EXHIBIT 4.1
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SALT HOLDINGS CORPORATION,
as Issuer,
and
THE BANK OF NEW YORK,
as Trustee
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INDENTURE
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Dated as of December 20, 2002
12 3/4% Senior Discount Notes Due 2012
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CROSS-REFERENCE TABLE
TIA Section Indenture Section
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310(a)(1)..................................................................... 7.10
(a)(2)..................................................................... 7.10
(a)(3)..................................................................... N.A.
(a)(4)..................................................................... N.A.
(a)(5)..................................................................... 7.8; 7.10
(b)........................................................................ 7.8; 7.10; 11.2
(c)........................................................................ N.A.
311(a)........................................................................ 7.11
(b)........................................................................ 7.11
(c)........................................................................ N.A.
312(a)........................................................................ 2.5
(b)........................................................................ 11.3
(c)........................................................................ 11.3
313(a)........................................................................ 7.6
(b)(1)..................................................................... 7.6
(b)(2)..................................................................... 7.6
(c)........................................................................ 7.6; 11.2
(d)........................................................................ 7.6
314(a)........................................................................ 4.8; 4.10
(b)........................................................................ N.A.
(c)(1)..................................................................... 7.2; 11.4; 11.5
(c)(2)..................................................................... 7.2; 11.4; 11.5
(c)(3)..................................................................... N.A.
(d)........................................................................ N.A.
(e)........................................................................ 11.5
(f)........................................................................ N.A.
315(a)........................................................................ 7.1(b)
(b)........................................................................ 7.5
(c)........................................................................ 7.1
(d)........................................................................ 6.5; 7.1(c)
(e)........................................................................ 6.11
316(a)(last sentence)......................................................... 2.9
(a)(1)(A).................................................................. 6.5
(a)(1)(B).................................................................. 6.4
(a)(2)..................................................................... N.A.
(b)........................................................................ 6.7
(c)........................................................................ 9.4
317(a)(1)..................................................................... 6.8
(a)(2)..................................................................... 6.9
(b)........................................................................ 2.4
318(a)........................................................................ 11.1
(c)........................................................................ 11.1
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N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
1.1. Definitions........................................................................................1
1.2. Incorporation by Reference of TIA.................................................................35
1.3. Rules of Construction.............................................................................36
ARTICLE TWO
THE SECURITIES
2.1. Form and Dating...................................................................................37
2.2. Execution and Authentication......................................................................38
2.3. Registrar and Paying Agent........................................................................39
2.4. Paying Agent To Hold Assets in Trust..............................................................40
2.5. Holder Lists......................................................................................40
2.6. Transfer and Exchange.............................................................................41
2.7. Replacement Securities............................................................................42
2.8. Outstanding Securities............................................................................42
2.9. Treasury Securities...............................................................................43
2.10. Temporary Securities..............................................................................43
2.11. Cancellation......................................................................................43
2.12. Defaulted Interest................................................................................44
2.13. CUSIP and ISIN Numbers............................................................................44
2.14. Restrictive Legends...............................................................................44
2.15. Book-Entry Provisions for Global Security.........................................................47
2.16. Special Transfer Provisions.......................................................................48
ARTICLE THREE
REDEMPTION
3.1. Notices to Trustee................................................................................53
3.2. Selection of Securities To Be Redeemed............................................................53
3.3. Notice of Redemption..............................................................................53
3.4. Effect of Notice of Redemption....................................................................54
3.5. Deposit of Redemption Price.......................................................................55
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3.6. Securities Redeemed in Part.......................................................................55
ARTICLE FOUR
COVENANTS
4.1. Payment of Securities.............................................................................55
4.2. Maintenance of Office or Agency...................................................................56
4.3. Limitation on Restricted Payments.................................................................56
4.4. Limitation on Incurrence of Additional Indebtedness...............................................61
4.5. Corporate Existence...............................................................................61
4.6. Payment of Taxes and Other Claims.................................................................61
4.7. Maintenance of Properties and Insurance...........................................................62
4.8. Compliance Certificate; Notice of Default.........................................................62
4.9. Compliance with Laws..............................................................................63
4.10. Reports to Holders................................................................................63
4.11. Waiver of Stay, Extension or Usury Laws...........................................................64
4.12. Limitations on Transactions with Affiliates.......................................................65
4.13. Limitation on Dividend and Other Payment Restrictions Affecting Subsidiaries......................66
4.14. Limitation on Issuances of Guarantees by Restricted Subsidiaries..................................68
4.15. Limitation on Liens...............................................................................69
4.16. Change of Control.................................................................................70
4.17. Limitation on Asset Sales.........................................................................72
ARTICLE FIVE
SUCCESSOR CORPORATION
5.1. Merger, Consolidation and Sale of Assets..........................................................76
5.2. Successor Corporation Substituted.................................................................79
ARTICLE SIX
DEFAULT AND REMEDIES
6.1. Events of Default.................................................................................79
6.2. Acceleration......................................................................................80
6.3. Other Remedies....................................................................................81
6.4. Waiver of Past Defaults...........................................................................82
6.5. Control by Majority...............................................................................82
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6.6. Limitation on Suits...............................................................................82
6.7. Rights of Holders To Receive Payment..............................................................83
6.8. Collection Suit by Trustee........................................................................83
6.9. Trustee May File Proofs of Claim..................................................................83
6.10. Priorities........................................................................................84
6.11. Undertaking for Costs.............................................................................84
6.12. Restoration of Rights and Remedies................................................................84
6.13. Rights and Remedies Cumulative....................................................................85
ARTICLE SEVEN
TRUSTEE
7.1. Duties of Trustee.................................................................................85
7.2. Rights of Trustee.................................................................................86
7.3. Individual Rights of Trustee......................................................................88
7.4. Trustee's Disclaimer..............................................................................88
7.5. Notice of Default.................................................................................88
7.6. Reports by Trustee to Holders.....................................................................89
7.7. Compensation and Indemnity........................................................................89
7.8. Replacement of Trustee............................................................................90
7.9. Successor Trustee by Merger, Etc..................................................................91
7.10. Eligibility; Disqualification.....................................................................91
7.11. Preferential Collection of Claims Against the Issuer..............................................92
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
8.1. Termination of the Issuer's Obligations...........................................................92
8.2. Legal Defeasance and Covenant Defeasance..........................................................93
8.3. Conditions to Legal Defeasance or Covenant Defeasance.............................................95
8.4. Application of Trust Money........................................................................96
8.5. Repayment to the Issuer...........................................................................97
8.6. Reinstatement.....................................................................................97
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
9.1. Without Consent of Holders........................................................................98
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9.2. With Consent of Holders...........................................................................99
9.3. Compliance with TIA..............................................................................100
9.4. Revocation and Effect of Consents................................................................100
9.5. Notation on or Exchange of Securities............................................................101
9.6. Trustee To Sign Amendments, Etc..................................................................101
ARTICLE TEN
GUARANTEE OF SECURITIES
10.1. Unconditional Guarantee..........................................................................102
10.2. Limitations on Guarantees........................................................................103
10.3. Execution and Delivery of Guarantee..............................................................103
10.4. Release of a Guarantor...........................................................................104
10.5. Waiver of Subrogation............................................................................105
10.6. Immediate Payment................................................................................106
10.7. No Setoff........................................................................................106
10.8. Obligations Absolute.............................................................................106
10.9. Obligations Continuing...........................................................................106
10.10. Obligations Not Reduced..........................................................................107
10.11. Obligations Reinstated...........................................................................107
10.12. Obligations Not Affected.........................................................................107
10.13. Waiver...........................................................................................108
10.14. No Obligation To Take Action Against the Issuer..................................................109
10.15. Dealing with the Issuer and Others...............................................................109
10.16. Default and Enforcement..........................................................................110
10.17. Amendment, Etc...................................................................................110
10.18. Acknowledgment...................................................................................110
10.19. Costs and Expenses...............................................................................110
10.20. No Merger or Waiver; Cumulative Remedies.........................................................110
10.21. Survival of Obligations..........................................................................111
10.22. Guarantee in Addition to Other Obligations.......................................................111
10.23. Severability.....................................................................................111
10.24. Successors and Assigns...........................................................................111
ARTICLE ELEVEN
MISCELLANEOUS
11.1. TIA Controls.....................................................................................111
11.2. Notices..........................................................................................112
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11.3. Communications by Holders with Other Holders.....................................................113
11.4. Certificate and Opinion as to Conditions Precedent...............................................113
11.5. Statements Required in Certificate or Opinion....................................................113
11.6. Rules by Trustee, Paying Agent, Registrar........................................................114
11.7. Legal Holidays...................................................................................114
11.8. Governing Law....................................................................................114
11.9. No Adverse Interpretation of Other Agreements....................................................114
11.10. No Recourse Against Others.......................................................................114
11.11. Successors.......................................................................................115
11.12. Duplicate Originals..............................................................................115
11.13. Severability.....................................................................................115
Exhibit A - Form of Initial Note
Exhibit B - Form of Exchange Note
Exhibit C - Form of Certificate for Transfers to Non-QIB Accredited Investors
Exhibit D - Form of Certificate for Transfers Pursuant to Regulation S
Exhibit E - Guarantee
Note: This Table of Contents shall not, for any purpose, be deemed to be part
of this Indenture
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INDENTURE dated as of December 20, 2002 between
SALT HOLDINGS
CORPORATION, a Delaware corporation (the "ISSUER" or the "COMPANY"), and THE
BANK OF
NEW YORK, as trustee (the "TRUSTEE").
The Issuer has duly authorized the creation of an issue of 12 3/4%
Senior Discount Notes Due 2012 and, when and if issued as provided in the
Registration Rights Agreement in an Exchange Offer, 12 3/4% Senior Discount
Notes Due 2012 registered under the Securities Act of 1933, as amended, and, to
provide therefor, the Issuer has duly authorized the execution and delivery of
this Indenture. All things necessary to make the Securities, when duly issued
and executed by the Issuer and authenticated and delivered hereunder, the valid
and binding obligations of the Issuer and to make this Indenture a valid and
binding agreement of the Issuer have been done.
This Indenture is subject to, and shall be governed by, the mandatory
provisions of the Trust Indenture Act of 1939 (the "TIA"), as amended, that are
required to be a part of and to govern indentures qualified under the TIA.
Each party hereto agrees as follows for the benefit of the other party
and for the equal and ratable benefit of the Holders of the Securities:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
1.1. DEFINITIONS.
"ACCELERATION NOTICE" has the meaning set forth in Section 6.2.
"ACCREDITED INVESTOR" has the meaning set forth in Section 2.16(a).
"ACCRETED VALUE" means, as of any date (the "SPECIFIED DATE"), the
amount provided below for each $1,000 principal amount at maturity of
Securities:
(1) if the Specified Date occurs on one of the following dates
(each, a "SEMI-ANNUAL ACCRUAL DATE"), the Accreted Value will
equal the amount set forth below for such Semi-Annual Accrual
Date:
SEMI-ANNUAL ACCRUAL DATE ACCRETED VALUE
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June 15, 2003................................................. $ 573.38
December 15, 2003............................................. $ 609.93
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June 15, 2004................................................. $ 648.82
December 15, 2004............................................. $ 690.18
June 15, 2005................................................. $ 734.18
December 15, 2005............................................. $ 780.98
June 15, 2006................................................. $ 830.77
December 15, 2006............................................. $ 883.73
June 15, 2007................................................. $ 940.07
December 15, 2007............................................. $ 1,000.00
(2) if the Specified Date occurs before the first Semi-Annual
Accrual Date, the Accreted Value will equal the sum of (A) the
original issue price of a Security and (B) an amount equal to
the product of (x) the Accreted Value for the first Semi-Annual
Accrual Date less such original issue price multiplied by (y) a
fraction, the numerator of which is the number of days from the
Issue Date to the Specified Date, using a 360-day year of twelve
30-day months, and the denominator of which is the number of
days elapsed from the Issue Date to the first Semi-Annual
Accrual Date, using a 360-day year of twelve 30-day months;
(3) if the Specified Date occurs between two Semi-Annual Accrual
Dates, the Accreted Value will equal the sum of (A) the Accreted
Value for the Semi-Annual Accrual Date immediately preceding
such Specified Date and (B) an amount equal to the product of
(x) the Accreted Value for the immediately following Semi-Annual
Accrual Date less the Accreted Value for the immediately
preceding Semi-Annual Accrual Date multiplied by (y) a fraction,
the numerator of which is the number of days from the
immediately preceding Semi-Annual Accrual Date to the Specified
Date, using a 360-day year of twelve 30-day months, and the
denominator of which is 180; or
(4) if the Specified Date occurs after the last Semi-Annual Date,
the Accreted Value will equal $1,000.
"ACQUIRED INDEBTEDNESS" means Indebtedness of a Person or any of its
Subsidiaries (1) existing at the time such Person becomes a Restricted
Subsidiary of the Company or at the time it merges or consolidates with the
Company or any of its Restricted Subsidiaries or (2) assumed in connection with
the acquisition of assets from such Person, in each case, not incurred by such
Person in connection with, or in contemplation of, such Person becoming a
Restricted Subsidiary of the Company or such acquisition, merger or
consolidation.
"AFFILIATE" means, with respect to any specified Person, any other
Person who directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, such specified Person. The
term "control" means the possession, directly
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or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by
contract or otherwise. "Controlling" and "controlled" have correlative meanings.
For purposes of this Indenture, IMC Global Inc. and its Affiliates shall not be
deemed to be an Affiliate of the Company so long as they beneficially own
securities representing equal to or less than thirty-five percent of the voting
power of the Company; PROVIDED that Apollo beneficially owns securities
representing a greater percentage of the voting power of the Company than IMC
Global Inc. and its Affiliates.
"AFFILIATE TRANSACTION" has the meaning set forth in Section 4.12(a).
"AGENT" means any Registrar, Paying Agent or co-Registrar.
"AGENT MEMBERS" has the meaning set forth in Section 2.15(a).
"APOLLO" means Apollo Management V, L.P. and its Affiliates.
"APPLICABLE PREMIUM" means, with respect to a Security, the greater of
(i) 1.0% of the Accreted Value of such Security and (ii) (a) the present value
of all remaining required principal payments due on such Security and all
premium payments relating thereto assuming a redemption date of December 15,
2007, computed using a discount rate equal to the Treasury Rate plus 50 basis
points, minus (b) the Accreted Value of such Security on the date of redemption.
"ASSET ACQUISITION" means:
(1) an Investment by the Company or any of its Restricted
Subsidiaries in any other Person pursuant to which such Person shall
become a Restricted Subsidiary of the Company or any Restricted
Subsidiary of the Company, or shall be merged with or into or
consolidated with the Company or any Restricted Subsidiary of the
Company; or
(2) the acquisition by the Company or any of its Restricted
Subsidiaries of the assets of any Person (other than a Restricted
Subsidiary of the Company) which constitute all or substantially all
of the assets of such Person or comprise any division or line of
business of such Person or any other properties or assets of such
Person other than in the ordinary course of business.
"ASSET SALE" means any direct or indirect sale, issuance, conveyance,
transfer, lease (other than operating leases entered into in the ordinary course
of business), assignment or other transfer for value by the Company or any of
its Restricted Subsidiaries, including any Sale and Leaseback Transaction, to
any Person other than the Company or a Wholly Owned
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Restricted Subsidiary of the Company of (a) any Capital Stock of any Restricted
Subsidiary of the Company (other than directors' qualifying shares); or (b) any
other property or assets of the Company or any Restricted Subsidiary of the
Company other than in the ordinary course of business; PROVIDED, HOWEVER, that
Asset Sales shall not include:
(1) a transaction or series of related transactions for
which the Company or its Restricted Subsidiaries receive aggregate
consideration of less than $3.0 million;
(2) the sale or exchange of equipment in connection with
the purchase or other acquisition of other equipment, in each case
used in the business of the Company and its Restricted Subsidiaries;
(3) the sale, lease, conveyance, disposition or other
transfer of all or substantially all of the assets of the Company as
permitted under Section 5.1;
(4) disposals of equipment in connection with the
reinvestment in or the replacement of its equipment and disposals of
worn-out or obsolete equipment, in each case in the ordinary course of
business of the Company or its Restricted Subsidiaries;
(5) the sale of accounts receivable pursuant to a Qualified
Receivables Transaction;
(6) sales or grants of licenses to use the Company's or any
Restricted Subsidiary's patents, trade secrets, know-how and
technology to the extent that such license does not prohibit the
licensor from using the patent, trade secret, know-how or technology;
(7) the disposition of any Capital Stock or other ownership
interest in or assets or property of an Unrestricted Subsidiary;
(8) Capacity Arrangements;
(9) any Restricted Payment permitted under Section 4.3 or
that constitutes a Permitted Investment; and
(10) one or more Sale and Leaseback Transactions for which
the Company or any Restricted Subsidiary of the Company receives
aggregate consideration of less than $15.0 million.
"BANKRUPTCY LAW" means Title 11, U.S. Code, or any similar federal,
state or foreign law for the relief of debtors.
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"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 such term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire, whether such
right is currently exercisable or is exercisable only upon the occurrence of a
subsequent condition, regardless of when such right may be exercised.
"BOARD OF DIRECTORS" means, as to any Person, the board of directors
or equivalent governing board of such Person or any duly authorized committee
thereof.
"BOARD RESOLUTION" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such 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 Saturday, Sunday or any
other day on which banking institutions in the City of
New York are required or
authorized by law or other governmental action to be closed.
"CAPACITY ARRANGEMENTS" means any agreement or arrangement involving,
relating to or otherwise facilitating, (a) requirement contracts, (b) tolling
arrangements or (c) the reservation or presale of production capacity of the
Company or its Restricted Subsidiaries by one or more third parties.
"CAPITALIZED LEASE OBLIGATION" means, at the time any determination
thereof is to be made, the amount of the liability of a Person under a capital
lease that would at that time be required to be capitalized on a balance sheet
in accordance with GAAP, with the stated maturity being the date of the last
payment of rent or any other amount due under such lease prior to the first date
upon which such lease may be prepaid by the lessee without payment of a penalty.
"CAPITAL STOCK" means:
(1) with respect to any person that is in the case of a
corporation, any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents (however
designated and whether or not voting) of corporate stock; and
(2) with respect to any other Person, any and all
partnership, membership, limited liability company interests or other
equity interests of such Person.
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"CASH EQUIVALENTS" means:
(1) U.S. dollars, and in the case of any Foreign Restricted
Subsidiaries of the Company, Euros and such local currencies held by
them from time to time in the ordinary course of business;
(2) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States, Canada and the
United Kingdom or issued by any agency of these countries and backed
by the full faith and credit of the respective country, in each case
maturing within one year from the date of acquisition thereof;
(3) marketable direct obligations issued by any State of
the United States of America or any political subdivision of any such
State or any public instrumentality thereof maturing within one year
from the date of acquisition thereof and, at the time of acquisition,
having one of the two highest ratings obtainable from either Standard
& Poor's Ratings Services ("S&P") or Xxxxx'x Investors Service, Inc.
("MOODY'S") or, if Xxxxx'x and S&P cease to exist, any other
nationally recognized statistical rating organization designated by
the Board of Directors of the Company;
(4) commercial paper maturing no more than one year from
the date of creation thereof and, at the time of acquisition, having a
rating of at least A- 1 from S&P or at least P-1 from Moody's or, if
Xxxxx'x and S&P cease to exist, the equivalent from any other
nationally recognized statistical rating organization designated by
the Board of Directors of the Company;
(5) time deposits, certificates of deposit or bankers'
acceptances maturing within one year from the date of acquisition
thereof issued by any bank organized under the laws of the United
States of America or any state thereof or the District of Columbia or
any foreign jurisdiction having at the date of acquisition thereof
combined capital and surplus of not less than $250.0 million;
(6) repurchase obligations with a term of not more than
thirty days for underlying securities of the types described in clause
(2) above entered into with any bank meeting the qualifications
specified in clause (5) above;
(7) investments in money market funds which invest
substantially all their assets in securities of the types described in
clauses (2) through (6) above; and
(8) overnight deposits and demand deposit accounts (in the
respective local currencies) maintained in the ordinary course of
business.
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"CHANGE OF CONTROL" means the occurrence of one or more of the
following events:
(1) any sale, lease, exchange, conveyance, disposition or
other transfer (in one transaction or a series of related
transactions) of all or substantially all of the Company's assets to
any Person or group of related Persons for purposes of Section 13(d)
of the Exchange Act (a "GROUP"), together with any Affiliates of such
Person, other than to the Permitted Holders;
(2) any approval, adoption or initiating of a plan or
proposal for the liquidation or dissolution of the Company;
(3) any Person or Group, together with any Affiliates
thereof (other than the Permitted Holders), shall become the
Beneficial Owner or owner of record (by way of merger, consolidation
or other business combinations or by purchase in one transaction or a
series of related transactions) of shares representing more than 50%
of the aggregate ordinary voting power represented by the issued and
outstanding Capital Stock of the Company;
(4) any Person or Group, together with any Affiliates or
Related Persons thereof (other than the Permitted Holders), shall
succeed in having a sufficient number of its nominees elected to the
Board of Directors of the Company such that such nominees, when added
to any existing director remaining on the Board of Directors of the
Company after such election who was a nominee of or is an Affiliate or
Related Person of such Person or Group, will constitute a majority of
the Board of Directors of the Company; or
(5) the Company shall cease to own, directly or indirectly,
a majority of the Capital Stock of Compass Minerals.
"CHANGE OF CONTROL DATE" has the meaning set forth in Section 4.16(c).
"CHANGE OF CONTROL OFFER" has the meaning set forth in Section
4.16(a).
"CHANGE OF CONTROL PAYMENT DATE" has the meaning set forth in Section
4.16(a).
"COMMISSION" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act or, with respect to the
Commission's duties under the TIA, if at any time after the execution of this
instrument such Commission is not existing and performing the duties now
assigned to it under the TIA, then the body performing such duties at such time.
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"COMMODITY AGREEMENT" means any commodity futures contract, commodity
option or other similar agreement or arrangement entered into by the Company or
any Restricted Subsidiaries of the Company designed to protect the Company or
any of its Restricted Subsidiaries against fluctuations in the price of the
commodities at the time used in the ordinary course of business of the Company
or any of its Restricted Subsidiaries.
"COMMON STOCK" of any Person means any and all shares, interests or
other participations in, and other equivalents (however designated and whether
voting or non-voting) of such Person's common stock, whether outstanding on the
Issue Date or issued after the Issue Date, and includes, without limitation, all
series and classes of such common stock.
"COMPANY" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter shall mean such
successor Person.
"COMPASS MINERALS" means Compass Minerals Group, Inc.
"CONSOLIDATED EBITDA" means, with respect to any Person, for any
period, the sum (without duplication) of:
(1) Consolidated Net Income; and
(2) to the extent Consolidated Net Income has been reduced
by the following,
(a) all income taxes of such Person and its
Restricted Subsidiaries paid or accrued in accordance with GAAP
for such period (other than income taxes attributable to
extraordinary, unusual or nonrecurring gains or losses),
(b) Consolidated Interest Expense, and
(c) Consolidated Non-cash Charges less any
non-cash items increasing Consolidated Net Income for such
period,
all as determined on a consolidated basis for such Person and its Restricted
Subsidiaries in accordance with GAAP as applicable.
"CONSOLIDATED FIXED CHARGE COVERAGE RATIO" means, with respect to any
Person, the ratio of Consolidated EBITDA of such Person during the four full
fiscal quarters for which financial statements are available (the "FOUR QUARTER
PERIOD") ending on or prior to the date of the transaction giving rise to the
need to calculate the Consolidated Fixed Charge Coverage Ratio (the "TRANSACTION
DATE") to Consolidated Fixed Charges of such Person for the Four Quarter Period.
In addition to and without limitation of the foregoing, for purposes of this
definition, "Consolidated EBITDA" and "Consolidated Fixed Charges" shall be
calculated
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after giving effect on a pro forma basis (consistent with the provisions below)
for the period of such calculation to:
(1) the incurrence or repayment of any Indebtedness of such
Person or any of its Restricted Subsidiaries (and the application of
the proceeds thereof) giving rise to the need to make such calculation
and any incurrence or repayment of other Indebtedness (and the
application of the proceeds thereof), other than the incurrence or
repayment of Indebtedness in the ordinary course of business for
working capital purposes pursuant to working capital facilities,
occurring during the Four Quarter Period or at any time subsequent to
the last day of the Four Quarter Period and on or prior to the
Transaction Date, as if such incurrence or repayment, as the case may
be (and the application of the proceeds thereof), occurred on the
first day of the Four Quarter Period;
(2) any asset sales or other dispositions or Asset
Acquisitions (including, without limitation, any Asset Acquisition
giving rise to the need to make such calculation as a result of such
Person or one of its Restricted Subsidiaries (including any Person who
becomes a Restricted Subsidiary as a result of the Asset Acquisition)
incurring, assuming or otherwise being liable for Acquired
Indebtedness and also including any Consolidated EBITDA (including any
pro forma expense and cost reductions, adjustments and other operating
improvements or synergies both achieved by such Person during such
period and to be achieved by such Person and with respect to the
acquired assets, all as determined in good faith by a responsible
financial or accounting officer of such Person attributable to the
assets which are the subject of the Asset Acquisition or asset sale or
other disposition during the Four Quarter Period) occurring during the
Four Quarter Period or at any time subsequent to the last day of the
Four Quarter Period and on or prior to the Transaction Date, as if
such asset sale or other disposition or Asset Acquisition (including
the incurrence, assumption or liability for any such Acquired
Indebtedness) occurred on the first day of the Four Quarter Period. If
such Person or any of its Restricted Subsidiaries directly or
indirectly guarantees Indebtedness of a third Person, the preceding
sentence shall give effect to the incurrence of such guaranteed
Indebtedness as if such Person or any Restricted Subsidiary of such
Person had directly incurred or otherwise assumed such guaranteed
Indebtedness; and
(3) all adjustments used in connection with the calculation
of pro forma EBITDA and Adjusted EBITDA as set forth in the offering
circular dated November 15, 2001 relating to the issuance by Compass
Minerals of the Existing Compass Minerals Notes to the extent such
adjustments are not fully reflected in such Four Quarter Period and
continue to be applicable.
-10-
Furthermore, in calculating "Consolidated Fixed Charges" for purposes
of determining the denominator (but not the numerator) of this "Consolidated
Fixed Charge Coverage Ratio,"
(1) interest on outstanding Indebtedness determined on a
fluctuating basis as of the Transaction Date and which will continue
to be so determined thereafter shall be deemed to have accrued at a
fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the Transaction Date; and
(2) notwithstanding clause (1) above, interest on
Indebtedness determined on a fluctuating basis, to the extent such
interest is covered by agreements relating to Interest Swap
Obligations or Currency Agreements, shall be deemed to accrue at the
rate per annum resulting after giving effect to the operation of such
agreements.
"CONSOLIDATED FIXED CHARGES" means, with respect to any Person for any
period, the sum, without duplication, of:
(1) Consolidated Interest Expense (excluding amortization
or write-off of deferred financing costs and the payment of non-cash
interest relating to the Securities or any other debt securities
issued after the Issue Date, directly or indirectly, in exchange for
shares of the Issuer's Series A Preferred Stock outstanding on the
Issue Date), plus
(2) the product of (x) the amount of all dividend payments
on any series of Preferred Stock of such Person or its Restricted
Subsidiaries (other than dividends paid in Qualified Capital Stock)
paid, accrued or scheduled to be paid or accrued during such period
times (y) a fraction, the numerator of which is one and the
denominator of which is one minus the then current effective
consolidated federal, state and local income tax rate of such Person,
expressed as a decimal.
"CONSOLIDATED INTEREST EXPENSE" means, with respect to any Person for
any period, the sum of, without duplication:
(1) the aggregate of the interest expense of such Person
and its Restricted Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP, including, without
limitation, (a) any amortization of debt discount and amortization or
write-off of deferred financing costs (including the amortization of
costs relating to interest rate caps or other similar agreements), (b)
the net costs under Interest Swap Obligations, (c) all capitalized
interest and (d) the interest portion of any deferred payment
obligation; and
(2) the interest component of Capitalized Lease Obligations
paid, accrued and/or scheduled to be paid or accrued by such Person
and its Restricted Subsidiaries
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during such period as determined on a consolidated basis in accordance
with GAAP, minus interest income for such period.
"CONSOLIDATED NET INCOME" means, with respect to any Person, for any
period, the aggregate net income (or loss) of such Person and its Restricted
Subsidiaries for such period on a consolidated basis, determined in accordance
with GAAP; PROVIDED that there shall be excluded therefrom:
(1) after-tax gains or losses from Asset Sales (without
regard to the $3.0 million limitation set forth in the definition
thereof) or abandonments or reserves relating thereto;
(2) after-tax items which are extraordinary gains or losses
or nonrecurring gains, losses, expenses or income (including, without
limitation, expenses related to the Transactions, severance and
transition expenses incurred as a direct result of the transition of
the Company to an independent operating company in connection with the
Transactions provided that with respect to any nonrecurring item or
transition expense, the Company delivers to the Trustee an Officers'
Certificate specifying and quantifying such item or expense and states
that such item or expense is a general non-recurring item or
specifically a severance or transition expense, as the case may be);
(3) the net income of any Person acquired in a "pooling of
interests" transaction accrued before the date it becomes a Restricted
Subsidiary of the referent Person or is merged or consolidated with
the referent Person or any Restricted Subsidiary of the referent
Person;
(4) the net income (but not loss) of any Restricted
Subsidiary of the referent Person to the extent that the declaration
of dividends or similar distributions by that Restricted Subsidiary of
that income is prohibited by contract, operation of law or otherwise
(other than as permitted by Section 4.13);
(5) the net income of any Person, other than a Restricted
Subsidiary of the referent Person, except to the extent of cash
dividends or distributions paid to the referent Person or to a
Restricted Subsidiary of the referent Person by such Person;
(6) the establishment of accruals and reserves within
twelve months after November 28, 2001 that are required to be so
established in accordance with GAAP;
(7) income or loss attributable to discontinued operations
(including, without limitation, operations disposed of during such
period whether or not such operations were classified as
discontinued);
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(8) in the case of a successor to the referent Person by
consolidation or merger or as a transferee of the referent Person's
assets, any earnings of the successor corporation prior to such
consolidation, merger or transfer of assets; and
(9) solely for the purposes of determining the amount
available to make Restricted Payments pursuant to Section 4.3(c)(i),
payments of non-cash interest (net of any related tax benefit included
in determining Consolidated Net Income) on the Securities or any other
debt securities of the Issuer issued after the Issue Date, directly or
indirectly, in exchange for shares of the Issuer's Series A Preferred
Stock outstanding on the Issue Date.
"CONSOLIDATED NON-CASH CHARGES" means, with respect to any Person, for
any period, the aggregate depreciation, amortization and other non-cash expenses
(solely for the purpose of determining compliance with Section 4.3, excluding
any non-cash items for which a future cash payment will be required and for
which an accrual or reserve is required by GAAP to be made) of such Person and
its Restricted Subsidiaries reducing Consolidated Net Income of such Person and
its Restricted Subsidiaries for such period, determined on a consolidated basis
in accordance with GAAP.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date of this Indenture,
located at 000 Xxxxxxx Xxxxxx, Xxxxx 0X, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Corporate Trust Administration.
"COVENANT DEFEASANCE" has the meaning set forth in Section 8.2(c).
"CREDIT AGREEMENT" means the Credit Agreement dated as of November 28,
2001, as amended, among the Company, Compass Minerals, one or more other
Subsidiaries of the Company, the lenders party thereto in their capacities as
lenders thereunder and The Chase Manhattan Bank, as administrative agent,
together with the related documents thereto (including, without limitation, any
guarantee agreements and security documents), in each case as such agreements
may be amended (including any amendment and restatement thereof), supplemented
or otherwise modified from time to time, including any agreement extending the
maturity of, refinancing, replacing or otherwise restructuring (including
increasing the amount of available borrowings thereunder or adding Restricted
Subsidiaries of the Company as additional borrowers or guarantors thereunder)
all or any portion of the Indebtedness under such agreement or any successor or
replacement agreement and whether by the same or any other agent, lender or
group of lenders.
"CURRENCY AGREEMENT" means any foreign exchange contract, currency
swap agreement or other similar agreement or arrangement designed to protect the
Company or any Restricted Subsidiary of the Company against fluctuations in
currency values.
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"CUSTODIAN" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"DEFAULT" means an event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"DEPOSITORY" shall mean The Depository Trust Company,
New York,
New
York, or a successor thereto registered under the Exchange Act or other
applicable statute or regulation.
