<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 30, 1998
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
RURAL/METRO CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 4119 AND 7389 86-0746929
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
OF INCORPORATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
------------------------
8401 EAST INDIAN SCHOOL ROAD
SCOTTSDALE, ARIZONA 85251
(602) 994-3886
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
SEE "TABLE OF ADDITIONAL REGISTRANTS" ON THE FOLLOWING PAGE FOR INFORMATION
RELATING TO THE GUARANTORS OF SECURITIES REGISTERED HEREBY.
------------------------
WARREN S. RUSTAND
RURAL/METRO CORPORATION
8401 EAST INDIAN SCHOOL ROAD
SCOTTSDALE, ARIZONA 85251
(602) 994-3886
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPIES TO:
JEAN E. HARRIS, ESQ.
MICHAEL L. KAPLAN, ESQ.
O'CONNOR, CAVANAGH, ANDERSON
KILLINGSWORTH & BESHEARS, P.A.
ONE EAST CAMELBACK, SUITE 1100
PHOENIX, ARIZONA 85012
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practical after the Registration Statement becomes effective.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
------------------------
CALCULATION OF REGISTRATION FEE
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<CAPTION>
=======================================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE AGGREGATE OFFERING OFFERING PRICE AMOUNT OF
SECURITIES TO BE REGISTERED(1) REGISTERED PRICE PER UNIT(1) PER SHARE(1) REGISTRATION FEE(2)
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
7 7/8% Senior Notes Due 2008....... $150,000,000 100% $150,000,000 $44,250
=======================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the amount of registration
fee pursuant to Rule 457 (f)(2), based on the stated principal amount of
each Outstanding Note (as defined) which may be received by the Registrant
in the exchange transaction in which the Exchange Notes (as defined) will be
offered.
(2) Registered herewith are Guarantees of Subsidiaries of Rural/Metro
Corporation of the 7 7/8% Senior Notes due 2008 for which no additional
consideration will be received. Accordingly, pursuant to Rule 457(o), under
the Securities Act, which permits the registration fee to be calculated on
the basis of the maximum offering price of all securities registered, no
additional fee is included for the registration of such Guarantees.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================
<PAGE> 2
TABLE OF ADDITIONAL REGISTRANTS
TO FORM S-4
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
<TABLE>
<CAPTION>
TAX
STATE OF IDENTIFICATION
NAME OF ENTITY ORGANIZATION NUMBER
-------------- -------------- --------------
<S> <C> <C>
Aid Ambulance at Vigo County, Inc. ......................... Indiana 35-1431604
Ambulance Transport Systems, Inc. .......................... New Jersey 11-3224874
American Limousine Service, Inc. ........................... Ohio 31-1208564
Arrow Ambulance, Inc. ...................................... Idaho 82-0413539
Beacon Transportation, Inc. ................................ New York 16-1024028
City Wide Ambulance Service, Inc. .......................... Ohio 31-0999303
Corning Ambulance Service Inc. ............................. New York 16-1025659
Donlock, Ltd. .............................................. Pennsylvania 23-2440659
E.M.S. Ventures, Inc. ...................................... Georgia 58-1923254
EMS Ventures of South Carolina, Inc. ....................... South Carolina 58-1971727
Eastern Ambulance Service, Inc. ............................ Nebraska 47-0497359
Eastern Paramedics, Inc. ................................... Delaware 16-1451102
Gold Cross Ambulance Services, Inc. ........................ Delaware 34-1014792
Gold Cross Ambulance Service of Pa., Inc. .................. Ohio 52-1139869
Keefe & Keefe, Inc. ........................................ New York 13-0412920
Keefe & Keefe Ambulette, Ltd. .............................. New York 11-2820129
LaSalle Ambulance Inc. ..................................... New York 16-0954422
Medi-Cab of Georgia, Inc. .................................. Delaware 86-0822551
Medical Emergency Devices and Services, Inc. ............... Arizona 86-0712218
Medical Transportation Services, Inc. ...................... South Dakota 46-0372542
Medstar Emergency Medical Services, Inc. ................... Delaware 86-0834429
Mercury Ambulance Service, Inc. ............................ Kentucky 61-1028659
Metro Care Corp. ........................................... Ohio 34-1643994
MO-RO-KO, Inc. ............................................. Arizona 86-0608231
Multi Cab Inc. ............................................. New Jersey 22-3121021
Multi-Care International, Inc. ............................. New Jersey 22-3132434
Multi-Care Medical Car Service, Inc. ....................... New Jersey 22-3319494
Multi-Health Corp. ......................................... Florida 59-2814574
Myers Ambulance Service, Inc. .............................. Indiana 35-1181236
National Ambulance & Oxygen Service, Inc. .................. New York 16-0769150
North Miss. Ambulance Service, Inc. ........................ Mississippi 64-0634696
Physicians Ambulance Service, Inc. ......................... Delaware 34-1778398
Professional Medical Services, Inc. ........................ Arkansas 71-0658629
RISC America Alabama Fire Safety Services, Inc.............. Delaware 63-1159506
R/M Management Co., Inc. ................................... Arizona 86-0273445
R/M of Mississippi, Inc. ................................... Delaware 62-1716931
R/M of Tennessee G.P., Inc. ................................ Delaware 86-0810819
R/M of Tennessee L.P., Inc. ................................ Delaware 86-0810821
R/M of Texas G.P., Inc. .................................... Delaware 86-0810815
R/M Partners, Inc. ......................................... Delaware Applied For
RMC Corporate Center, L.L.C. ............................... Arizona 86-0844546
Rural/Metro Argentina, L.L.C. .............................. Arizona Applied For
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
TAX
STATE OF IDENTIFICATION
NAME OF ENTITY ORGANIZATION NUMBER
-------------- -------------- --------------
<S> <C> <C>
Rural/Metro Brasil, L.L.C. ................................. Arizona Applied For
Rural/Metro Canadian Holdings, Inc.......................... Delaware 86-0842600
Rural/Metro Communications Services, Inc. .................. Delaware 23-2906712
Rural/Metro Corporation, an Arizona corporation............. Arizona 86-0084388
Rural/Metro Corporation of Florida.......................... Florida 59-0934668
Rural/Metro Corporation of Tennessee........................ Tennessee 62-0719245
Rural/Metro Fire Dept., Inc. ............................... Arizona 86-0273445
Rural/Metro International, Inc. ............................ Delaware 86-0842601
Rural/Metro Mid-Atlantic, Inc. ............................. Delaware Applied For
Rural/Metro of Alabama, Inc. ............................... Delaware 86-0834427
Rural/Metro of Argentina, Inc. ............................. Delaware Applied For
Rural/Metro of Arkansas, Inc. .............................. Delaware 86-0847331
Rural/Metro of Arlington, Inc. ............................. Delaware 75-2629709
Rural/Metro of Brasil, Inc. ................................ Delaware Applied For
Rural/Metro of California, Inc.............................. Delaware 73-1498164
Rural/Metro of Central Alabama, Inc. ....................... Delaware 59-3385348
Rural/Metro of Central Ohio, Inc. .......................... Delaware 31-1442407
Rural/Metro of Georgia, Inc. ............................... Delaware 86-0783075
Rural/Metro of Indiana, Inc. ............................... Delaware 86-0834431
Rural/Metro of Indiana, L.P. ............................... Delaware 35-1969954
Rural/Metro of Indiana II, L.P. ............................ Delaware 35-1972413
Rural/Metro of Kentucky, Inc. .............................. Delaware 86-0842598
Rural/Metro of Mississippi, Inc. ........................... Delaware 62-1716929
Rural/Metro of Nebraska, Inc. .............................. Delaware 47-0780161
Rural/Metro of New York, Inc. .............................. Delaware 86-0750083
Rural/Metro of North Florida, Inc. ......................... Florida 59-2798471
Rural/Metro of Ohio, Inc. .................................. Delaware 93-1150488
Rural/Metro of Oregon, Inc. ................................ Delaware 86-0803435
Rural/Metro of Rochester, Inc............................... New York 16-0980148
Rural/Metro of San Diego, Inc. ............................. California 33-0754132
Rural/Metro of South Carolina, Inc. ........................ Delaware 86-0785691
Rural/Metro of South Dakota, Inc. .......................... Delaware 86-0823323
Rural/Metro of Tennessee, L.P. ............................. Delaware 62-1623714
Rural/Metro of Texas, Inc. ................................. Delaware 75-2613511
Rural/Metro of Texas, L.P. ................................. Delaware 75-2625686
Rural/Metro Protection Services, Inc........................ Arizona 86-0273443
Rural/Metro Texas Holdings, Inc. ........................... Delaware 86-0834430
SW General, Inc. ........................................... Arizona 86-0434455
Sioux Falls Ambulance, Inc. ................................ South Dakota 46-0284797
South Georgia Emergency Medical Services, Inc. ............. Georgia 58-1927289
Southwest Ambulance of Casa Grande, Inc. ................... Arizona 86-0702807
Southwest Ambulance of Southeastern Arizona, Inc. .......... Arizona 86-0758145
Southwest Ambulance of Tucson, Inc. ........................ Arizona 86-0203618
Southwest General Services, Inc. ........................... Arizona 86-0767537
The Aid Ambulance Company, Inc. ............................ Delaware 86-0834432
The Aid Company, Inc. ...................................... Indiana 35-1508091
</TABLE>
<PAGE> 4
<TABLE>
<CAPTION>
TAX
STATE OF IDENTIFICATION
NAME OF ENTITY ORGANIZATION NUMBER
-------------- -------------- --------------
<S> <C> <C>
The Western New York Emergency Medical Services Training
Institute Inc. ........................................... New York 22-2718876
Towns Ambulance Service, Inc. .............................. New York 16-1088281
United Medical Services, Inc. .............................. Washington 91-1176902
Valley Fire Service, Inc. .................................. Delaware 93-1196188
W & W Leasing Company, Inc. ................................ Arizona 86-0201806
</TABLE>
<PAGE> 5
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED APRIL 30, 1998
RURAL/METRO CORPORATION
OFFER TO EXCHANGE
7 7/8% SENIOR NOTES DUE 2008
[RURAL/METRO CORPORATION LOGO]
($150,000,000 PRINCIPAL AMOUNT OUTSTANDING)
FOR
7 7/8% SENIOR NOTES DUE 2008
($150,000,000 PRINCIPAL AMOUNT)
---------------------
The Exchange Offer will expire at 5:00 p.m., E.D.T., on May , 1998,
unless extended.
