.A.
(e)..................................................................................... 12.05
315(a).................................................................................. 7.01
(b)..................................................................................... 7.05, 12.02
(c)..................................................................................... 7.01
(d)..................................................................................... 7.01
(e)..................................................................................... 6.11
316(a) (last sentence).................................................................. 2.09
(a)(1)(A)............................................................................... 6.05
(a)(1)(B)............................................................................... 6.04
(a)(2).................................................................................. N.A.
(b)..................................................................................... 6.07
317(a)(1)............................................................................... 6.08
(a)(2).................................................................................. 6.09
(b)..................................................................................... 2.04
318(a).................................................................................. 12.01
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of this Indenture.