"DISQUALIFIED CAPITAL STOCK" means that portion of any Capital Stock
which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable at the option of the holder
thereof), or upon the happening of any event (other than an event which would
constitute a Change of Control or an Asset Sale), matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the sole option of the holder thereof (except, in each case, upon the
occurrence of a Change of Control or an Asset Sale), on or prior to the final
maturity date of the Securities; PROVIDED that any class of Capital Stock of
such Person that by its terms authorizes such Person to satisfy its obligations
thereunder by delivery of Qualified Capital Stock shall not be deemed
Disqualified Capital Stock.
"DOMESTIC RESTRICTED SUBSIDIARY" means any Restricted Subsidiary of
the Company incorporated or otherwise organized or existing under the laws of
the United States, any State thereof or the District of Columbia.
"EQUITY OFFERING" means a public or private sale of Qualified Capital
Stock (other than on Form S-8) of the Issuer or any direct or indirect parent of
the Issuer; PROVIDED that with respect to any Equity Offering by such direct or
indirect parent of the Issuer, such Person contributes the net cash proceeds
from such Equity Offering to the Issuer.
"EUROS" means the single currency of the participating member states
as described in any legislative measures of the European Union for the
introduction of, change over to, or operation of, a single or unified European
currency.
"EVENT OF DEFAULT" has the meaning set forth in Section 6.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
or any successor statute or statutes thereto.
"EXCHANGE NOTES" means the 12 3/4% Senior Discount Notes Due 2012 (the
terms of which are identical to the Initial Notes except that the Exchange Notes
shall be registered under the Securities Act, and shall not contain the
restrictive legend on the face of the form of
-14-
the Initial Notes) to be issued in exchange for the Initial Notes pursuant to
the registered Exchange Offer.
"EXCHANGE OFFER" means the registration by the Company under the
Securities Act pursuant to a registration statement of the offer by the Company
to each Holder of the Initial Notes to exchange all the Initial Notes held by
such Holder for the Exchange Notes in an aggregate Accreted Value and aggregate
principal amount at maturity equal to the aggregate Accreted Value and aggregate
principal amount at maturity of the Initial Notes held by such Holder, all in
accordance with the terms and conditions of the Registration Rights Agreement.
"EXCLUDED CONTRIBUTION" means Net Cash Proceeds received by the
Company from (a) contributions to its common equity capital and (b) the sale of
Qualified Capital Stock of the Company, in each case designated as Excluded
Contributions pursuant to an Officers' Certificate executed on the date such
capital contributions are made or the date such Qualified Capital Stock is sold,
as the case may be, which are excluded from the calculation set forth in clause
(c) of Section 4.3.
"EXISTING COMPASS MINERALS INDENTURE" means the indenture dated as of
November 28, 2001 among Compass Minerals, the guarantors named therein and The
Bank of
New York, as trustee.
"EXISTING COMPASS MINERALS NOTES" means the 10% Senior Subordinated
Notes due 2011 of Compass Minerals issued under the Existing Compass Minerals
Indenture.
"FAIR MARKET VALUE" means with respect to any asset or property, the
price which could be negotiated in an arm's-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction. Fair market
value shall be determined conclusively by the Board of Directors of the Company
acting reasonably and in good faith and shall be evidenced by a Board Resolution
of the Board of Directors of the Company delivered to the Trustee.
"FOREIGN RESTRICTED SUBSIDIARY" means any Restricted Subsidiary of the
Company incorporated in any jurisdiction outside of the United States.
"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 may be approved by a significant segment of the accounting
profession of the United States, which are in effect as of November 28, 2001.
"GLOBAL SECURITY" has the meaning set forth in Section 2.1.
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"GUARANTEE" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any other Person,
including any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness of such other Person (whether arising by virtue of
partnership arrangements, or by agreements to keep-well, to purchase assets,
goods, securities or services (unless such purchase arrangements are on
arm's-length terms and are entered into in the ordinary course of business), to
take-or-pay, or to maintain financial statement conditions or otherwise), or
(ii) entered into for purposes of assuring in any other manner the obligee of
such Indebtedness of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided that the term "guarantee"
shall not include endorsements for collection or deposit in the ordinary course
of business. The term "guarantee" used as a verb has a corresponding meaning.
"GUARANTEE" means the guarantee by each Guarantor of the Issuer's
obligations under this Indenture.
"GUARANTOR" means each of the Company's Restricted Subsidiaries that
in the future executes a supplemental indenture in which such Restricted
Subsidiary agrees to be bound by the terms of this Indenture as a Guarantor;
PROVIDED that any Person constituting a Guarantor as described above shall cease
to constitute a Guarantor when its Guarantee is released in accordance with the
terms of this Indenture.
"HOLDER" or "SECURITYHOLDER" means the registered holder of any
Security.
"INDEBTEDNESS" means with respect to any Person, any indebtedness of
such Person, without duplication, in respect of:
(1) all obligations of such Person for borrowed money;
(2) all Obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments;
(3) all Capitalized Lease Obligations of such Person;
(4) the deferred and unpaid purchase price of property, all
conditional sale obligations and all obligations under any title
retention agreement (but excluding trade accounts payable and other
accrued liabilities arising in the ordinary course of business);
(5) all Obligations for the reimbursement of any obligor on
any letter of credit, banker's acceptance or similar credit
transaction;
-16-
(6) guarantees and other contingent Obligations in respect
of Indebtedness referred to in clauses (1) through (5) above and
clause (8) below;
(7) all Obligations of any other Person of the type
referred to in clauses (1) through (6) which are secured by any Lien
on any property or asset of such Person, the amount of such
Obligations being deemed to be the lesser of the fair market value of
such property or asset or the amount of the Obligation so secured;
(8) all Obligations under Currency Agreements or Commodity
Agreements and Interest Swap Obligations of such Person; and
(9) all Disqualified Capital Stock issued by such Person
with the amount of Indebtedness represented by such Disqualified
Capital Stock being equal to the greater of its voluntary or
involuntary liquidation preference and its maximum fixed repurchase
price, but excluding accrued dividends, if any.
For purposes hereof, the "maximum fixed repurchase price" of any Disqualified
Capital Stock which does not have a fixed repurchase price shall be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such price
is based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value shall be determined reasonably and in good
faith by the Board of Directors of the issuer of such Disqualified Capital
Stock. For purposes of Section 4.4, in determining the principal amount of any
Indebtedness to be incurred by the Company or any Restricted Subsidiary or which
is outstanding at any date, the principal amount of any Indebtedness which
provides that an amount less than the principal amount thereof shall be due upon
any declaration of acceleration thereof shall be the accreted value thereof at
the date of determination.
"INDENTURE" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"INDEPENDENT FINANCIAL ADVISOR" means a firm:
(1) which does not have a direct or indirect common equity
interest in the Company; and
(2) which, in the judgment of the Board of Directors of the
Company, is otherwise independent and qualified to perform the task
for which it is to be engaged.
"INITIAL NOTES" means the 12 3/4% Senior Discount Notes Due 2012 of
the Issuer issued on the Issue Date and authenticated and delivered under this
Indenture pursuant to
-17-
Section 2.2 and any other Securities (other than Exchange Notes) issued after
the Issue Date in accordance with clause (iii) of the fourth paragraph of
Section 2.2.
"INSTITUTIONAL ACCREDITED INVESTOR" has the meaning set forth in
Section 2.16(a).
"INTEREST PAYMENT DATE" means the stated maturity of an installment of
interest on the Securities.
"INTEREST SWAP OBLIGATIONS" means the obligations of any Person
pursuant to any arrangement with any other Person, whereby, directly or
indirectly, such Person is entitled to receive from time to time periodic
payments calculated by applying either a floating or a fixed rate of interest on
a stated notional amount in exchange for periodic payments made by such other
Person calculated by applying a fixed or a floating rate of interest on the same
notional amount and shall include, without limitation, interest rate swaps,
caps, floors, collars and similar agreements.
"INVESTMENT" means, with respect to any Person, any direct or indirect
loan or other extension of credit (including, without limitation, a guarantee)
or capital contribution to (by means of any transfer of cash or other property
to others or any payment for property or services for the account or use of
others), or any purchase or acquisition by such Person of any Capital Stock,
bonds, notes, debentures or other securities or evidences of Indebtedness issued
by, any Person. "Investment" shall exclude extensions of trade credit by,
prepayment of expenses by, and receivables owing to, the Company and its
Restricted Subsidiaries on commercially reasonable terms in accordance with
normal trade practices of the Company or such Restricted Subsidiary, as the case
may be. For purposes of Section 4.3:
(1) "Investment" shall include and be valued at the fair
market value of the net assets of any Restricted Subsidiary of the
Company at the time that such Restricted Subsidiary is designated an
Unrestricted Subsidiary of the Company and shall exclude the fair
market value of the net assets of any Unrestricted Subsidiary of the
Company at the time that such Unrestricted Subsidiary is designated a
Restricted Subsidiary of the Company; and
(2) the amount of any Investment shall be the original cost
of such Investment plus the cost of all additional Investments by the
Company or any of its Restricted Subsidiaries, without any adjustments
for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment, reduced by the payment of
dividends or distributions in connection with such Investment or any
other amounts received in respect of such Investment; PROVIDED that no
such payment of dividends or distributions or receipt of any such
other amounts shall reduce the amount of any Investment if such
payment of dividends or distributions or receipt of any such amounts
would be included in Consolidated Net Income.
-18-
If the Company or any Restricted Subsidiary of the Company sells or otherwise
disposes of any Common Stock of any Person that prior to such sale or
disposition was a direct or indirect Restricted Subsidiary of the Company such
that after giving effect to any such sale or disposition, such Person ceases to
be a Restricted Subsidiary of the Company, the Company shall be deemed to have
made an Investment on the date of any such sale or disposition equal to the fair
market value of the Common Stock of such Person not sold or disposed of.
"ISSUE DATE" means December 20, 2002, the date of original issuance of
the Initial Notes.
"ISSUER" means the parties named as such in the first paragraph of
this Indenture.
"LEGAL DEFEASANCE" has the meaning set forth in Section 8.2(b).
"LIEN" means any lien, mortgage, deed of trust, pledge, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof and any
agreement to give any security interest).
"MANAGEMENT AGREEMENT" means the Management Agreement dated as of
November 28, 2001 between Compass Minerals and Apollo.
"MATURITY DATE" means December 15, 2012.
"
MERGER AGREEMENT" means the Agreement and Plan of Merger, dated as of
October 13, 2001, among IMC Global, Inc., the Company, YBR Holdings LLC and YBR
Acquisition Corp.
"NET CASH PROCEEDS" means (a) with respect to any Asset Sale, the
proceeds in the form of cash or Cash Equivalents including payments in respect
of deferred payment obligations when received in the form of cash or Cash
Equivalents (other than the portion of any such deferred payment constituting
interest) received by the Company or any of its Restricted Subsidiaries from
such Asset Sale net of:
(1) reasonable out-of-pocket expenses and fees relating to
such Asset Sale (including, without limitation, legal, accounting and
investment banking fees and sales commissions);
(2) taxes paid or payable after taking into account any
reduction in consolidated tax liability due to available tax credits
or deductions and any tax sharing arrangements;
(3) any repayment of Indebtedness that is required to be
repaid in connection with such Asset Sale;
-19-
(4) appropriate amounts to be provided by the Company or
any Restricted Subsidiary, as the case may be, as a reserve, in
accordance with GAAP, against any liabilities associated with such
Asset Sale and retained by the Company or such Restricted Subsidiary,
as the case may be, after such Asset Sale, including, without
limitation, pension and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Sale; and
(5) all distributions and other payments required to be
made to minority interest holders in Restricted Subsidiaries or joint
ventures as a result of such Asset Sale;
and (b) with respect to any issuance or sale of Capital Stock, means the cash
proceeds of such issuance or sale, net of attorneys' fees, accountants' fees,
underwriters' or placement agents' or initial purchasers' fees, discounts or
commissions and brokerage, consultant and other fees and expenses actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof.
"NET PROCEEDS OFFER" has the meaning set forth in Section 4.17.
"NET PROCEEDS OFFER AMOUNT" has the meaning set forth in Section 4.17.
"NET PROCEEDS OFFER PAYMENT DATE" has the meaning set forth in Section
4.17.
"NET PROCEEDS OFFER TRIGGER DATE" has the meaning set forth in Section
4.17.
"NON-U.S. PERSON" means a Person who is not a "U.S. Person" (as
defined in Regulation S).
"OBLIGATIONS" means all obligations for principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.
"OFFERING CIRCULAR" means the Offering Circular dated December 13,
2002 relating to the offering of the Initial Notes.
"OFFICER" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, any Vice President, the Chief
Financial Officer, the Controller, the Treasurer or the Secretary of such
Person.
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers of
the Issuer or of any Guarantor, as applicable, except that an authentication
order pursuant to Section 2.2 may be signed by only one such Officer.
-20-
"OFFSHORE GLOBAL SECURITIES" has the meaning provided in Section 2.1.
"OFFSHORE PHYSICAL SECURITIES" has the meaning provided in Section
2.1.
"OPINION OF COUNSEL" means a written opinion from legal counsel, which
opinion and counsel are reasonably acceptable to the Trustee.
"PAYING AGENT" has the meaning set forth in Section 2.3.
"PERMANENT OFFSHORE GLOBAL SECURITIES" has the meaning provided in
Section 2.1.
"PERMITTED BUSINESS" means the business of the Company and its
Restricted Subsidiaries as existing on the Issue Date and any other businesses
that are the same, similar or reasonably related, ancillary or complementary
thereto and reasonable extensions thereof.
"PERMITTED HOLDERS" means Apollo and other Related Parties.
"PERMITTED INDEBTEDNESS" means, without duplication, each of the
following:
(1) Indebtedness under (y) the Securities issued on the
Issue Date and any Guarantees thereof and (z) additional Securities or
other debt securities (i) issued, directly or indirectly, in exchange
for shares of the Issuer's Series A Preferred Stock outstanding on the
Issue Date and (ii) with a principal amount or accreted value (in the
case of the Securities or debt securities issued at a discount) not in
excess of the aggregate liquidation preference and accumulated but
unpaid dividends on such Series A Preferred Stock;
(2) Indebtedness incurred pursuant to the Credit Agreement
by the Company and its Restricted Subsidiaries, in an aggregate
principal amount at any time outstanding not to exceed $360.0 million
less the amount of all repayments of term debt and permanent
commitment reductions under the Credit Agreement with Net Cash
Proceeds of Asset Sales applied thereto as required by Section
4.17(iii); PROVIDED that the aggregate principal amount of
Indebtedness permitted to be incurred from time to time under this
clause (2) shall be reduced dollar for dollar by the amount of any
Indebtedness then outstanding under clause (12) below and PROVIDED
FURTHER that any Indebtedness outstanding pursuant to the Credit
Agreement as of the Issue Date shall be deemed to be incurred under
this clause (2); and PROVIDED FURTHER that the amount of Indebtedness
permitted to be incurred pursuant to the Credit Agreement in
accordance with this clause (2) shall be in addition to any
Indebtedness to be incurred pursuant to the Credit Agreement in
reliance on and in accordance with clauses (10) and (16) below;
-21-
(3) other Indebtedness (including Indebtedness under the
Issuer's 10.23% Seller Notes due November 28, 2015 in an aggregate
principal amount not to exceed the sum of $8.4 million plus accrued
and unpaid interest thereon in the form of additional Indebtedness) of
the Company and its Restricted Subsidiaries outstanding on the Issue
Date (other than pursuant to the Credit Agreement) reduced by the
amount of any scheduled amortization payments or mandatory prepayments
when actually paid or permanent reductions thereon;
(4) Interest Swap Obligations of the Company covering
Indebtedness of the Company or any of its Restricted Subsidiaries and
Interest Swap Obligations of any Restricted Subsidiary of the Company
covering Indebtedness of the Company or such Restricted Subsidiary;
PROVIDED, HOWEVER, that such Interest Swap Obligations are entered
into to protect the Company and its Restricted Subsidiaries from
fluctuations in interest rates on Indebtedness incurred in accordance
with this Indenture to the extent the notional principal amount of
each such Interest Swap Obligation does not exceed the principal
amount of the Indebtedness to which such Interest Swap Obligation
relates;
(5) Indebtedness under Currency Agreements; provided that
in the case of Currency Agreements which relate to Indebtedness, such
Currency Agreements do not increase the Indebtedness of the Company
and its Restricted Subsidiaries outstanding other than as a result of
fluctuations in foreign currency exchange rates or by reason of fees,
indemnities and compensation payable thereunder;
(6) Indebtedness of a Restricted Subsidiary of the Company
to the Company or to a Restricted Subsidiary of the Company for so
long as such Indebtedness is held by the Company, a Restricted
Subsidiary of the Company or the lenders or collateral agent under the
Credit Agreement, in each case subject to no Lien held by a Person
other than the Company, a Restricted Subsidiary of the Company or the
lenders or collateral agent under the Credit Agreement; provided that
if as of any date any Person other than the Company, a Restricted
Subsidiary of the Company or the lenders or collateral agent under the
Credit Agreement owns or holds any such Indebtedness or holds a Lien
in respect of such Indebtedness, such date shall be deemed the
incurrence of Indebtedness not constituting Permitted Indebtedness
under this clause (6) by the issuer of such Indebtedness;
(7) Indebtedness of the Company to a Restricted Subsidiary
of the Company for so long as such Indebtedness is held by a
Restricted Subsidiary of the Company or the lenders or the collateral
agent under the Credit Agreement and is subject to no Lien other than
a Lien in favor of the lenders or collateral agent under the Credit
Agreement; provided that (a) any Indebtedness of the Company to any
-22-
Restricted Subsidiary of the Company is unsecured and subordinated,
pursuant to a written agreement, to the Company's obligations under
this Indenture and the Securities and (b) if as of any date any Person
other than a Restricted Subsidiary of the Company owns or holds any
such Indebtedness or any Person holds a Lien other than a Lien in
favor of the lenders or collateral agent under the Credit Agreement in
respect of such Indebtedness, such date shall be deemed the incurrence
of Indebtedness not constituting Permitted Indebtedness under this
clause (7) by the Company;
(8) Indebtedness arising from the honoring by a bank or
other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn
against insufficient funds in the ordinary course of business;
PROVIDED, HOWEVER, that such Indebtedness is extinguished within two
Business Days of incurrence;
(9) Indebtedness of the Company or any of its Restricted
Subsidiaries in respect of performance bonds, bankers' acceptances,
workers' compensation claims, surety or appeal bonds, payment
obligations in connection with self-insurance or similar obligations,
and bank overdrafts (and letters of credit in respect thereof);
(10) Indebtedness represented by Capitalized Lease
Obligations, Purchase Money Indebtedness or Acquired Indebtedness of
the Company and its Restricted Subsidiaries not to exceed $20.0
million in the aggregate at any one time outstanding; provided that
all or a portion of the $20.0 million permitted to be incurred under
this clause (10) may, at the option of the Company, be incurred under
the Credit Agreement or pursuant to clause (16) below (in addition to
the amount set forth therein) instead of pursuant to Capitalized Lease
Obligations, Purchase Money Indebtedness or Acquired Indebtedness;
(11) Indebtedness arising from agreements of the Company or
a Restricted Subsidiary of the Company providing for indemnification,
adjustment of purchase price or similar obligations, in each case,
incurred or assumed in connection with the disposition of any
business, assets or a Subsidiary, other than guarantees by the Company
or a Restricted Subsidiary of the Company of Indebtedness incurred by
any Person acquiring all or any portion of such business, assets or a
Subsidiary for the purpose of financing such acquisition; PROVIDED,
HOWEVER, that:
(a) such Indebtedness is not reflected on the
balance sheet of the Company or any Restricted Subsidiary of the
Company (contingent obligations referred to in a footnote to
financial statements and not otherwise reflected on the balance
sheet will not be deemed to be reflected on such balance sheet
for purposes of this clause (a)); and
-23-
(b) the maximum assumable liability in respect of
all such Indebtedness shall at no time exceed the gross proceeds
including the fair market value of non-cash proceeds (the fair
market value of such non-cash proceeds being measured at the
time they are received as determined in good faith by the Board
of Directors of the Company or the Restricted Subsidiary, as
applicable, and without giving effect to any subsequent changes
in value) actually received by the Company and its Restricted
Subsidiaries in connection with such disposition;
(12) the incurrence by a Receivables Subsidiary of
Indebtedness in a Qualified Receivables Transaction that is without
recourse (other than pursuant to representations, warranties,
covenants and indemnities entered into in the ordinary course of
business in connection with a Qualified Receivables Transaction) to
the Company or to any Restricted Subsidiary of the Company or their
assets (other than such Receivables Subsidiary and its assets), and is
not guaranteed by any such Person, PROVIDED that any outstanding
Indebtedness incurred under this clause (12) shall reduce (for so long
as, and to the extent that, the Indebtedness referred to in this
clause (12) remains outstanding) the aggregate amount permitted to be
incurred under clause (2) above to the extent set forth therein;
(13) Indebtedness under Commodity Agreements;
(14) guarantees by the Company or any Restricted Subsidiary
of the Company of each other's Indebtedness, including agreements of
the Company to keep-well or maintain financial statement conditions of
any Restricted Subsidiary of the Company, PROVIDED that such
Indebtedness is permitted to be incurred under this Indenture and, if
a Restricted Subsidiary guarantees the Company's Indebtedness, such
Restricted Subsidiary has complied, to the extent applicable, with
Section 4.14;
(15) Refinancing Indebtedness;
(16) additional Indebtedness of the Company and its
Restricted Subsidiaries in an aggregate principal amount not to exceed
$50.0 million at any one time outstanding (which amount may, but need
not, be incurred in whole or in part under the Credit Agreement) plus
up to an additional amount as contemplated by, and to the extent not
incurred under, clause (10) above; and
(17) Indebtedness of the Company or any of its Restricted
Subsidiaries consisting of (x) the financing of insurance premiums in
the ordinary course of business or (y) take-or-pay obligations
contained in supply arrangements entered into in the ordinary course
of business and on a basis consistent with past practice.
-24-
For purposes of determining compliance with Section 4.4,
(a) in the event that an item of Indebtedness meets the
criteria of more than one of the categories of Permitted Indebtedness
described in clauses (1) through (17) above or is entitled to be
incurred pursuant to the Consolidated Fixed Charge Coverage Ratio
provisions of such Section, the Company shall, in its sole discretion,
classify (or later reclassify) such item of Indebtedness in any manner
that complies with Section 4.4,
(b) accrual of interest, accretion or amortization of
original issue discount, the payment of interest on any Indebtedness
in the form of additional Indebtedness with the same terms or in the
form of Capital Stock, the payment of dividends on Disqualified
Capital Stock in the form of additional shares of the same class of
Disqualified Capital Stock and increases in the amount of Indebtedness
outstanding solely as a result of fluctuations in the exchange rate of
currencies will not be deemed to be an incurrence of Indebtedness or
an issuance of Disqualified Capital Stock for purposes of Section 4.4,
(c) guarantees of, or obligations in respect of letters of
credit relating to, Indebtedness which is otherwise included in the
determination of a particular amount of Indebtedness shall not be
included,
(d) if obligations in respect of letters of credit are
incurred pursuant to the Credit Agreement and are being treated as
incurred pursuant to clause (2) above and the letters of credit relate
to other Indebtedness, then such other Indebtedness shall not be
included, and
(e) if such Indebtedness is denominated in a currency other
than U.S. dollars, the U.S. dollar equivalent principal amount thereof
will be calculated based on the relevant currency exchange rates in
effect on the date such Indebtedness was incurred.
"PERMITTED INVESTMENTS" means:
(1) Investments by the Company or any Restricted Subsidiary
of the Company in any Person that is or will become immediately after
such Investment a Restricted Subsidiary of the Company or that will
merge or consolidate into the Company or a Restricted Subsidiary of
the Company; provided that such Restricted Subsidiary of the Company
is not restricted from making dividends or similar distributions by
contract, operation of law or otherwise other than as permitted by
Section 4.13;
-25-
(2) Investments in the Company by any Restricted Subsidiary
of the Company; PROVIDED that any Indebtedness evidencing such
Investment is unsecured and subordinated, pursuant to a written
agreement, to the Company's obligations under the Securities and this
Indenture;
(3) Investments in cash and Cash Equivalents;
(4) loans and advances to employees and officers of the
Company and its Restricted Subsidiaries made (a) in the ordinary
course of business for bona fide business purposes not to exceed $5.0
million in the aggregate at any one time outstanding or (b) to fund
purchases of Capital Stock of the Company or Compass Minerals under
any stock option plan or similar employment arrangements so long as no
cash is actually advanced by the Company or any of its Restricted
Subsidiaries to such employees and officers to fund such purchases;
(5) Currency Agreements, Commodity Agreements and Interest
Swap Obligations entered into in the ordinary course of the Company's
or its Restricted Subsidiaries' businesses and otherwise in compliance
with this Indenture;
(6) Investments in securities of trade creditors or
customers received (a) pursuant to any plan of reorganization or
similar arrangement upon the bankruptcy or insolvency of such trade
creditors or customers or (b) in settlement of delinquent obligations
of, and other disputes with, customers, suppliers and others, in each
case arising in the ordinary course of business or otherwise in
satisfaction of a judgment;
(7) Investments (a) made by the Company or its Restricted
Subsidiaries consisting of consideration received in connection with
an Asset Sale made in compliance with Section 4.17, (b) consisting of
consideration received by the Company or any of its Restricted
Subsidiaries in connection with a transaction that would be an Asset
Sale if it consisted of aggregate consideration received by the
Company or any of its Restricted Subsidiaries of $3.0 million or more
or (c) acquired in exchange for, or out of the proceeds of, a
substantially concurrent offering of Capital Stock (other than
Disqualified Capital Stock) of the Company (which proceeds of any such
offering of Capital Stock of the Company shall not have been, and
shall not be, included in clause (3)(b) of the first paragraph of
Section 4.3);
(8) Investments of a Person or any of its Subsidiaries
existing at the time such Person becomes a Restricted Subsidiary of
the Company or at the time such Person merges or consolidates with the
Company or any of its Restricted Subsidiaries, in either case in
compliance with this Indenture; provided that such Investments were
not made by such Person in connection with, or in anticipation or
contemplation of,
-26-
such Person becoming a Restricted Subsidiary of the Company or such
merger or consolidation;
(9) Investments in the Securities or the Existing Compass
Minerals Notes;
(10) Investments in existence on the Issue Date;
(11) guarantees of Indebtedness to the extent permitted
pursuant to Sections 4.4 and 4.14; and
(12) additional Investments (including Investments in joint
ventures and Unrestricted Subsidiaries) not to exceed $35.0 million at
any one time outstanding.
"PERMITTED LIENS" means the following types of Liens:
(1) Liens for taxes, assessments or governmental charges or
claims that are either (a) not delinquent or (b) contested in good
faith by appropriate proceedings and as to which the Company or its
Restricted Subsidiaries shall have set aside on its books such
reserves, if any, as shall be required pursuant to (x) GAAP in the
case of a Domestic Restricted Subsidiary, and (y) generally accepted
accounting principles in effect from time to time in the applicable
jurisdiction, in the case of a Foreign Restricted Subsidiary;
(2) statutory and common law Liens of landlords and Liens
of carriers, warehousemen, mechanics, suppliers, materialmen,
repairmen, customs and revenue authorities and other Liens imposed by
law incurred in the ordinary course of business for sums not yet
delinquent or being contested in good faith, if such reserve or other
appropriate provision, if any, as shall be required by GAAP shall have
been made in respect thereof;
(3) Liens incurred or deposits made in the ordinary course
of business in connection with workers' compensation, unemployment
insurance and other types of social security, including any Lien
securing letters of credit issued in the ordinary course of business
consistent with past practice in connection therewith, or to secure
the performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(4) judgment Liens not giving rise to an Event of Default
so long as such Lien is adequately bonded and any appropriate legal
proceedings which may have been duly initiated for the review of such
judgment shall not have been finally terminated or the period within
which such proceedings may be initiated shall not have expired;
-27-
(5) licenses, sublicenses, leases, subleases, easements,
rights-of-way, zoning restrictions and other similar charges or
encumbrances in respect of property not interfering in any material
respect with the ordinary conduct of the business of the Company and
its Restricted Subsidiaries, taken as a whole;
(6) any interest or title of a lessor under any Capitalized
Lease Obligation or operating lease; provided that such Liens do not
extend to any property or asset which is not leased property subject
to such Capitalized Lease Obligation or operating lease;
(7) Liens securing Indebtedness permitted pursuant to
clause (10) of the definition of "Permitted Indebtedness"; PROVIDED,
HOWEVER, that in the case of Purchase Money Indebtedness (a) the
Indebtedness shall not exceed the cost of such property or assets and
shall not be secured by any property or assets of the Company or any
Restricted Subsidiary of the Company other than the property and
assets so acquired or constructed and any improvements thereon and (b)
the Lien securing such Indebtedness shall be created within 180 days
of such acquisition or construction or, in the case of a refinancing
of any Purchase Money Indebtedness, within 180 days of such
refinancing;
(8) Liens upon specific items of inventory or other goods
and proceeds of any Person securing such Person's obligations in
respect of bankers' acceptances or similar credit transactions issued
or created for the account of such Person to facilitate the purchase,
shipment or storage of such inventory or other goods;
(9) Liens securing reimbursement obligations with respect
to commercial letters of credit which encumber documents and other
property relating to such letters of credit and products and proceeds
thereof;
(10) Liens encumbering deposits made to secure obligations
arising from statutory, regulatory, contractual, or warranty
requirements of the Company or any of its Restricted Subsidiaries,
including rights of offset and setoff;
(11) Liens securing Interest Swap Obligations so long as the
Interest Swap Obligations relate to Indebtedness that is otherwise
permitted under this Indenture;
(12) Liens in the ordinary course of business not exceeding
$10.0 million at any one time outstanding that (a) are not incurred in
connection with borrowing money and (b) do not materially detract from
the value of the property or materially impair its use;
-28-
(13) Liens by reason of judgment or decree not otherwise
resulting in an Event of Default;
(14) Liens securing Indebtedness permitted to be incurred
pursuant to clause (16) of the definition of "Permitted Indebtedness";
(15) Liens securing Indebtedness under Currency Agreements
and Commodity Agreements permitted under this Indenture;
(16) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with importation of goods;
(17) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into
by the Company or any of its Restricted Subsidiaries in the ordinary
course of business;
(18) Liens securing Acquired Indebtedness incurred in
accordance with Section 4.4 (including, without limitation, clause
(10) of the definition of "Permitted Indebtedness"); PROVIDED that:
(a) such Liens secured such Acquired Indebtedness
at the time of and prior to the incurrence of such Acquired
Indebtedness by the Company or a Restricted Subsidiary of the
Company and were not granted in connection with, or in
anticipation of, the incurrence of such Acquired Indebtedness by
the Company or a Restricted Subsidiary of the Company; and
(b) such Liens do not extend to or cover any
property or assets of the Company or of any of its Restricted
Subsidiaries other than the property or assets that secured the
Acquired Indebtedness prior to the time such Indebtedness became
Acquired Indebtedness of the Company or a Restricted Subsidiary
of the Company and are no more favorable to the lienholders than
those securing the Acquired Indebtedness prior to the incurrence
of such Acquired Indebtedness by the Company or a Restricted
Subsidiary of the Company; and
(19) Liens securing insurance premium financing
arrangements, PROVIDED that such Lien is limited to the applicable
insurance contracts.
"PERSON" means an individual, partnership, corporation, limited
liability company, unincorporated organization, trust or joint venture, or a
governmental agency or political subdivision thereof or any other entity.
-29-
"PHYSICAL SECURITIES" has the meaning provided in Section 2.1.
Physical Securities are sometimes referred to herein as certificated Securities.
"PREFERRED STOCK" of any Person means any Capital Stock of such Person
that has preferential rights to any other Capital Stock of such Person with
respect to dividends or redemptions or upon liquidation.
"PRIVATE PLACEMENT LEGEND" means the legend initially set forth on the
Initial Notes in the form set forth in the first paragraph of Section 2.14.
"PURCHASE MONEY INDEBTEDNESS" means Indebtedness of the Company and
its Restricted Subsidiaries incurred in the normal course of business for the
purpose of financing all or any part of the purchase price, or the cost of
installation, construction or improvement, of property or equipment or other
related assets and any Refinancing thereof.
"QIB" means any "qualified institutional buyer" (as defined under the
Securities Act).
"QUALIFIED CAPITAL STOCK" means any Capital Stock that is not
Disqualified Capital Stock.