Rural/Metro Corporation, a Delaware corporation (the "Company"), hereby
offers (the "Exchange Offer"), upon the terms and subject to the conditions set
forth in this Prospectus and the accompanying Letter of Transmittal (the "Letter
of Transmittal"), to exchange up to an aggregate principal amount of
$150,000,000 of its outstanding 7 7/8% Senior Notes due 2008 (the "Outstanding
Notes") for an equal principal amount of its 7 7/8% Senior Notes due 2008 in
integral multiples of $1,000 (the "Exchange Notes" and, together with the
Outstanding Notes, the "Notes"). The Exchange Notes will be general unsecured
obligations of the Company and are substantially identical (including principal
amount, interest rate, maturity, and redemption rights) to the Outstanding Notes
for which they may be exchanged pursuant to this Exchange Offer, except that the
Exchange Notes will be registered under the Securities Act of 1933, as amended,
and therefore will not be subject to certain transfer restrictions and
registration rights relating to the Outstanding Notes. The Outstanding Notes
have been, and the Exchange Notes will be, issued under an Indenture dated as of
March 16, 1998 (the "Indenture"), among the Company, certain of its subsidiaries
(the "Guarantors"), and The First National Bank of Chicago, as trustee (the
"Trustee"). See "Description of the Exchange Notes." There will be no proceeds
to the Company from the Exchange Offer; however, pursuant to a Registration
Rights Agreement dated as of March 11, 1998 (the "Registration Rights
Agreement") among the Company, the Guarantors, and the Initial Purchasers (as
defined) of the Outstanding Notes, the Company will bear certain offering
expenses.
The Company will accept for exchange any and all Outstanding Notes validly
tendered on or prior to 5:00 p.m., E.D.T., on , 1998, unless extended
(the "Expiration Date"). Tenders of Outstanding Notes may be withdrawn at any
time prior to 5:00 p.m., E.D.T., on the Expiration Date; otherwise such tenders
are irrevocable. The First National Bank of Chicago is acting as Exchange Agent
(the "Exchange Agent") in connection with the Exchange Offer. The minimum period
of time that the Exchange Offer will remain open is 30 business days from the
date the Registration Statement is declared effective. The Exchange Offer is not
conditioned upon any minimum principal amount of Outstanding Notes being
tendered for exchange, but is otherwise subject to certain customary conditions.
(Cover text continued on next page)
---------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 12 FOR A DISCUSSION OF CERTAIN RISKS
TO BE CONSIDERED IN CONNECTION WITH THE EXCHANGE OFFER AND IN EVALUATING AN
INVESTMENT IN THE EXCHANGE NOTES.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COM-
MISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
---------------------
The date of this Prospectus is , 1998
<PAGE> 6
(Continued from Cover Page)
Interest on the Exchange Notes will accrue at a rate equal to 7 7/8% per
annum and will be payable semiannually in arrears on March 15 and September 15
of each year commencing September 15, 1998. Interest on the Exchange Notes will
accrue from the most recent date to which interest has been paid on the
Outstanding Notes or, if no interest has been paid, from the date of original
issuance of the Outstanding Notes.
The Outstanding Notes in an aggregate principal amount of $150,000,000 were
sold by the Company as of March 16, 1998 (the "Initial Offering"), to Bear,
Stearns & Co. Inc., Salomon Smith Barney, SBC Warburg Dillon Read Inc., and
First Union Capital Markets (the "Initial Purchasers") pursuant to a Purchase
Agreement among the Company, the Guarantors, and the Initial Purchasers dated
March 11, 1998 (the "Purchase Agreement") in a transaction not registered under
the Securities Act of 1933, as amended (the "Securities Act"), in reliance upon
the exemption provided in Section 4(2) of the Securities Act. The Initial
Purchasers subsequently placed the Outstanding Notes with qualified
institutional buyers in reliance upon Rule 144A under the Securities Act.
Accordingly, the Outstanding Notes may not be re-offered, resold, or otherwise
transferred in the United States unless so registered or unless an applicable
exemption from the registration requirements of the Securities Act is available.
The Exchange Notes are being offered hereunder in order to satisfy the
obligations of the Company under the Registration Rights Agreement. See "The
Exchange Offer."
Based on an interpretation by the staff of the Securities and Exchange
Commission (the "Commission") set forth in no-action letters issued to third
parties (including Exxon Capital Holdings Corporation (available April 13,
1989), Morgan Stanley & Co., Inc. (available June 5, 1991), Mary Kay Cosmetics,
Inc. (available June 5, 1991), and Sherman & Sterling (available July 2, 1993)),
the Company believes that Exchange Notes issued pursuant to this Exchange Offer
may be offered for resale, resold, and otherwise transferred by a holder who is
not an affiliate of the Company without compliance with the registration and
prospectus delivery provisions of the Securities Act, provided that the holder
is acquiring the Exchange Notes in its ordinary course of business and is not
participating in and has no arrangement or understanding with any person to
participate in the distribution (within the meaning of the Securities Act) of
the Exchange Notes. Persons wishing to exchange Outstanding Notes in the
Exchange Offer must represent to the Company that such conditions have been met.
Each broker-dealer that receives Exchange Notes for its own account
pursuant to the Exchange Offer (a "Participating Broker-Dealer") must
acknowledge that it will deliver a prospectus in connection with any resale of
such Exchange Notes. The Letter of Transmittal states that by so acknowledging
and by delivering a prospectus, a broker-dealer will not be deemed to admit that
it is an "underwriter" within the meaning of the Securities Act. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of Exchange Notes received in
exchange for Outstanding Notes where such Outstanding Notes were acquired by
such broker-dealer as a result of market-making activities or other trading
activities. The Company has agreed that, for a period of 180 days after the
Expiration Date, it will make this Prospectus available to any Participating
Broker-Dealer for use in connection with any such resale. In addition, until 25
days after the Expiration Date, all dealers effecting transactions in the
Exchange Notes may be required to deliver a prospectus. See "Plan of
Distribution."
The Company does not intend to list the Exchange Notes on any national
securities exchange or to seek the admission thereof to trading on the Nasdaq
Stock Market, Inc. National Market. The Outstanding Notes are currently eligible
for trading in the Private Offering, Resales and Trading through Automated
Linkages ("PORTAL") Market of the Nasdaq Stock Market, Inc. Following
commencement of the Exchange Offer, the Outstanding Notes may continue to be
traded in the PORTAL Market. Following consummation of the Exchange Offer, the
Exchange Notes will not be eligible for trading in the PORTAL Market. The
Initial Purchasers are not obligated to make a market in the Exchange Notes and
any market-making may be discontinued at any time without notice. Accordingly,
no assurance can be given that an active public or other market will develop for
the Exchange Notes or as to the liquidity of or the trading market for the
Exchange Notes.
<PAGE> 7
(Continued from Cover Page)
Any Outstanding Notes not tendered and accepted in the Exchange Offer will
remain outstanding. To the extent that any Outstanding Notes of other holders
are tendered and accepted in the Exchange Offer, a holder's ability to sell
untendered Outstanding Notes could be adversely affected. Following consummation
of the Exchange Offer, the holders of untendered Outstanding Notes will continue
to be subject to the existing restrictions upon transfer thereof.
The Company expects that the Exchange Notes issued pursuant to this
Exchange Offer initially will be issued in the form of a Global Exchange Note
(as defined herein), which will be deposited with, or on behalf of, The
Depository Trust Company (the "Depositary") and registered in the Depositary's
name or in the name of Cede & Co., its nominee, in each case for credit to an
account of a direct or indirect participant in the Depositary, including Morgan
Guaranty Trust Company of New York, Brussels office, as operator of the
Euroclear System and Citibank, N.A., as depositary for Cedel, S.A. Beneficial
interests in the Global Exchange Note representing the Exchange Notes will be
shown on, and transfers thereof to qualified institutional buyers will be
effected through, records maintained by the Depositary and its participants.
After the initial issuance of the Global Exchange Note, Exchange Notes in
certificated form will be issued in exchange for the Global Exchange Note on the
terms set forth in the Indenture. See "Description of the Exchange
Notes -- Book-Entry, Delivery, and Form."
---------------------
No dealer, salesperson, or other person has been authorized to give
information or to make any representations not contained in this Prospectus,
and, if given or made, such information or representations must not be relied
upon as having been authorized by the Company. This Prospectus does not
constitute an offer to sell or the solicitation of an offer to buy any security
other than the Exchange Notes offered hereby, nor does it constitute an offer to
sell or the solicitation of an offer to buy any of the Exchange Notes to any
person in any jurisdiction in which it is unlawful to make such an offer or
solicitation to such person. Neither the delivery of this Prospectus nor any
sale made hereunder shall under any circumstances create any implication that
the information contained herein is correct as of any date subsequent to the
date hereof.