"QUALIFIED RECEIVABLES TRANSACTION" means any transaction or series of
transactions that may be entered into by the Company or any of its Restricted
Subsidiaries pursuant to which the Company or any of its Restricted Subsidiaries
may sell, convey or otherwise transfer to (1) a Receivables Subsidiary (in the
case of a transfer by the Company or any of its Restricted Subsidiaries) and (2)
any other Person (in the case of a transfer by a Receivables Subsidiary), or may
grant a security interest in, any accounts receivable (whether now existing or
arising in the future) of the Company or any of its Restricted Subsidiaries, and
any assets related thereto including, without limitation, all collateral
securing such accounts receivable, all contracts and all guarantees or other
obligations in respect of such accounts receivable, proceeds of such accounts
receivable and other assets (including contract rights) which are customarily
transferred or in respect of which security interests are customarily granted in
connection with asset securitization transactions involving accounts receivable.
"RECAPITALIZATION" means the recapitalization of the Company and
Compass Minerals consummated on November 28, 2001.
"RECEIVABLES SUBSIDIARY" means a Wholly Owned Restricted Subsidiary of
the Company that engages in no activities other than in connection with the
financing of accounts receivable and that is designated by the Board of
Directors of the Company (as provided below) as a Receivables Subsidiary:
-30-
(1) no portion of the Indebtedness or any other Obligations
(contingent or otherwise) of which (a) is guaranteed by the Company or
any Restricted Subsidiary of the Company (excluding guarantees of
Obligations (other than the principal of, and interest on,
Indebtedness) pursuant to representations, warranties, covenants and
indemnities entered into in the ordinary course of business in
connection with a Qualified Receivables Transaction), (b) is recourse
to or obligates the Company or any Restricted Subsidiary of the
Company in any way other than pursuant to representations, warranties,
covenants and indemnities entered into in the ordinary course of
business in connection with a Qualified Receivables Transaction or (c)
subjects any property or asset of the Company or any Restricted
Subsidiary of the Company, directly or indirectly, contingently or
otherwise, to the satisfaction thereof, other than pursuant to
representations, warranties, covenants and indemnities entered into in
the ordinary course of business in connection with a Qualified
Receivables Transaction;
(2) with which neither the Company nor any Restricted
Subsidiary of the Company has any material contract, agreement,
arrangement or understanding other than on terms 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, other than fees payable in the ordinary course of business in
connection with servicing accounts receivable; and
(3) with which neither the Company nor any Restricted
Subsidiary of the Company has any obligation to maintain or preserve
such Restricted Subsidiary's financial condition or cause such
Restricted Subsidiary to achieve certain levels of operating results.
Any such designation by the Board of Directors of the Company shall be
evidenced to the Trustee by filing with the Trustee a Board Resolution giving
effect to such designation and an Officers' Certificate certifying that such
designation complied with the foregoing conditions.
"RECORD DATE" means the applicable record date specified in the
Securities.
"REDEMPTION DATE," when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to this Indenture
and the Securities.
"REDEMPTION PRICE," when used with respect to any Security to be
redeemed, means the price fixed for such redemption, payable in immediately
available funds, pursuant to this Indenture and the Securities.
"REFERENCE DATE" has the meaning set forth in Section 4.3(c)(i).
-31-
"REFINANCE" means, in respect of any security or Indebtedness, to
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue a security or Indebtedness in exchange or replacement for, such
security or Indebtedness in whole or in part. "REFINANCED" and "REFINANCING"
shall have correlative meanings.
"REFINANCING INDEBTEDNESS" means any Refinancing by the Company or any
Restricted Subsidiary of the Company of (A) for purposes of clause (15) of the
definition of Permitted Indebtedness, Indebtedness incurred or existing in
accordance with Section 4.4 (other than pursuant to clause (2), (4), (5), (6),
(7), (8), (9), (10), (11), (12), (13) or (14) of the definition of "Permitted
Indebtedness") or (B) for any other purpose, Indebtedness incurred in accordance
with Section 4.4, in each case that does not:
(1) result in an increase in the aggregate principal amount
of Indebtedness of such Person as of the date of such proposed
Refinancing (plus the amount of any premium, accrued interest and
defeasance costs, required to be paid under the terms of the
instrument governing such Indebtedness and plus the amount of
reasonable fees, expenses, discounts and commissions incurred by the
Company in connection with such Refinancing); or
(2) create Indebtedness with (a) if the Indebtedness being
Refinanced was incurred pursuant to clause (3) of the definition of
"Permitted Indebtedness," a Weighted Average Life to Maturity that is
less than the Weighted Average Life to Maturity of the Indebtedness
being Refinanced or a final maturity earlier than the final maturity
of the Indebtedness being Refinanced or (b) if the Indebtedness being
Refinanced was otherwise incurred in accordance with the definition of
"Permitted Indebtedness" or with Section 4.4, a Weighted Average Life
to Maturity that is less than the Weighted Average Life to Maturity of
the Securities or a final maturity earlier than the final maturity of
the Securities; PROVIDED that (x) if such Indebtedness being
Refinanced is Indebtedness solely of the Company, then such
Refinancing Indebtedness shall be Indebtedness solely of the Company
and (y) if such Indebtedness being Refinanced is subordinate or junior
to the Securities, then such Refinancing Indebtedness shall be
subordinate to the Securities at least to the same extent and in the
same manner as the Indebtedness being Refinanced.
"REGISTRAR" has the meaning set forth in Section 2.3.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated December 20, 2002 among the Issuer and Credit Suisse First
Boston Corporation, X.X. Xxxxxx Securities Inc. and Deutsche Banc Securities
Inc.
"REGULATION S" means Regulation S under the Securities Act.
-32-
"RELATED PARTIES" means with respect to a Person (a) that is a natural
person (1) any spouse, parent or lineal descendant (including by adoption) of
such Person or (2) the estate of such Person during any period in which such
estate holds Capital Stock of the Company for the benefit of any Person referred
to in clause (a)(1) and (b) that is a trust, corporation, partnership, limited
liability company or other entity, the beneficiaries, stockholders, partners,
owners or Persons beneficially owning an interest of more than 50% of which
consist of such Person and/or such other Persons referred to in the immediately
preceding clause (a).
"REPLACEMENT ASSETS" has the meaning set forth in Section
4.17(iii)(B).
"REPRESENTATIVE" means the indenture trustee or other trustee, agent
or representative in respect of the Credit Agreement; PROVIDED that if, and for
so long as, the Credit Agreement lacks such a representative, then the
Representative for such Credit Agreement shall at all times constitute the
holders of a majority in outstanding principal amount of obligations under the
Credit Agreement.
"RESPONSIBLE OFFICER" means, when used with respect to the Trustee,
any officer in the Corporate Trust Office of the Trustee with direct
responsibility for the administration of this Indenture or to whom any corporate
trust matter is referred because of such officer's knowledge of and familiarity
with the particular subject.
"RESTRICTED PAYMENT" has the meaning set forth in Section 4.3.
"RESTRICTED SECURITY" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act; PROVIDED that the Trustee shall be entitled
to request and conclusively rely on an Opinion of Counsel with respect to
whether any Security constitutes a Restricted Security.
"RESTRICTED SUBSIDIARY" of any Person means any Subsidiary of such
Person which at the time of determination is not an Unrestricted Subsidiary.
"RULE 144A" means Rule 144A under the Securities Act.
"SALE AND LEASEBACK TRANSACTION" means any direct or indirect
arrangement with any Person or to which any such Person is a party, providing
for the leasing to the Company or a Restricted Subsidiary of any property,
whether owned by the Company or any Restricted Subsidiary at the Issue Date or
later acquired, which has been or is to be sold or transferred by the Company or
such Restricted Subsidiary to such Person or to any other Person from whom funds
have been or are to be advanced by such Person on the security of such property
other than (a) arrangements between the Company and a Wholly Owned Restricted
Subsidiary of the Company or between Wholly Owned Restricted Subsidiaries of the
Company or (b) any arrangement whereby the transfer involves fixed or capital
assets and is consummated within
-33-
120 days after the date the Company or a Restricted Subsidiary acquires or
finishes construction of such fixed or capital assets.
"SECURITIES" means the Initial Notes, the Exchange Notes and any other
Securities issued after the Issue Date in accordance with clause (iii) of the
fourth paragraph of Section 2.2 treated as a single class of securities, as
amended or supplemented from time to time in accordance with the terms hereof,
that are issued pursuant to this Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
successor statute or statutes thereto.
"SERIES A PREFERRED STOCK" means the 13 3/4% Series A Cumulative
Senior Redeemable Exchangeable Preferred Stock, par value $0.01 per share, of
the Issuer.
"SIGNIFICANT SUBSIDIARY," with respect to any Person, means any
Restricted Subsidiary of such Person that satisfies the criteria for a
"significant subsidiary" as defined in Regulation S-X under the Securities Act
as such Regulation is in effect on the Issue Date and (2) any Restricted
Subsidiary that, when aggregated with all other Restricted Subsidiaries that are
not otherwise Significant Subsidiaries and as to which any event described in
clause (v), (vi) or (vii) of Section 6.1 has occurred and is continuing, would
constitute a Significant Subsidiary under clause (1) of this definition.
"SUBSIDIARY," with respect to any Person, means:
(1) any corporation of which the outstanding Capital Stock
having at least a majority of the votes entitled to be cast in the
election of directors under ordinary circumstances shall at the time
be owned, directly or indirectly, by such Person or a Subsidiary of
such Person; or
(2) any other Person of which at least a majority of the
voting interest under ordinary circumstances is at the time, directly
or indirectly, owned by such Person or a Subsidiary of such Person.
"SURVIVING ENTITY" has the meaning set forth in Section 5.1(a)(i).
"TEMPORARY OFFSHORE GLOBAL SECURITIES" has the meaning set forth in
Section 2.1.
"TIA" or "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939
(15 U.S.C. Sections 77aaa-77bbbb), as amended, as in effect on the date of the
execution of this Indenture until such time as this Indenture is qualified under
the TIA, and thereafter as in effect on the date on which this Indenture is
qualified under the TIA, except as otherwise provided in Section 9.3.
-34-
"TRANSACTION DATE" has the meaning specified in the definition of
"Consolidated Fixed Charge Coverage Ratio."
"TRANSACTIONS" means the Recapitalization and the related offering of
the Existing Compass Minerals Notes and the initial borrowings under the Credit
Agreement on November 28, 2001.
"TREASURY RATE" means the rate per annum equal to the yield to
maturity at the time of computation of United States Treasury securities with a
constant maturity most nearly equal to the period from such date of redemption
to December 15, 2007; PROVIDED, HOWEVER, that if the period from such date of
redemption to December 15, 2007 is not equal to the constant maturity of the
United States Treasury security for which a weekly average yield is given, the
Treasury Rate shall be obtained by linear interpolation (calculated to the
nearest one-twelfth of a year) from the weekly average yields of United States
Treasury securities for which such yields are given, except that if the period
from such date of redemption to December 15, 2007 is less than one year, the
weekly average yield on actually traded United States Treasury securities
adjusted to a constant maturity of one year shall be used.
"TRUSTEE" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"UNRESTRICTED SUBSIDIARY" of any Person means (1) any Subsidiary of
such Person that is designated an Unrestricted Subsidiary by the Board of
Directors of such Person in the manner provided below and (2) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors may designate any Subsidiary
(including any newly acquired or newly formed Subsidiary) to be an Unrestricted
Subsidiary unless such Subsidiary owns any Capital Stock of, or owns or holds
any Lien on any property of, the Company or any other Subsidiary of the Company
that is not a Subsidiary of the Subsidiary to be so designated; PROVIDED that
(x) either (i) the Company certifies to the Trustee in an Officers' Certificate
that such designation complies with Section 4.3 or (ii) the Subsidiary to be so
designated at the time of designation has total consolidated assets of $1,000 or
less and (y) each Subsidiary to be so designated and each of its Subsidiaries
has not at the time of designation, and does not thereafter, create, incur,
issue, assume, guarantee or otherwise become directly or indirectly liable with
respect to any Indebtedness pursuant to which the lender has recourse to any of
the assets of the Company or any of its Restricted Subsidiaries (other than the
assets of such Unrestricted Subsidiary). The Board of Directors may designate
any Unrestricted Subsidiary to be a Restricted Subsidiary only if (x)
immediately after giving effect to such designation, the Company is able to
incur at least $1.00 of additional Indebtedness (other than Permitted
Indebtedness) in compliance with Section 4.4 and (y) immediately before and
immediately after giving effect to such designation, no Default or Event of
Default shall have occurred and be continuing. Any such designation by the Board
of Directors shall be evidenced to the Trustee by promptly filing
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with the Trustee a copy of the Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the foregoing provisions.
"U.S. GLOBAL SECURITIES" has the meaning provided in Section 2.1.
"U.S. GOVERNMENT OBLIGATIONS" means direct obligations of, and
obligations guaranteed by, the United States of America for the payment of which
the full faith and credit of the United States of America is pledged and which
are not callable or redeemable at the issuer's option.
"U.S. LEGAL TENDER" means such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts.
"U.S. PHYSICAL SECURITIES" means the Securities issued in the form of
permanent certificated Securities in registered form in substantially the form
set forth in Exhibit A to Institutional Accredited Investors which are not QIBs
(excluding Non-U.S. Persons) who purchased Securities pursuant to Regulation D
of the Securities Act.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (1) the then
outstanding aggregate principal amount of such Indebtedness into (2) the sum of
the total of the products obtained by multiplying (a) the amount of each then
remaining installment, sinking fund, serial maturity or other required payment
of principal, including payment at final maturity, in respect thereof, by (b)
the number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
"WHOLLY OWNED RESTRICTED SUBSIDIARY" of any Person means any
Restricted Subsidiary of such Person of which all the outstanding voting
securities (other than in the case of a Foreign Restricted Subsidiary,
directors' qualifying shares or an immaterial amount of shares required to be
owned by other Persons pursuant to applicable law) are owned by such Person or
any Wholly Owned Restricted Subsidiary of such Person.
1.2. INCORPORATION BY REFERENCE OF TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"INDENTURE SECURITIES" means the Securities.
"INDENTURE SECURITY HOLDER" means a Holder or a Securityholder.
"INDENTURE TO BE QUALIFIED" means this Indenture.
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"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the
Trustee.
"OBLIGOR" on the indenture securities means the Company, any
Guarantor or any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
and not otherwise defined herein have the meanings assigned to them therein.
1.3. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural, and words in
the plural include the singular;
(6) provisions apply to successive events and transactions;
and
(7) "herein," "hereof" and other words of similar import
refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
(8) all ratios and computations based on GAAP contained in
this Indenture shall be computed in accordance with the definition of
GAAP set forth in Section 1.1.
(9) all references to Sections or Articles refer to
Sections or Articles in this Indenture unless otherwise indicated.
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ARTICLE TWO
THE SECURITIES
2.1. FORM AND DATING.
The Initial Notes and the Trustee's certificate of authentication
shall be substantially in the form of EXHIBIT A and the Exchange Notes and the
Trustee's certificate of authentication shall be substantially in the form of
EXHIBIT B. The Securities may have notations, legends or endorsements required
by law, stock exchange rule or usage. The Issuer and the Trustee shall approve
the form of the Securities and any notation, legend or endorsement on them. Each
Security shall be dated the date of its authentication.
The terms and provisions contained in the Securities, annexed hereto
as EXHIBIT A and EXHIBIT B, shall constitute, and are hereby expressly made, a
part of this Indenture and, to the extent applicable, the Issuer and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby.
Securities offered and sold in reliance on Rule 144A shall be issued
initially in the form of one or more permanent global Securities in registered
form, substantially in the form set forth in EXHIBIT A (the "U.S. GLOBAL
SECURITIES"), deposited with the Trustee, as custodian for the Depository, duly
executed by the Issuer and authenticated by the Trustee as hereinafter provided,
and shall bear the legends set forth in Section 2.14. The aggregate principal
amount at maturity of the U.S. Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depository, as hereinafter provided.
Securities issued in exchange for interests in the U.S. Global
Securities pursuant to Section 2.15 may be issued in the form of permanent
certificated Securities in registered form and shall bear the first legend set
forth in Section 2.14.
Securities offered and sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of one or more temporary
global Securities in registered form substantially in the form set forth in
EXHIBIT A (the "TEMPORARY OFFSHORE GLOBAL SECURITIES"), registered in the name
of the nominee of the Depository, deposited with the Trustee, as custodian for
the Depository, duly executed by the Issuer and authenticated by the Trustee as
hereinafter provided and shall bear the legends set forth in Section 2.14. At
any time on or after the 41st day after the Issue Date, upon receipt by the
Trustee, Registrar and the Issuer of a certificate substantially in the form of
EXHIBIT D hereto, one or more permanent global Securities in registered form
substantially in the form set forth in EXHIBIT A (the "PERMANENT OFFSHORE GLOBAL
SECURITIES"; and together with the Temporary Offshore Global Securities, the
"OFFSHORE
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GLOBAL SECURITIES"), duly executed by the Issuer and authenticated by the
Trustee as hereinafter provided shall be deposited with the Trustee, as
custodian for the Depository or its nominee, and the Registrar shall reflect on
its books and records the date and a decrease in the principal amount at
maturity of the Temporary Offshore Global Securities in an amount equal to the
principal amount at maturity of the beneficial interest in the Temporary
Offshore Global Securities transferred. The aggregate principal amount at
maturity of the Offshore Global Securities may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depository, as hereinafter provided.
Securities issued in exchange for interests in the Offshore Global
Securities pursuant to Section 2.15 may be issued in the form of permanent
certificated Securities in registered form (the "OFFSHORE PHYSICAL SECURITIES")
and shall bear the first legend set forth in Section 2.14. All Securities
offered and sold in reliance on Regulation S shall remain in the form of an
Offshore Global Security until the consummation of the Exchange Offer pursuant
to the Registration Rights Agreement.
The Offshore Physical Securities and the U.S. Physical Securities are
sometimes collectively herein referred to as the "PHYSICAL SECURITIES." The U.S.
Global Securities and the Offshore Global Securities are sometimes referred to
herein as the "GLOBAL SECURITIES."
2.2. EXECUTION AND AUTHENTICATION.
One Officer or an Assistant Secretary of the Issuer (each of whom
shall, in each case, have been duly authorized by all requisite corporate
actions) shall sign the Securities for the Issuer by manual or facsimile
signature.
If an Officer whose signature is on a Security was an Officer at the
time of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall nevertheless be valid.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate (i) Initial Notes for original issue on
the Issue Date in the aggregate principal amount at maturity not to exceed
$123,500,000, (ii) pursuant to the Exchange Offer, Exchange Notes from time to
time for issue only in exchange for a like Accreted Value and principal amount
at maturity of Initial Notes and (iii) subject to compliance with Section 4.4,
one or more series of Securities for original issue after the Issue Date (such
Securities to be substantially in the form of EXHIBIT A or EXHIBIT B, as the
case may be) in an unlimited amount (and if in the form of EXHIBIT A the same
Accreted Value and principal amount at maturity of Exchange Notes in exchange
therefor upon consummation of a registered
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exchange offer), in each case upon written orders of the Issuer in the form of
an Officers' Certificate, which Officers' Certificate shall, in the case of any
issuance pursuant to clause (iii) above, certify that such issuance is in
compliance with Section 4.4. In addition, each such Officers' Certificate shall
specify the amount of Securities to be authenticated, the date on which the
Securities are to be authenticated, whether the Securities are to be Initial
Notes, Exchange Notes or Securities issued under clause (iii) of the preceding
sentence and the aggregate principal amount at maturity of Securities
outstanding on the date of authentication, and shall further specify the amount
at maturity of such Securities to be issued as a Global Security or Physical
Securities. Such Securities shall initially be in the form of one or more Global
Securities, which (i) shall represent, and shall be denominated in an amount
equal to the aggregate principal amount at maturity of, the Securities to be
issued, (ii) shall be registered in the name of the Depository for such Global
Security or Securities or its nominee and (iii) shall be delivered by the
Trustee to the Depository or pursuant to the Depository's instruction. All
Securities issued under this Indenture shall vote and consent together on all
matters as one class and no series of Securities will have the right to vote or
consent as a separate class on any matter.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Issuer to authenticate the Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Issuer and Affiliates of the Issuer.
The Securities shall be issuable only in registered form without
coupons in denominations of $1,000 principal amount at maturity and integral
multiples thereof.
2.3. REGISTRAR AND PAYING AGENT.
The Issuer shall maintain an office or agency in the Borough of
Manhattan, The City of
New York, where (a) Securities may be presented or
surrendered for registration of transfer or for exchange ("REGISTRAR"), (b)
Securities may be presented or surrendered for payment ("PAYING AGENT") and (c)
notices and demands to or upon the Issuer in respect of the Securities and this
Indenture may be served. The Issuer may also from time to time designate one or
more other offices or agencies where the Securities may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; PROVIDED, HOWEVER, that no such designation or rescission shall in
any manner relieve the Issuer of its obligation to maintain an office or agency
in the Borough of Manhattan, The City of
New York, for such purposes. The Issuer
may act as its own Registrar or Paying Agent except that for the purposes of
Articles Three and Eight and Sections 4.16 and 4.17, neither the Issuer nor any
Affiliate of the Issuer shall act as Paying Agent. The Registrar shall keep a
register of the Securities
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and of their transfer and exchange. The Issuer, upon notice to the Trustee, may
have one or more co-Registrars and one or more additional paying agents
reasonably acceptable to the Trustee. The term "Paying Agent" includes any
additional paying agent. The Issuer hereby initially appoints the Trustee as
Registrar and Paying Agent until such time as the Trustee has resigned or a
successor has been appointed.
The Issuer shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which agreement shall implement the
provisions of this Indenture that relate to such Agent. The Issuer shall notify
the Trustee, in advance, of the name and address of any such Agent. If the
Issuer fails to maintain a Registrar or Paying Agent, the Trustee shall act as
such.
The Trustee is authorized to enter into a letter of representations
with the Depository in the form provided by the Issuer and to act in accordance
with such letter.
2.4. PAYING AGENT TO HOLD ASSETS IN TRUST.
The Issuer shall require each Paying Agent other than the Trustee to
agree in writing that each Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all assets held by the Paying Agent for the payment of
Accreted Value of, premium, if any, or interest on, the Securities (whether such
assets have been distributed to it by the Issuer or any other obligor on the
Securities), and shall notify the Trustee of any Default or Event of Default by
the Issuer (or any other obligor on the Securities) in making any such payment.
If either the Issuer or a Subsidiary acts as Paying Agent, it shall segregate
such assets and hold them as a separate trust fund. The Issuer at any time may
require a Paying Agent to distribute all assets held by it to the Trustee and
account for any assets disbursed and the Trustee may at any time during the
continuance of any payment Default or payment Event of Default, upon written
request to a Paying Agent, require such Paying Agent to distribute all assets
held by it to the Trustee and to account for any assets distributed. Upon
distribution to the Trustee of all assets that shall have been delivered by the
Issuer to the Paying Agent, the Paying Agent shall have no further liability for
such assets.
2.5. 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
Holders. If the Trustee is not the Registrar, the Issuer shall furnish to the
Trustee on or 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 as the
Trustee may reasonably require of the names and addresses of Holders, which list
may be conclusively relied upon by the Trustee.
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2.6. TRANSFER AND EXCHANGE.
(a) Subject to the provisions of Sections 2.14 and 2.15, when
Securities are presented to the Registrar or a co-Registrar with a request to
register the transfer of such Securities or to exchange such Securities for an
equal principal amount at maturity of Securities of other authorized
denominations, the Registrar or co-Registrar shall register the transfer or make
the exchange as requested if its requirements for such transaction are met;
PROVIDED, HOWEVER, that the Securities surrendered for registration of transfer
or exchange shall be duly endorsed or accompanied by a written instrument of
transfer in form satisfactory to the Issuer and the Registrar or co-Registrar,
duly executed by the Holder thereof or his attorney duly authorized in writing.
To permit registrations of transfers and exchanges, the Issuer shall execute and
the Trustee shall authenticate Securities at the Registrar's or co-Registrar's
request. No service charge shall be made for any registration of transfer or
exchange, but the Issuer may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or similar governmental charge payable upon
exchanges or transfers pursuant to Section 2.2, 2.10, 3.6, 4.16, 4.17 or 9.5).
The Registrar or co-Registrar shall not be required to register the transfer of
or exchange of any Security (i) during a period beginning at the opening of
business 15 days before the mailing of a notice of redemption of Securities and
ending at the close of business on the day of such mailing, (ii) selected for
redemption in whole or in part pursuant to Article Three, except the unredeemed
portion of any Security being redeemed in part, and (iii) during a Change of
Control Offer or a Net Proceeds Offer if such Security is tendered pursuant to
such Change of Control Offer or Net Proceeds Offer and not withdrawn. A Global
Security may be transferred, in whole but not in part, in the manner provided in
this Section 2.6(a), only to a nominee of the Depository for such Global
Security, or to the Depository, or a successor Depository for such Global
Security selected or approved by the Issuer, or to a nominee of such successor
Depository.
(b) If at any time the Depository for the Global Security or
Securities notifies the Issuer that it is unwilling or unable to continue as
Depository for such Global Security or Securities or the Issuer becomes aware
that the Depository has ceased to be a clearing agency registered under the
Exchange Act, the Issuer shall appoint a successor Depository with respect to
such Global Security or Securities. If a successor Depository for such Global
Security or Securities has not been appointed within 90 days after the Issuer
receives such notice or become aware of such ineligibility, the Issuer shall
execute, and the Trustee, upon receipt of an Officers' Certificate for the
authentication and delivery of Securities, shall authenticate and make available
for delivery, Securities in definitive form, in an aggregate principal amount at
maturity equal to the principal amount at maturity of the Global Security
representing such Securities, in exchange for such Global Security. The Issuer
shall reimburse the Registrar, the Depository and the Trustee for expenses they
incur in documenting such exchanges and issuances of Securities in definitive
form.
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The Issuer may at any time and in its sole discretion determine that
the Securities shall no longer be represented by such Global Security or
Securities. In such event the Issuer will execute, and the Trustee, upon receipt
of a written order for the authentication and delivery of individual Securities
in exchange in whole or in part for such Global Security or Securities, will
authenticate and make available for delivery individual Securities in definitive
form in an aggregate principal amount at maturity equal to the principal amount
at maturity of such Global Security or Securities in exchange for such Global
Security or Securities.
In any exchange provided for in any of the preceding two paragraphs,
the Issuer will execute and the Trustee will authenticate and make available for
delivery individual Securities in definitive registered form in authorized
denominations. Upon the exchange of a Global Security for individual Securities,
such Global Security shall be cancelled by the Trustee. Securities issued in
exchange for a Global Security pursuant to this Section 2.6(b) shall be
registered in such names and in such authorized denominations as the Depository
for such Global Security, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee shall make
available for delivery such Securities to the Persons in whose names such
Securities are so registered.
Neither the Issuer, the Trustee, any Paying Agent or the Registrar
will have any responsibility or liability for any aspect of the records relating
to or payments made on account of beneficial ownership interests in a Global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
2.7. REPLACEMENT SECURITIES.
If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Issuer shall issue and the Trustee shall authenticate a replacement
Security if the Trustee's requirements are met. If required by the Trustee or
the Issuer, such Holder must provide an indemnity bond or other indemnity,
sufficient in the judgment of both the Issuer and the Trustee, to protect the
Issuer, the Trustee or any Agent from any loss which any of them may suffer if a
Security is replaced. The Issuer may charge such Holder for its reasonable
out-of-pocket expenses in replacing a Security pursuant to this Section 2.7,
including reasonable fees and expenses of counsel.
Every replacement Security is an additional obligation of the Issuer.
2.8. OUTSTANDING SECURITIES.
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee except those cancelled by it, those delivered
to it for cancellation and those described in this Section as not outstanding. A
Security does not cease to be outstanding because
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the Issuer, any Guarantor or any of their respective Subsidiaries or Affiliates
holds the Security.
If a Security is replaced pursuant to Section 2.7 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a BONA FIDE purchaser or a protected purchaser. A mutilated Security
ceases to be outstanding upon surrender of such Security and replacement thereof
pursuant to Section 2.7. If the principal amount at maturity of any Security is
considered paid under Section 4.1, it ceases to be outstanding and interest
ceases to accrue.
If on a Redemption Date or the Maturity Date the Paying Agent (other
than the Issuer or a Subsidiary) holds U.S. Legal Tender sufficient to pay all
of the Accreted Value of, premium, if any, and interest due on the Securities
payable on that date, then on and after that date such Securities cease to be
outstanding and interest on them ceases to accrue.
2.9. TREASURY SECURITIES.
In determining whether the Holders of the required principal amount at
maturity of Securities have concurred in any direction, waiver or consent,
Securities owned by the Issuer, any of its Subsidiaries or any of its respective
Affiliates shall be disregarded, except that, for the purposes of determining
whether the Trustee shall be protected in relying on any such direction, waiver
or consent, only Securities that a Responsible Officer of the Trustee knows or
has reason to know are so owned shall be disregarded.
2.10. TEMPORARY SECURITIES.
Until definitive Securities are ready for delivery, the Issuer may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Issuer considers appropriate for temporary Securities,
as evidenced by execution of such temporary Securities by the Issuer. Without
unreasonable delay, the Issuer shall prepare and the Trustee shall authenticate
definitive Securities in exchange for temporary Securities. Until such exchange,
temporary Securities shall be entitled to the same rights, benefits and
privileges as definitive Securities. Notwithstanding the foregoing, so long as
the Securities are represented by a Global Security, such Global Security may be
in typewritten form.
2.11. CANCELLATION.
The Issuer at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee, or at the direction of the Trustee,
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the Registrar or the Paying Agent (other than the Issuer or a Subsidiary), and
no one else, shall cancel and shall dispose of all Securities surrendered for
registration of transfer, exchange, payment or cancellation in accordance with
its procedures for the disposition of cancelled securities. Subject to Section
2.7, the Issuer may not issue new Securities to replace Securities that they
have paid or delivered to the Trustee for cancellation. If the Issuer or any
Guarantor shall acquire any of the Securities, such acquisition shall not
operate as a redemption or satisfaction of the Indebtedness represented by such
Securities unless and until the same are surrendered to the Trustee for
cancellation pursuant to this Section 2.11.
2.12. DEFAULTED INTEREST.
If the Issuer defaults in a payment of interest on the Securities, it
shall, unless the Trustee fixes another record date pursuant to Section 6.10,
pay the defaulted interest, plus (to the extent lawful) any interest payable on
the defaulted interest, in any lawful manner. The Issuer may pay the defaulted
interest to the Persons who are Holders on a subsequent special record date,
which date shall be the fifteenth day next preceding the date fixed by the
Issuer for the payment of defaulted interest or the next succeeding Business Day
if such date is not a Business Day. At least 15 days before any such subsequent
special record date, the Issuer shall mail to each Holder, with a copy to the
Trustee, a notice that states the subsequent special record date, the payment
date and the amount of defaulted interest, and interest payable on such
defaulted interest, if any, to be paid.
2.13. CUSIP AND ISIN NUMBERS.
The Issuer in issuing the Securities may use "CUSIP" and "ISIN"
numbers, and if so, the Trustee shall use the CUSIP numbers in notices of
redemption or exchange as a convenience to Holders; PROVIDED, HOWEVER, that any
such notice may state that no representation is made as to the correctness or
accuracy of the CUSIP and ISIN numbers printed in the notice or on the
Securities, and that reliance may be placed only on the other identification
numbers printed on the Securities and that any such redemption or exchange shall
not be affected by any defect or omission of such CUSIP and ISIN numbers. The
Issuer will promptly notify the Trustee of any change in CUSIP or ISIN number.
2.14. RESTRICTIVE LEGENDS.
Unless and until a Security is exchanged for an Exchange Note or sold
in connection with an effective registration statement under the Securities Act
pursuant to the Registration Rights Agreement, (i) the U.S. Global Securities
and U.S. Physical Securities shall bear the legend set forth below (the "PRIVATE
PLACEMENT LEGEND") on the face thereof and (ii) the Offshore Physical
Securities, until at least the 41st day after the Issue Date and receipt by the
Issuer and the Trustee of a certificate substantially in the form of EXHIBIT D
hereto, and the
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Temporary Offshore Global Securities shall bear the legend set forth below on
the face thereof.