<PAGE> 8
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Commission. Such reports, proxy statements, and other information may be
inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, Room 1024, 450 Fifth Street, N.W., Washington,
D.C. 20549; the Chicago Regional Office, Suite 1400, 500 West Madison Street,
Citicorp Center, Chicago, Illinois 60661; and the New York Regional Office,
Suite 1300, 7 World Trade Center, New York, New York 10048. Copies of such
material also can be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, upon payment of
the prescribed fees. The Commission maintains a Web site on the Internet that
contains reports, proxy and information statements, and other information
regarding registrants that file electronically with the Commission. The address
of this site on the Internet is http://www.sec.gov. The Company's Common Stock
is quoted on the Nasdaq National Market.
------------------------
The Company will furnish periodic reports to the Trustee, which will make
them available upon request to the holders of the Notes.
To permit compliance with Rule 144A in connection with resales of the
Notes, the Company and the Guarantors will make available upon the request of
the holder of a Note and any prospective purchaser designated by such holder the
information required under Rule 144A(d)(4) under the Securities Act if at the
time of such request the Company or Guarantors are neither reporting companies
under Section 13 or 15(d) of the Exchange Act nor exempt from reporting pursuant
to Rule 12g3-2(b) thereunder.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference except as superseded or modified herein: (1)
the Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
1997; (2) the Company's Quarterly Report on Form 10-Q for the quarter ended
December 31, 1997; (3) the Company's Annual Report on Form 10-K for the fiscal
year ended June 30, 1997; (4) the Company's Current Report on Form 8-K dated
July 15, 1997 as amended by the Form 8-K/A dated August 12, 1997; (5) the
Company's Current Report on Form 8-K dated February 27, 1998; and (6) the
Company's Current Report on Form 8-K dated April 1, 1998. All documents filed by
the Company with the Commission pursuant to Sections 13(a), 13(c), 14, or 15(d)
of the Exchange Act subsequent to the date hereof and prior to the termination
of the Exchange Offer shall be deemed to be incorporated by reference into this
Prospectus and to be a part hereof from the date of filing of such documents.
Any statements contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon a written request of such person, a copy of any or
all of the foregoing documents incorporated by reference into this Prospectus
(other than exhibits to such documents, unless such exhibits are specifically
incorporated by reference into such documents). Requests for such copies should
be delivered to the Investor Relations Department, 8401 East Indian School Road,
Scottsdale, Arizona 85251.
1
<PAGE> 9
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS INCLUDES "FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF
SECTION 27A OF THE SECURITIES ACT AND SECTION 21E OF THE SECURITIES EXCHANGE ACT
OF 1934, AS AMENDED (THE "EXCHANGE ACT"). ALL STATEMENTS OTHER THAN STATEMENTS
OF HISTORICAL FACTS INCLUDED IN THIS PROSPECTUS, INCLUDING WITHOUT LIMITATION,
CERTAIN STATEMENTS UNDER THE "PROSPECTUS SUMMARY," "MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS" AND "BUSINESS,"
CONSTITUTE FORWARD-LOOKING STATEMENTS. ALTHOUGH THE COMPANY BELIEVES THAT THE
EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE REASONABLE, IT CAN
GIVE NO ASSURANCE THAT SUCH EXPECTATIONS WILL PROVE TO BE CORRECT. IMPORTANT
FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE COMPANY'S
EXPECTATIONS ("CAUTIONARY STATEMENTS") ARE DISCLOSED IN THIS PROSPECTUS,
INCLUDING WITHOUT LIMITATION IN CONJUNCTION WITH THE FORWARD-LOOKING STATEMENTS
INCLUDED IN THIS PROSPECTUS AND UNDER "RISK FACTORS." ALL SUBSEQUENT WRITTEN AND
ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE COMPANY OR PERSONS ACTING ON
ITS BEHALF ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE CAUTIONARY
STATEMENTS.
2
<PAGE> 10
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information and Consolidated Financial Statements of the Company, including the
notes thereto, which are contained elsewhere or incorporated by reference in
this Prospectus.
THE COMPANY
The Company is a leading provider of health and safety services, which
include "911" emergency ambulance and general transport services, fire
protection services, and other safety and health care related services, to
municipal, residential, commercial, and industrial customers. The Company
believes that it is the only multi-state provider of both ambulance and fire
protection services in the United States and that it ranks as one of the largest
private-sector providers of ambulance and fire protection services in the world.
The Company currently serves over 400 communities in 25 states, the District of
Columbia, Canada, and Latin America. Ambulance services and fire protection
services accounted for approximately 80% and 11%, respectively, of the Company's
revenue for the six months ended December 31, 1997.
Founded in 1948, the Company has been instrumental in the development of
protocols and policies applicable to the emergency services industry. The
Company has grown significantly since the late 1970s both through internal
growth and through acquisitions. To manage this growth, the Company invested in
the development of management and operational systems that have resulted in
productivity gains and increased profitability. The Company believes its key
business competencies in communications and logistics management position it to
continue its growth internally as well as through acquisitions, joint ventures,
and business alliances and enable it to operate profitably in both large and
small communities. The Company completed 11 acquisitions in the fiscal year
ended June 30, 1995, 18 acquisitions in the fiscal year ended June 30, 1996, 19
acquisitions in the fiscal year ended June 30, 1997, and nine acquisitions
during the six months ended December 31, 1997.
Based on generally available industry data, it is estimated that annual
expenditures for ambulance services in the United States are between $4 billion
and $7 billion. Various factors, including the growth and aging of the
population, and trends toward the use of outpatient services and specialized
treatment facilities in an effort to contain health care costs have increased
the demand for ambulance services. At the same time, industry factors have
increased the standards of pre-hospital emergency care and have required faster
ambulance response times, increasing the amount of capital and technological
resources necessary to provide higher levels of service. These factors, combined
with the historically fragmented nature of the ambulance service industry, are
contributing to consolidation within the industry.
Market-driven forces changing the health care industry are impacting the
ambulance industry as well. The Company believes the trend toward managed care
benefits larger ambulance services providers, which can service a larger portion
of a managed care provider's needs. This allows the managed care provider to
reduce its number of suppliers, cutting administrative costs and allowing it to
negotiate more favorable rates.
Volunteer fire departments, tax-supported fire districts, and municipal
fire departments constitute the primary providers of fire protection services in
the United States. Because emergency medical response represents a significant
portion of fire response activity within many fire departments, the Company
believes that its ambulance and fire protection services operations are
complementary. The Company believes that its integration of health and safety
services can provide operating economies, coordination of the delivery of
services, efficiencies in the use of personnel and equipment, and enhanced
levels of service, especially in lower-utilization communities. Additionally, a
variety of economic pressures on the public sector may increase opportunities
for privatization and public/private alliances in fire protection and other
safety-related services.
The Company's strategy is to leverage its experience and competencies in
communications and logistics management to enhance its position as a leading
provider of emergency response services in the United States and in other
countries through the acquisition of ambulance service providers and increased
marketing efforts to serve the health and safety needs of the public and private
sector. This strategy includes plans to (i) acquire additional ambulance service
providers operating in metropolitan areas and in communities surrounding the
3
<PAGE> 11
metropolitan areas that the Company currently serves or plans to serve; (ii)
expand its emergency ambulance services through the pursuit of new contracts
with municipalities and fire districts and its general transport services and
other value-added services through increased marketing efforts to, and pursuit
of other alliances with, managed care providers and other health care providers;
(iii) expand its fire protection services into selected additional service areas
through the pursuit of opportunities to supplant or enhance services provided by
volunteer fire departments, expand its services to newly developed communities,
and develop public/private partnerships for fire and safety services with fire
districts and municipal fire departments; (iv) continue the integration of its
health and safety services to maximize operational efficiencies and synergies;
(v) improve its productivity through the more efficient utilization of equipment
and personnel; and (vi) expand its presence in the international health and
safety and other related services markets initially in Canada and Latin America.
See "Business -- Strategy."
The Company was incorporated in Arizona in 1948 and reincorporated in
Delaware in May 1993. Unless the context indicates otherwise and except as used
in "Description of the New Credit Facility" and "Description of the Exchange
Notes," all references to the "Company" refer to Rural/Metro Corporation and its
subsidiaries. The Company maintains its principal executive offices at 8401 East
Indian School Road, Scottsdale, Arizona 85251, and its telephone number is (602)
994-3886.
RECENT DEVELOPMENTS
In March 1998, the Company purchased all of the issued and outstanding
capital stock of four operating companies ("ECCO") of Emergencias Cardio
Coronarias in Argentina. ECCO has approximately 750,000 customers who pre-pay
monthly for urgent home medical attention and ambulance transport services under
a capitated service arrangement. Under the ECCO model, medical personnel conduct
telephone triage and prioritize the dispatch of services to subscribers. ECCO's
mobile services include the dispatch of physicians to the patient, covering a
wider scope of service than the traditional U.S. ambulance service model. The
purchase price was equal to $35.0 million, consisting of a combination of $25.0
million in cash and $10.0 million in shares of the Company's Common Stock. For
its most recent fiscal year ended September 30, 1997, ECCO recognized net
revenues and income before income tax of approximately $43.4 million and $5.9
million, respectively, prepared in accordance with generally accepted accounting
principles in force in Argentina ("Argentina GAAP"). Argentina GAAP and United
States generally accepted accounting principles ("U.S. GAAP") differ in certain
respects. ECCO's combined operating data for its fiscal year ended September 30,
1997 prepared in accordance with U.S. GAAP are not expected to differ materially
from its financial results determined in accordance with Argentina GAAP. See
"Risk Factors -- Risks Associated with Rapid Growth, Acquisitions, and
Integration" and "-- Risks Associated with International Operations and Foreign
Currency Fluctuations."
In February 1998, the Company acquired by merger United Medical Services
("United Medical"), one of the leading providers of ambulance transport services
in the Pacific Northwest, operating as Shannon Ambulance Company in Snohomish,
King, and Pierce counties in Washington, as well as in the greater Seattle and
Tacoma areas, and as Arrow Ambulance Company in parts of Northern Idaho. United
Medical, which transports more than 35,000 patients per year, has annualized
revenues of approximately $12.0 million. The purchase price was equal to $5.5
million paid in shares of the Company's Common Stock. See "Risk Factors -- Risks
Associated with Rapid Growth, Acquisitions, and Integration."
4
<PAGE> 12
THE EXCHANGE OFFER
THE OUTSTANDING NOTES...... The Outstanding Notes were sold by the Company as
of March 16, 1998, in the Initial Offering, to the
Initial Purchasers pursuant to the Purchase
Agreement. The Initial Purchasers subsequently
resold the Outstanding Notes to "Qualified
Institutional Buyers" as such term is defined in
Rule 144A under the Securities Act ("QIBs").
REGISTRATION
REQUIREMENTS............... Pursuant to the Purchase Agreement, the Company,
the Guarantors, and the Initial Purchasers entered
into the Registration Rights Agreement, which
grants the holders of the Outstanding Notes certain
exchange and registration rights. The Exchange
Offer is intended to satisfy such exchange and
registration rights, which terminate upon the
consummation of the Exchange Offer. If applicable
law or applicable interpretations of the staff of
the Commission do not permit the Company to effect
the Exchange Offer, the Company and the Guarantors
agreed to file a shelf registration (the "Shelf
Registration Statement") covering resales of the
Outstanding Notes. See "The Exchange
Offer -- Resale of Exchange Notes" and "The
Exchange Offer -- Shelf Registration Statement."
THE EXCHANGE OFFER......... The Company is offering to exchange $1,000
principal amount of the Exchange Notes for each
$1,000 principal amount of Outstanding Notes. As of
the date hereof, $150.0 million aggregate principal
amount of Outstanding Notes are outstanding. The
Company will issue the Exchange Notes subsequent to
the Expiration Date and on or before May , 1998
(the "Exchange Date"), unless the Exchange Offer is
extended. See "Risk Factors -- Exchange Offer
Procedures; Consequences of Failure to Exchange."
Based on an interpretation of the staff of the
Commission set forth in no-action letters issued to
third parties, the Company believes that the
Exchange Notes issued pursuant to the Exchange
Offer in exchange for Outstanding Notes may be
offered for resale, resold, and otherwise
transferred by any holder thereof (other than any
such holder which is an "affiliate" of the Company
within the meaning of Rule 405 under the Securities
Act) without compliance with the registration and
prospectus delivery provisions of the Securities
Act, provided that such Exchange Notes are acquired
in the ordinary course of such holder's business
and that such holder does not intend to participate
and has no arrangement or understanding with any
person to participate in the distribution of such
Exchange Notes.
Any holder who tenders in the Exchange Offer with
the intention to participate, or for the purpose of
participating, in a distribution of the Exchange
Notes could not rely on the position of the staff
of the Commission enunciated in Exxon Capital
Holdings Corporation (available April 13, 1989) or
similar no-action letters and, in the absence of an
exemption therefrom, must comply with the
registration and prospectus delivery requirements
of the Securities Act in connection with the resale
transaction. Failure to comply with such
requirements in such instance may result in such
holder incurring liability under the Securities Act
for which the holder is not indemnified by the
Company.
Each Participating Broker-Dealer that receives
Exchange Notes for its own account in exchange for
Outstanding Notes, where such Outstanding Notes
were acquired by such broker-dealer as a result of
market-
5
<PAGE> 13
making activities or other trading activities, must
acknowledge that it will deliver a prospectus in
connection with any resale of Exchange Notes. The
Letter of Transmittal for the Exchange Offer states
that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to
admit that it is an "underwriter" within the
meaning of the Securities Act. This Prospectus, as
it may be amended or supplemented from time to
time, may be used by a broker-dealer in connection
with resales of Exchange Notes received in exchange
for Outstanding Notes where such Outstanding Notes
were acquired by such broker-dealer as a result of
market-making activities or other trading
activities. The Company has agreed to make this
Prospectus available to any Participating
Broker-Dealer for use in connection with any such
resale for a period of up to 180 days from the
consummation of the Exchange Offer. See "Plan of
Distribution."
EXPIRATION DATE............ 5:00 p.m., E.D.T., on , 1998, unless
extended.
INTEREST ON THE EXCHANGE
NOTES.................... Interest on the Exchange Notes will accrue at a
rate equal to 7 7/8% per annum and will be payable
semi-annually in arrears on March 15 and September
15 of each year, commencing September 15, 1998.
Interest on the Exchange Notes will accrue from the
most recent date to which interest has been paid on
the Outstanding Notes or, if no interest has been
paid, from the date of original issuance of the
Outstanding Notes.
PROCEDURES FOR TENDERING
OUTSTANDING NOTES........ Each holder of Outstanding Notes wishing to accept
the Exchange Offer must complete, sign, and date
the accompanying Letter of Transmittal, or a
facsimile thereof, in accordance with the
instructions contained herein and therein, and mail
or otherwise deliver such Letter of Transmittal, or
such facsimile, together with the Outstanding Notes
and any other required documentation to the
Exchange Agent at the address set forth herein. By
executing the Letter of Transmittal, each holder
will represent to the Company that, among other
things, the holder or person receiving such
Exchange Notes, whether or not such person is the
holder, is acquiring the Exchange Notes in the
ordinary course of business and that neither the
holder nor any such other person has any
arrangement or understanding with any person to
participate in the distribution of such Exchange
Notes. In lieu of physical delivery of the
certificates representing Outstanding Notes,
tendering holders may transfer Outstanding Notes
pursuant to the procedure for book-entry transfer
as set forth under "The Exchange
Offer -- Procedures for Tendering."
Each Participating Dealer that acquired Outstanding
Notes as a result of market-making or other trading
activities must acknowledge that it will deliver a
prospectus in connection with any resale of such
Exchange Notes. See "Plan of Distribution."
SPECIAL PROCEDURES FOR
BENEFICIAL OWNERS........ Any beneficial owner whose Outstanding Notes are
registered in the name of a broker-dealer,
commercial bank, trust company, or other nominee
and who wishes to tender should contact such
registered holder promptly and instruct such
registered holder to tender on such beneficial
owner's behalf.
6
<PAGE> 14
If such beneficial owner wishes to tender on such
owner's own behalf, such owner must prior to
completing and executing the Letter of Transmittal
and delivering its Outstanding Notes, either make
appropriate arrangements to register ownership of
the Outstanding Notes in such owner's name or
obtain a properly completed bond power from the
registered holder. The transfer of record ownership
may take considerable time.
GUARANTEED DELIVERY
PROCEDURES............... Holders of Outstanding Notes who wish to tender
their Outstanding Notes and whose Outstanding Notes
are not immediately available or who cannot deliver
their Outstanding Notes, the Letter of Transmittal,
or any other documents required by the Letter of
Transmittal to the Exchange Agent (or comply with
the procedures for book-entry transfer) prior to
the Expiration Date must tender their Outstanding
Notes according to the guaranteed delivery
procedures set forth in "The Exchange
Offer -- Guaranteed Delivery Procedures."
WITHDRAWAL RIGHTS.......... Tenders of Outstanding Notes may be withdrawn at
any time prior to 5:00 p.m., E.D.T., on the
Expiration Date pursuant to the procedures
described under "The Exchange Offer -- Withdrawal
of Tenders."
ACCEPTANCE OF OUTSTANDING
NOTES
AND DELIVERY OF EXCHANGE
NOTES.................... Subject to certain conditions, the Company will
accept for exchange any and all Outstanding Notes
that are properly tendered in the Exchange Offer
prior to 5:00 p.m., E.D.T., on the Expiration Date.
The Exchange Notes issued pursuant to the Exchange
Offer will be delivered on the Exchange Date. See
"The Exchange Offer -- Terms of the Exchange
Offer."
FEDERAL INCOME TAX
CONSEQUENCES............. The issuance of the Exchange Notes to holders of
the Outstanding Notes pursuant to the Exchange
Offer should not be a taxable event for United
States federal income tax purposes. See "Certain
Federal Income Tax Consequences."
EFFECT ON HOLDERS OF
OUTSTANDING NOTES........ As a result of the making of this Exchange Offer,
the Company will have fulfilled one of its
obligations under the Registration Rights
Agreement, and, with certain exceptions noted
below, holders of Outstanding Notes who do not
tender their Outstanding Notes will not have any
further registration rights under the Registration
Rights Agreement or otherwise. Such holders will
continue to hold the untendered Outstanding Notes
and will be entitled to all the rights and subject
to all the limitations applicable thereto under the
Indenture, except to the extent such rights or
limitations, by their terms, terminate or cease to
have further effectiveness as a result of the
Exchange Offer. All untendered Outstanding Notes
will continue to be subject to certain restrictions
on transfer. Accordingly, if any Outstanding Notes
are tendered and accepted in the Exchange Offer,
the trading market of the untendered Outstanding
Notes could be adversely affected. See "Risk
Factors -- Exchange Offer Procedures" and "Risk
Factors -- Lack of Public Market for the Exchange
Notes."
EXCHANGE AGENT............. The First National Bank of Chicago (the "Exchange
Agent").
7
<PAGE> 15
SUMMARY OF TERMS OF THE EXCHANGE NOTES
ISSUER....................... Rural/Metro Corporation
SECURITIES OFFERED........... $150,000,000 in aggregate principal amount of
7 7/8% Senior Notes due 2008.
MATURITY..................... March 15, 2008
INTEREST..................... Interest on the Exchange Notes will accrue
interest at a rate equal to 7 7/8% per annum,
payable semi-annually in arrears on March 15 and
September 15 of each year, commencing September
15, 1998.