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT
(A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION
D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED INVESTOR")
OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE
SECURITIES ACT, (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD
REFERRED TO IN RULE 144(k) UNDER THE SECURITIES ACT AS IN EFFECT ON
THE DATE OF THE TRANSFER OF THIS SECURITY, RESELL OR OTHERWISE
TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY
THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER,
FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON
TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER CAN BE OBTAINED
FROM THE TRUSTEE) AND IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE
PRINCIPAL AMOUNT AT MATURITY OF SECURITIES OF LESS THAN $100,000, AN
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN
AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (F)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS
SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
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THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS SECURITY WITHIN
THE TIME PERIOD REFERRED TO IN RULE 144(k) UNDER THE SECURITIES ACT
AFTER THE ORIGINAL ISSUANCE OF THE SECURITIES, THE HOLDER MUST CHECK
THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE
MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE. IF
THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR OR
NON-U.S. PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO
THE TRUSTEE AND THE ISSUER SUCH CERTIFICATIONS, LEGAL OPINIONS OR
OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM
THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN
A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
"UNITED STATES" AND "U.S. PERSON" HAVE THE MEANING GIVEN TO THEM BY
REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF
THIS SECURITY IN VIOLATION OF THE FOREGOING RESTRICTION.
Each Global Security shall also bear the following legend on the face
thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR BY ANY SUCH
NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF SUCH
SUCCESSOR DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR
A NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A
NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR
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VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTION 2.16 OF THE INDENTURE GOVERNING
THIS SECURITY.
2.15. BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITY.
(a) Each Global Security initially shall (i) be registered in the
name of the Depository or the nominee of such Depository, (ii) be delivered to
the Trustee as custodian for such Depository and (iii) bear legends as set forth
in Section 2.14.
Members of, or participants in, the Depository ("AGENT MEMBERS") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depository, or the Trustee as its custodian, or under any
Global Security, and the Depository may be treated by the Issuer, the Trustee
and any agent of the Issuer or the Trustee as the absolute owner of each Global
Security for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Issuer, the Trustee or any agent of the Issuer or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depository or impair, as between the Depository
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Security.
(b) Transfers of Global Securities shall be limited to transfers in
whole, but not in part, to the Depository, its successors or their respective
nominees. Interests of beneficial owners in any Global Security may be
transferred or, subject to Section 2.1, exchanged for Physical Securities in
accordance with the rules and procedures of the Depository and the provisions of
Section 2.16. In addition, U.S. Physical Securities and Offshore Physical
Securities shall be transferred to all beneficial owners in exchange for their
beneficial interests in U.S. Global Securities or Offshore Global Securities, as
the case may be, if (i) the Depository notifies the Issuer that it is unwilling
or unable to continue as Depository for the U.S. Global Securities or the
Offshore Global Securities and a successor depositary is not appointed by the
Issuer within 90 days of such notice or (ii) an Event of Default has occurred
and is continuing and the Registrar has received a written request from the
Depository or the Trustee to issue Physical Securities.
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(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Security to beneficial owners pursuant to
paragraph (b), the Registrar shall (if one or more Physical Securities are to be
issued) reflect on its books and records the date and a decrease in the
principal amount at maturity of such Global Security in an amount equal to the
principal amount at maturity of the beneficial interest in such Global Security
to be transferred, and the Issuer shall execute, and the Trustee shall
authenticate and make available for delivery, one or more U.S. Physical
Securities or Offshore Physical Securities, as the case may be, of like tenor
and amount.
(d) In connection with the transfer of U.S. Global Securities or
Offshore Global Securities, in whole, to beneficial owners pursuant to paragraph
(b), the U.S. Global Securities or the Offshore Global Securities, as the case
may be, shall be deemed to be surrendered to the Trustee for cancellation, and
the Issuer shall execute, and the Trustee shall authenticate and make available
for delivery, to each beneficial owner identified by the Depository in exchange
for its beneficial interest in such U.S. Global Securities or Offshore Global
Securities, as the case may be, an equal aggregate principal amount at maturity
of U.S. Physical Securities or Offshore Physical Securities, as the case may be,
of authorized denominations.
(e) Any Physical Security constituting a Restricted Security
delivered in exchange for an interest in a Global Security pursuant to paragraph
(b) or (c) shall, except as otherwise provided by paragraphs (a)(i)(x), (d),
(e)(ii) and (f) of Section 2.16, bear the legend regarding transfer restrictions
applicable to the Physical Securities set forth in Section 2.14.
(f) The Holder of a Global Security may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Securities.
2.16. SPECIAL TRANSFER PROVISIONS.
(a) TRANSFERS TO NON-QIB INSTITUTIONAL ACCREDITED INVESTORS. The
following provisions shall apply with respect to the registration of any
proposed transfer of a Security constituting a Restricted Security to any
institutional accredited investor (as defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act) (an "ACCREDITED INVESTOR" or an "INSTITUTIONAL
ACCREDITED INVESTOR") which is not a QIB (excluding Non-U.S. Persons):
(i) the Registrar shall register the transfer of any
Security constituting a Restricted Security, whether or not such
Security bears the Private Placement Legend, if (x) the transferee
certifies that it is not an Affiliate of the Issuer and the requested
transfer is after the second anniversary of the later of the (a) Issue
Date and (b) the last date on which the Issuer or an Affiliate of the
Issuer was the owner of such Security (or any predecessor Security) or
such shorter period of time as permitted by Rule
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144(k) under the Securities Act or any successor provision thereunder
or (y) the proposed transferee has delivered to the Registrar a
certificate substantially in the form of EXHIBIT C hereto and if such
transfer is in respect of an aggregate principal amount at maturity of
Securities of less than $100,000, the proposed transferee has
delivered to the Registrar and the Issuer an opinion of counsel
acceptable to the Issuer that such transfer is in compliance with the
Securities Act and such other certifications, legal opinions or other
information that the Trustee may reasonably request in order to
confirm that such transaction is being made pursuant to an exemption
from or in a transaction not subject to the registration requirements
of the Securities Act; and
(ii) if the proposed transferor is an Agent Member holding a
beneficial interest in the U.S. Global Security, the Registrar shall
register the transfer of any Security constituting a Restricted
Security, whether or not such Security bears a Private Placement
Legend upon receipt by the Registrar of (x) the certificate, if any,
required by paragraph (i) above and (y) instructions given in
accordance with the Depository's and the Registrar's procedures,
whereupon (a) the Registrar shall reflect on its books and records the
date and (if the transfer does not involve a transfer of outstanding
U.S. Physical Securities) a decrease in the principal amount at
maturity of the applicable U.S. Global Security in an amount equal to
the principal amount at maturity of the beneficial interest in such
U.S. Global Security to be transferred, and (b) the Issuer shall
execute and the Trustee shall authenticate and make available for
delivery one or more U.S. Physical Securities of like tenor and
amount.
(b) TRANSFERS TO QIBS. The following provisions shall apply with
respect to the registration of any proposed transfer of a Security to a QIB
(excluding transfers to Non-U.S. Persons):
(i) if the Security to be transferred consists of (x)
either Offshore Physical Securities prior to the removal of the
Private Placement Legend or U.S. Physical Securities, the Registrar
shall register the transfer if such transfer is being made by a
proposed transferor who has checked the box provided for on the form
of Security stating, or has otherwise advised the Issuer and the
Registrar in writing, that the sale has been made in compliance with
the provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Security stating, or has
otherwise advised the Issuer and the Registrar in writing, that it is
purchasing the Security for its own account or an account with respect
to which it exercises sole investment discretion and that it and any
such account is a QIB within the meaning of Rule 144A, and is aware
that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the
Issuer as it has requested pursuant to Rule 144A or has determined not
to request such information and that it is aware that the transferor
is relying upon its foregoing representations in order to claim the
exemption
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from registration provided by Rule 144A or (y) an interest in the U.S.
Global Securities, the transfer of such interest may be effected only
through the book entry system maintained by the Depository; and
(ii) if the proposed transferee is an Agent Member, and the
Securities to be transferred consist of U.S. Physical Securities which
after transfer are to be evidenced by an interest in a U.S. Global
Security, upon receipt by the Registrar of instructions given in
accordance with the Depository's and the Registrar's procedures, the
Registrar shall reflect on its books and records the date and an
increase in the principal amount at maturity of the applicable U.S.
Global Security in an amount equal to the principal amount at maturity
of the U.S. Physical Securities to be transferred, and the Trustee
shall cancel the U.S. Physical Securities so transferred.
(c) TRANSFERS OF INTERESTS IN THE TEMPORARY OFFSHORE GLOBAL
SECURITIES. The following provisions shall apply with respect to registration of
any proposed transfer of an interest in a Temporary Offshore Global Securities:
(i) The Registrar shall register the transfer of any
Security (x) if the proposed transferee is a Non-U.S. Person and the
proposed transferor has delivered to the Registrar a certificate
substantially in the form of Exhibit D hereto or (y) if the proposed
transferee is a QIB and the proposed transferor has checked the box
provided for on the form of Security stating, or has otherwise advised
the Issuer and the Registrar in writing, that the sale has been made
in compliance with the provisions of Rule 144A to a transferee who has
signed the certification provided for on the form of Security stating,
or has otherwise advised the Issuer and the Registrar in writing, that
it is purchasing the Security for its own account or an account with
respect to which it exercises sole investment discretion and that it
and any such account is a QIB within the meaning of Rule 144A, and is
aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the
Issuer as it has requested pursuant to Rule 144A or has determined not
to request such information and that it is aware that the transferor
is relying upon its foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
(ii) If the proposed transferee is an Agent Member, upon
receipt by the Registrar of the documents referred to in clause (i)(y)
above and instructions given in accordance with the Depository's and
the Registrar's procedures, the Registrar shall reflect on its books
and records the date and an increase in the principal amount at
maturity of the U.S. Global Securities in an amount equal to the
principal amount at maturity of the Temporary Offshore Global
Securities to be transferred, and the Trustee shall decrease the
amount of the Temporary Offshore Global Securities.
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(d) TRANSFERS OF INTERESTS IN THE PERMANENT OFFSHORE GLOBAL
SECURITIES OR UNLEGENDED OFFSHORE PHYSICAL SECURITIES. The following provisions
shall apply with respect to any transfer of interests in Permanent Offshore
Global Securities or unlegended Offshore Physical Securities. The Registrar
shall register the transfer of any such Security without requiring any
additional certification.
(e) TRANSFERS TO NON-U.S. PERSONS AT ANY TIME. The following
provisions shall apply with respect to any transfer of a Security to a Non-U.S.
Person:
(i) Prior to the 41st day after the Issue Date, the
Registrar shall register any proposed transfer of a Security to a
Non-U.S. Person upon receipt of a certificate substantially in the
form of Exhibit D hereto from the proposed transferor.
(ii) On and after the 41st day after the Issue Date, the
Registrar shall register any proposed transfer to any Non-U.S. Person
if the Security to be transferred is a U.S. Physical Security or an
interest in U.S. Global Securities, upon receipt of a certificate
substantially in the form of EXHIBIT D hereto from the proposed
transferor.
(iii) (a) If the proposed transferor is an Agent Member
holding a beneficial interest in the U.S. Global Securities, upon
receipt by the Registrar of (x) the documents, if any, required by
paragraph (ii) and (y) instructions in accordance with the
Depository's and the Registrar's procedures, the Registrar shall
reflect on its books and records the date and a decrease in the
principal amount at maturity of the U.S. Global Securities in an
amount equal to the principal amount at maturity of the beneficial
interest in the U.S. Global Securities to be transferred, and (b) if
the proposed transferee is an Agent Member, upon receipt by the
Registrar of instructions given in accordance with the Depository's
and the Registrar's procedures, the Registrar shall reflect on its
books and records the date and an increase in the principal amount at
maturity of the Offshore Global Securities in an amount equal to the
principal amount at maturity of the U.S. Physical Securities or the
U.S. Global Securities, as the case may be, to be transferred, and the
Trustee shall cancel the U.S. Physical Security, if any, so
transferred or decrease the amount of the U.S. Global Security.
(f) PRIVATE PLACEMENT LEGEND. Upon the registration of transfer,
exchange or replacement of Securities not bearing the Private Placement Legend,
the Registrar shall make available for delivery Securities that do not bear the
Private Placement Legend. Upon the registration of transfer, exchange or
replacement of Securities bearing the Private Placement Legend, the Registrar
shall make available for delivery only Securities that bear the Private
Placement Legend unless (i) the circumstance contemplated by paragraph
(a)(i)(x), (d) or (e)(ii) of this Section 2.16 exists or (ii) there is delivered
to the Registrar an Opinion of Counsel reasonably satisfactory to the Issuer and
the Trustee to the effect that neither such legend
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nor the related restrictions on transfer are required in order to maintain
compliance with the provisions of the Securities Act.
(g) GENERAL. By its acceptance of any Security bearing the Private
Placement Legend, each Holder of such Security acknowledges the restrictions on
transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.15 or this Section 2.16 in
accordance with its customary procedures. The Issuer shall have the right to
inspect and make copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable written
notice to the Registrar.
(h) NO OBLIGATION OF THE TRUSTEE. (i) The Trustee shall have no
responsibility or obligation to any beneficial owner of a Global Security, a
member of, or a participant in, the Depository or any other Person with respect
to the accuracy of the records of the Depository or its nominee or of any
participant member thereof, with respect to any ownership interest in the
Securities or with respect to the delivery to any participant, member,
beneficial owner or other Person (other than the Depository) of any notice
(including any notice of redemption or repurchase) or the payment of any amount,
under or with respect to such Securities. All notices and communications to be
given to the Holders and all payments to be made to Holders under the Securities
shall be given or made only to the registered Holders (which shall be the
Depository or its nominee in the case of a Global Security). The rights of
beneficial owners in any Global Security shall be exercised only through the
Depository subject to the applicable rules and procedures of the Depository. The
Trustee may rely and shall be fully protected in relying upon information
furnished by the Depository with respect to its members, participants and any
beneficial owners.
(ii) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to any
transfer of any interest in any Security (including any transfers between or
among Depository participants, members or beneficial owners in any Global
Security) 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.
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ARTICLE THREE
REDEMPTION
3.1. NOTICES TO TRUSTEE.
If the Issuer elects to redeem Securities pursuant to Paragraph 5 of
the Securities, it shall notify the Trustee in writing of the Redemption Date,
the Redemption Price and the principal amount at maturity of the applicable
Securities to be redeemed. The Issuer shall give notice of redemption to the
Paying Agent and Trustee at least 45 days but not more than 60 days before the
Redemption Date (unless a shorter notice shall be agreed to by the Trustee in
writing), together with an Officers' Certificate stating that such redemption
will comply with the conditions contained herein.
3.2. SELECTION OF SECURITIES TO BE REDEEMED.
In the event that less than all of the Securities are to be redeemed
at any time, selection of such Securities for redemption will be made by the
Trustee in compliance with the requirements of the principal national securities
exchange, if any, on which such Securities are listed or, if such Securities are
not then listed on a national securities exchange, on a PRO RATA basis, by lot
or by such method as the Trustee shall deem fair and appropriate; PROVIDED,
HOWEVER, that no Securities of a principal amount at maturity of $1,000 or less
shall be redeemed in part; and PROVIDED, FURTHER, that if a partial redemption
is made with the Net Cash Proceeds of an Asset Sale or Equity Offering,
selection of the Securities or portions thereof for redemption shall be made by
the Trustee only on a PRO RATA basis or on as nearly a PRO RATA basis as is
practicable (subject to the procedures of the Depository), unless such method is
otherwise prohibited.
3.3. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a Redemption Date,
the Issuer shall mail a notice of redemption by first class mail, postage
prepaid, to each Holder whose Securities are to be redeemed at its registered
address. At the Issuer's request at least 45 days before a Redemption Date
(unless a shorter period shall be acceptable to the Trustee), the Trustee shall
give the notice of redemption in the Issuer's name and at the Issuer's expense.
Each notice of redemption shall identify the Securities to be redeemed and shall
state:
(a) the Redemption Date;
(b) the Redemption Price and the amount of accrued
interest, if any, to be paid;
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(c) the name and address of the Paying Agent;
(d) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price plus
accrued interest, if any;
(e) that, unless the Issuer defaults in making the
redemption payment, Accreted Value or interest on Securities called
for redemption ceases to accrete or accrue, as the case may be, on and
after the Redemption Date, and the only remaining right of the Holders
of such Securities is to receive payment of the Redemption Price and
accrued interest, if any, upon surrender to the Paying Agent of the
Securities redeemed;
(f) if any Security is being redeemed in part, the portion
of the principal amount at maturity of such Security to be redeemed
and that, after the Redemption Date, and upon surrender of such
Security, a new Security or Securities in aggregate principal amount
at maturity equal to the unredeemed portion thereof will be issued;
(g) if fewer than all the Securities are to be redeemed,
the identification of the particular Securities (or portion thereof)
to be redeemed, as well as the aggregate principal amount at maturity
of Securities to be redeemed and the aggregate principal amount at
maturity of Securities to be outstanding after such partial
redemption;
(h) the Paragraph of the Securities pursuant to which the
Securities are to be redeemed; and
(i) the CUSIP or ISIN number, if any, printed on the
Securities being redeemed and a statement that no representation is
made as to the correctness or accuracy of the CUSIP or ISIN number, if
any, listed in such notice or printed on the Securities.
The notice, if mailed in a manner herein provided, shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Security designated for redemption in whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security.
3.4. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.3,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price plus accrued interest, if any. Upon surrender to the
Trustee or Paying Agent, such Securities called for redemption shall be paid at
the Redemption Price (which shall include accrued interest thereon to the
Redemption Date), but installments of interest, the maturity of which is
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on or prior to the Redemption Date, shall be payable to Holders of record at the
close of business on the relevant Record Dates.
3.5. DEPOSIT OF REDEMPTION PRICE.
On or before 11:00 a.m.
New York time on the Redemption Date, the
Issuer shall deposit with the Paying Agent U.S. Legal Tender sufficient to pay
the Redemption Price plus accrued interest, if any, of all Securities to be
redeemed on that date.
If the Issuer complies with the preceding paragraph, then, unless the
Issuer defaults in the payment of such Redemption Price plus accrued interest,
if any, Accreted Value on the Securities to be redeemed will cease to accrete
and interest on the Securities to be redeemed will cease to accrue, as
applicable, on and after the applicable Redemption Date, whether or not such
Securities are presented for payment.
3.6. SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is to be redeemed in part only, the
Trustee shall upon written instruction from the Issuer authenticate for the
Holder a new Security or Securities in a principal amount at maturity equal to
the unredeemed portion of the Security surrendered.
ARTICLE FOUR
COVENANTS
4.1. PAYMENT OF SECURITIES.
The Issuer shall pay the Accreted Value of, premium, if any, and
interest on the Securities in the manner provided in the Securities. An
installment of Accreted Value of, premium, if any, or interest on the Securities
shall be considered paid on the date it is due if the Trustee or Paying Agent
holds on that date U.S. Legal Tender designated for and sufficient to pay the
installment. If the Issuer or any Subsidiary of the Issuer acts as Paying Agent,
an installment of Accreted Value of, premium, if any, or interest shall be
considered paid on the date it is due if the entity acting as Paying Agent
complies with the second sentence of Section 2.4. Interest on the Securities
will be computed on the basis of a 360-day year comprised of twelve 30-day
months. As provided in Section 6.9, upon any bankruptcy or reorganization
procedure relative to the Issuer, the Trustee shall serve as Paying Agent, if
any, for the Securities.
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4.2. MAINTENANCE OF OFFICE OR AGENCY.
The Issuer shall maintain in the Borough of Manhattan, The City of New
York, the office or agency required under Section 2.3. The Issuer shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Issuer shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the address of the Trustee set forth in Section 11.2.
The Issuer may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations. The
Issuer will give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Issuer hereby initially designates the Trustee at its address at
000 Xxxxxxx Xxxxxx, Xxxxx 0X, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate
Trust Administration, as such office of the Issuer in accordance with Section
2.3.
4.3. LIMITATION ON RESTRICTED PAYMENTS.
The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, (1) declare or pay any
dividend or make any distribution (other than dividends or distributions payable
in Qualified Capital Stock of the Company) on or in respect of shares of the
Company's Capital Stock to holders of such Capital Stock; (2) purchase, redeem
or otherwise acquire or retire for value any Capital Stock of the Company or any
warrants, rights or options to purchase or acquire shares of any class of such
Capital Stock of the Company; (3) make any principal payment on, purchase,
defease, redeem, prepay, decrease or otherwise acquire or retire for value,
prior to any scheduled final maturity, scheduled repayment or scheduled sinking
fund payment, any Indebtedness of the Company that is subordinate or junior in
right of payment to the Securities or any Guarantee (other than Indebtedness
described in clause (7) of the definition of "Permitted Indebtedness"); or (4)
make any Investment (other than Permitted Investments) (each of the foregoing
actions set forth in clauses (1), (2), (3) and (4) being referred to as a
"RESTRICTED PAYMENT"), if at the time of such Restricted Payment or immediately
after giving effect thereto:
(a) a Default or an Event of Default shall have occurred
and be continuing; or
(b) the Company is not able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) in
compliance with Section 4.4; or
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(c) the aggregate amount of Restricted Payments (including
such proposed Restricted Payment) made subsequent to November 28, 2001
(the amount expended for such purposes, if other than in cash, being
the fair market value of such property as determined reasonably and in
good faith by the Board of Directors of the Company whose
determination shall be conclusive) shall exceed the sum of:
(i) 50% of the cumulative Consolidated Net Income
(or if cumulative Consolidated Net Income shall be a loss, minus
100% of such loss) of the Company earned subsequent to November
28, 2001 and on or prior to the date the Restricted Payment is
made (the "REFERENCE DATE") (treating such period as a single
accounting period); plus
(ii) 100% of the aggregate Net Cash Proceeds and
the fair market value, as determined in good faith by the Board
of Directors of the Company, of property other than cash
received by the Company from any Person (other than a Subsidiary
of the Company) from the issuance and sale subsequent to
November 28, 2001 and on or prior to the Reference Date of
Qualified Capital Stock of the Company (other than Excluded
Contributions); plus
(iii) without duplication of any amounts included in
clause (c)(ii) above, 100% of the aggregate Net Cash Proceeds of
any equity contribution received by the Company subsequent to
November 28, 2001 from a holder of the Company's Capital Stock
(other than Excluded Contributions); plus
(iv) the amount by which Indebtedness of the
Company or any of its Restricted Subsidiaries is reduced on the
Company's balance sheet upon the conversion or exchange
subsequent to November 28, 2001 of any Indebtedness of the
Company or any of its Restricted Subsidiaries incurred after
November 28, 2001 into or for Qualified Capital Stock; plus
(v) without duplication, the sum of:
(a) the aggregate amount returned in cash on
or with respect to Investments (other than Permitted
Investments) made subsequent to November 28, 2001
whether through interest payments, principal payments,
dividends or other distributions or payments;
(b) the net cash proceeds received by the
Company or any Restricted Subsidiary of the Company
from the disposition of all or any portion of such
Investments (other than to a Subsidiary of the
Company); and
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(c) upon redesignation of an Unrestricted
Subsidiary as a Restricted Subsidiary, the fair market
value of such Subsidiary (valued in each case as
provided in the definition of "Investment");
PROVIDED, HOWEVER, that the sum of clauses (a), (b) and (c) above shall not
exceed the aggregate amount of all such Investments made by the Company or any
Restricted Subsidiary in the relevant Person or Unrestricted Subsidiary
subsequent to November 28, 2001.
Notwithstanding the foregoing, the provisions set forth in the
immediately preceding paragraph do not prohibit:
(1) the payment of any dividend or other distribution
within 60 days after the date of declaration of such dividend or other
distribution if the dividend or other distribution would have been
permitted on the date of declaration;
(2) if no Default or Event of Default shall have occurred
and be continuing, the acquisition of any shares of Capital Stock of
the Company, either (a) solely in exchange for shares of Qualified
Capital Stock of the Company, or (b) through the application of net
proceeds of a substantially concurrent sale for cash (other than to a
Subsidiary of the Company) of shares of Qualified Capital Stock of the
Company;
(3) if no Default or Event of Default shall have occurred
and be continuing, the acquisition of any Indebtedness of the Company
that is subordinate or junior in right of payment to the Securities or
a Guarantee either (a) solely in exchange for shares of Qualified
Capital Stock of the Company, or (b) through the application of net
proceeds of a substantially concurrent sale for cash (other than to a
Subsidiary of the Company) of (i) shares of Qualified Capital Stock of
the Company, or (ii) Refinancing Indebtedness;
(4) if no Default or Event of Default shall have occurred
and be continuing, repurchases by the Company or any Restricted
Subsidiary of the Company of securities of the Company from employees,
directors or consultants of the Company or any Subsidiaries of the
Company or their authorized representatives (a) upon the death,
disability or termination of employment of such employees, directors
or consultants or to the extent required pursuant to employee benefit
plans, employment agreements or consulting agreements or (b) pursuant
to any other agreements with such employees or directors of or
consultants to the Company or any Subsidiaries of the Company, in an
aggregate amount not to exceed $7.5 million in any calendar year (with
unused amounts in any calendar year being carried over to succeeding
years subject to a maximum of $15.0 million in any calendar year),
PROVIDED that the cancellation of Indebtedness owing to the Company or
any Restricted Subsidiary of the Company from such employees,
directors or consultants of the Company or any of its Restricted
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Subsidiaries in connection with a repurchase of Capital Stock of the
Company will not be deemed to constitute a Restricted Payment under
this Indenture;
(5) the declaration and payment of dividends to holders of
any class or series of Preferred Stock of the Company, provided that
for the most recently ended four full fiscal quarters for which
internal financial statements are available immediately preceding the
date of issuance of such Preferred Stock, after giving effect to such
issuance on a PRO FORMA basis, the Company would have been able to
incur at least $1.00 of Indebtedness (other than Permitted
Indebtedness) pursuant to Section 4.4;
(6) the payment of dividends on the Company's Common Stock
following the first public offering of the Company's Common Stock
after the Issue Date, of up to 6% per annum of the net proceeds
received by the Company in such public offering (other than public
offerings with respect to the Company's Common Stock registered on
Form S-8);
(7) the repurchase, retirement or other acquisition or
retirement for value of any securities of the Company in existence on
the Issue Date and from the Persons holding such securities on the
Issue Date and which are not held by Apollo or any of its Affiliates
or members of management of the Company and its Subsidiaries on the
Issue Date (including any equity interests issued in respect of any
such securities constituting equity interests as a result of a stock
split, recapitalization, merger, combination, consolidation or similar
transaction); PROVIDED, HOWEVER, that the Company shall be permitted
to make Restricted Payments under this clause only if after giving
effect thereto, the Company would be permitted to incur at least $1.00
of additional Indebtedness (other than Permitted Indebtedness)
pursuant to Section 4.4;
(8) other Restricted Payments in an aggregate amount not to
exceed $15.0 million;
(9) if no Default or Event of Default shall have occurred
and be continuing, payments or distributions to dissenting
stockholders pursuant to applicable law, pursuant to or in connection
with a consolidation, merger or transfer of assets that complies with
the provisions of this Indenture applicable to mergers, consolidations
and transfers of all or substantially all of the property and assets
of the Company;
(10) Investments that are made with Excluded Contributions;
(11) any payments made to consummate the Transactions
pursuant to or contemplated by the
Merger Agreement and any other
agreements related to the Recapitalization in effect on the closing
date of the Recapitalization, in each case, as
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such agreements or documents are in effect on the Issue Date as
amended from time to time so long as such amendment is in the good
faith judgment of the Board of Directors of the Company not more
disadvantageous to the Holders of the Securities in any material
respect than such agreements or documents as in effect on the Issue
Date;
(12) repurchases of Capital Stock deemed to occur upon the
exercise of stock options, warrants or other convertible securities,
to the extent such Capital Stock represents a portion of the
consideration for such exercise;
(13) the acquisition of any shares of Disqualified Capital
Stock of the Company either (a) solely in exchange for shares of
Disqualified Capital Stock of the Company or (b) through the
application of the net proceeds of a substantially concurrent sale for
cash (other than to a Subsidiary of the Company) of shares of
Disqualified Capital Stock of the Company;
(14) any purchase or redemption of Indebtedness that ranks
junior to the Securities utilizing any Net Cash Proceeds remaining
after the Company has complied with the requirements of the covenants
described under Sections 4.16 and 4.17;
(15) the payment of dividends, other distributions or
amounts by the Company to any direct or indirect parents of the
Company in amounts required to pay the tax obligations of the Company
and its Subsidiaries and the tax obligations of any direct or indirect
parents of the Company attributable to the Company and its
Subsidiaries; PROVIDED that (x) the amount of dividends paid pursuant
to this clause (15) to enable any direct or indirect parents of the
Company to pay Federal and state income taxes at any time shall not
exceed the amount of such Federal and state income taxes actually
owing by any direct or indirect parents of the Company at such time
for the respective period and (y) any refunds received by any direct
or indirect parents of the Company attributable to the Company and its
Subsidiaries shall promptly be returned by such direct or indirect
parents to the Company; and
(16) if no Default or Event of Default shall have occurred
and be continuing, payments by the Company of cash, in lieu of the
issuance of fractional shares upon the exercise of warrants or upon
the conversion or exchange of, or issuance of Capital Stock in lieu of
cash dividends on, any Capital Stock of the Company or any Restricted
Subsidiary, which in the aggregate do not exceed $3.0 million.
In determining the aggregate amount of Restricted Payments made subsequent to
November 28, 2001, in accordance with clause (c) of the immediately preceding
paragraph, amounts expended pursuant to clauses (1), (2), (4), (5), (6), (7),
(8), (9), (14) and (16) shall be included in such calculation.
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Not later than the date of making any Restricted Payment, the Company
shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment complies with this Indenture and setting forth in reasonable
detail the basis upon which the required calculations were computed, which
calculations may be based upon the Company's latest available internal quarterly
financial statements.
4.4. LIMITATION ON INCURRENCE OF ADDITIONAL INDEBTEDNESS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume, guarantee,
acquire, become liable, contingently or otherwise, with respect to, or otherwise
become responsible for payment of (collectively, "INCUR") any Indebtedness
(other than Permitted Indebtedness); PROVIDED, HOWEVER, that if no Default or
Event of Default shall have occurred and be continuing at the time of or as a
consequence of the incurrence of any such Indebtedness, (i) the Company may
incur Indebtedness (including, without limitation, Acquired Indebtedness) if on
the date of the incurrence of such Indebtedness, after giving effect to the
incurrence thereof, the Company's Consolidated Fixed Charge Coverage Ratio is
greater than 2.0 to 1.0 and (ii) any Restricted Subsidiary of the Company may
incur Indebtedness (including, without limitation, Acquired Indebtedness) if on
the date of the incurrence of such Indebtedness, after giving effect to the
incurrence thereof, such Restricted Subsidiary's Consolidated Fixed Charge
Coverage Ratio is greater than 2.0 to 1.0.
4.5. CORPORATE EXISTENCE.
Except as otherwise permitted by Article Five, the Company shall do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence and the corporate, partnership or other existence
of each of its Restricted Subsidiaries in accordance with the respective
organizational documents of each such Restricted Subsidiary and the rights
(charter and statutory) and material franchises of the Company and each of its
Restricted Subsidiaries; PROVIDED, HOWEVER, that neither the Company nor any
Restricted Subsidiary shall be required to preserve any such right or franchise
or in the case of any Restricted Subsidiary, its existence, if (in each case)
the Board of Directors of the Company shall determine that the loss thereof is
not, and will not be, adverse in any material respect to the Holders.
4.6. PAYMENT OF TAXES AND OTHER CLAIMS.
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (a) all material taxes, assessments and
governmental charges levied or imposed upon it or any of its Subsidiaries or
upon the income, profits or property of it or any of its Restricted Subsidiaries
and (b) all lawful claims for labor, materials and supplies which, in each case,
if unpaid, might by law become a material liability or Lien upon the
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property of it or any of its Restricted Subsidiaries; PROVIDED, HOWEVER, that
the Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount, (i) the
applicability or validity is being contested in good faith by appropriate
proceedings and for which appropriate provision has been made or (ii) where the
failure to effect such payment or discharge is not adverse in any material
respect to the Holders.
4.7. MAINTENANCE OF PROPERTIES AND INSURANCE.
(a) The Company shall cause all material properties owned by or
leased by it or any of its Restricted Subsidiaries used or useful to the conduct
of its business or the business of any of its Restricted Subsidiaries, taken as
a whole, to be maintained and kept in normal condition, repair and working order
and supplied with all necessary equipment and shall cause to be made all
repairs, renewals, replacements, and betterments thereof, all as in its judgment
may be necessary, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; PROVIDED, HOWEVER, that
nothing in this Section 4.7 shall prevent the Company or any of its Restricted
Subsidiaries from discontinuing the use, operation or maintenance of any of such
properties, or disposing of any of them, if such discontinuance or disposal is,
in the judgment of the Board of Directors of the Company or any such Restricted
Subsidiary desirable in the conduct of the business of the Company or any such
Restricted Subsidiary, and if such discontinuance or disposal is not adverse in
any material respect to the Holders; PROVIDED FURTHER that nothing in this
Section 4.7 shall prevent the Company or any of its Restricted Subsidiaries from
discontinuing or disposing of any properties to the extent otherwise permitted
by this Indenture.
(b) The Company shall maintain, and shall cause its Restricted
Subsidiaries to maintain, insurance with responsible carriers against such risks
and in such amounts, and with such deductibles, retentions, self-insured amounts
and co-insurance provisions, as are, in the Company's reasonable judgment,
customarily carried by similar businesses of similar size, including property
and casualty loss, workers' compensation and interruption of business insurance.
4.8. COMPLIANCE CERTIFICATE; NOTICE OF DEFAULT.
(a) The Issuer and each Guarantor, if any, shall deliver to the
Trustee, within 120 days after the close of each fiscal year of the Issuer, an
Officers' Certificate stating that a review of the activities of the Issuer or
the applicable Guarantor has been made under the supervision of the signing
Officers with a view to determining whether it has kept, observed, performed and
fulfilled its obligations under this Indenture and further stating, as to each
such Officer signing such certificate, that to the best of his or her knowledge,
the Issuer or the applicable Guarantor during such preceding fiscal year has
kept, observed, performed and fulfilled each and every such covenant and no
Default or Event of Default occurred during such
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year and at the date of such certificate there is no Default or Event of Default
that has occurred and is continuing or, if such signers do know of such Default
or Event of Default, the certificate shall describe its status with
particularity. The applicable Officers' Certificate shall also notify the
Trustee should either of the Issuer or any Guarantor elect to change the manner
in which it fixes its fiscal year end.
(b) The annual financial statements delivered pursuant to Section
4.10 shall be accompanied by a written report of the Company's independent
accountants (who shall be a firm of established national reputation) that in
conducting their audit of such financial statements nothing has come to their
attention that would lead them to believe that the Issuer has violated any
provisions of Article Four, Five or Six of this Indenture insofar as they relate
to accounting matters or, if any such violation has occurred, specifying the
nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.
(c) The Issuer shall promptly deliver to the Trustee, in the event
that any Officer becomes aware of any Default or Event of Default in the
performance of any covenant, agreement or condition contained in this Indenture,
an Officers' Certificate specifying the Default or Event of Default and
describing its status with particularity.
(d) The Issuer shall file with the Trustee promptly at the end of
each calendar year (i) a written notice specifying the amount of the original
issue discount (including daily rates and accrual periods) accrued on
outstanding Securities as of the end of such year and (ii) such other specific
information relating to such original issue discount as may then be relevant
under the Internal Revenue Code of 1986, as amended from time to time.
4.9. COMPLIANCE WITH LAWS.
The Company shall comply, and shall cause each of its Subsidiaries to
comply, with all applicable statutes, rules, regulations, orders and
restrictions of the United States, all states and municipalities thereof, and of
any governmental department, commission, board, regulatory authority, bureau,
agency and instrumentality of the foregoing, in respect of the conduct of their
respective businesses and the ownership of their respective properties, except
for such noncompliances as would not in the aggregate have a material adverse
effect on the financial condition or results of operations of the Company and
its Subsidiaries taken as a whole.
4.10. REPORTS TO HOLDERS.
Whether or not required by the rules and regulations of the
Commission, so long as any Securities are outstanding, the Company shall file a
copy of the following information and reports with the Commission for public
availability (unless the Commission will not accept
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such a filing) and shall furnish to the Holders of Securities and to securities
analysts and prospective investors, upon their written request:
(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" that describes the financial
condition and results of operations of the Company and its
consolidated Subsidiaries and, with respect to the annual information
only, a report thereon 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, in each case within the time periods specified in the
Commission's rules and regulations.
In addition, following the consummation of the Exchange Offer, whether
or not required by the rules and regulations of the Commission, the Company
shall file a copy of all such information and reports 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
written request to the Company.
In addition, for so long as any Securities remain outstanding, the
Company shall 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.
4.11. WAIVER OF STAY, EXTENSION OR USURY LAWS.
The Issuer and each Guarantor, if any, covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law that would prohibit or forgive such
Issuer or such Guarantor from paying all or any portion of the Accreted Value
of, premium, if any, and/or interest on the Securities or the Guarantee of any
such Guarantor as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of this
Indenture, and (to the extent that it may lawfully do so) each hereby expressly
waives all benefit or advantage of any such law, and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
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4.12. LIMITATIONS ON TRANSACTIONS WITH AFFILIATES.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or permit to
exist any transaction or series of related transactions (including, without
limitation, the purchase, sale, lease or exchange of any property or the
rendering of any service) with, or for the benefit of, any of its Affiliates
(each an "AFFILIATE TRANSACTION"), other than (x) Affiliate Transactions
permitted under paragraph (b) below and (y) Affiliate Transactions on terms that
are no less favorable than those that could reasonably have been obtained in a
comparable transaction at such time on an arm's-length basis from a Person that
is not an Affiliate of the Company or such Restricted Subsidiary. All Affiliate
Transactions (and each series of related Affiliate Transactions which are
similar or part of a common plan) involving aggregate payments or other property
with a fair market value in excess of $2.0 million shall be approved by the
Board of Directors of the Company or such Restricted Subsidiary, as the case may
be, such approval to be evidenced by a Board Resolution stating that such Board
of Directors has determined that such transaction complies with the foregoing
provisions. If the Company or any Restricted Subsidiary of the Company enters
into an Affiliate Transaction (or a series of related Affiliate Transactions
related to a common plan) that involves an aggregate fair market value of more
than $10.0 million, the Company or such Restricted Subsidiary, as the case may
be, shall, prior to the consummation thereof, obtain a favorable opinion as to
the fairness of such transaction or series of related transactions to the
Company or the relevant Restricted Subsidiary, as the case may be, from a
financial point of view, from an Independent Financial Advisor and file the same
with the Trustee.
(b) The restrictions set forth in clause (a) shall not apply to:
(i) reasonable fees and compensation paid to and indemnity
provided on behalf of, officers, directors, employees or consultants
of the Company or any Restricted Subsidiary of the Company as
determined in good faith by the Company's Board of Directors;
(ii) transactions exclusively between or among the Company
and any of its Restricted Subsidiaries or exclusively between or among
such Restricted Subsidiaries, PROVIDED such transactions are not
otherwise prohibited by this Indenture;
(iii) any agreement as in effect or entered into as of the
Issue Date or any amendment thereto or any transaction contemplated
thereby (including pursuant to any amendment thereto) in any
replacement agreement thereto so long as any such amendment or
replacement agreement is not more disadvantageous to the Holders in
any material respect than the original agreement as in effect on the
Issue Date;
(iv) Restricted Payments and Permitted Investments permitted
by this Indenture;
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(v) transactions in which the Company or any of its
Restricted Subsidiaries, as the case may be, delivers to the Trustee a
letter from an Independent Financial Advisor stating that such
transaction is fair to the Company or such Restricted Subsidiary from
a financial point of view or meets the requirements of the first
sentence of paragraph (a) above;
(vi) the issuance of securities or other payments, awards or
grants in cash, securities or otherwise pursuant to or the funding of,
employment arrangements, stock options and stock ownership plans or
similar employee benefit plans approved by Board of Directors of the
Company in good faith and loans to employees of the Company and its
Subsidiaries which are approved by the Board of Directors of the
Company in good faith;
(vii) transactions with customers, clients, suppliers, or
purchasers or sellers of goods or services, in each case on ordinary
business terms and otherwise in compliance with the terms of this
Indenture, which are fair to the Company or its Restricted
Subsidiaries, in the reasonable determination of the Board of
Directors of the Company or the senior management thereof, or are on
terms at least as favorable as could reasonably have been obtained at
such time from an unaffiliated party;
(viii) fees payable to Apollo pursuant to the Management
Agreement as in effect on the Issue Date or pursuant to any amendment,
restatement or replacement thereof to the extent that such amendment,
restatement or replacement does not provide for any fees or other
payments in excess of those set forth in the Management Agreement as
in effect on the Issue Date;
(ix) any contribution to the capital of the Company by any
Permitted Holder, or any sales of Capital Stock of the Company to any
Permitted Holder; and
(x) any tax sharing agreement or arrangement and payments
pursuant thereto among the Company and its Subsidiaries and any other
Person with which the Company or its Subsidiaries is required or
permitted to file a consolidated tax return or with which the Company
or any of its Restricted Subsidiaries is or could be part of a
consolidated group for tax purposes in amounts not otherwise
prohibited by this Indenture.
4.13. LIMITATION ON DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
SUBSIDIARIES.
The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries (other than a Restricted Subsidiary that has executed a
Guarantee) to, directly or indirectly, create or otherwise cause or permit to
exist or become effective any encumbrance or restriction
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on the ability of any Restricted Subsidiary of the Company to (a) pay dividends
or make any other distribution on or in respect of its Capital Stock (it being
understood that the priority of any Preferred Stock in receiving dividends or
liquidating distributions prior to dividends or liquidating distributions being
paid on Common Stock shall not be deemed a restriction on the ability to make
distributions on Capital Stock); (b) make loans or advances or to pay any
Indebtedness or other obligation owed to the Company or any other Restricted
Subsidiary of the Company; or (c) transfer any of its property or assets to the
Company or any other Restricted Subsidiary of the Company, except for such
encumbrances or restrictions existing under or by reason of:
(i) applicable law, rule, regulation, order, grant or
governmental permit;
(ii) this Indenture, the Existing Compass Minerals Indenture
and the Existing Compass Minerals Notes and the guarantees thereof;
(iii) the Credit Agreement;
(iv) customary non-assignment provisions of any contract,
license or any lease of any Restricted Subsidiary of the Company;
(v) any instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person or the
properties or assets of the Person so acquired;
(vi) agreements existing or entered into on the Issue Date
to the extent and in the manner such agreements are in effect on the
Issue Date;
(vii) purchase money obligations for property acquired in the
ordinary course of business or Capitalized Lease Obligations that
impose restrictions of the nature discussed in clause (c) above on the
property so acquired;
(viii) contracts for the sale of assets, including, without
limitation, customary restrictions with respect to a Restricted
Subsidiary of the Company pursuant to an agreement that has been
entered into for the sale or disposition of all or substantially all
of the Capital Stock or assets of such Restricted Subsidiary;
(ix) secured Indebtedness otherwise permitted to be incurred
pursuant to Sections 4.4 and 4.15 that limit the right of the debtor
to dispose of the assets securing such Indebtedness;
(x) customary provisions in joint venture agreements and
other similar agreements entered into in the ordinary course of
business;
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(xi) customary net worth and restrictions on transfer,
assignment or subletting provisions contained in leases and other
agreements entered into by the Company or any Restricted Subsidiary;
(xii) any restriction in any agreement or instrument of a
Receivables Subsidiary governing a Qualified Receivables Transaction;
(xiii) any agreement governing Indebtedness incurred to
Refinance the Indebtedness issued, assumed or incurred pursuant to an
agreement referred to in clauses (i) through (xii) above; PROVIDED,
HOWEVER, that the provisions relating to such encumbrance or
restriction contained in any such Indebtedness, taken as a whole, are
no less favorable to the Company in any material respect as determined
by the Board of Directors of the Company in its reasonable and good
faith judgment than the provisions relating to such encumbrance or
restriction contained in agreements referred to in such clauses; or
(xiv) any agreement governing Indebtedness permitted to be
incurred pursuant to Section 4.4; PROVIDED that either (y) the
provisions relating to such encumbrance or restriction contained in
such Indebtedness, taken as a whole, are no less favorable to the
Company in any material respect as determined by the Board of
Directors of the Company in its reasonable and good faith judgment
than the provisions contained in the Credit Agreement, the Existing
Compass Minerals Indenture or in this Indenture, in each case, as in
effect on the Issue Date or (z) any encumbrance or restriction
contained in such Indebtedness does not prohibit (except upon a
default or event of default thereunder) the payment of dividends in an
amount sufficient, as determined by the Board of Directors of the
Company in its reasonable and good faith judgment, to make scheduled
payments of cash interest on the Securities.
4.14. LIMITATION ON ISSUANCES OF GUARANTEES BY RESTRICTED SUBSIDIARIES.
The Company shall not permit any Restricted Subsidiary of the Company,
directly or indirectly, to Guarantee any Indebtedness of the Company (other than
Indebtedness and other obligations under the Credit Agreement), unless (i) such
Restricted Subsidiary simultaneously executes and delivers a supplemental
indenture to this Indenture providing for a Guarantee of payment of the
Securities by such Restricted Subsidiary and (ii) such Restricted Subsidiary
waives and will not in any manner whatsoever claim or take the benefit or
advantage of any rights of reimbursement, indemnity or subrogation or any other
rights against the Company or any other Restricted Subsidiary as a result of any
payment by such Restricted Subsidiary under its Guarantee so long as any
Securities remain outstanding.
Notwithstanding the foregoing, any such Guarantee by a Restricted
Subsidiary may provide by its terms that it shall be automatically and
unconditionally released and discharged
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upon (i) any sale, exchange or transfer, to any Person not an Affiliate of the
Company, of all of the Company's and each Restricted Subsidiary's Capital Stock
in, or all or substantially all the assets of, such Restricted Subsidiary (which
sale, exchange or transfer is not prohibited by this Indenture), (ii) the
release or discharge of the guarantee, if any, which resulted in the creation of
such Guarantee, except a discharge or release by or as a result of payment under
such guarantee or (iii) the designation of such Restricted Subsidiary as an
Unrestricted Subsidiary in accordance with the provisions of this Indenture.
4.15. LIMITATION ON LIENS.
The Company shall not, directly or indirectly, create, incur, assume
or permit or suffer to exist any Liens of any kind against or upon any property
or assets of the Company whether owned on the Issue Date or acquired after the
Issue Date, or any proceeds therefrom, or assign or otherwise convey any right
to receive income or profits therefrom unless:
(a) in the case of Liens securing Indebtedness that is
expressly subordinate or junior in right of payment of the Securities,
the Securities are secured by a Lien on such property, assets or
proceeds that is senior in priority to such Liens; and
(b) in all other cases, the Securities are equally and
ratably secured, except for the following Liens which are expressly
permitted:
(i) Liens existing as of the Issue Date;
(ii) Liens securing Indebtedness (including any
guarantee) incurred by the Company under the Credit Agreement;
(iii) Liens securing the Securities;
(iv) Liens in favor of the Company;
(v) Liens securing Refinancing Indebtedness which
is incurred to Refinance any Indebtedness (including, without
limitation, Acquired Indebtedness) which has been secured by a
Lien permitted under this Indenture and which has been incurred
in accordance with the provisions of this Indenture; PROVIDED,
HOWEVER, that such Liens:
(a) are no less favorable to the Holders and
are not more favorable to the lienholders with respect
to such Liens than the Liens in respect of the
Indebtedness being Refinanced; and
(b) do not extend to or cover any property
or assets of the Company not securing the Indebtedness
so Refinanced; and
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(vi) Permitted Liens.
4.16. CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, the Company shall be
obligated to make an offer to purchase (the "CHANGE OF CONTROL OFFER"), and
shall purchase, on a Business Day (the "CHANGE OF CONTROL PAYMENT DATE") as
described below, all or a portion of the then outstanding Securities at a
purchase price equal to 101% of the Accreted Value thereof, plus accrued and
unpaid interest, if any, thereon to the Change of Control Payment Date. The
Change of Control Offer shall remain open for at least 20 Business Days and
until the close of business on the Change of Control Payment Date.
Notwithstanding the occurrence of a Change of Control, the Company shall not be
obligated to repurchase the Securities pursuant to this Section 4.16 in the
event that the Company has exercised its right to redeem all the Securities
under the terms of Article III of this Indenture and paragraph 5 of the
Securities.
(b) Prior to the mailing of the notice referred to below, but in any
event within 60 days following any Change of Control, the Company covenants to:
(i) repay in full and terminate all commitments under
Indebtedness under the Credit Agreement and offer to repay in full and
terminate all commitments under all Indebtedness under the Credit
Agreement and to repay the Indebtedness owed to (and terminate all
commitments of) each lender which has accepted such offer; or
(ii) obtain the requisite consents under the Credit
Agreement to permit the repurchase of the Securities as provided
below.
The Company shall first comply with the covenant in the immediately preceding
sentence before it shall be required to repurchase Securities pursuant to the
provisions described below. The Company's failure to comply with the covenant
described in the second preceding sentence (and any failure to send the notice
referred to in clause (c) below because the same is prohibited by the second
preceding sentence) may (with notice and lapse of time) constitute an Event of
Default described in clause (iii) of Section 6.1 but shall not constitute an
Event of Default described in clause (ii) of Section 6.1.
(c) Within 60 days following the date upon which a Change of Control
occurs (the "CHANGE OF CONTROL DATE"), the Company shall send, by first class
mail, a notice to each Holder, with a copy to the Trustee, which notice shall
govern the terms of the Change of Control Offer. The notice to the Holders shall
contain all instructions and materials necessary to enable such Holders to
tender Securities pursuant to the Change of Control Offer. Such notice shall
state:
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(i) that the Change of Control Offer is being made pursuant
to this Section 4.16 and that all Securities tendered and not
withdrawn will be accepted for payment;
(ii) the purchase price (including the amount of accrued
interest) and the Change of Control Payment Date, which shall be a
Business Day, that is not earlier than 30 days or later than 60 days
from the date such notice is mailed, other than as may be required by
law;
(iii) that any Security not tendered will continue to accrete
Accreted Value or accrue interest, as the case may be;
(iv) that, unless the Company defaults in making payment
therefor, any Security accepted for payment pursuant to the Change of
Control Offer shall cease to accrete Accreted Value or accrue
interest, as the case may be, after the Change of Control Payment
Date;
(v) that Holders electing to have a Security purchased
pursuant to a Change of Control Offer will be required to surrender
the Security, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Security completed, to the Paying
Agent at the address specified in the notice prior to the close of
business on the third Business Day prior to the Change of Control
Payment Date;
(vi) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the second
Business Day prior to the Change of Control Payment Date, a telegram,
telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount at maturity of the Securities the Holder
delivered for purchase and a statement that such Holder is withdrawing
his election to have such Security purchased;
(vii) that Holders electing to have their Securities
purchased only in part will be issued new Securities in a principal
amount at maturity equal to the unpurchased portion of the Securities
surrendered; and
(viii) the circumstances and relevant facts regarding such
Change of Control.
The Company shall not be required to make a Change of Control Offer
upon a Change of Control if any other Person makes the Change of Control Offer
in the manner, at the times and otherwise in compliance with the requirements
set forth in this Section 4.16 applicable to a Change of Control Offer made by
the Company and purchases all Securities validly tendered and not withdrawn
under such Change of Control Offer.
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On or before the Change of Control Payment Date, the Company shall (i)
accept for payment Securities or portions thereof tendered pursuant to the
Change of Control Offer, (ii) deposit with the Paying Agent U.S. Legal Tender
sufficient to pay the purchase price plus accrued interest, if any, of all
Securities so tendered and (iii) deliver to the Trustee Securities so accepted
together with an Officers' Certificate stating the Securities or portions
thereof being purchased by the Company. The Paying Agent shall promptly mail to
the Holders of Securities so accepted payment in an amount equal to the purchase
price plus accrued interest, if any, and upon written order of the Company the
Trustee shall promptly authenticate and mail to such Holders new Securities
equal in principal amount to any unpurchased portion of the Securities
surrendered. Any Securities not so accepted shall be promptly mailed by the
Company to the Holder thereof. For purposes of this Section 4.16, the Trustee
shall act as the Paying Agent.
Any amounts remaining with the Paying Agent after the purchase of
Securities pursuant to a Change of Control Offer shall be returned by the
Trustee to the Company.
The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Securities pursuant to a Change of Control Offer. To the extent
the provisions of any securities laws or regulations conflict with the
provisions of this Section 4.16, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under this Section 4.16 by virtue thereof.
4.17. LIMITATION ON ASSET SALES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(i) the Company or the applicable Restricted Subsidiary, as
the case may be, receives consideration at the time of such Asset Sale
at least equal to the fair market value of the assets sold or
otherwise disposed of (as determined in good faith by the Company's
senior management or, in the case of an Asset Sale in excess of $5.0
million, the Board of Directors of the Company);
(ii) at least 75% of the consideration received by the
Company or the Restricted Subsidiary, as the case may be, from such
Asset Sale shall be in the form of (x) cash or Cash Equivalents, (y)
properties and assets to be owned by the Company or any of its
Restricted Subsidiaries and used in a Permitted Business or (z)
Capital Stock in one or more Persons engaged in a Permitted Business
that are or thereby become Restricted Subsidiaries of the Company,
and, in each case, such consideration is received at the time of such
disposition; PROVIDED that the amount of (a) any liabilities
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(as shown on the Company's or such Restricted Subsidiary's most recent
balance sheet) of the Company or any Restricted Subsidiary (other than
liabilities that are by their terms subordinated to the Securities)
that are assumed by the transferee of any such assets, and (b) any
notes or other securities 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 180 days after
such Asset Sale (to the extent of the cash received) shall be deemed
to be cash for the purposes of this provision only; and
(iii) upon the consummation of an Asset Sale, the Company
shall apply, or cause such Restricted Subsidiary to apply, the Net
Cash Proceeds relating to such Asset Sale within 390 days of receipt
thereof either:
(A) to prepay any Indebtedness under the Credit
Agreement or Indebtedness of a Restricted Subsidiary and, in the
case of Indebtedness under any revolving credit facility, effect
a permanent reduction in the availability under such revolving
credit facility (or effect a permanent reduction in availability
under such revolving credit facility regardless of the fact that
no prepayment is required);
(B) to make an Investment (x) in properties and
assets that replace the properties and assets that were the
subject of such Asset Sale, (y) in properties and assets that
will be used by the Company or a Restricted Subsidiary in a
Permitted Business or (z) permitted by clause (1) of the
definition of Permitted Investments (collectively, "REPLACEMENT
ASSETS"); or
(C) a combination of prepayment and investment
permitted by the foregoing clauses (iii)(A) and (iii)(B).
Pending the final application of the Net Cash Proceeds, the Company
and its Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise
invest such Net Cash Proceeds in any manner not prohibited by this Indenture.
On the 391st day after an Asset Sale or such earlier date, if any, as
the senior management or the Board of Directors of the Company or of such
Restricted Subsidiary determines not to apply the Net Cash Proceeds relating to
such Asset Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the
next preceding paragraph (each, a "NET PROCEEDS OFFER TRIGGER DATE"), such
aggregate amount of Net Cash Proceeds which have not been applied on or before
such Net Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B)
and (iii)(C) of the next preceding paragraph (each a "NET PROCEEDS OFFER
AMOUNT") shall be applied by the Company or such Restricted Subsidiary to make
an offer to purchase (the "NET PROCEEDS OFFER") on a date (the "NET PROCEEDS
OFFER PAYMENT Date") not less than 30 nor more
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than 60 days following the applicable Net Proceeds Offer Trigger Date, from all
Holders on a pro rata basis, that amount of Securities equal to the Net Proceeds
Offer Amount at a price equal to 100% of the Accreted Value of the Securities to
be purchased, plus accrued and unpaid interest thereon, if any, to the date of
purchase; PROVIDED, HOWEVER, that if the Company is required by the terms of any
PARI PASSU Indebtedness of the Company, such Net Proceeds Offer may be made
ratably to purchase the Securities and such other Indebtedness of the Company
that ranks PARI PASSU with the Securities.
If at any time any non-cash consideration received by the Company or
any Restricted Subsidiary of the Company, as the case may be, in connection with
any Asset Sale is converted into or sold or otherwise disposed of for cash
(other than interest received with respect to any such non-cash consideration),
then such conversion or disposition shall be deemed to constitute an Asset Sale
hereunder as of the date of such conversion or disposition and the Net Cash
Proceeds thereof shall be applied in accordance with this Section.
The Company may defer the Net Proceeds Offer until there is an
aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $10.0
million resulting from one or more Asset Sales (at which time, the entire
unutilized Net Proceeds Offer Amount, and not just the amount in excess of $10.0
million, shall be applied as required pursuant to the second preceding
paragraph).
In the event of the transfer of substantially all (but not all) of the
property and assets of the Company and its Restricted Subsidiaries as an
entirety to a Person in a transaction permitted under Section 5.1, which
transaction does not constitute a Change of Control, the successor corporation
shall be deemed to have sold the properties and assets of the Company and its
Restricted Subsidiaries not so transferred for purposes of this Section, and
shall comply with the provisions of clause (iii) of this Section with respect to
such deemed sale as if it were an Asset Sale. In addition, the fair market value
of such properties and assets of the Company or its Restricted Subsidiaries
deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this
Section 4.17.
Notice of each Net Proceeds Offer pursuant to this Section 4.17 shall
be mailed or caused to be mailed, by first class mail, by the Company within 25
days following the applicable Net Proceeds Offer Trigger Date to all Holders at
their last registered addresses, with a copy to the Trustee. A Net Proceeds
Offer shall remain open for a period of 20 Business Days or such longer period
as may be required by law. The notice shall contain all instructions and
materials necessary to enable such Holders to tender Securities pursuant to the
Net Proceeds Offer and shall state the following terms:
(i) that Holders may elect to have their Securities
purchased by the Company either in whole or in part (subject to
proration as hereinafter described in the
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event the Net Proceeds Offer is oversubscribed) in integral multiples
of $1,000 principal amount at maturity, at the applicable purchase
price;
(ii) that the Net Proceeds Offer is being made pursuant to
this Section 4.17 and that all Securities tendered will be accepted
for payment; PROVIDED, HOWEVER, that if the principal amount of
Securities tendered in the Net Proceeds Offer exceeds the aggregate
amount of the Net Proceeds Offer Amount, the Company shall select the
Securities to be purchased on a PRO RATA basis (based on amounts
tendered) (with such adjustments as may be deemed appropriate by the
Company so that only Securities in denominations of $1,000 principal
amount at maturity, or integral multiples thereof, shall be
purchased);
(iii) the purchase price (including the amount of accrued
interest, if any) and the purchase date (which shall be no earlier
than 30 days nor later than 60 days from the Net Proceeds Offer
Trigger Date, other than as may be required by applicable law);
(iv) that any Security not tendered will continue to accrete
Accreted Value or accrue interest, as the case may be;
(v) that, unless the Company defaults in making payment
therefor, any Security accepted for payment pursuant to the Net
Proceeds Offer shall cease to accrue interest after the Net Proceeds
Offer Payment Date;
(vi) that Holders electing to have a Security purchased
pursuant to the Net Proceeds Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Security completed, to the Paying Agent at the
address specified in the notice prior to the close of business on the
Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the second
Business Day prior to the Net Proceeds Offer Payment Date, a facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Security the Holder delivered for purchase and
a statement that such Holder is withdrawing his election to have such
Security purchased; and
(viii) that Holders whose Securities are purchased only in
part will be issued new Securities in a principal amount at maturity
equal to the unpurchased portion of the Securities surrendered.
On or before the Net Proceeds Offer Payment Date, the Company shall
(i) accept for payment Securities or portions thereof tendered pursuant to the
Net Proceeds Offer, (ii) deposit with the Paying Agent U.S. Legal Tender
sufficient to pay the purchase price, plus
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accrued interest, if any, of all Securities to be purchased and (iii) deliver to
the Trustee Securities so accepted together with an Officers' Certificate
stating the Securities or portions thereof being purchased by the Company. The
Paying Agent shall promptly mail to the Holders of Securities so accepted
payment in an amount equal to the purchase price, plus accrued interest, if any,
thereon set forth in the notice of such Net Proceeds Offer. Any Security not so
accepted shall be promptly mailed by the Company to the Holder thereof. For
purposes of this Section 4.17, the Trustee shall act as the Paying Agent.
Any amounts remaining after the purchase of Securities pursuant to a
Net Proceeds Offer shall be returned by the Trustee to the Company. To the
extent that the aggregate amount of the Securities tendered pursuant to a Net
Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use
such excess Net Proceeds Offer Amount for general corporate purposes or for any
other purposes not prohibited by this Indenture. Upon completion of any such Net
Proceeds Offer, the Net Proceeds Offer Amount shall 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 such laws and regulations are applicable in connection with the
repurchase of Securities pursuant to a Net Proceeds Offer. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of this Section 4.17, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under this Section 4.17 by virtue thereof. The provisions of this
Section and other provisions contained in this Indenture relating to the
Company's obligation to make a Net Proceeds Offer may be waived or modified with
the written consent of the Holders of a majority in principal amount at maturity
of the Securities.
ARTICLE FIVE
SUCCESSOR CORPORATION
5.1. MERGER, CONSOLIDATION AND SALE OF ASSETS.
(a) The Company shall not, in a single transaction or series of
related transactions, consolidate or merge with or into any Person, or sell,
assign, transfer, lease, convey or otherwise dispose of (or cause or permit any
Restricted Subsidiary of the Company to sell, assign, transfer, lease, convey or
otherwise dispose of) all or substantially all of the Company's assets
(determined on a consolidated basis for the Company and the Company's Restricted
Subsidiaries) whether as an entirety or substantially as an entirety to any
Person unless:
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(i) either (a) the Company shall be the surviving or
continuing corporation, partnership, trust or limited liability
company or (b) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person which
acquires by sale, assignment, transfer, lease, conveyance or other
disposition the properties and assets of the Company and of the
Company's Restricted Subsidiaries substantially as an entirety (the
"SURVIVING ENTITY"):
(x) shall be a corporation, partnership, trust or
limited liability company organized and validly existing under
the laws of the United States or any State thereof or the
District of Columbia; and
(y) shall expressly assume, by supplemental
indenture (in form and substance reasonably satisfactory to the
Trustee), executed and delivered to the Trustee, the due and
punctual payment of the principal of, and premium, if any, and
interest on all of the Securities and the performance of every
covenant of the Securities and this Indenture on the part of the
Company to be performed or observed;
(ii) immediately after giving effect to such transaction on
a PRO FORMA basis and the assumption contemplated by clause (a)(i)(y)
above (including giving effect to any Indebtedness and Acquired
Indebtedness incurred or anticipated to be incurred in connection with
or in respect of such transaction), the Company or such Surviving
Entity, as the case may be, shall be able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant
to Section 4.4;
(iii) immediately before and immediately after giving effect
to such transaction on a PRO FORMA basis and the assumption
contemplated by clause (a)(i)(y) above (including, without limitation,
giving effect to any Indebtedness and Acquired Indebtedness incurred
or anticipated to be incurred or repaid and any Lien granted or to be
released in connection with or in respect of the transaction), no
Default or Event of Default shall have occurred or be continuing; and
(iv) the Company or the Surviving Entity, as the case may
be, shall have delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger,
sale, assignment, transfer, lease, conveyance or other disposition
and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with the applicable
provisions of this Indenture and that all conditions precedent in this
Indenture relating to such transaction have been satisfied.
Notwithstanding the foregoing, (i) the merger of the Company with an
Affiliate incorporated solely for the purpose of reincorporating the Company in
another jurisdiction shall be
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permitted and (ii) the merger of any Restricted Subsidiary of the Company into
the Company or the transfer, lease, conveyance or other disposition of all or
substantially all of the assets of a Restricted Subsidiary of the Company to the
Company shall be permitted so long as the Company delivers to the Trustee an
Officers' Certificate stating that the purpose of such merger, transfer, lease,
conveyance or other disposition is not to consummate a transaction that would
otherwise be prohibited by clause (iii) of this Section 5.1(a).
(b) For purposes of the foregoing paragraph (a), the transfer (by
lease, assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries of the Company the Capital Stock of which
constitutes all or substantially all of the properties and assets of the
Company, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
(c) Each Guarantor (other than any Guarantor whose Guarantee is to
be released in accordance with the terms of such Guarantee and this Indenture in
connection with any transaction complying with the provisions of Section 4.17)
shall not, and the Company shall not cause or permit any Guarantor to,
consolidate with or merge with or into any Person other than the Company or any
other Guarantor unless:
(i) the Person formed by or surviving any such
consolidation or merger (if other than the Guarantor) or to which such
sale, lease, conveyance or other disposition shall have been made is a
corporation, partnership or limited liability company organized and
validly existing under the laws of the United States, any State
thereof, the District of Columbia or the jurisdiction in which such
Guarantor is organized;
(ii) such Person expressly assumes by supplemental indenture
all of the obligations of the Guarantor on its Guarantee;
(iii) immediately after giving effect to such transaction on
a PRO FORMA basis, no Default or Event of Default shall have occurred
and be continuing; and
(iv) immediately after giving effect to such transaction and
the use of any net proceeds therefrom on a PRO FORMA basis, the
Company could satisfy the provisions of clause (ii) of Section 5.1(a)
Any merger or consolidation of a Guarantor with and into the Company (with the
Company being the surviving entity) or another Guarantor that is a Wholly Owned
Restricted Subsidiary of the Company need only comply with clause (iv) of
Section 5.1(a).