GUARANTEES................... The Exchange Notes will be fully and
unconditionally guaranteed on a senior,
unsecured, and joint and several basis by the
Guarantors. As of December 31, 1997, on a pro
forma basis after giving effect to the Initial
Offering and the application of the net proceeds
therefrom, the Guarantors would have had $14.2
million principal amount of secured or other
Indebtedness outstanding other than the
Guarantees. See "Description of the Exchange
Notes -- Guarantees."
RANKING...................... The Exchange Notes will rank senior in right of
payment to all existing and future Subordinated
Indebtedness and pari passu in right of payment
with all other Indebtedness and all other
liabilities (including trade payables) of the
Company. The Indenture pursuant to which the
Exchange Notes will be issued (the "Indenture")
permits the Company to incur additional
Indebtedness, including Senior Indebtedness and
secured Indebtedness, subject to certain
limitations. The Exchange Notes will be
effectively subordinated to all present or future
secured Indebtedness of the Company to the extent
of the value of the collateral securing such
Indebtedness. The Guarantees will rank senior in
right of payment to all existing and future
Subordinated Indebtedness of the Guarantors, will
be effectively subordinated to all secured
Indebtedness of the Guarantors to the extent of
the value of the assets securing such
Indebtedness, and will rank pari passu in right
of payment with all other Indebtedness and
liabilities (including trade payables) of the
Guarantors. As of December 31, 1997, after giving
effect to the Initial Offering and the
application of the net proceeds therefrom, the
Company would have had $12.9 million secured
Indebtedness and $46.1 million other Indebtedness
outstanding other than the Exchange Notes. In
addition, upon consummation of the Initial
Offering, the Company received $200.0 million of
total commitments under the New Credit Facility,
of which approximately $161.9 million would have
been available as of December 31, 1997, after
giving effect to the Initial Offering, the use of
the net proceeds therefrom, and the terms of the
New Credit Facility. See "Risk Factors -- Holding
Company Structure," "Capitalization,"
"Description of the New Credit Facility," and
"Description of the Exchange Notes."
OPTIONAL REDEMPTION.......... Except as set forth below, the Exchange Notes
will not be redeemable at the option of the
Company prior to March 15, 2003. Thereafter, the
Exchange Notes will be subject to redemption at
any time at the option of the Company, in whole
or in part, at the redemption prices set forth
herein, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the
redemption date. In addition, at any
8
<PAGE> 16
time prior to March 15, 2001, the Company may
redeem up to an aggregate of $52.0 million in
principal amount of Notes at a redemption price
equal to 107.875% of the principal amount
thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the
redemption date with the net cash proceeds of one
or more Public Equity Offerings; provided that at
least $98.0 million in principal amount of Notes
remains outstanding immediately following each
such redemption.
CHANGE OF CONTROL............ In the event of a Change of Control, the Company
will be required to make an offer to each holder
of Exchange Notes to repurchase all or any part
of such holder's Exchange Notes at a repurchase
price equal to 101%, in the case of a Change of
Control which was approved by the Board of
Directors of the Company, or 105%, in the case of
a Change of Control which was not approved by the
Board of Directors of the Company, of the
principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon
to the repurchase date. See "Risk
Factors -- Potential Failure to Make Payment Upon
Change of Control" and "Description of the
Exchange Notes."
CERTAIN COVENANTS............ The Indenture will contain certain covenants
that, among other things, limit the ability of
the Company to incur additional Indebtedness, pay
dividends, repurchase Equity Interests (as
defined) or make other Restricted Payments (as
defined), create Liens (as defined), enter into
transactions with Affiliates (as defined), sell
assets or enter into certain mergers and
consolidations. See "Description of the Exchange
Notes."
9
<PAGE> 17
SUMMARY CONSOLIDATED FINANCIAL DATA
The following table sets forth (i) summary historical consolidated
financial data of the Company for each of the three years in the period ended
June 30, 1997 and for the six months ended December 31, 1996 and 1997, (ii)
summary pro forma consolidated financial data of the Company for the year ended
June 30, 1997 and the six months ended December 31, 1997, which give effect to
receipt and application of the net proceeds (after deducting expenses related to
the Initial Offering) from the Initial Offering and the fiscal 1997 and 1998
acquisitions (as defined) as if each had occurred on July 1, 1996, and (iii)
summary historical balance sheet data of the Company and as adjusted to give
effect to the receipt and application of the net proceeds (after deducting
expenses related to the Initial Offering) from the Initial Offering as if such
transaction had occurred on December 31, 1997. The summary historical
consolidated financial data for each of the three years in the period ended June
30, 1997 were derived from the audited consolidated financial statements of the
Company, which are included elsewhere in this Prospectus, together with the
report thereon of Arthur Andersen LLP, independent public accountants. The
summary historical consolidated financial data for the six months ended December
31, 1996 and 1997 were derived from unaudited consolidated financial statements
of the Company, which, in the opinion of management, contain all adjustments
(consisting of only normal recurring adjustments) necessary for the fair
presentation of the information set forth therein. The results of operations for
the six months ended December 31, 1997 are not necessarily indicative of the
results that may be expected for the full year. The pro forma financial data and
the as adjusted balance sheet data are provided for informational purposes only,
are unaudited, and are not necessarily indicative of future results or what the
operating results or financial condition of the Company would have been had the
transactions described below actually been consummated on the dates assumed. The
following table should be read in conjunction with "Capitalization," "Unaudited
Pro Forma Consolidated Financial Data," "Selected Consolidated Financial Data,"
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," and the Consolidated Financial Statements of the Company, including
the notes thereto, which are contained elsewhere or incorporated by reference in
this Prospectus.
<TABLE>
<CAPTION>
SIX MONTHS
FISCAL YEAR ENDED JUNE 30, ENDED DECEMBER 31,
-------------------------------------------- ------------------------------
PRO PRO
FORMA FORMA
1995 1996 1997 1997(1) 1996 1997 1997(1)
-------- -------- -------- ----------- -------- -------- --------
(UNAUDITED) (UNAUDITED)
(IN THOUSANDS, EXCEPT STATISTICAL DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENTS OF INCOME:
Revenue......................................... $171,583 $250,263 $319,805 $427,067 $151,524 $209,115 $223,958
Operating income................................ 15,940 24,664 27,804 38,944 14,066 22,545 23,902
Interest expense, net........................... 3,059 5,108 5,720 13,537 2,082 5,409 6,941
Net income(2)................................... 6,900 11,512 12,720 14,483 7,070 10,082 9,927
OTHER FINANCIAL DATA:
Adjusted EBITDA(3).............................. $ 24,668 $ 38,011 $ 50,626 $ 68,772 $ 21,917 $ 34,503 $ 36,941
Adjusted EBITDA margin(4)....................... 14.4% 15.2% 15.8% 16.1% 14.5% 16.5% 16.5%
Depreciation and amortization................... $ 8,728 $ 13,347 $ 16,796 $ 23,802 $ 7,851 $ 11,958 $ 13,039
Capital expenditures............................ 11,474 18,237 23,872 NA 7,725 14,909 NA
Ratio of adjusted EBITDA to interest expense.... 8.1x 7.4x 8.9x 5.1x 10.5x 6.4x 5.3x
Ratio of earnings to fixed charges(5)........... 3.8x 3.7x 3.5x 2.4x 4.2x 3.2x 2.7x
STATISTICAL DATA:
States of operation (at period end)............. 10 17 21 23 18 23 23
Ambulances (at period end)...................... 761 1,243 1,561 1,883 1,621 1,883 1,883
Fire apparatus (at period end).................. 119 128 135 145 130 145 145
Sources of revenue
Ambulance services............................ 74.3% 78.8% 80.5% 84.8% 80.2% 80.0% 81.1%
Fire protection services...................... 18.8 15.5 13.2 9.9 13.6 10.8 10.0
Other services................................ 6.9 5.7 6.3 5.3 6.2 9.2 8.9
-------- -------- -------- -------- -------- -------- --------
Total................................... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
======== ======== ======== ======== ======== ======== ========
</TABLE>
10
<PAGE> 18
<TABLE>
<CAPTION>
DECEMBER 31, 1997
-------------------------
ACTUAL AS ADJUSTED(6)
-------- --------------
<S> <C> <C>
BALANCE SHEET DATA:
Working capital........................................... $116,918 $121,918
Total assets.............................................. 451,822 456,764
Current portion of long-term debt......................... 16,435 11,435
Long-term debt, net of current portion.................... 187,334 197,276
Stockholders' equity...................................... 172,967 172,967
</TABLE>
- ---------------
(1) Reflects the pro forma effects of the results of operations and the receipt
and application of the net proceeds (after deducting expenses related to the
Initial Offering) from the Initial Offering and the fiscal 1997 and 1998
acquisitions as if each transaction had occurred as of the beginning of the
period.
(2) Net income for the year ended June 30, 1995 reflects the effect of an
extraordinary loss of $693,000.
(3) Adjusted EBITDA represents income before interest, extraordinary items,
depreciation and amortization expense, and federal and state income taxes
and excludes the $6,026,000 loss contract/restructuring charge incurred
during fiscal 1997. EBITDA is generally considered to provide information
regarding a company's ability to service and/or incur debt. EBITDA should
not be considered in isolation or as a substitute for net income, cash flows
from operations, or other consolidated income or cash flow data prepared in
accordance with generally accepted accounting principles as a measure of a
company's profitability or liquidity.
(4) Adjusted EBITDA margin as used herein consists of adjusted EBITDA divided by
revenue.
(5) For purposes of calculating the ratio of earnings to fixed charges, earnings
consist of income before provision for income taxes plus fixed charges.