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5.2. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation, combination or merger or any transfer of all
or substantially all of the assets of the Company in accordance with Section 5.1
in which the Company or any Guarantor, as applicable, is not the continuing
corporation, the successor Person formed by such consolidation or into which the
Company or such Guarantor is merged or to which such conveyance, lease or
transfer is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company or such Guarantor under this Indenture and
the Securities or any Guarantee, as applicable, with the same effect as if such
Surviving Entity had been named as such.
ARTICLE SIX
DEFAULT AND REMEDIES
6.1. EVENTS OF DEFAULT.
Each of the following shall be an "EVENT OF DEFAULT":
(i) the failure to pay interest on any Securities when the
same becomes due and payable and the default continues for a period of
30 days;
(ii) the failure to pay the principal on any Securities,
when such principal becomes due and payable, at maturity, upon
redemption or otherwise (including the failure to make a payment to
purchase Securities tendered pursuant to a Change of Control Offer or
a Net Proceeds Offer);
(iii) a default by the Company or any Restricted Subsidiary
of the Company in the observance or performance of any other covenant
or agreement contained in this Indenture, which default continues for
a period of 30 days after the Company receives written notice
specifying the default (and demanding that such default be remedied)
from the Trustee or from the Holders of at least 25% of the
outstanding principal amount at maturity of the Securities;
(iv) the failure to pay at final stated maturity (giving
effect to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness of the Company or the
Indebtedness of any Significant Subsidiaries of the Company, or the
acceleration of the final stated maturity of any such Indebtedness by
the holders thereof, if the aggregate principal amount of such
Indebtedness, together with the principal amount of any other such
Indebtedness in default for failure to pay principal at
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final stated maturity or which has been accelerated, exceeds $10.0
million or more at any time;
(v) one or more judgments in an aggregate amount in excess
of $10.0 million (exclusive of amounts covered by insurance other than
self-insurance) shall have been rendered against the Company or any of
its Significant Subsidiaries and such judgments remain undischarged,
unpaid or unstayed for a period of 60 days after such judgment or
judgments become final and non-appealable;
(vi) the Company or any of its Significant Subsidiaries (i)
commences a voluntary case or proceeding under any Bankruptcy Law with
respect to itself, (ii) consents to the entry of a judgment, decree or
order for relief against it in an involuntary case or proceeding under
any Bankruptcy Law, (iii) consents to the appointment of a custodian
of it or for substantially all of its property, (iv) consents to or
acquiesces in the institution of a bankruptcy or an insolvency
proceeding against it, (v) makes a general assignment for the benefit
of its creditors or (vi) takes any corporate action to authorize or
effect any of the foregoing; or
(vii) a court of competent jurisdiction enters a judgment,
decree or order for relief in respect of the Company or any of its
Significant Subsidiaries in an involuntary case or proceeding under
any Bankruptcy Law, which shall (i) approve as properly filed a
petition seeking reorganization, arrangement, adjustment or
composition in respect of the Company or any of its Significant
Subsidiaries, (ii) appoint a Custodian of the Company or any of its
Significant Subsidiaries or for substantially all of any of its
property or (iii) order the winding-up or liquidation of its affairs;
and such judgment, decree or order shall remain unstayed and in effect
for a period of 60 consecutive days.
If, pursuant to clause (iii) above, the Holders of at least 25% of the then
outstanding principal amount at maturity of Securities notify the Company as
specified in such clause, such Holders shall similarly notify the Trustee. Any
notice given pursuant to clause (iii) above or the immediately preceding
sentence shall be given by registered or certified mail, return receipt
requested.
6.2. ACCELERATION.
If an Event of Default (other than an Event of Default specified in
clause (vi) or (vii) of Section 6.1 above with respect to the Company) shall
occur and be continuing, the Trustee or the Holders of at least 25% in principal
amount at maturity of outstanding Securities may declare the Accreted Value of,
and accrued and unpaid interest, if any, on all the Securities to be due and
payable by notice in writing to the Issuer and the Trustee specifying the
respective Event of Default and that it is a "notice of acceleration" (the
"ACCELERATION NOTICE"), and the same (i) shall become immediately due and
payable or (ii) if there are any
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amounts outstanding under the Credit Agreement, shall become immediately due and
payable upon the first to occur of an acceleration under the Credit Agreement or
five (5) Business Days after receipt by the Company and the Representative under
the Credit Agreement of such Acceleration Notice (but only if such Event of
Default is then continuing). If an Event of Default specified in clause (vi) or
(vii) of Section 6.1 above with respect to the Company occurs and is continuing,
then all unpaid Accreted Value of, and accrued and unpaid interest, if any, on
all of the outstanding Securities shall IPSO FACTO become and be immediately due
and payable without any declaration or other act on the part of the Trustee or
any Holder.
At any time after a declaration of acceleration with respect to the
Securities as described in the preceding paragraph, the Holders of a majority in
principal amount at maturity of the Securities may rescind and cancel such
declaration and its consequences (i) if the rescission would not conflict with
any judgment or decree, (ii) if all existing Events of Default have been cured
or waived except nonpayment of Accreted Value, premium, if any, or interest, if
any, that has become due solely because of the acceleration, (iii) to the extent
the payment of such interest is lawful, interest on overdue installments of
interest, if any, and overdue Accreted Value and premium, if any, which has
become due otherwise than by such declaration of acceleration has been paid,
(iv) if the Company has paid the Trustee its reasonable compensation and
reimbursed the Trustee for its expenses, disbursements and advances, and any
other amounts due to the Trustee under Section 7.7 and (v) in the event of the
cure or waiver of an Event of Default of the type described in clause (vi) or
(vii) of Section 6.1, the Trustee shall have received an Officers' Certificate
and an Opinion of Counsel that such Event of Default has been cured or waived.
No such rescission shall affect any subsequent Default or Event of Default or
impair any right consequent thereto.
6.3. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of Accreted Value of, premium, if any, or interest on the Securities or
to enforce the performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
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6.4. WAIVER OF PAST DEFAULTS.
Subject to Sections 2.9, 6.2, 6.7 and 9.2, the Holders of not less
than a majority in principal amount at maturity of the outstanding Securities by
notice to the Trustee may waive an existing Default or Event of Default and its
consequences, except a Default or Event of Default in the payment of Accreted
Value of, premium, if any, or interest, if any, on any Security as specified in
clauses (i) and (ii) of Section 6.1. The Company shall deliver to the Trustee an
Officers' Certificate stating that the requisite percentage of Holders have
consented to such waiver and attaching copies of such consents. When a Default
or Event of Default is waived, it is cured and ceases.
6.5. CONTROL BY MAJORITY.
The Holders of not less than a majority in aggregate principal amount
at maturity of the outstanding Securities may 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 it. Subject to Section 7.1, however,
the Trustee may refuse to follow any direction that conflicts with any law or
this Indenture, that the Trustee determines may be unduly prejudicial to the
rights of another Securityholder, or that may involve the Trustee in personal
liability.
6.6. LIMITATION ON SUITS.
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
(i) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(ii) the Holder or Holders of at least 25% in principal
amount at maturity of the outstanding Securities make a written
request to the Trustee to pursue the remedy;
(iii) such Holder or Holders offer and, if requested, provide
to the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(iv) the Trustee does not comply with the request within 45
days after receipt of the request and the offer and, if requested, the
provision of indemnity; and
(v) during such 45-day period the Holder or Holders of a
majority in principal amount at maturity of the outstanding Securities
do not give the Trustee a direction which, in the opinion of the
Trustee, is inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over such other
Securityholder.
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6.7. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of Accreted Value of, premium, if any, and
interest, if any, on a Security, on or after the respective due dates expressed
in such Security, 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 the Holder.
6.8. COLLECTION SUIT BY TRUSTEE.
If an Event of Default in payment of principal, premium, if any, or
interest specified in clause (i) or (ii) of Section 6.1 occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Issuer or any other obligor on the Securities for
the whole amount of Accreted Value of, premium, if any, and accrued interest, if
any, and fees remaining unpaid, together with interest on overdue Accreted Value
and premium, if any, and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, if any, in each case at the rate
PER ANNUM borne by the Securities 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, and any other amounts due to the Trustee under Section 7.7.
6.9. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due to the Trustee under Section 7.7) and the Securityholders allowed in
any judicial proceedings relating to the Issuer, its creditors or its property
and shall be entitled and empowered to participate as a member, voting or
otherwise, of any official committee appointed for such matter, to collect and
receive any monies or other securities or property payable or deliverable upon
the conversion or exchange of the Securities or upon any such claims and to
distribute the same, and any Custodian in any such judicial proceedings is
hereby authorized by each Securityholder 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 Securityholders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agent and counsel, and any other amounts due the Trustee under
Section 7.7. Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Securityholder in any such proceeding.
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6.10. PRIORITIES.
If the Trustee collects any money or property pursuant to this Article
Six, it shall pay out the money or property in the following order:
First: to the Trustee for amounts due under Section 7.7;
Second: to Holders for interest accrued on the Securities,
ratably, without preference or priority of any kind, according to the
amounts due and payable on the Securities for interest, if any;
Third: to Holders for Accreted Value and premium, if any, due
and unpaid on the Securities, ratably, without preference or priority
of any kind, according to the amounts due and payable on the
Securities for principal; and
Fourth: to the Issuer or to the Guarantors, if any, as their
respective interests may appear.
The Trustee, upon prior notice to the Issuer, may fix a record date
and payment date for any payment to Securityholders pursuant to this Section
6.10.
6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.7, or a suit by a Holder or Holders of more than 10% in
principal amount at maturity of the outstanding Securities.
6.12. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then, and in every such case, subject to any
determination in such proceeding, the Issuer, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Issuer, Trustee and the Holders shall
continue as though no such proceeding had been instituted.
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6.13. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or wrongfully taken Securities in Section
2.7, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
ARTICLE SEVEN
TRUSTEE
7.1. 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 his or
her own affairs.
(b) Except during the continuance of an Event of Default:
(i) The Trustee need perform only those duties as are
specifically set forth herein or in the TIA and no duties, covenants,
responsibilities or obligations shall be implied in this Indenture
against the Trustee.
(ii) In the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates
(including Officers' Certificates) or opinions (including Opinions of
Counsel) furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the certificates
and opinions to determine whether or not they conform to the
requirements of this Indenture, but need not verify the contents
thereof.
(c) Notwithstanding anything to the contrary herein, the Trustee may
not be relieved from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
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(i) This paragraph does not limit the effect of paragraph
(b) of this Section 7.1.
(ii) 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.
(iii) The Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.5.
(d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
under this Indenture or take any action at the request or direction of Holders
if it shall have reasonable grounds for believing that repayment of such funds
is not assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to this Section 7.1.
(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 Issuer. Money
held in trust by the Trustee need not be segregated from other funds except to
the extent required by law.
(g) In the absence of bad faith, negligence or willful misconduct on
the part of the Trustee, the Trustee shall not be responsible for the
application of any money by any Paying Agent other than the Trustee.
7.2. RIGHTS OF TRUSTEE.
Subject to Section 7.1:
(a) The Trustee may conclusively rely on any document
believed by it to be genuine and to have been signed or presented by
the proper Person. The Trustee need not investigate any fact or matter
stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate and an Opinion of Counsel, which
shall conform to the provisions of Section 11.5. The Trustee shall not
be liable for any action it takes or omits to take in good faith in
reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and agents
and shall not be responsible for the misconduct or negligence of any
agent appointed with due care.
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(d) The Trustee shall not be liable for any action it takes
or omits to take in good faith which it reasonably believes to be
authorized or within its rights or powers.
(e) The Trustee may consult with counsel and the advice or
opinion of such counsel as to matters of law shall be full and
complete authorization and protection from liability in respect of any
action taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request, order or direction of any of the Holders pursuant to the
provisions of this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred therein or thereby.
(g) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate (including any Officers' Certificate), statement,
instrument, opinion (including any Opinion of Counsel), notice,
request, direction, consent, order, bond, debenture, or other paper or
document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled, upon reasonable notice to the
Issuer, to examine the books, records, and premises of the Issuer,
personally or by agent or attorney at the sole cost of the Company and
shall incur no liability or additional liability of any kind by reason
of such inquiry or investigation.
(h) The Trustee shall not be required to give any bond or
surety in respect of the performance of its powers and duties
hereunder.
(i) The permissive rights of the Trustee to do things
enumerated in this Indenture shall not be construed as duties.
(j) The Trustee shall not be charged with knowledge of any
Default or Event of Default, of the identity of any Restricted
Subsidiary or the existence of any Change of Control or Asset Sale
unless either (i) a Responsible Officer shall have actual knowledge
thereof or (ii) the Trustee shall have received written notice thereof
from either of the Issuer or any Holder.
(k) Delivery of reports, information and documents to the
Trustee under Section 4.10 is for informational purposes only and the
Trustee's receipt of the foregoing shall not constitute constructive
notice of any information contained therein or determinable from
information contained therein, including the Issuer's compliance with
any of the covenants hereunder.
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(l) The rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its
right to be indemnified, are extended to, and shall be enforceable by,
the Trustee in each of its capacities hereunder, and each agent,
custodian and other Person employed to act hereunder.
(m) The Trustee may request that the Company deliver an
Officers' Certificate setting forth the names of individuals and/or
titles of officers authorized at such time to take specified actions
pursuant to this Indenture, which Officers' Certificate may be signed
by any person authorized to sign an Officers' Certificate, including
any person specified as so authorized in any such certificate
previously delivered and not superseded.
7.3. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Issuer, its
Subsidiaries (including any Guarantors) or their respective Affiliates with the
same rights it would have if it were not Trustee. Any Agent may do the same with
like rights. However, the Trustee must comply with Sections 7.10 and 7.11.
7.4. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture, any Guarantee or the
Securities, it shall not be accountable for the Issuer's use of the proceeds
from the Securities, and it shall not be responsible for any statement of the
Issuer in this Indenture or any document issued in connection with the sale of
Securities or any statement in the Securities other than the Trustee's
certificate of authentication. The Trustee makes no representations with respect
to the effectiveness or adequacy of this Indenture.
7.5. NOTICE OF DEFAULT.
If a Default or an Event of Default occurs and is continuing and the
Trustee receives actual notice of such Default or Event of Default, the Trustee
shall mail to each Securityholder notice of the uncured Default or Event of
Default within 90 days after such Default or Event of Default occurs. Except in
the case of a Default or an Event of Default in payment of Accreted Value of,
premium, if any, or interest on, if any, any Security, including an accelerated
payment and the failure to make payment on the Change of Control Payment Date
pursuant to a Change of Control Offer or the Net Proceeds Offer Payment Date
pursuant to a Net Proceeds Offer, the Trustee may withhold the notice if and so
long as the Board of Directors, the executive committee, or a trust committee of
directors and/or Responsible Officers, of the
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Trustee in good faith determines that withholding the notice is in the interest
of the Securityholders.
7.6. REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each May 15, beginning with the first May 15
following the date of this Indenture, the Trustee shall, to the extent that any
of the events described in TIA Section 313(a) occurred within the previous
twelve months, but not otherwise, mail to each Securityholder a brief report
dated as of such date that complies with TIA Section 313(a). The Trustee also
shall comply with TIA Sections 313(b), 313(c) and 313(d).
A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Issuer and filed with the Commission and each securities
exchange, if any, on which the Securities are listed.
The Issuer shall notify the Trustee if the Securities become listed on
any securities exchange or of any delisting thereof and the Trustee shall comply
with TIA Section 313(d).
7.7. COMPENSATION AND INDEMNITY.
The Issuer shall pay to the Trustee, from time to time, such
compensation for its services hereunder as the Issuer and the Trustee shall from
time to time agree in writing. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Issuer shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances (including reasonable fees and expenses of counsel) incurred or
made by it in addition to the compensation for its services, except any such
disbursements, expenses and advances as may be attributable to the Trustee's
negligence, bad faith or willful misconduct. Such expenses shall include the
reasonable fees and expenses of the Trustee's agents and counsel.
The Issuer shall indemnify the Trustee and its agents, employees,
officers, stockholders and directors for, and hold them harmless against, any
loss, liability or expense (including reasonable attorneys' fees and expenses)
incurred by them except for such actions to the extent caused by any negligence,
bad faith or willful misconduct on their part, arising out of or in connection
with the acceptance or administration of this trust including the cost and
expense of enforcing this Indenture and the Securities against the Issuer
(including this Section 7.7) including the reasonable costs and expenses of
defending themselves against or investigating any claim (whether asserted by the
Issuer, any Holder or any other Person) or liability in connection with the
exercise or performance of any of the Trustee's rights, powers or duties
hereunder. The Trustee shall notify the Issuer promptly of any claim asserted
against the Trustee or any of its agents, employees, officers, stockholders and
directors for which it may seek indemnity, PROVIDED that any failure to so
notify the Issuer shall not relieve the Issuer of
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its indemnity obligations hereunder. The Issuer may, subject to the approval of
the Trustee, defend the claim and the Trustee shall cooperate in the defense.
The Trustee and its agents, employees, officers, stockholders and directors
subject to the claim may have separate counsel and the Issuer shall pay the
reasonable fees and expenses of such counsel; PROVIDED, HOWEVER, that the Issuer
will not be required to pay such fees and expenses if, subject to the approval
of the Trustee, it assumes the Trustee's defense and there is no conflict of
interest between the Issuer and the Trustee and its agents, employees, officers,
stockholders and directors subject to the claim in connection with such defense
as reasonably determined by the Trustee. The Issuer need not pay for any
settlement made without its written consent, which consent will not be
unreasonably withheld, delayed or conditioned. The Issuer need not reimburse any
expense or indemnify against any loss or liability to the extent incurred by the
Trustee through its negligence, bad faith or willful misconduct.
To secure the Issuer's payment obligations in this Section 7.7, the
Trustee shall have a Lien prior to the Securities against all money or property
held or collected by the Trustee, in its capacity as Trustee. The obligations of
the Issuer under this Section shall not be subordinated except with respect to
assets or money held in trust to pay principal of, premium, if any, or interest
on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in clause (vi) or (vii) of Section 6.1 occurs, such expenses
and the compensation for such services shall be paid to the extent allowed under
any Bankruptcy Law.
Notwithstanding any other provision in this Indenture, the foregoing
provisions of this Section 7.7 shall survive the satisfaction and discharge of
this Indenture or the appointment of a successor Trustee.
7.8. REPLACEMENT OF TRUSTEE.
The Trustee may resign at any time by so notifying the Issuer in
writing. The Holders of a majority in principal amount at maturity of the
outstanding Securities may remove the Trustee by so notifying the Issuer and the
Trustee and may appoint a successor Trustee. The Issuer may remove the Trustee
if:
(i) the Trustee fails to comply with Section 7.10;
(ii) the Trustee is adjudged bankrupt or insolvent;
(iii) a receiver or other public officer takes charge of the
Trustee or its property; or
(iv) the Trustee becomes incapable of acting.
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If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuer shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount at
maturity of the Securities may appoint a successor Trustee to replace the
successor Trustee appointed by the Issuer.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Immediately after that,
the retiring Trustee shall transfer, after payment of all sums then owing to the
Trustee pursuant to Section 7.7, all property held by it as Trustee to the
successor Trustee, subject to the Lien provided in Section 7.7, 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. A successor Trustee shall mail notice of its succession to each
Securityholder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee at the Issuer's
expense, the Issuer or the Holders of at least 10% in principal amount at
maturity of the outstanding Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.8, the Issuer's and the Guarantors' obligations under Section 7.7 shall
continue for the benefit of the retiring Trustee.
7.9. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee; PROVIDED that such
corporation shall be otherwise qualified and eligible under this Article Seven.
7.10. ELIGIBILITY; DISQUALIFICATION.
This Indenture shall always have a Trustee who satisfies the
requirement of TIA Sections 310(a)(1), 310(a)(2) and 310(a)(5). The Trustee
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition. In addition, if the
Trustee is a corporation included in a bank holding company system, the Trustee,
independently of the bank holding company, shall meet the capital requirements
of TIA
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Section 310(a)(2). The Trustee shall comply with TIA Section 310(b); PROVIDED,
HOWEVER, that there shall be excluded from the operation of TIA Section
310(b)(1) any indenture or indentures under which other securities, or
certificates of interest or participation in other securities, of the Issuer are
outstanding, if the requirements for such exclusion set forth in TIA Section
310(b)(1) are met. The provisions of TIA Section 310 shall apply to the Issuer
and any other obligor of the Securities.
7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE ISSUER.
The Trustee, in its capacity as Trustee hereunder, shall comply with
TIA Section 311(a), excluding any creditor relationship listed in TIA Section
311(b). A Trustee who has resigned or been removed shall be subject to TIA
Section 311(a) to the extent indicated.
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
8.1. TERMINATION OF THE ISSUER'S OBLIGATIONS.
The Issuer may terminate its obligations under the Securities and this
Indenture, except those obligations referred to in the penultimate paragraph of
this Section 8.1, if all Securities previously authenticated and delivered
(other than destroyed, lost or stolen Securities which have been replaced or
paid or Securities for whose payment U.S. Legal Tender has theretofore been
deposited with the Trustee or the Paying Agent in trust or segregated and held
in trust by the Issuer and thereafter repaid to the Issuer, as provided in
Section 8.5) have been delivered to the Trustee for cancellation and the Issuer
has paid all sums payable by them hereunder, or if:
(i) either (i) pursuant to Article Three, the Issuer shall
have given notice to the Trustee and mailed a notice of redemption to
each Holder of the redemption of all of the Securities in accordance
with the provisions hereof or (ii) all Securities have otherwise
become due and payable hereunder;
(ii) the Issuer shall have irrevocably deposited or caused
to be deposited with the Trustee or a trustee satisfactory to the
Trustee, under the terms of an irrevocable trust agreement in form and
substance satisfactory to the Trustee, as trust funds in trust solely
for the benefit of the Holders of that purpose, U.S. Legal Tender in
such amount as is sufficient without consideration of reinvestment of
such interest, to pay Accreted Value of, premium, if any, and
interest, if any, on the outstanding Securities to maturity or
redemption; PROVIDED that the Trustee shall have been irrevocably
instructed
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to apply such U.S. Legal Tender to the payment of said Accreted Value,
premium, if any, and interest, if any, with respect to the Securities;
(iii) no Default or Event of Default with respect to this
Indenture or the Securities shall have occurred and be continuing on
the date of such deposit or shall occur as a result of such deposit
(other than a Default or Event of Default resulting from the
incurrence of Indebtedness all or a portion of the proceeds of which
will be used to defease the Securities pursuant to this Article Eight
concurrently with such incurrence) and such deposit will not result in
a breach or violation of, or constitute a default under, any other
instrument or agreement (including, without limitation, the Credit
Agreement) to which either the Issuer or any Restricted Subsidiary is
bound is a party or by which either is bound;
(iv) the Issuer shall have paid all other sums payable by it
hereunder; and
(v) the Issuer shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent providing for or relating to the termination of
the Issuer's obligations under the Securities and this Indenture have
been complied with. Such Opinion of Counsel shall also state that such
satisfaction and discharge does not result in a default under the
Credit Agreement or any other material agreement or instrument then
known to such counsel that binds or affects the Issuer.
Subject to the next sentence and notwithstanding the foregoing
paragraph, the Issuer's obligations in Sections 2.5, 2.6, 2.7, 2.8, 4.1, 4.2,
7.7, 8.5 and 8.6 shall survive until the Securities are no longer outstanding
pursuant to the last paragraph of Section 2.8. After the Securities are no
longer outstanding, the Issuer's obligations in Sections 7.7, 8.5 and 8.6 shall
survive.
After such delivery or irrevocable deposit, the Trustee upon request
shall acknowledge in writing the discharge of the Issuer's obligations under the
Securities and this Indenture except for those surviving obligations specified
above.
8.2. LEGAL DEFEASANCE AND COVENANT DEFEASANCE.
(a) The Issuer may, at its option by Board Resolutions of the Board
of Directors of the Issuer, at any time, elect to have either paragraph (b) or
(c) below applied to all outstanding Securities upon compliance with the
conditions set forth in Section 8.3.
(b) Upon the Issuer's exercise under paragraph (a) hereof of the
option applicable to this paragraph (b), the Issuer shall, subject to the
satisfaction of the conditions set forth in Section 8.3, be deemed to have been
discharged from its obligations with respect to all outstanding
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Securities on the date the conditions set forth below are satisfied
(hereinafter, "LEGAL DEFEASANCE"). For this purpose, Legal Defeasance means that
the Issuer shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Securities, which shall thereafter be deemed to
be "outstanding" only for the purposes of Section 8.4 and the other Sections of
this Indenture referred to in (i) and (ii) below, and to have satisfied all its
other obligations under such Securities and this Indenture (and the Trustee, on
demand of and at the expense of the Issuer, shall execute proper instruments
acknowledging the same), except for the following provisions, which shall
survive until otherwise terminated or discharged hereunder: (i) the rights of
Holders of outstanding Securities to receive solely from the trust fund
described in Section 8.4, and as more fully set forth in such Section, payments
in respect of the Accreted Value of, premium, if any, and interest, if any, on
such Securities when such payments are due, (ii) the Company's obligations with
respect to such Securities under Article Two and Section 4.2, (iii) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the Company's
obligations in connection therewith and (iv) this Article Eight. Subject to
compliance with this Article Eight, the Issuer may exercise its option under
this paragraph (b) notwithstanding the prior exercise of its option under
paragraph (c) hereof.
(c) Upon the Issuer's exercise under paragraph (a) hereof of the
option applicable to this paragraph (c), the Issuer shall, subject to the
satisfaction of the conditions set forth in Section 8.3, be released from its
obligations, if any, under the covenants contained in Sections 4.3 and 4.4 and
Sections 4.12 through 4.17 and Article Five with respect to the outstanding
Securities on and after the date the conditions set forth below are satisfied
(hereinafter, "COVENANT DEFEASANCE"), and the Securities shall thereafter be
deemed not "OUTSTANDING" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "OUTSTANDING"
for all other purposes hereunder (it being understood that such Securities shall
not be deemed outstanding for accounting purposes). For this purpose, such
Covenant Defeasance means that, with respect to the outstanding Securities, the
Company may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such covenant, whether directly
or indirectly, by reason of any reference elsewhere herein to any such covenant
or by reason of any reference in any such covenant to any other provision herein
or in any other document and such omission to comply shall not constitute a
Default or an Event of Default under Section 6.1(iii), but, except as specified
above, the remainder of this Indenture and such Securities shall be unaffected
thereby. In addition, upon the Issuer's exercise under paragraph (a) hereof of
the option applicable to this paragraph (c), subject to the satisfaction of the
conditions set forth in Section 8.3 hereof, Sections 6.1(iii), 6.1(iv) and
6.1(v) shall not constitute Events of Default.
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8.3. CONDITIONS TO LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.2(b) or 8.2(c) to the outstanding Securities:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(i) the Issuer must irrevocably deposit with the Trustee,
in trust, for the benefit of the Holders, U.S. Legal Tender or
non-callable U.S. Government Obligations which through the scheduled
payment of principal, premium, if any, and interest in respect thereof
in accordance with their terms, will provide, not later than one day
before the due date of any payment on the Securities, U.S. Legal
Tender, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if
any, and interest on the Securities on the stated date for payment
thereof or on the applicable redemption date, as the case may be;
(ii) in the case of an election under Section 8.2(b), the
Issuer shall have delivered to the Trustee an Opinion of Counsel in
the United States reasonably acceptable to the Trustee confirming that
(a) the Issuer has received from, or there has been published by, the
Internal Revenue Service a ruling or (b) since the date of the
execution of this Indenture, there has been a change in the applicable
federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders 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;
(iii) in the case of an election under Section 8.2(c), the
Issuer shall have delivered to the Trustee an Opinion of Counsel in
the United States reasonably acceptable to the Trustee confirming that
the Holders of the Securities 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;
(iv) 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 incurrence of Indebtedness all or
a portion of the proceeds of which will be used to defease the
Securities pursuant to this Article Eight concurrently with such
incurrence) or insofar as Sections 6.1(vi) and 6.1(vii) hereof are
concerned, at any time in the period ending on the 91st day after the
date of such deposit;
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(v) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under this
Indenture (other than a Default or Event of Default resulting from the
incurrence of Indebtedness all or a portion of the proceeds of which
will be used to defease the Securities pursuant to this Article Eight
concurrently with such incurrence), the Credit Agreement or any other
material agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound;
(vi) the Issuer shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the
Issuer with the intent of preferring the Holders over any other
creditors of the Issuer or with the intent of defeating, hindering,
delaying or defrauding any other creditors of the Issuer or others;
(vii) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent hereunder provided for or relating to the Legal
Defeasance or the Covenant Defeasance have been complied with; and
(viii) the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that assuming no intervening
bankruptcy or insolvency of the Company between the date of deposit
and the 91st day following the deposit and that no Holder is an
insider of the Company, after the 91st day following the deposit, the
trust funds will not be subject to the effect of Xxxxxxx 000 xx xxx
Xxxxxx Xxxxxx Bankruptcy Code or Section 15 of the New York Debtor and
Creditor Law.
Notwithstanding the foregoing, the Opinion of Counsel required by
clause (ii) above of this Section 8.3 need not be delivered if all Securities
not theretofore delivered to the Trustee for cancellation (i) have become due
and payable, (ii) will become due and payable on the Maturity Date within one
year or (iii) are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the Company.
8.4. APPLICATION OF TRUST MONEY.
The Trustee or Paying Agent shall hold in trust U.S. Legal Tender or
U.S. Government Obligations deposited with it pursuant to this Article Eight,
and shall apply the deposited U.S. Legal Tender and the money from U.S.
Government Obligations in accordance with this Indenture to the payment of
Accreted Value of, premium, if any, and interest, if any, on the Securities.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Legal Tender or U.S.
Government Obligations deposited
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pursuant to Section 8.3 hereof or the Accreted Value, premium, if any, and
interest received, if any, 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
Securities.
Anything in this Article Eight to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuer from time to time upon the Issuer's
request any U.S. Legal Tender or U.S. Government Obligations held by it as
provided in Section 8.3 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
8.5. REPAYMENT TO THE ISSUER.
The Trustee and the Paying Agent shall pay to the Issuer upon request
any money held by them for the payment of Accreted Value, premium, if any, or
interest, if any, that remains unclaimed for two years; PROVIDED that the
Trustee or such Paying Agent, before being required to make any payment, may at
the expense of the Issuer cause to be published once in a newspaper of general
circulation in The City of New York or mail to each Holder entitled to such
money notice that such money remains unclaimed and that after a date specified
therein which shall be at least 30 days from the date of such publication or
mailing any unclaimed balance of such money then remaining will be repaid to the
Issuer. After payment to the Issuer, Holders entitled to such money must look to
the Issuer for payment as general creditors unless an applicable law designates
another Person.
8.6. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any U.S. Legal
Tender or U.S. Government Obligations in accordance with this Article Eight by
reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, the Issuer's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Eight until such time as the Trustee or Paying Agent is
permitted to apply all such U.S. Legal Tender or U.S. Government Obligations in
accordance with this Article Eight; PROVIDED that if the Issuer has made any
payment of interest on, premium, if any, or principal of any Securities because
of the reinstatement of its obligations, the Issuer shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the U.S.
Legal Tender or U.S. Government Obligations held by the Trustee or Paying Agent.