Fixed charges consist of interest expense (including the amortization of
debt issuance costs) plus that portion of rental payments on operating
leases deemed representative of the interest factor. Pro forma amounts are
adjusted to give effect to the Initial Offering, the application of the net
proceeds therefrom, and reflects the results of operations of acquisitions
from the beginning of the period through the respective dates of
acquisition. See "Use of Proceeds" and "Capitalization." Pro forma ratio of
earnings to fixed charges adjusted to give effect to the Initial Offering
and the application of net proceeds therefrom, excluding the results of
operations of acquisitions from the beginning of the period through the
respective dates of acquisition, is 2.0x and 2.7x for the fiscal year ended
June 30, 1997 and the six months ended December 31, 1997, respectively.
(6) As adjusted to give effect to the receipt and application of the net
proceeds (after deducting expenses related to the Initial Offering) from the
Initial Offering as if such transaction had occurred on December 31, 1997.
11
<PAGE> 19
RISK FACTORS
Holders of the Outstanding Notes should carefully review the information
set forth below, in addition to the other information in this Prospectus, before
deciding to tender their Outstanding Notes in the Exchange Offer.
EXCHANGE OFFER PROCEDURES; CONSEQUENCES OF FAILURE TO EXCHANGE
Issuance of the Exchange Notes in exchange for Outstanding Notes pursuant
to the Exchange Offer will be made only after the timely receipt by the Company
of such Outstanding Notes, a properly completed and duly executed Letter of
Transmittal, and all other required documents. Therefore, holders of the
Outstanding Notes desiring to tender such Outstanding Notes in exchange for
Exchange Notes should allow sufficient time to ensure timely delivery. The
Company is under no duty to give notification of defects or irregularities with
respect to the tenders of Outstanding Notes for exchange. Outstanding Notes that
are not tendered or are tendered but not accepted will, following the
consummation of the Exchange Offer, continue to be subject to the existing
restrictions upon transfer thereof. Upon consummation of the Exchange Offer, the
registration rights under the Registration Rights Agreement will terminate. In
addition, any holder of Outstanding Notes who tenders in the Exchange Offer for
the purpose of participating in a distribution of the Exchange Notes may be
deemed to have received restricted securities and, if so, will be required to
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any resale transaction. Each broker-dealer
that receives Exchange Notes for its own account in exchange for the Outstanding
Notes, where such Outstanding Notes were acquired by such broker-dealer as a
result of market-making activities or other trading activities, must acknowledge
that it will deliver a prospectus in connection with any resale of such Exchange
Notes. See "Plan of Distribution." TO THE EXTENT THAT SOME OF THE OUTSTANDING
NOTES ARE TENDERED AND ACCEPTED IN THE EXCHANGE OFFER, THE TRADING MARKET FOR
UNTENDERED AND TENDERED BUT UNACCEPTED OUTSTANDING NOTES COULD BE ADVERSELY
AFFECTED.
SIGNIFICANT LEVERAGE
The Company has significant indebtedness and debt service obligations. At
December 31, 1997, after giving effect to the Initial Offering and the
application of the net proceeds therefrom, the Company would have had
approximately $208.7 million of consolidated indebtedness as compared to the
Company's stockholders' equity of $173.0 million. In addition, as of December
31, 1997, after giving effect to the Initial Offering and the application of the
net proceeds therefrom, the Company would have had a debt-to-equity ratio of
1.2-to-1. If the Company is unable to service the Notes and to meet its debt
service obligations and operating expenses, it will be required to examine
alternative means of repayment that could include restructuring or refinancing
some or all of its indebtedness or raising additional equity. There can be no
assurance that any of these strategies could be effected on satisfactory terms.
The Indenture permits the Company to incur additional indebtedness under certain
conditions, and the Company expects that it will incur additional indebtedness
during the term of the Exchange Notes pursuant to the New Credit Facility. The
Company's ability to make payments with respect to the Exchange Notes and to
satisfy its other debt obligations will depend on its future operating
performance, which will be affected by governmental regulations, prevailing
economic conditions, financial factors, and other factors, certain of which are
beyond the Company's control. There can be no assurance that the Company will
generate sufficient cash flow to meet its debt service obligations. The
Company's leverage and related financial covenants could have a material adverse
effect on its ability to withstand competitive pressures or adverse economic
conditions, make material acquisitions, obtain future financing, or take
advantage of business opportunities that may arise. See "Capitalization" and
"Description of the New Credit Facility."
The degree to which the Company is leveraged could have important
consequences to holders of the Exchange Notes, including: (i) the Company's
ability to obtain additional financing in the future for operating expenses,
acquisitions, or general corporate purposes may be impaired; (ii) a portion of
the Company's cash flows from operations may be dedicated to the payment of
principal and interest on its indebtedness, thereby reducing the funds available
for operations; (iii) certain of the Company's indebtedness, including the New
Credit Facility, contain financial covenants, including a total debt leverage
ratio, a total debt to total
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capitalization ratio, and a fixed charge ratio, and other restrictive covenants,
including those restricting the incurrence of additional indebtedness, the
creation of liens, the payment of dividends and sales of assets; and (iv) the
Company's leverage may make the Company vulnerable to changes in the industry,
including, among other things, government regulations and changing economic
conditions.
RESTRICTIVE COVENANTS IMPOSED BY TERMS OF THE COMPANY'S INDEBTEDNESS
The Indenture governing the terms of the Exchange Notes will contain
certain covenants limiting, subject to certain exceptions, the incurrence of
additional indebtedness, the payment of dividends, the redemption of capital
stock, the making of certain investments, the issuance of capital stock of
subsidiaries, the creation of liens, and other restrictions affecting the
Company's subsidiaries, the issuance of guarantees, transactions with
affiliates, asset sales, and certain mergers and consolidations. A breach of any
of these covenants could result in an event of default under the Indenture. In
addition, the New Credit Facility will contain other more restrictive covenants
and will require the Company to satisfy certain financial tests. The Company's
ability to satisfy those tests can be affected by events beyond its control, and
there can be no assurance that the Company will be able to meet those tests. A
breach of any of these covenants could result in a default under the New Credit
Facility and under the Indenture. Upon the occurrence of an event of default
under the New Credit Facility, depending on actions taken by the lenders under
the New Credit Facility, the Company could experience difficulties with
customers, personnel, or others. See "Description of the New Credit Facility"
and "Description of the Exchange Notes -- Certain Covenants."
HOLDING COMPANY STRUCTURE
The Company is a holding company and substantially all of its operations
are conducted through its subsidiaries. The Company's cash flow and,
consequently, its ability to service its indebtedness, including the Exchange
Notes, are dependent on its ability to gain access to the cash flow of its
subsidiaries (whether through loans, dividends, distributions, or otherwise) and
are subject to any legal, contractual, or other restrictions that could hinder
or prevent the Company from doing so. Each subsidiary is a separate and distinct
legal entity from the Company and, unless it is a Guarantor, has no obligation,
contingent or otherwise, to pay any amounts due in respect of the Exchange Notes
or to make any amounts available for the payment thereof. The holders of any
indebtedness of the Company's subsidiaries will be entitled to payment thereof
from the assets of such subsidiaries prior to the holders of any general,
unsecured obligations of the Company, including the Exchange Notes and the
Guarantees. As of December 31, 1997, after giving effect to the Initial Offering
and the application of the net proceeds therefrom, the Company's subsidiaries
would have had $14.2 million of secured or other Indebtedness. Accordingly,
there can be no assurance that the subsidiaries will be able to, or will be
permitted to, pay to the Company amounts necessary to service the Exchange
Notes. In the event such amounts are not paid to the Company, the Company may be
unable to make required principal and interest payments on the Exchange Notes.
DEPENDENCE ON CERTAIN BUSINESS RELATIONSHIPS
The Company depends to a great extent on certain contracts with
municipalities or fire districts to provide "911" emergency ambulance services
and fire protection services. The Company's five largest contracts accounted for
approximately 22% and 18% of total revenue for the fiscal years ended June 30,
1996 and 1997 respectively, with one contract accounting for approximately 7%
and 5% of total revenue for the same periods. The loss or cancellation of any
one or more of these contracts could have a material adverse effect on the
Company's business, financial condition, cash flows, and results of operations.
No assurance can be given that the Company will be successful in retaining its
existing contracts or in obtaining new contracts for emergency ambulance
services or for fire protection services. In addition, many of the Company's
contracts are for extended periods ranging from 2 years to 5 years. During such
periods, the Company may determine that a contract is no longer favorable and
may pursue options to modify or terminate the contract. Factors contributing to
such a determination could include weaker than expected transport volume,
geographical issues adversely affecting response times, and delays in
implementing technology upgrades. The Company faces certain risks in attempting
to terminate unfavorable contracts prior to their expiration due to the risk of
forfeiting performance bonds and the potential adverse political and public
relations consequences. The
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Company's inability to terminate or amend unfavorable contracts could have a
material adverse effect on the Company's business, financial condition, cash
flows, and results of operations. The Company also faces the risk that areas in
which it provides fire protection services through subscription arrangements
with residents and businesses will be converted to tax-supported fire districts
or annexed by municipalities. See "Business -- Marketing and Sales,"
"-- Contracts," and "-- Competition."