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ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
9.1. WITHOUT CONSENT OF HOLDERS.
Subject to Section 9.3, the Issuer and the Trustee, together, may
amend or supplement this Indenture or the Securities without notice to or
consent of any Securityholder:
(i) to cure any ambiguity, defect or inconsistency, so long
as such change does not, in the good faith determination of the Board
of Directors of the Company, adversely affect the rights of any of the
Holders in any material respect. In formulating its determination on
such matters, the Board of Directors of the Company will be entitled
to rely on such evidence as it deems appropriate;
(ii) to evidence the succession in accordance with Article
Five of another Person to the Company and the assumption by any such
successor of the covenants of the Company herein and in the
Securities;
(iii) to provide for uncertificated Securities in addition to
or in place of certificated Securities;
(iv) to make any other change that does not adversely affect
the rights of any Securityholders hereunder in any material respect;
(v) to comply with any requirements of the Commission in
connection with the qualification of this Indenture under the TIA;
(vi) to add or release any Guarantor pursuant to the terms
of this Indenture; or
(vii) to provide for issuance of the Exchange Notes, which
will have terms substantially identical in all material respects to
the Initial Notes (except that the transfer restrictions contained in
the Initial Notes will be modified or eliminated, as appropriate), and
which will be treated together with any outstanding Initial Notes, as
a single issue of securities, PROVIDED that for purposes of this
clause (vii), the terms Initial Notes and Exchange Notes, shall
include any other Securities issued in accordance with clause (iii) of
the fourth paragraph of Section 2.2 or Securities issued in exchange
therefor which are identical in all material respects to such
Securities (except that the transfer restrictions on the Securities
issued in exchange for Securities issued in accordance
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with clause (iii) of the fourth paragraph of Section 2.2 shall be
modified or eliminated, as appropriate);
PROVIDED that the Company has delivered to the Trustee an Opinion of Counsel and
an Officers' Certificate, each stating that such amendment or supplement
complies with the provisions of this Section 9.1.
9.2. WITH CONSENT OF HOLDERS.
Subject to Sections 6.7 and 9.3, the Issuer and the Trustee, together,
with the written consent of the Holder or Holders of at least a majority in
aggregate principal amount at maturity of the outstanding Securities, may amend
or supplement this Indenture or the Securities without notice to any other
Securityholders. Subject to Sections 6.7 and 9.3, the Holder or Holders of a
majority in aggregate principal amount at maturity of the outstanding Securities
may waive compliance by the Issuer with any provision of this Indenture or the
Securities without notice to any other Securityholder. Without the consent of
each Securityholder affected, however, no amendment, supplement or waiver,
including a waiver pursuant to (and to the extent provided in) Section 6.4, may:
(i) reduce the amount of Securities whose Holders must
consent to an amendment, supplement or waiver;
(ii) reduce the rate of or change or have the effect of
changing the time for payment of interest, including default interest,
on any Security;
(iii) reduce the principal or Accreted Value of or change or
have the effect of changing the fixed maturity of any Security, or
change the date on which any Securities may be subject to redemption
or reduce the redemption price therefor;
(iv) make any Securities payable in money other than that
stated in the Securities;
(v) make any change in provisions of this Indenture
protecting the right of each Holder to receive payment of Accreted
Value of, premium, if any, and interest, if any, on such Security on
or after the due date thereof or to bring suit to enforce such
payment, or permitting Holders of a majority in principal amount at
maturity of the Securities to waive Defaults or Events of Default;
(vi) modify or change any provision of this Indenture or the
related definitions affecting ranking of the Securities in a manner
which adversely affects the Holders;
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(vii) amend, change or modify in any material respect the
obligation of the Issuer to make and consummate a Change of Control
Offer in the event of a Change of Control which has occurred or modify
any of the provisions or definitions with respect thereto after a
Change of Control has occurred; or
(viii) make any changes in Section 6.4, 6.7 or this
Section 9.2.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.2
becomes effective, the Issuer shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Issuer to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
9.3. COMPLIANCE WITH TIA.
From the date on which this Indenture is qualified under the TIA,
every amendment, waiver or supplement of this Indenture or the Securities or any
Guarantee shall comply with the TIA as then in effect.
9.4. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of his Security by notice to the Trustee
or the Issuer received before the date on which the Trustee receives an
Officers' Certificate certifying that the Holders of the requisite principal
amount at maturity of Securities have consented (and not theretofore revoked
such consent) to the amendment, supplement or waiver.
The Issuer may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the last
sentence of the immediately preceding paragraph, those Persons who were Holders
at such record date (or their duly designated proxies), and only those Persons,
shall be entitled to revoke any consent previously given, whether or not such
Persons continue to be Holders after such record date. No such consent shall be
valid or effective for more than 90 days after such record date.
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After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(i) through (vii) of Section 9.2, in which case, the amendment, supplement or
waiver shall bind only each Holder of a Security who has consented to it and
every subsequent Holder of a Security or portion of a Security that evidences
the same debt as the consenting Holder's Security; PROVIDED that any such waiver
shall not impair or affect the right of any Holder to receive payment of
principal of, premium, if any, and interest on a Security, on or after the
respective due dates expressed in such Security, or to bring suit for the
enforcement of any such payment on or after such respective dates without the
consent of such Holder.
9.5. NOTATION ON OR EXCHANGE OF SECURITIES.
If an amendment, supplement or waiver changes the terms of a Security,
the Issuer may require the Holder of the Security to deliver it to the Trustee.
The Issuer shall provide the Trustee with an appropriate notation on the
Security about the changed terms and cause the Trustee to return it to the
Holder at the Issuer's expense. Alternatively, if the Issuer or the Trustee so
determines, the Issuer in exchange for the Security shall issue and the Trustee
shall authenticate a new Security that reflects the changed terms. Failure to
make the appropriate notation or issue a new Security shall not affect the
validity and effect of such amendment, supplement or waiver.
9.6. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article Nine; PROVIDED that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel and an Officers' Certificate
each complying with Sections 11.4 and 11.5 and stating that the execution of any
amendment, supplement or waiver authorized pursuant to this Article Nine is
authorized or permitted by this Indenture and constitutes the legal, valid and
binding obligations of the Issuer enforceable in accordance with its terms. Such
Opinion of Counsel shall be at the expense of the Issuer.
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ARTICLE TEN
GUARANTEE OF SECURITIES
10.1. UNCONDITIONAL GUARANTEE.
Subject to the provisions of this Article Ten, each Guarantor, if any,
upon the execution and delivery of a Guarantee pursuant to Section 4.14, shall
hereby, jointly and severally, unconditionally and irrevocably guarantee (such
guarantee to be referred to herein as the "GUARANTEE") to each Holder of a
Security authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of this
Indenture, the Securities or the obligations of the Issuer or any other
Guarantors to the Holders or the Trustee hereunder or thereunder, that: (a) the
Accreted Value of, premium, if any, and interest, if any, on the Securities
shall be duly and punctually paid in full when due, whether at maturity, upon
redemption at the option of Holders pursuant to the provisions of the Securities
relating thereto, by acceleration or otherwise, and interest on the overdue
Accreted Value and (to the extent permitted by law) interest, if any, on the
Securities and all other obligations of the Issuer or the Guarantors to the
Holders or the Trustee hereunder or thereunder (including amounts due the
Trustee under Section 7.7 hereof) and all other obligations shall be promptly
paid in full or performed, all in accordance with the terms hereof and thereof;
and (b) in case of any extension of time of payment or renewal of any Securities
or any of such other obligations, the same shall be promptly paid in full when
due or performed in accordance with the terms of the extension or renewal,
whether at maturity, by acceleration or otherwise. Failing payment when due of
any amount so guaranteed, or failing performance of any other obligation of the
Issuer to the Holders under this Indenture or under the Securities, for whatever
reason, such Guarantor shall be obligated to pay, or to perform or cause the
performance of, the same immediately. An Event of Default under this Indenture
or the Securities shall constitute an event of default under the Guarantees, and
shall entitle the Holders of Securities to accelerate the obligations of the
Guarantors hereunder in the same manner and to the same extent as the
obligations of the Issuer.
Each Guarantor, if any, upon the execution and delivery of a Guarantee
pursuant to Section 4.14, shall hereby agree that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions hereof or thereof, any release of any other Guarantor,
if any, the recovery of any judgment against the Issuer, any action to enforce
the same, whether or not a Guarantee is affixed to any particular Security, or
any other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a Guarantor. Each Guarantor, if any, upon the execution
and delivery of a Guarantee pursuant to Section 4.14, shall hereby
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waive the benefit of diligence, presentment, demand of payment, filing of claims
with a court in the event of insolvency or bankruptcy of Issuer, any right to
require a proceeding first against the Issuer, protest, notice and all demands
whatsoever and covenants that its Guarantee shall not be discharged except by
complete performance of the obligations contained in the Securities, this
Indenture and the Guarantees. Each Guarantee is a guarantee of payment and not
of collection. If any Holder or the Trustee is required by any court or
otherwise to return to the Issuer or to any Guarantor, or any custodian,
trustee, liquidator or other similar official acting in relation to such Issuer
or such Guarantor, any amount paid by such Issuer or such Guarantor to the
Trustee or such Holder, each Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each Guarantor, if any, upon the
execution and delivery of a Guarantee pursuant to Section 4.14, shall hereby
further agree that, as between it, on the one hand, and the Holders of
Securities and the Trustee, on the other hand, (a) subject to this Article Ten,
the maturity of the obligations guaranteed hereby may be accelerated as provided
in Article Six hereof for the purposes of the Guarantees, notwithstanding any
stay, injunction or other prohibition preventing such acceleration in respect of
the obligations guaranteed hereby, and (b) in the event of any acceleration of
such obligations as provided in Article Six hereof, such obligations (whether or
not due and payable) shall forthwith become due and payable by the Guarantors
for the purpose of the Guarantees.
No Affiliate, stockholder, officer, director, limited liability
company member or employee, past, present or future, of any Guarantor, as such,
shall have any personal liability under such Guarantor's Guarantee by reason of
his, her or its status as such Affiliate, stockholder, officer, director,
limited liability company member or employee.
10.2. LIMITATIONS ON GUARANTEES.
The obligations of any Guarantor under its Guarantee shall be limited
to the maximum amount which, after giving effect to all other contingent and
fixed liabilities of such Guarantor and after giving effect to any collections
from or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant to its
contribution obligations under this Indenture, will result in the obligations of
such Guarantor under the Guarantee not constituting a fraudulent conveyance or
fraudulent transfer under federal or state law. Each Guarantor that makes a
payment or distribution under a Guarantee shall be entitled to a contribution
from each other Guarantor in an amount PRO RATA, based on the net assets of each
Guarantor, determined in accordance with GAAP.
10.3. EXECUTION AND DELIVERY OF GUARANTEE.
To further evidence the Guarantees set forth in Section 10.1, each
Guarantor, if any, upon the execution and delivery of a Guarantee pursuant to
Section 4.14, hereby agrees that a notation of its Guarantee, substantially in
the form of EXHIBIT E hereto, shall be endorsed on each Security authenticated
and delivered by the Trustee. The Guarantee of any Guarantor
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shall be executed on behalf of such Guarantor by either manual or facsimile
signature of two Officers of such Guarantor, each of whom, in each case, shall
have been duly authorized to so execute by all requisite corporate action. The
validity and enforceability of any Guarantee shall not be affected by the fact
that it is not affixed to any particular Security.
Each Guarantor, if any, upon the execution and delivery of a Guarantee
pursuant to Section 4.14, hereby agrees that its Guarantee set forth in Section
10.1 shall remain in full force and effect notwithstanding any failure to
endorse on each Security a notation of such Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or a
Guarantee no longer holds that office at the time the Trustee authenticates the
Security on which such Guarantee is endorsed or at any time thereafter, such
Guarantor's Guarantee of such Security shall nevertheless be valid.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantee set forth in
this Indenture on behalf of each Guarantor.
10.4. RELEASE OF A GUARANTOR.
(a) If no Default or Event of Default exists or would exist under
this Indenture, upon the sale or disposition of all of the Capital Stock of a
Guarantor by the Company or any Restricted Subsidiary of the Company, in a
transaction or series of related transactions that either (i) does not
constitute an Asset Sale or (ii) constitutes an Asset Sale and such Asset Sale
is not in violation of Section 4.17, or upon the consolidation or merger of a
Guarantor with or into any Person in compliance with Article Five (in each case,
other than to the Company or an Affiliate of the Company), or if any Guarantor
is dissolved or liquidated in accordance with this Indenture, such Guarantor's
Guarantee will be automatically discharged and such Guarantor shall be released
from all obligations under this Article Ten without any further action required
on the part of the Trustee or any Holder. Any Guarantor not so released or the
entity surviving such Guarantor, as applicable, shall remain or be liable under
its Guarantee as provided in this Article Ten.
(b) In addition, each such Guarantee will be automatically
discharged and the Guarantor party thereto shall be released from all
obligations under this Article Ten without any further action on the part of the
Trustee or any Holder upon (i) the release or discharge of the guarantee which
resulted in the creation of such Guarantee under such Section 4.14, except a
discharge or release by or as a result of payment under such Guarantee or (ii)
the designation of such Guarantor as an Unrestricted Subsidiary in accordance
with the provisions of this Indenture. Any Guarantor not so released or the
entity surviving such Guarantor, as applicable, shall remain or be liable under
its Guarantee as provided in this Article Ten.
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(c) The obligations of each Guarantor will be automatically released
upon such Guarantor ceasing to be a subsidiary of the Issuer as a result of any
foreclosure on any pledge or security interest securing Obligations with respect
to the Credit Agreement or other exercise of remedies in respect thereof if such
Guarantor is released from its guarantee of Obligations with respect to the
Credit Agreement.
(d) The Trustee shall deliver an appropriate instrument evidencing
the release of a Guarantor upon receipt of a request by the Issuer or such
Guarantor accompanied by an Officers' Certificate and an Opinion of Counsel
certifying as to the compliance with this Section 10.4; PROVIDED, HOWEVER, that
the legal counsel delivering such Opinion of Counsel may rely as to matters of
fact on one or more Officers' Certificates of the Company.
The Trustee shall execute any documents reasonably requested by the
Issuer or a Guarantor in order to evidence the release of such Guarantor from
its obligations under its Guarantee endorsed on the Securities and under this
Article Ten.
Except as set forth in Articles Four and Five and this Section 10.4,
nothing contained in this Indenture or in any of the Securities shall prevent
any consolidation or merger of a Guarantor with or into the Issuer 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 Issuer or another
Guarantor.
10.5. WAIVER OF SUBROGATION.
Until this Indenture is discharged and all of the Securities are
discharged and paid in full, each Guarantor, upon the execution and delivery of
a Guarantee pursuant to Section 4.14, shall hereby irrevocably waive and agrees
not to exercise any claim or other rights which it may now or hereafter acquire
against the Issuer that arise from the existence, payment, performance or
enforcement of the Issuer's obligations under the Securities or this Indenture
and such Guarantor's obligations under its Guarantee and this Indenture, in any
such instance, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution, indemnification, and any right to
participate in any claim or remedy of the Holders against the Issuer, whether or
not such claim, remedy or right arises in equity, or under contract, statute or
common law, including, without limitation, the right to take or receive from the
Issuer, directly or indirectly, in cash or other property or by setoff or in any
other manner, payment or security on account of such claim or other rights. If
any amount shall be paid to any Guarantor in violation of the preceding sentence
and any amounts owing to the Trustee or the Holders of Securities under the
Securities, this Indenture, or any other document or instrument delivered under
or in connection with such agreements or instruments, shall not have been paid
in full, such amount shall have been deemed to have been paid to such Guarantor
for the benefit of, and held in trust for the benefit of, the Trustee or the
Holders and shall forthwith be paid to the Trustee for the benefit of itself or
such Holders to be credited and applied
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to the obligations in favor of the Trustee or the Holders, as the case may be,
whether matured or unmatured, in accordance with the terms of this Indenture.
Each Guarantor acknowledges that it will receive direct and indirect benefits
from the financing arrangements contemplated by this Indenture and that the
waiver set forth in this Section 10.5 is knowingly made in contemplation of such
benefits.
10.6. IMMEDIATE PAYMENT.
Each Guarantor, upon the execution and delivery of a Guarantee
pursuant to Section 4.14, shall hereby agree to make immediate payment to the
Trustee, on behalf of the Holders or itself, of all Obligations due and owing or
payable to the respective Holders or the Trustee upon receipt of a demand for
payment therefor by the Trustee to such Guarantor in writing.
10.7. NO SETOFF.
Each payment to be made by a Guarantor hereunder in respect of the
Obligations shall be payable in the currency or currencies in which such
Obligations are denominated, and shall be made without setoff, counterclaim,
reduction or diminution of any kind or nature.
10.8. OBLIGATIONS ABSOLUTE.
The obligations of each Guarantor hereunder are and shall be absolute
and unconditional and any monies or amounts expressed to be owing or payable by
each Guarantor hereunder which may not be recoverable from such Guarantor on the
basis of a Guarantee shall be recoverable from such Guarantor as a primary
obligor and principal debtor in respect thereof.
10.9. OBLIGATIONS CONTINUING.
The obligations of each Guarantor hereunder shall be continuing and
shall remain in full force and effect until all the obligations have been paid
and satisfied in full. Upon the execution and delivery of a Guarantee pursuant
to Section 4.14, each Guarantor shall hereby agree with the Trustee that it will
from time to time deliver to the Trustee suitable acknowledgments of its
continued liability hereunder and under any other instrument or instruments in
such form as counsel to the Trustee may advise and as will prevent any action
brought against it in respect of any default hereunder being barred by any
statute of limitations now or hereafter in force and, in the event of the
failure of a Guarantor so to do, it hereby irrevocably appoints the Trustee the
attorney and agent of such Guarantor to make, execute and deliver such written
acknowledgment or acknowledgments or other instruments as may from time to time
become necessary or advisable, in the judgment of the Trustee on the advice of
counsel, to fully maintain and keep in force the liability of such Guarantor
hereunder and under its Guarantee.
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10.10. OBLIGATIONS NOT REDUCED.
The obligations of each Guarantor hereunder shall not be satisfied,
reduced or discharged solely by the payment of such principal, premium, if any,
interest, fees and other monies or amounts as may at any time prior to discharge
of this Indenture pursuant to Article Eight be or become owing or payable under
or by virtue of or otherwise in connection with the Securities or this
Indenture.
10.11. OBLIGATIONS REINSTATED.
The obligations of each Guarantor hereunder shall continue to be
effective or shall be reinstated, as the case may be, if at any time any payment
which would otherwise have reduced the obligations of any Guarantor hereunder
(whether such payment shall have been made by or on behalf of the Issuer or by
or on behalf of a Guarantor) is rescinded or reclaimed from any of the Holders
upon the insolvency, bankruptcy, liquidation or reorganization of the Issuer or
any Guarantor or otherwise, all as though such payment had not been made. If
demand for, or acceleration of the time for, payment by the Issuer is stayed
upon the insolvency, bankruptcy, liquidation or reorganization of such Issuer,
all such Indebtedness otherwise subject to demand for payment or acceleration
shall nonetheless be payable by each Guarantor as provided herein.
10.12. OBLIGATIONS NOT AFFECTED.
The obligations of each Guarantor hereunder shall not be affected,
impaired or diminished in any way by any act, omission, matter or thing
whatsoever, occurring before, upon or after any demand for payment hereunder
(and whether or not known or consented to by any Guarantor or any of the
Holders) which, but for this provision, might constitute a whole or partial
defense to a claim against any Guarantor hereunder or might operate to release
or otherwise exonerate any Guarantor from any of its obligations hereunder or
otherwise affect such obligations, whether occasioned by default of any of the
Holders or otherwise, including, without limitation:
(i) any limitation of status or power, disability,
incapacity or other circumstance relating to the Issuer or any other
Person, including any insolvency, bankruptcy, liquidation,
reorganization, readjustment, composition, dissolution, winding-up or
other proceeding involving or affecting such Issuer or any other
Person;
(ii) any irregularity, defect, unenforceability or
invalidity in respect of any indebtedness or other obligation of the
Issuer or any other Person under this Indenture, the Securities or any
other document or instrument;
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(iii) any failure of the Issuer, whether or not without fault
on its part, to perform or comply with any of the provisions of this
Indenture or the Securities, or to give notice thereof to a Guarantor;
(iv) the taking or enforcing or exercising or the refusal or
neglect to take or enforce or exercise any right or remedy from or
against the Issuer or any other Person or their respective assets or
the release or discharge of any such right or remedy;
(v) the granting of time, renewals, extensions,
compromises, concessions, waivers, releases, discharges and other
indulgences to the Issuer or any other Person;
(vi) any change in the time, manner or place of payment of,
or in any other term of, any of the Securities, or any other
amendment, variation, supplement, replacement or waiver of, or any
consent to departure from, any of the Securities or this Indenture,
including, without limitation, any increase or decrease in the
Accreted Value or principal amount at maturity of or premium, if any,
or interest on any of the Securities;
(vii) any change in the ownership, control, name, objects,
businesses, assets, capital structure or constitution of the Issuer or
a Guarantor;
(viii) any merger or amalgamation of the Issuer or a Guarantor
with any Person or Persons;
(ix) the occurrence of any change in the laws, rules,
regulations or ordinances of any jurisdiction by any present or future
action of any governmental authority or court amending, varying,
reducing or otherwise affecting, or purporting to amend, vary, reduce
or otherwise affect, any of the Obligations or the obligations of a
Guarantor under its Guarantee; and
(x) any other circumstance, including release of a
Guarantor pursuant to Section 10.4 (other than by complete,
irrevocable payment) that might otherwise constitute a legal or
equitable discharge or defense of the Issuer under this Indenture or
the Securities or of another Guarantor in respect of its Guarantee
hereunder;
PROVIDED, that the provisions of this Section 10.12 are not intended to affect
in any way any release of a Guarantor in accordance with the provisions of
Section 10.4.
10.13. WAIVER.
Without in any way limiting the provisions of Section 10.1 hereof,
each Guarantor, upon the execution and delivery of a Guarantee pursuant to
Section 4.14, shall hereby waive
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notice of acceptance hereof, notice of any liability of any Guarantor hereunder,
notice or proof of reliance by the Holders upon the obligations of any Guarantor
hereunder, and diligence, presentment, demand for payment on the Issuer,
protest, notice of dishonor or nonpayment of any of the Obligations, or other
notice or formalities to the Issuer or any Guarantor of any kind whatsoever.
10.14. NO OBLIGATION TO TAKE ACTION AGAINST THE ISSUER.
Neither the Trustee nor any other Person shall have any obligation to
enforce or exhaust any rights or remedies or to take any other steps under any
security for the Obligations or against the Issuer or any other Person or any
property of such Issuer or any other Person before the Trustee is entitled to
demand payment and performance by any or all Guarantors of their liabilities and
obligations under their Guarantees or under this Indenture.
10.15. DEALING WITH THE ISSUER AND OTHERS.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Guarantor
and without the consent of or notice to any Guarantor, may
(i) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to
the Issuer or any other Person;
(ii) take or abstain from taking security or collateral from
the Issuer or from perfecting security or collateral of the Issuer;
(iii) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or
without consideration) any and all collateral, mortgages or other
security given by the Issuer or any third party with respect to the
obligations or matters contemplated by this Indenture or the
Securities;
(iv) accept compromises or arrangements from the Issuer;
(v) apply all monies at any time received from the Issuer
or from any security upon such part of the Obligations as the Holders
may see fit or change any such application in whole or in part from
time to time as the Holders may see fit; and
(vi) otherwise deal with, or waive or modify their right to
deal with, the Issuer and all other Persons and any security as the
Holders or the Trustee may see fit.
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10.16. DEFAULT AND ENFORCEMENT.
If any Guarantor fails to pay in accordance with Section 10.6 hereof,
the Trustee may proceed in its name as trustee hereunder in the enforcement of
the Guarantee of any such Guarantor and such Guarantor's obligations thereunder
and hereunder by any remedy provided by law, whether by legal proceedings or
otherwise, and to recover from such Guarantor the obligations.
10.17. AMENDMENT, ETC.
No amendment, modification or waiver of any provision of this
Indenture relating to any Guarantor or consent to any departure by any Guarantor
or any other Person from any such provision will in any event be effective
unless it is signed by such Guarantor and the Trustee.
10.18. ACKNOWLEDGMENT.
Each Guarantor, upon the execution and delivery of a Guarantee
pursuant to Section 4.14, shall hereby acknowledge communication of the terms of
this Indenture and the Securities and shall hereby consent to and approves of
the same.
10.19. COSTS AND EXPENSES.
Each Guarantor shall pay on demand by the Trustee any and all costs,
fees and expenses (including, without limitation, legal fees on a solicitor and
client basis) incurred by the Trustee, its agents, advisors and counsel or any
of the Holders in enforcing any of their rights under any Guarantee.
10.20. NO MERGER OR WAIVER; CUMULATIVE REMEDIES.
No Guarantee shall operate by way of merger of any of the obligations
of a Guarantor under any other agreement, including, without limitation, this
Indenture. No failure to exercise and no delay in exercising, on the part of the
Trustee or the Holders, any right, remedy, power or privilege hereunder or under
this Indenture or the Securities, shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, remedy, power or privilege
hereunder or under this Indenture or the Securities preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges in the Guarantee and
under this Indenture, the Securities and any other document or instrument
between a Guarantor and/or the Issuer and the Trustee are cumulative and not
exclusive of any rights, remedies, powers and privilege provided by law.
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10.21. SURVIVAL OF OBLIGATIONS.
Without prejudice to the survival of any of the other obligations of
any Guarantor hereunder, the obligations of each Guarantor under Section 10.1
shall survive the payment in full of the Obligations under the Securities, but
only if and to the extent such payment is avoided, and in such case shall be
enforceable against such Guarantor to the same extent as prior to any such
payment and without regard to and without giving effect to any defense, right of
offset or counterclaim available to or which may be asserted by the Issuer or
any Guarantor.
10.22. GUARANTEE IN ADDITION TO OTHER OBLIGATIONS.
The Obligations of each Guarantor under its Guarantee and this
Indenture are in addition to and not in substitution for any other Obligations
to the Trustee or to any of the Holders in relation to this Indenture or the
Securities and any guarantees or security at any time held by or for the benefit
of any of them.
10.23. SEVERABILITY.
Any provision of this Article Ten which is prohibited or unenforceable
in any jurisdiction shall not invalidate the remaining provisions and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction unless its removal
would substantially defeat the basic intent, spirit and purpose of this
Indenture and this Article Ten.
10.24. SUCCESSORS AND ASSIGNS.
Each Guarantee shall be binding upon and inure to the benefit of each
Guarantor and the Trustee and the other Holders and their respective successors
and permitted assigns, except that no Guarantor may assign any of its
obligations hereunder or thereunder, except as otherwise permitted in this
Indenture.
ARTICLE ELEVEN
MISCELLANEOUS
11.1. TIA CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
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11.2. NOTICES.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
if to the Issuer or a Guarantor:
Salt Holdings Corporation
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: Chief Financial Officer
Fax No: (000) 000-0000
with a copy to:
Xxxxxx & Xxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxx, Esq.
Fax No: (000) 000-0000
if to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 0X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
if to the Trustee for presentation of Securities for payment or for
registration of transfer or exchange:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 0X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
The Issuer and the Trustee by written notice to each other such Person
may designate additional or different addresses for notices to such Person. Any
notice or communication to the Issuer and the Trustee, shall be deemed to have
been given or made as of the date so delivered
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if personally delivered; when answered back, if telecopied; and five (5)
calendar days after mailing if sent by registered or certified mail, postage
prepaid (except that a notice of change of address shall not be deemed to have
been given until actually received by the addressee), except that, with respect
to any mailing, notices to the Trustee shall be deemed effective only upon
receipt.
Any notice or communication mailed to a Securityholder shall be mailed
to him by first class mail or other equivalent means at his address as it
appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
11.3. COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities. The Issuer, the Trustee, the Registrar and any other Person shall
have the protection of TIA Section 312(c).
11.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Issuer to the Trustee to take
any action under this Indenture, the Issuer shall furnish to the Trustee at the
request of the Trustee:
(i) an Officers' Certificate, in form and substance
satisfactory to the Trustee, stating that, in the opinion of the
signers, all conditions precedent to be performed or effected by the
Issuer, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(ii) an Opinion of Counsel stating that, in the opinion of
such counsel, any and all such conditions precedent have been complied
with.
11.5. 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 the Officers'
Certificate required by Section 4.8, shall include:
(i) a statement that the Person making such certificate or
opinion has read such covenant or condition;
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(ii) 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;
(iii) a statement that, in the opinion of such Person, he has
made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(iv) a statement as to whether or not, in the opinion of
each such Person, such condition or covenant has been complied with;
PROVIDED, HOWEVER, that with respect to matters of fact an Opinion of
Counsel may rely on an Officers' Certificate or certificates of public
officials.
11.6. RULES BY TRUSTEE, PAYING AGENT, REGISTRAR.
The Trustee, Paying Agent or Registrar may make reasonable rules for
its functions.
11.7. LEGAL HOLIDAYS.
If a payment date is not a Business Day, payment may be made on the
next succeeding day that is a Business Day.
11.8. GOVERNING LAW.
THIS INDENTURE, THE SECURITIES AND ANY GUARANTEES WILL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Each of the parties hereto agrees to submit to the jurisdiction of the courts of
the State of New York in any action or proceeding arising out of or relating to
this Indenture, the Securities or any Guarantees.
11.9. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of any of the Company or any of its Subsidiaries. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
11.10. NO RECOURSE AGAINST OTHERS.
No Affiliate, director, officer, employee, limited liability company
members or stockholder of the Company or any Subsidiary, as such, shall have any
liability for any obligations
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of the Issuer under the Securities or any Guarantee or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability. Such waiver and release are part of the consideration for the
issuance of the Securities.
11.11. SUCCESSORS.
All agreements of the Issuer and the Guarantors, if any, in this
Indenture and the Securities and the Guarantees shall bind their respective
successors. All agreements of the Trustee in this Indenture shall bind its
successor.
11.12. DUPLICATE ORIGINALS.
All parties may sign any number of copies of this Indenture. Each
signed copy or counterpart shall be an original, but all of them together shall
represent the same agreement.
11.13. SEVERABILITY.
In case any one or more of the provisions in this Indenture, the
Securities or the Guarantees shall be held invalid, illegal or unenforceable, in
any respect for any reason, the validity, legality and enforceability of any
such provision in every other respect and of the remaining provisions shall not
in any way be affected or impaired thereby, it being intended that all of the
provisions hereof shall be enforceable to the full extent permitted by law.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed all as of the date first written above.
SALT HOLDINGS CORPORATION
By:
---------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By: /s/ Xxxxx Xxx
---------------------------------
Name: Xxxxx Xxx
Title: Assistant Treasurer
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed all as of the date first written above.
SALT HOLDINGS CORPORATION
By: /s/ Xxxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: VP
THE BANK OF NEW YORK, as Trustee
By:
---------------------------------
Name:
Title:
EXHIBIT A
[FORM OF INITIAL NOTE](a)
[FACE OF SECURITY]
SALT HOLDINGS CORPORATION
THIS NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF
SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE. FOR EACH $1,000
PRINCIPAL AMOUNT AT MATURITY OF THIS NOTE, THE ISSUE PRICE IS $539.95.
THE ISSUE DATE OF THIS NOTE IS DECEMBER 20, 2002 AND THE YIELD TO
MATURITY IS 12 3/4%.
12 3/4% SENIOR DISCOUNT NOTE DUE 2012
No. Principal Amount at Maturity: $
ISIN No.
CUSIP No.
SALT HOLDINGS CORPORATION, a Delaware corporation (the "COMPANY" or
the "ISSUER," which terms include any of its successors under the Indenture
hereinafter referred to), for value received promises to pay to or
registered assigns, the principal sum of ($ ) on December 15,
2012.
Interest Payment Dates: June 15 and December 15, commencing June 15,
2008.
Record Dates: June 1 and December 1.
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
----------
(a) Add Private Placement Legend and, if appropriate, Global Security
Legend.
A-1
IN WITNESS WHEREOF, the Issuer has caused this Security to be signed
manually or by facsimile by its duly authorized officer.
Dated:
SALT HOLDINGS CORPORATION
By:
----------------------------------
Name:
Title:
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[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
CERTIFICATE OF AUTHENTICATION
This is one of the 12 3/4% Senior Discount Notes Due 2012 described in
the within-mentioned Indenture.