RISKS ASSOCIATED WITH RAPID GROWTH, ACQUISITIONS, AND INTEGRATION
The Company's strategy with respect to ambulance services depends in large
part on its continued ability to acquire and operate successfully additional
ambulance service providers. The Company actively seeks acquisition
opportunities in the regular course of its business and is engaged in ongoing
evaluations of and discussions regarding potential acquisitions. The Company
completed 11 acquisitions in fiscal 1995, 18 acquisitions in fiscal 1996, 19
acquisitions in fiscal 1997, and nine acquisitions during the six months ended
December 31, 1997. There can be no assurance that the Company will be able to
identify additional suitable acquisition candidates, that it will be able to
consummate any such acquisitions, or that it will be able to integrate any such
acquisitions successfully into its operations. See "-- Dependence on Management
and Other Key Personnel." Acquisitions involve numerous short-term and long-term
risks, including diversion of management's attention, failure to retain key
personnel of the acquired company, adverse consequences to cash flow until
accounts receivable of the acquired company are fully integrated, loss of net
revenues of the acquired company, and possible regulatory issues of the acquired
company. In addition, the Company may be required to comply with laws and
regulations of jurisdictions that differ from those in which the Company
currently operates and may face competitors with greater knowledge of such local
markets. The Company expects to use cash and securities, including its Common
Stock, as the principal consideration for future acquisitions. The Company's
acquisition program could be adversely affected if the Company does not generate
sufficient cash for future acquisitions from existing operations or through
additional debt or equity financings. There can be no assurance that the
Company's operations will generate sufficient cash for acquisitions or that any
additional financings for acquisitions will be available if and when needed or
on terms acceptable to the Company. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and "Business -- Strategy."
The integration of the management, operations, facilities, and accounting
and information systems of businesses acquired by the Company requires continued
investment of time and resources and could involve unforeseen difficulties, all
of which could have a material adverse effect on the Company's business,
financial condition, cash flows, and results of operations. There can be no
assurance that unforeseen liabilities will not arise in connection with the
operation of businesses acquired by the Company or that any contractual purchase
price adjustments, rights of set-off, or other remedies available to the Company
will be sufficient to compensate the Company in the event unforeseen liabilities
arise.
DEPENDENCE ON REIMBURSEMENTS BY THIRD-PARTY PAYORS AND INDIVIDUALS
Payments received from third-party payors (including Medicare, Medicaid,
and private insurers) represent a substantial portion of the Company's ambulance
receipts. The Company derived approximately 79% and 74% of its net ambulance fee
collections from such third-party payors during 1996 and 1997, including 27% and
26% from Medicare, respectively. The reimbursement process is complex and can
involve lengthy delays. Third-party payors are continuing their efforts to
control expenditures for health care, including proposals to revise
reimbursement policies. The Company recognizes revenue when the services are
provided; however, there can be lengthy delays before reimbursement is received.
The Company has from time to time experienced delays in receiving reimbursements
from third-party payors. In addition, third-party payors may disallow, in whole
or in part, requests for reimbursement based on determinations that certain
amounts are not reimbursable or because additional supporting documentation is
necessary. Retroactive adjustments can change amounts realized from third-party
payors. Delays and uncertainties in the reimbursement process adversely affect
the Company's level of accounts receivable and may adversely affect the
Company's working capital and cause the Company to incur additional borrowing
costs. Under present coverage programs with third-party payors, the Company also
faces the continuing risk of nonreimbursement to the extent that uninsured
individuals require emergency ambulance service in service areas where an
adequate subsidy is not provided. Amounts not covered by third-party payors are
the obligations of individual
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<PAGE> 22
patients. The Company's gross accounts receivable as of June 30, 1996, June 30,
1997, and December 31, 1997 were $95.2 million, $142.8 million, and $194.9
million, respectively. The Company's accounts receivable, net of the allowance
for doubtful account, were $68.6 million, $107.0 million, and $149.9 million as
of such dates, respectively. The Company believes that the increase in accounts
receivable is related significantly to acquisition activity and to recent
revenue growth. The Company also attributes the increase in accounts receivable
and the increased age of receivables to certain factors, including delays in
payments from certain third-party payors, particularly in certain of the
Company's regional billing areas, and a general industry trend towards a
lengthening payment cycle of accounts receivable due from third-party payors. In
addition, the Company believes certain transitional aspects of the integration
of acquired companies into the Company's centralized billing and collection
function has resulted in increases in the amount and age of accounts receivable
during the transition period. The risks associated with third-party payors and
individuals and the Company's failure to monitor and manage accounts receivable
successfully could have a material adverse effect on the Company's business,
financial condition, cash flows, and results of operations. The Company reviews
its allowance for doubtful accounts on an ongoing basis and may increase such
allowances from time to time. However, there can be no assurance that the
Company's collection policies and allowances for doubtful accounts receivable
will be adequate. See "Business -- Billings and Collections" and "Management's
Discussion and Analysis of Financial Condition and Results of Operations."
POSSIBLE ADVERSE CHANGES IN REIMBURSEMENT RATES OF COVERAGE
During June 1997, HCFA issued proposed rules that would revise Medicare
policy on the coverage of ambulance services. These proposed rules have been
subject to public comment and, despite the passage of new laws addressing
changes to the reimbursement of ambulance services by Medicare (discussed
below), have not yet been withdrawn. The proposed HCFA rules have not been
finalized. See "Business -- Reimbursement."
In addition, in August 1997, the "Balanced Budget Act of 1997" (the "Budget
Act") became law. The Budget Act provides for the development, negotiation, and
implementation of a prospective fee schedule for ambulance services between HCFA
and ambulance service providers by January 2000. The Budget Act also reduces the
annual rate adjustment for Medicare reimbursements from the Consumer Price Index
(CPI) to CPI less one percentage point.
If the proposed HCFA rules were to be finalized prior to the negotiation of
a prospective fee schedule as stipulated in the Budget Act, and the Company were
unable to mitigate the effect of the new rules, the Company's business,
financial condition, cash flows, and results of operations could be adversely
effected. The final outcome of the proposed rules and the effect of the
prospective fee schedule is uncertain. However, changes in reimbursement
policies, or other government action, together with the financial instability of
private third-party payors and budget pressures on payor sources could influence
the timing and, potentially, the ultimate receipt of payments and
reimbursements. A reduction in coverage or reimbursement rates by third-party
payors, or an increase in the Company's cost structure relative to the rate of
increase in the CPI, could have a material adverse effect on the Company's
business, financial condition, cash flows, and results of operations. See
"Business -- Billings and Collections," "-- Governmental Regulation," and
"-- Reimbursement" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations."
IMPACT OF RATE STRUCTURES AND LIMITATIONS ON RATES OF RETURN
State or local government regulations or administrative policies regulate
rate structures in most states in which the Company conducts ambulance
operations. In certain service areas in which the Company is the exclusive
provider of services, the municipality or fire district sets the rates for
emergency ambulance services pursuant to a master contract and establishes the
rates for general ambulance services that the Company is permitted to charge.
Rates in most service areas are set at the same amounts for emergency and
general ambulance services. The State of Arizona establishes a rate of return on
sales the Company is permitted to earn in determining the ambulance service
rates the Company may charge in that state. Ambulance services revenue generated
in Arizona accounted for approximately 11% and 9% of total revenue for the
fiscal years ended June 30, 1996 and 1997, respectively. No assurance can be
given that the Company will be able to receive ambulance service rate increases
on a timely basis where rates are regulated or to establish or maintain
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<PAGE> 23
satisfactory rate structures where rates are not regulated. See
"Business -- Billings and Collections" and "-- Governmental Regulation."
Municipalities and fire districts negotiate the payments to be made to the
Company for fire protection services pursuant to master contracts. These master
contracts are based on a budget and on level of effort or performance criteria
desired by the municipalities and fire districts. No assurance can be given that
the Company will be successful in negotiating or maintaining profitable
contracts with municipalities and fire districts. See "Business -- Contracts."
RISKS ASSOCIATED WITH INTERNATIONAL OPERATIONS AND FOREIGN CURRENCY FLUCTUATIONS
The Company plans to expand its presence internationally, including
operations in Canada and select Latin American markets. Although the Company
maintains operations in Canada and recently established operations in Argentina
through the acquisition of ECCO, there can be no assurance that the Company will
be successful in expanding its international operations. As the Company expands
its international operations, the Company increasingly will be subject to risks
associated with international operations, including management of a
multi-national organization, fluctuations in currency exchange rates, compliance
with local laws and other regulatory requirements and changes in such laws and
requirements, restrictions on the repatriation of funds, inflationary
conditions, employment and severance issues, political and economic instability,
war or other hostilities, expropriation or nationalization of assets, overlap of
tax structures, and renegotiation or nullification of contracts. The inability
to effectively manage these and other risks could adversely affect the Company's
business, financial condition, cash flows, and results of operations.
The financial information presented herein regarding ECCO is prepared in
accordance with Argentina GAAP. If required under the Exchange Act, the Company
will file with the Commission on the appropriate form combined audited financial
statements of ECCO prepared in accordance with U.S. GAAP. Such financial
statements prepared in accordance with U.S. GAAP are not expected to differ
materially from those prepared in accordance with Argentina GAAP.
The Company's revenue from international operations is denominated
primarily in the currency of the country in which it is operating. A decrease in
the value of such foreign currencies relative to the U.S. dollar could result in
losses from currency exchange rate fluctuations. The Company does not currently
engage in foreign currency hedging transactions. However, as the Company
continues to expand its international operations, exposures to gains and losses
on foreign currency transactions may increase. The Company may choose to limit
such exposure by entering into forward-foreign exchange contracts or engaging in
similar hedging strategies. There can be no assurance that any currency exchange
strategy would be successful in avoiding exchange-related losses, or that the
failure to manage currency risks effectively would not have a material adverse
effect on the Company's business, financial condition, cash flows, and results
of operations. In addition, revenues of the Company earned in foreign countries
may be subject to taxation by more than one jurisdiction, thereby adversely
affecting the Company's earnings.