Dated: December 20, 0000 XXX XXXX XX XXX XXXX, as Trustee
By:
----------------------------------
Authorized Signatory
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[REVERSE OF SECURITY]
SALT HOLDINGS CORPORATION
12 3/4% SENIOR DISCOUNT NOTE DUE 2012
1. INTEREST.
SALT HOLDINGS CORPORATION, a Delaware corporation (the "COMPANY" or
the "ISSUER," which terms include any of its successors under the Indenture
hereinafter referred to), promises to pay interest on the principal amount of
this Security at the rate per annum shown above. Prior to December 15, 2007,
interest on this Security will accrue in the form of an increase in the Accreted
Value of the Notes, and no cash interest shall be paid. The Accreted Value of
this Security will increase from the date of issuance until December 15, 2007 at
a rate of 12 3/4% per annum compounded semi-annually as provided in the
definition of "Accreted Value" in the Indenture such that the Accreted Value
will equal the principal amount at maturity on December 15, 2007. The Issuer
will pay interest semiannually on June 15 and December 15 of each year (the
"INTEREST PAYMENT DATE"), commencing June 15, 2008. Interest on this Security
will accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from and including December 15, 2007. Interest on this
Security will be computed on the basis of a 360-day year of twelve 30-day
months.
The Issuer shall pay cash interest on overdue principal, and on
overdue premium, if any, and overdue interest, to the extent lawful, at the rate
of interest borne by this Security.
2. METHOD OF PAYMENT.
The Issuer shall pay interest on the Securities (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date even if the
Securities are canceled on registration of transfer or registration of exchange
(including pursuant to an Exchange Offer (as defined in the Indenture)) after
such Record Date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Issuer shall pay Accreted Value or principal, premium,
if any and interest in money of the United States that at the time of payment is
legal tender for payment of public and private debts ("U.S. LEGAL TENDER").
However, the Issuer may pay Accreted Value or principal, premium, if any, and
interest by wire transfer of federal funds, or interest by check payable in such
U.S. Legal Tender. The Issuer may deliver any such interest payment to the
Paying Agent or to a Holder at the Holder's registered address.
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3. PAYING AGENT AND REGISTRAR.
Initially, The Bank of New York (the "TRUSTEE") will act as Paying
Agent and Registrar. The Issuer may change any Paying Agent, Registrar or
co-Registrar without notice to the Holders. The Company or any of its
Subsidiaries may, subject to certain exceptions, act as Registrar or
co-Registrar.
4. INDENTURE.
The Issuer issued the Securities under an Indenture, dated as of
December 20, 2002 (the "INDENTURE"), between the Issuer and the Trustee. This
Security is one of a duly authorized issue of Securities of the Issuer
designated as its 12 3/4% Senior Discount Notes Due 2012 (the "INITIAL NOTES").
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstanding anything to the contrary
herein, the Securities are subject to all such terms, and Holders of Securities
are referred to the Indenture and the TIA for a statement of them. The
Securities are general obligations of the Issuer unlimited in amount, of which
an aggregate principal amount at maturity of $123,500,000 has been issued on the
Issue Date.
5. OPTIONAL REDEMPTION.
The Issuer may redeem the Securities, in whole at any time or in part
from time to time, on and after December 15, 2007, upon not less than 30 nor
more than 60 days' notice, at the following redemption prices (expressed as
percentages of the principal amount at maturity thereof) if redeemed during the
twelve-month period commencing on December 15 of the years set forth below,
plus, in each case, accrued and unpaid interest thereon, if any, to the date of
redemption (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date):
Year Percentage
---- ----------
2007........................ 106.375%
2008........................ 104.250%
2009........................ 102.125%
2010 and thereafter......... 100.000%
The Issuer may redeem the Securities, at any time, or from time to
time, on or prior to December 15, 2005, by using the Net Cash Proceeds of one or
more Equity Offerings to redeem up to 35% in aggregate principal amount at
maturity of the Securities originally issued under the Indenture at a redemption
price equal to 112 3/4% of the Accreted Value thereof to
A-5
the date of redemption; PROVIDED, HOWEVER, that after any such redemption the
aggregate principal amount at maturity of the Securities outstanding must equal
at least 65% of the aggregate principal amount at maturity of the Securities
originally issued under the Indenture. In order to effect the foregoing
redemption with the net cash proceeds of any Equity Offering, the Issuer shall
make such redemption not more than 120 days after the consummation of any such
Equity Offering.
In addition, at any time prior to December 15, 2007, upon the
occurrence of a Change of Control, the Issuer may redeem the Securities, in
whole but not in part, at a redemption price equal to the Accreted Value thereof
plus the Applicable Premium to the date of redemption. Notice of redemption of
the Securities pursuant to this paragraph shall be mailed to Holders of the
Securities not more than 30 days following the occurrence of a Change of
Control.
6. NOTICE OF REDEMPTION.
Notice of redemption shall be mailed by first-class mail at least 30
days but not more than 60 days before the Redemption Date to each Holder of
Securities to be redeemed at such Holder's registered address. Securities in
denominations of $1,000 principal amount at maturity may be redeemed only in
whole. The Trustee may select for redemption portions (equal to $1,000 principal
amount at maturity or any integral multiple thereof) of the principal of
Securities that have denominations larger than $1,000 principal amount at
maturity.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount at maturity thereof to be redeemed. A new Security in a
principal amount at maturity equal to the unredeemed portion thereof will be
issued in the name of the Holder thereof upon cancellation of the original
Security. On and after the Redemption Date, interest will cease to accrue on
Securities or portions thereof called for redemption, subject to the provisions
of the Indenture.
7. CHANGE OF CONTROL OFFER.
Upon the occurrence of a Change of Control, the Issuer will be
required, as and to the extent set forth in the Indenture, to offer to purchase
all of the outstanding Securities at a purchase price equal to 101% of the
Accreted Value thereof, plus accrued and unpaid interest, if any, thereon to the
date of repurchase (subject to the right of Securityholders of record on the
relevant record date to receive interest due on the relevant interest payment
date); PROVIDED HOWEVER, that notwithstanding the occurrence of a Change of
Control, the Issuer shall not be obligated to repurchase the Securities pursuant
to this paragraph 7 in the event that the Issuer has exercised its right to
redeem all of the Securities under the terms of paragraph 5 hereof).
A-6
8. LIMITATION ON ASSET SALES.
The Issuer is, subject to certain conditions, obligated to make an
offer to purchase Securities at 100% of their Accreted Value, plus accrued and
unpaid interest, if any, thereon to the date of repurchase with certain Net Cash
Proceeds of certain sales or other dispositions of assets in accordance with the
Indenture.
9. REGISTRATION RIGHTS.
Pursuant to the Registration Rights Agreement, the Issuer will be
obligated to consummate an exchange offer pursuant to which the Holder of this
Security shall have the right to exchange this Security for the Issuer's 12 3/4%
Senior Discount Notes Due 2012 (the "EXCHANGE NOTES"), which shall have been
registered under the Securities Act, in like Accreted Value and principal amount
at maturity and having terms identical in all material respects to the Initial
Notes. The Holders of Securities shall be entitled to an increase in the
Accreted Value of the Securities or to receive certain additional interest
payments in the event such exchange offer is not consummated and upon certain
other conditions, all pursuant to and in accordance with the terms of the
Registration Rights Agreement.
10. DENOMINATIONS; TRANSFER; EXCHANGE.
The Securities are in registered form, without coupons, in
denominations of $1,000 principal amount at maturity and integral multiples of
$1,000 principal amount at maturity. A Holder shall register the transfer of or
exchange Securities in accordance with the Indenture. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay certain transfer taxes or similar governmental charges
payable in connection therewith as permitted by the Indenture. The Registrar
need not register the transfer of or exchange any Securities or portions thereof
selected for redemption, except the unredeemed portion of any security being
redeemed in part.
11. PERSONS DEEMED OWNERS.
The registered Holder of a Security shall be treated as the owner of
it for all purposes.
12. UNCLAIMED FUNDS.
If funds for the payment of Accreted Value or principal, premium, if
any, or interest remain unclaimed for two years, the Trustee and the Paying
Agent will repay the funds to the Issuer at its request. After that, all
liability of the Trustee and such Paying Agent with respect to such funds shall
cease.
A-7
13. DISCHARGE PRIOR TO REDEMPTION OR MATURITY.
The Issuer may be discharged from its obligations under the Indenture
or the Securities except for certain provisions thereof, and may be discharged
from obligations to comply with certain covenants contained in the Indenture and
the Securities upon satisfaction of certain conditions specified in the
Indenture.
14. AMENDMENT; SUPPLEMENT; WAIVER.
Subject to certain exceptions, the Indenture and the Securities may be
amended or supplemented with the written consent of the Holders of at least a
majority in aggregate principal amount at maturity of the Securities then
outstanding, and any existing Default or Event of Default or compliance with any
provision may be waived with the consent of the Holders of a majority in
aggregate principal amount at maturity of the Securities then outstanding.
Without notice to or consent of any Holder, the parties thereto may amend or
supplement the Indenture, the Securities and any Guarantee to, among other
things, cure any ambiguity, defect or inconsistency, provide for uncertificated
Securities in addition to or in place of certificated Securities or comply with
any requirements of the Commission in connection with the qualification of the
Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
15. RESTRICTIVE COVENANTS.
The Indenture contains certain covenants that, among other things,
limit the ability of the Company and its Restricted Subsidiaries to make
restricted payments, to incur indebtedness, to create liens, to sell assets, to
permit restrictions on dividends and other payments by Restricted Subsidiaries
of the Company to the Company, to consolidate, merge or sell all or
substantially all of its assets or to engage in transactions with affiliates.
The limitations are subject to a number of important qualifications and
exceptions. The Company must annually report to the Trustee on compliance with
such limitations.
16. DEFAULTS AND REMEDIES.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount at maturity of Securities
then outstanding may declare all the Securities to be due and payable
immediately in the manner and with the effect provided in the Indenture. Holders
of Securities may not enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee is not obligated to enforce the Indenture or the
Securities, unless it has received indemnity satisfactory to it. The Indenture
permits, subject to certain limitations therein provided, Holders of a majority
in aggregate principal amount at maturity of the Securities then outstanding to
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of Securities notice of certain continuing Defaults or
Events of Default if it determines that withholding notice is in their interest.
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17. TRUSTEE DEALINGS WITH ISSUER.
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with the Issuer, its Subsidiaries or their respective Affiliates as if it were
not the Trustee.
18. NO RECOURSE AGAINST OTHERS.
No Affiliate, stockholder, director, officer, employee or limited
liability company member of the Issuer or any of its Subsidiaries shall have any
liability for any obligation of the Issuer under the Securities or the Indenture
or for any claim based on, in respect of or by reason of, such obligations or
their creation. Each Holder of a Security by accepting a Security waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
19. AUTHENTICATION.
This Security shall not be valid until the Trustee or authenticating
agent signs the certificate of authentication on this Security.
20. ABBREVIATIONS AND DEFINED TERMS.
Customary abbreviations may be used in the name of a Holder of a
Security 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).
21. GOVERNING LAW.
This Security shall be governed by, and construed in accordance with,
the laws of the State of New York without giving effect to applicable principles
of conflicts of laws to the extent that the application of the laws of another
jurisdiction would be required thereby.
22. CUSIP AND ISIN NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Issuer has caused CUSIP and ISIN numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
A-9
23. INDENTURE.
Each Holder, by accepting a Security, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time.
The Issuer will furnish to any Holder of a Security upon written
request and without charge a copy of the Indenture which has the text of this
Security in larger type. Requests may be made to: Salt Holdings Corporation,
0000 Xxxxxxx Xxxxxxxxx, Xxxxxxxx Xxxx, XX, 00000, Attn: Chief Financial Officer.
A-10
ASSIGNMENT FORM
I or we assign and transfer this Security to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee or transferee)
--------------------------------------------------------------------------------
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint_______________________________________________agent to
transfer this Security on the books of the Issuer. The agent may substitute
another to act for him.
Dated: Signed:
-------------- -----------------------
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee: ------------------------------
Participant in a recognized
Signature Guarantee
Medallion Program (or other
signature guarantor program
reasonably acceptable to
the Trustee)
In connection with any transfer of this Security occurring prior to
the date which is the earlier of (i) the date of the declaration by the
Commission of the effectiveness of a registration statement under the Securities
Act of 1933, as amended (the "SECURITIES ACT"), covering resales of this
Security (which effectiveness shall not have been suspended or terminated at the
date of the transfer) and (ii) December 20, 2004, the undersigned confirms that
it has not utilized any general solicitation or general advertising in
connection with the transfer and that this Security is being transferred:
A-11
[CHECK ONE]
/ / (1) to the Issuer or a subsidiary thereof; or
/ / (2) pursuant to and in compliance with Rule 144A under the
Securities Act; or
/ / (3) to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) that has
furnished to the Trustee a signed letter containing certain
representations and agreements (the form of which letter can be
obtained from the Trustee); or
/ / (4) outside the United States to a "foreign person" in compliance
with Rule 904 of Regulation S under the Securities Act; or
/ / (5) pursuant to the exemption from registration provided by
Rule 144 under the Securities Act; or
/ / (6) pursuant to an effective registration statement under the
Securities Act; or
/ / (7) pursuant to another available exemption from the registration
requirements of the Securities Act;
and unless the box below is checked, the undersigned confirms that such Security
is not being transferred to an "affiliate" of the Issuer as defined in Rule 144
under the Securities Act of 1933, as amended (an "AFFILIATE"):
/ / The transferee is an Affiliate of the Issuer.
Unless one of the items is checked, the Trustee will refuse to
register any of the Securities evidenced by this certificate in the name of any
person other than the registered Holder thereof; PROVIDED that if box (3), (4),
(5) or (7) is checked, the Issuer or the Trustee may require, prior to
registering any such transfer of the Securities, in its sole discretion, such
legal opinions, certifications (including an investment letter in the case of
box (3) or (4)) and other information as the Trustee or the Issuer have
reasonably requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act.
A-12
If none of the foregoing boxes is checked, the Trustee or Registrar
shall not be obligated to register this Security in the name of any person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.16 of the Indenture shall have
been satisfied.
Dated: Signed:
---------------- -----------------------
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee: ------------------------------
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Issuer as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:
-----------------------------------------
NOTICE: To be executed by an executive officer
A-13
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.16 or Section 4.17 of the Indenture, check the appropriate
box:
Section 4.16 / / Section 4.17 / /
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.16 or Section 4.17 of the Indenture, state the
amount: $___________
Dated:
-------------- Signed:
-----------------------
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee: ------------------------------
Participant in a recognized
Signature Guarantee
Medallion Program (or other
signature guarantor program
reasonably acceptable to
the Trustee)
A-14
EXHIBIT B
[FORM OF EXCHANGE NOTE](a)
[FACE OF SECURITY]
THIS NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR
PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE
CODE. FOR EACH $1,000 PRINCIPAL AMOUNT AT MATURITY OF THIS
NOTE, THE ISSUE PRICE IS $539.95. THE ISSUE DATE OF THIS
NOTE IS DECEMBER 20, 2002 AND THE YIELD TO MATURITY IS 12
3/4%.
SALT HOLDINGS CORPORATION
12 3/4% SENIOR DISCOUNT NOTE DUE 2012
CUSIP No.
ISIN No.
No. Principal Amount at Maturity: $
SALT HOLDINGS CORPORATION, a Delaware corporation (the "COMPANY" or
the "ISSUER," which terms include any of its successors under the Indenture
hereinafter referred to), for value received promises to pay to or
registered assigns, the principal sum of ($ ), on
December 15, 2012.
Interest Payment Dates: June 15 and December 15, commencing June 15,
2008.
Record Dates: June 1 and December 1.
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
----------
(a) Add Private Placement Legend and, if appropriate, Global Security Legend.
B-1
IN WITNESS WHEREOF, the Issuer has caused this Security to be signed
manually or by facsimile by its duly authorized officer.
Dated: SALT HOLDINGS CORPORATION
By:
---------------------------
Name:
Title:
B-2
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
CERTIFICATE OF AUTHENTICATION
This is one of the 12 3/4% Senior Discount Notes Due 2012 described in
the within-mentioned Indenture.
Dated: December 20, 0000 XXX XXXX XX XXX XXXX, as Trustee
By:
-----------------------------
Authorized Signatory
B-3
[REVERSE OF SECURITY]
SALT HOLDINGS CORPORATION
12 3/4% SENIOR DISCOUNT NOTE DUE 2012
1. INTEREST.
SALT HOLDINGS CORPORATION, a Delaware corporation (the "COMPANY" or
the "ISSUER," which terms include any of its successors under the Indenture
hereinafter referred to), promises to pay interest on the principal amount of
this Security at the rate PER ANNUM shown above. Prior to December 15, 2007,
interest on this Security will accrue in the form of an increase in the Accreted
Value of the Notes, and no cash interest shall be paid. The Accreted Value of
this Security will increase from the date of issuance until December 15, 2007 at
a rate of 12 3/4% per annum compounded semi-annually as provided in the
definition of "Accreted Value" in the Indenture such that the Accreted Value
will equal the principal amount at maturity on December 15, 2007. The Issuer
will pay interest semiannually on June 15 and December 15 of each year (the
"INTEREST PAYMENT DATE"), commencing June 15, 2008. Interest on this Security
will accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from and including December 15, 2007. Interest on this
Security will be computed on the basis of a 360-day year of twelve 30-day
months.
The Issuer shall pay cash interest on overdue principal, and on
overdue premium, if any, and overdue interest, to the extent lawful, at the rate
of interest borne by this Security.
2. METHOD OF PAYMENT.
The Issuer shall pay interest on the Securities (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date even if the
Securities are canceled on registration of transfer or registration of exchange
(including pursuant to an Exchange Offer (as defined in the Indenture)) after
such Record Date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Issuer shall pay Accreted Value or principal, premium,
if any and interest in money of the United States that at the time of payment is
legal tender for payment of public and private debts ("U.S. LEGAL TENDER").
However, the Issuer may pay Accreted Value or principal, premium, if any, and
interest by wire transfer of federal funds, or interest by check payable in such
U.S. Legal Tender. The Issuer may deliver any such interest payment to the
Paying Agent or to a Holder at the Holder's registered address.
B-4
3. PAYING AGENT AND REGISTRAR.
Initially, The Bank of New York (the "TRUSTEE") will act as Paying
Agent and Registrar. The Issuer may change any Paying Agent, Registrar or
co-Registrar without notice to the Holders. The Company or any of its
Subsidiaries may, subject to certain exceptions, act as Registrar or
co-Registrar.
4. INDENTURE.
The Issuer issued the Securities under an Indenture, dated as of
December 20, 2002 (the "INDENTURE"), between the Issuer and the Trustee. This
Security is one of a duly authorized issue of Securities of the Issuer
designated as its 12 3/4% Senior Discount Notes Due 2012 (the "INITIAL NOTES").
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstanding anything to the contrary
herein, the Securities are subject to all such terms, and Holders of Securities
are referred to the Indenture and the TIA for a statement of them. The
Securities are general obligations of the Issuer unlimited in amount, of which
an aggregate principal amount at maturity of $123,500,000 has been issued on the
Issue Date.
5. OPTIONAL REDEMPTION.
The Issuer may redeem the Securities, in whole at any time or in part
from time to time, on and after December 15, 2007, upon not less than 30 nor
more than 60 days' notice, at the following redemption prices (expressed as
percentages of the principal amount at maturity thereof) if redeemed during the
twelve-month period commencing on December 15 of the years set forth below,
plus, in each case, accrued and unpaid interest thereon, if any, to the date of
redemption (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date):
Year Percentage
---- ----------
2007.............................. 106.375%
2008.............................. 104.250%
2009.............................. 102.125%
2010 and thereafter............... 100.000%
The Issuer may redeem the Securities, at any time, or from time to
time, on or prior to December 15, 2005, by using the Net Cash Proceeds of one or
more Equity Offerings to redeem up to 35% in aggregate principal amount at
maturity of the Securities originally issued
B-5
under the Indenture at a redemption price equal to 112 3/4% of the Accreted
Value thereof to the date of redemption; PROVIDED, HOWEVER, that after any such
redemption the aggregate principal amount at maturity of the Securities
outstanding must equal at least 65% of the aggregate principal amount at
maturity of the Securities originally issued under the Indenture. In order to
effect the foregoing redemption with the net cash proceeds of any Equity
Offering, the Issuer shall make such redemption not more than 120 days after the
consummation of any such Equity Offering.
In addition, at any time prior to December 15, 2007, upon the
occurrence of a Change of Control, the Issuer may redeem the Securities, in
whole but not in part, at a redemption price equal to the Accreted Value thereof
plus the Applicable Premium to the date of redemption. Notice of redemption of
the Securities pursuant to this paragraph shall be mailed to Holders of the
Securities not more than 30 days following the occurrence of a Change of
Control.
6. NOTICE OF REDEMPTION.
Notice of redemption shall be mailed by first-class mail at least 30
days but not more than 60 days before the Redemption Date to each Holder of
Securities to be redeemed at such Holder's registered address. Securities in
denominations of $1,000 principal amount at maturity may be redeemed only in
whole. The Trustee may select for redemption portions (equal to $1,000 principal
amount at maturity or any integral multiple thereof) of the principal of
Securities that have denominations larger than $1,000 principal amount at
maturity.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount at maturity thereof to be redeemed. A new Security in a
principal amount at maturity equal to the unredeemed portion thereof will be
issued in the name of the Holder thereof upon cancellation of the original
Security. On and after the Redemption Date, interest will cease to accrue on
Securities or portions thereof called for redemption, subject to the provisions
of the Indenture.
7. CHANGE OF CONTROL OFFER.
Upon the occurrence of a Change of Control, the Issuer will be
required, as and to the extent set forth in the Indenture, to offer to purchase
all of the outstanding Securities at a purchase price equal to 101% of the
Accreted Value thereof, plus accrued and unpaid interest, if any, thereon to the
date of repurchase (subject to the right of Securityholders of record on the
relevant record date to receive interest due on the relevant interest payment
date); PROVIDED, HOWEVER, that notwithstanding the occurrence of a Change of
Control, the Issuer shall not be obligated to repurchase the Securities pursuant
to this paragraph 7 in the event that the Issuer has exercised its right to
redeem all of the Securities under the terms of paragraph 5 hereof).
B-6
8. LIMITATION ON ASSET SALES.
The Issuer is, subject to certain conditions, obligated to make an
offer to purchase Securities at 100% of their Accreted Value, plus accrued and
unpaid interest, if any, thereon to the date of repurchase with certain Net Cash
Proceeds of certain sales or other dispositions of assets in accordance with the
Indenture.
9. DENOMINATION, TRANSFER, EXCHANGE.
The Securities are in registered form, without coupons, in
denominations of $1,000 principal amount at maturity and integral multiples of
$1,000 principal amount at maturity. A Holder shall register the transfer of or
exchange Securities in accordance with the Indenture. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay certain transfer taxes or similar governmental charges
payable in connection therewith as permitted by the Indenture. The Registrar
need not register the transfer of or exchange any Securities or portions thereof
selected for redemption, except the unredeemed portion of any security being
redeemed in part.
10. PERSONS DEEMED OWNERS.
The registered Holder of a Security shall be treated as the owner of
it for all purposes.
11. UNCLAIMED FUNDS.
If funds for the payment of Accreted Value or principal, premium, if
any, or interest remain unclaimed for two years, the Trustee and the Paying
Agent will repay the funds to the Issuer at its request. After that, all
liability of the Trustee and such Paying Agent with respect to such funds shall
cease.
12. DISCHARGE PRIOR TO REDEMPTION OR MATURITY.
The Issuer may be discharged from its obligations under the Indenture
or the Securities except for certain provisions thereof, and may be discharged
from obligations to comply with certain covenants contained in the Indenture and
the Securities upon satisfaction of certain conditions specified in the
Indenture.
13. AMENDMENT; SUPPLEMENT; WAIVER.
Subject to certain exceptions, the Indenture and the Securities may be
amended or supplemented with the written consent of the Holders of at least a
majority in aggregate principal amount at maturity of the Securities then
outstanding, and any existing Default or Event of Default or compliance with any
provision may be waived with the consent of the Holders of a majority in
aggregate principal amount at maturity of the Securities then outstanding.
Without notice to or consent of any Holder, the parties thereto may amend or
supplement the
B-7
Indenture, the Securities and any Guarantee to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of certificated Securities or comply with any
requirements of the Commission in connection with the qualification of the
Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
14. RESTRICTIVE COVENANTS.
The Indenture contains certain covenants that, among other things,
limit the ability of the Company and its Restricted Subsidiaries to make
restricted payments, to incur indebtedness, to create liens, to sell assets, to
permit restrictions on dividends and other payments by Restricted Subsidiaries
of the Company to the Company, to consolidate, merge or sell all or
substantially all of its assets or to engage in transactions with affiliates.
The limitations are subject to a number of important qualifications and
exceptions. The Company must annually report to the Trustee on compliance with
such limitations.
15. DEFAULTS AND REMEDIES.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount at maturity of Securities
then outstanding may declare all the Securities to be due and payable
immediately in the manner and with the effect provided in the Indenture. Holders
of Securities may not enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee is not obligated to enforce the Indenture or the
Securities, unless it has received indemnity satisfactory to it. The Indenture
permits, subject to certain limitations therein provided, Holders of a majority
in aggregate principal amount at maturity of the Securities then outstanding to
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of Securities notice of certain continuing Defaults or
Events of Default if it determines that withholding notice is in their interest.
16. TRUSTEE DEALINGS WITH ISSUER.
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with the Issuer, its Subsidiaries or their respective Affiliates as if it were
not the Trustee.
17. NO RECOURSE AGAINST OTHERS.
No Affiliate, stockholder, director, officer, employee or limited
liability company member of the Issuer or any of its Subsidiaries shall have any
liability for any obligation of the Issuer under the Securities or the Indenture
or for any claim based on, in respect of or by reason of, such obligations or
their creation. Each Holder of a Security by accepting a Security waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
B-8
18. AUTHENTICATION.
This Security shall not be valid until the Trustee or authenticating
agent signs the certificate of authentication on this Security.
19. ABBREVIATIONS AND DEFINED TERMS.
Customary abbreviations may be used in the name of a Holder of a
Security 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).
20. GOVERNING LAW.
This Security shall be governed by, and construed in accordance with,
the laws of the State of New York without giving effect to applicable principles
of conflicts of laws to the extent that the application of the laws of another
jurisdiction would be required thereby.
21. CUSIP AND ISIN NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Issuer has caused CUSIP and ISIN numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
22. INDENTURE.
Each Holder, by accepting a Security, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time.
The Issuer will furnish to any Holder of a Security upon written
request and without charge a copy of the Indenture which has the text of this
Security in larger type. Requests may be made to: Salt Holdings Corporation,
0000 Xxxxxxx Xxxxxxxxx, Xxxxxxxx Xxxx, XX, 00000, Attn: Chief Financial Officer.
B-9
ASSIGNMENT FORM
I or we assign and transfer this Security to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee or transferee)
--------------------------------------------------------------------------------
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint_______________________________________________agent to
transfer this Security on the books of the Issuer. The agent may substitute
another to act for him.
Dated: Signed:
-------------- -----------------------
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee: ------------------------------
Participant in a recognized
Signature Guarantee
Medallion Program (or other
signature guarantor program
reasonably acceptable to
the Trustee)
B-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.16 or Section 4.17 of the Indenture, check the appropriate
box:
Section 4.16 / / Section 4.17 / /
Dated: Signed:
-------------- -----------------------
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee: ------------------------------
Participant in a recognized
Signature Guarantee
Medallion Program (or other
signature guarantor program
reasonably acceptable to
the Trustee)
B-11
EXHIBIT C
Form of Certificate to Be
Delivered in Connection with
TRANSFERS TO NON-QIB ACCREDITED INVESTORS
[Date]
Attention:
Re: Salt Holdings Corporation
12 3/4% Senior Discount Notes Due 2012
(the "Securities")
--------------------------------------
Ladies and Gentlemen:
In connection with our proposed purchase of the Securities of Salt
Holdings Corporation (the "ISSUER"), we confirm that:
1. We have received a copy of the Offering Circular (the "OFFERING
CIRCULAR"), dated December 13, 2002, relating to the Securities and such other
information as we deem necessary in order to make our investment decision. We
acknowledge that we have read and agreed to the matters stated on pages (i) and
(ii) of the Offering Circular and in the section entitled "Transfer
Restrictions" of the Offering Circular, including the restrictions on
duplication and circulation of the Offering Circular.
2. We understand that any subsequent transfer of the Securities is
subject to certain restrictions and conditions set forth in the Indenture
relating to the Securities (as described in the Offering Circular) and the
undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Securities except in compliance with, such restrictions and
conditions and the Securities Act of 1933, as amended (the "SECURITIES ACT").
3. We understand that the offer and sale of the Securities have not
been registered under the Securities Act, and that the Securities may not be
offered or sold 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 or otherwise transfer any Securities prior to the
date which is two years after the original issuance of the Securities, and if
such transfer is in respect of any aggregate principal amount at maturity of
Securities of less than $100,000, also furnishes an opinion of counsel
acceptable to the Issuer that such transfer complies with the Securities Act, we
will do so only (i) to the Issuer or any of its subsidiaries, (ii) inside the
United States in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined in Rule 144A under the Securities
Act), (iii) inside the United States to an institutional "accredited investor"
(as defined below) that, prior to such
C-1
transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to
the Trustee (as defined in the Indenture relating to the Securities), a signed
letter containing certain representations and agreements relating to the
restrictions on transfer of the Securities, (iv) outside the United States in
accordance with Rule 904 of Regulation S under the Securities Act, (v) pursuant
to the exemption from registration provided by Rule 144 under the Securities Act
(if available), or (vi) pursuant to an effective registration statement under
the Securities Act, and we further agree to provide to any person purchasing any
of the Securities from us a notice advising such purchaser that resales of the
Securities are restricted as stated herein.
4. We understand that, on any proposed resale of any Securities, we
will be required to furnish to the Trustee and the Issuer such certification,
legal opinions and other information as the Trustee and the Issuer may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Securities purchased by us will
bear a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Securities,
and we and any accounts for which we are acting are each able to bear the
economic risk of our or their investment, as the case may be.
6. We are acquiring the Securities purchased by us for our account
or for one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion, and we
are acquiring the Securities not with a view to, or for offer or sale in
connection with, any distribution in violation of the Securities Act.
You and the Issuer are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
By:
-----------------------------
Name:
Title:
C-2
Form of Certificate To Be
Delivered in Connection with
TRANSFERS PURSUANT TO REGULATION S
[Date]
Attention:
Re: Salt Holdings Corporation
12 3/4% Senior Discount Notes Due 2012
(the "Securities")
--------------------------------------
In connection with our proposed sale of $_________ aggregate principal
amount at maturity of the Securities, we confirm that such sale has been
effected pursuant to and in accordance with Regulation S under the U.S.
Securities Act of 1933, as amended (the "SECURITIES ACT"), and, accordingly, we
represent that:
(1) the offer of the Securities was not made to a person in
the United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting
on our behalf reasonably believed that the transferee was outside the
United States, or (b) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither
we nor any person acting on our behalf knows that the transaction has
been prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer
restrictions applicable to the Securities.
You and the Issuer are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
D-1
Very truly yours,
[Name of Transferor]
By:
-----------------------------
Authorized Signature
D-2
EXHIBIT E
GUARANTEE
For value received, the undersigned hereby unconditionally guarantees,
as principal obligor and not only as a surety, to the Holder of this Security
the cash payments in United States dollars of Accreted Value of, premium, if
any, and interest, if any, on this Security in the amounts and at the times when
due and interest on the overdue Accreted Value, premium, if any, and interest,
if any, of this Security, if lawful, and the payment or performance of all other
obligations of the Issuer under the Indenture (as defined below) or the
Securities, to the Holder of this Security and the Trustee, all in accordance
with and subject to the terms and limitations of this Security, Article Ten of
the Indenture and this Guarantee. This Guarantee will become effective in
accordance with Article Ten of the Indenture and its terms shall be evidenced
therein. The validity and enforceability of any Guarantee shall not be affected
by the fact that it is not affixed to any particular Security.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Indenture dated as of December 20, 2002, between Salt
Holdings Corporation, a Delaware corporation (the "COMPANY" or the "ISSUER"),
and The Bank of New York, as trustee (the "TRUSTEE").
The obligations of the undersigned to the Holders of Securities and to
the Trustee pursuant to this Guarantee and the Indenture are expressly set forth
in Article Ten of the Indenture and reference is hereby made to the Indenture
for the precise terms of the Guarantee and all of the other provisions of the
Indenture to which this Guarantee relates.
THIS GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES
OF CONFLICTS OF LAWS TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY. The undersigned Guarantor hereby agrees
to submit to the jurisdiction of the courts of the State of New York in any
action or proceeding arising out of or relating to this Guarantee.
This Guarantee is subject to release upon the terms set forth in the
Indenture.
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IN WITNESS WHEREOF, each Guarantor has caused its Guarantee to be duly
executed.
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By:
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Name:
Title:
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