EFFECT OF GOVERNMENTAL REGULATIONS
Numerous federal, state, local, and foreign laws and regulations govern
various aspects of the business of ambulance service providers, covering matters
such as licensing, rates, employee certification, environmental matters, and
other factors. Certificates of necessity may be required from state or local
governments to operate ambulance services in a designated service area. Master
contracts from governmental authorities are subject to risks of cancellation or
unenforceability as a result of budgetary and other factors and may subject the
Company to certain liabilities or restrictions which traditionally have applied
only to governmental bodies or which they are otherwise immune. There can be no
assurance that federal, state, local, or foreign governments will not change
existing laws or regulations, adopt new laws or regulations that would increase
the Company's cost of doing business, lower reimbursement levels, or otherwise
have a material adverse effect on the Company's business, financial condition,
cash flows, and results of operations, or that the Company will comply, or
continue to comply, with applicable laws or regulations. Additionally, there can
be no assurance that businesses acquired by the Company will be in compliance
with all applicable laws and regulations when acquired. See
"Business -- Governmental Regulation" and "-- Reimbursement."
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<PAGE> 24
HEALTH CARE REFORMS AND COST CONTAINMENT
Numerous legislative proposals have been considered that would result in
major reforms in the United States health care system. The Company cannot
predict which, if any, health care reforms may be proposed or enacted or the
effect that any such legislation would have on the Company's business. In
addition, managed care providers are attempting to contain health care costs
through the use of outpatient services and specialized treatment facilities. No
assurance can be given that changing industry practices will not have an adverse
effect on the Company's business, financial condition, cash flows, and results
of operations. See "Business -- Governmental Regulation."
COMPETITION
The ambulance service industry is highly competitive. Ambulance and general
transport service providers compete primarily on the basis of quality of
service, performance, and cost. The Company believes that counties, fire
districts, and municipalities consider quality of care, historical response time
performance, and cost to be among the most important factors in awarding a
contract, although other factors, such as customer service, financial stability,
and personnel policies and practices, also may be considered. The Company
currently encounters competition in providing ambulance services from
governmental entities (including fire districts), hospitals, other national
ambulance service providers, large regional ambulance service providers, and
numerous local and volunteer private providers. There can be no assurance that
municipalities, fire districts, or health care organizations that currently
contract for ambulance services will not choose to provide ambulance services
directly in the future. The Company is experiencing increased competition from
fire departments to provide emergency ambulance service. Some of the Company's
current competitors and certain potential competitors have greater capital and
other resources than the Company.
Tax-supported fire districts, municipal fire departments, and volunteer
fire departments represent the principal providers of fire protection services
for residential and commercial properties. Private providers represent only a
small portion of the total fire protection market and generally provide services
where a tax-supported municipality or fire district has decided to contract for
the provision of fire protection services or has not assumed the financial
responsibility for fire protection. In these situations, the Company provides
services for a municipality or fire district on a contract basis or provides
fire protection services directly to residences and businesses on a subscription
basis. There can be no assurance that the Company will be able to obtain
additional fire protection business on a contractual or subscription basis, that
fire districts or municipalities will not choose to provide fire protection
services directly in the future, or that areas in which the Company provides
services through subscriptions will not be converted to tax-supported fire
districts or annexed by municipalities. See "Business -- Competition."
DEPENDENCE ON MANAGEMENT AND OTHER KEY PERSONNEL
The Company's success depends upon the retention of principal key personnel
and the recruitment and retention of additional key personnel. The loss of
existing key personnel or the failure to recruit and retain necessary additional
key personnel would adversely affect the Company's business prospects. There can
be no assurance that the Company will be able to retain its current personnel or
attract and retain necessary additional personnel. The Company's internal growth
and its expansion into new geographic areas, including international markets,
will require additional expertise, such as marketing and operational management.
These growth and expansion activities will further increase the demand on the
Company's resources and require the addition of new personnel and the
development of additional expertise by existing personnel. The failure of the
Company to attract and retain personnel with the requisite expertise or to
develop internally such expertise could adversely affect the prospects for the
Company's success. The Company has entered into employment agreements with
certain of its executive officers and has entered into similar agreements with
certain other key personnel. The Company maintains "key person" insurance on
several of its key executive officers. See "Management."
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CONTROL BY CURRENT STOCKHOLDERS
The Company's directors, executive officers, and their affiliates own
beneficially approximately 12.9%, and the Company's Employee Stock Ownership
Plan (the "ESOP") holds approximately 6.6%, of the outstanding shares of the
Company's Common Stock. Accordingly, these persons, if they act as a group,
likely will be able to significantly influence the election of the Company's
directors and the outcome of matters requiring approval by the stockholders of
the Company.
FRAUDULENT CONVEYANCE; UNENFORCEABILITY OF CERTAIN CORPORATE GUARANTEES
If a court in a lawsuit brought by an unpaid creditor or representative of
creditors, such as a trustee in bankruptcy, or the Company as a
debtor-in-possession, were to determine under relevant federal or state
fraudulent conveyance statutes that the Company did not receive fair
consideration or reasonably equivalent value for incurring indebtedness,
including the Exchange Notes, and that, at the time of such incurrence, the
Company (i) was insolvent, (ii) was rendered insolvent by reason of such
incurrence or grant, (iii) was engaged in a business or transaction for which
the assets remaining with the Company constituted unreasonably small capital, or
(iv) intended to incur, or believed that it would incur, debts beyond its
ability to pay such debts as they matured, then such court, subject to
applicable statutes of limitation, could void the Company's obligations under
the Exchange Notes, subordinate the Exchange Notes to other indebtedness of the
Company, or take other action detrimental to the holders of the Exchange Notes.
The measure of insolvency for these purposes will depend upon the governing
law of the relevant jurisdiction. Generally, however, a company will be
considered insolvent for these purposes if the sum of that company's debts is
greater than the fair value or the fair salable value of all of that company's
property or if the present fair salable value of that company's assets is less
than the amount that will be required to pay its probable liability on its
existing debts as they become absolute and matured. Moreover, regardless of
solvency, a court could void an incurrence of indebtedness, including the
Exchange Notes, if it determined that such transaction was made with the intent
to hinder, delay, or defraud creditors. In addition, a court could subordinate
indebtedness, including the Exchange Notes, to the claims of all existing and
future creditors on similar grounds.
The Company's obligations under the Exchange Notes will be guaranteed by
the Guarantors, and the Guarantees also may be subject to review under various
laws for the protection of creditors, including federal and state fraudulent
conveyance and fraudulent transfer laws, if a bankruptcy case or a lawsuit
(including in circumstances where bankruptcy is not involved) is commenced by or
on behalf of any creditor of a Guarantor or a representative of any such
creditors. In such a case, the analysis set forth above would generally apply,
except that the Guarantees could also be subject to the claim that, since the
Guarantees were incurred for the benefit of the Company (and only indirectly for
the benefit of the Guarantors), the obligations of the Guarantors thereunder
were incurred for less than reasonably equivalent value or fair consideration. A
court could void a Guarantor's obligation under its Guarantee, subordinate the
Guarantee to other indebtedness of a Guarantor, direct that holders of the
Exchange Notes return any amounts paid under a Guarantee to the relevant
Guarantor or to a fund for the benefit of its creditors, or take other action
detrimental to the holders of the Exchange Notes.
In addition, the enforceability of a guarantee by a subsidiary of
indebtedness of its corporate parent may be unclear or limited under the laws of
certain jurisdictions under which existing or future Guarantors may be
organized. Although substantially all of the existing Guarantors are organized
under the laws of jurisdictions under which no such limitations exist for wholly
owned subsidiaries, the Company may form additional subsidiaries under the laws
of jurisdictions where such limitations do exist. If a Guarantee is held to be
invalid or unenforceable as a result of any such limitation, then any right of
the Company or any other Guarantor to receive assets of the Guarantor whose
Guarantee is so limited upon the latter's liquidation or reorganization (and the
consequent right of the holders of the Exchange Notes to participate in those
assets) will be effectively subordinated to the claims of the affected
Guarantor's creditors, except to the extent that the Company or any other
Guarantor is itself recognized as a creditor of such affected Guarantor, in
which case the claims of the Company or such other Guarantor would still be
effectively subordinated to any security interest in the assets of such affected
Guarantor.
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POTENTIAL FAILURE TO MAKE PAYMENT UPON CHANGE OF CONTROL
Upon the occurrence of a Change of Control, the Company will be required to
make an offer to each holder of Notes to repurchase all or any part of such
holder's Notes at a repurchase price equal to 101%, or in certain instances
105%, of the principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the repurchase date. There can be no
assurance that the Company would have sufficient resources to repurchase the
Notes upon the occurrence of a Change of Control. The failure to repurchase all
of the Notes tendered to the Company would constitute an Event of Default under
the Indenture. Furthermore, the repurchase of the Notes by the Company upon a
Change of Control might result in a default on the part of the Company in
respect of the New Credit Facility or other future indebtedness of the Company,
as a result of the financial effect of such repurchase on the Company or
otherwise. See "Description of the New Credit Facility" and "Description of the
Notes."
LACK OF PUBLIC MARKET FOR THE EXCHANGE NOTES
The Outstanding Notes are currently owned by a relatively small number of
beneficial owners. The Outstanding Notes have not been registered under the
Securities Act and are subject to significant restrictions on resale. The
Exchange Notes are a new issue of securities for which there is currently no
active trading market. The Company does not intend to apply for a listing or
quotation of the Outstanding Notes or the Exchange Notes on any securities
exchange or stock market. The Initial Purchasers have informed the Company that
they currently intend to make a market in the Exchange Notes. However, the
Initial Purchasers are not obligated to do so, and any such market making may be
discontinued at any time without notice. No assurance can be given as to the
liquidity of the trading market for the Exchange Notes. Accordingly, there can
be no assurance as to the development or liquidity of any market for the
Exchange Notes. Future trading prices of the Exchange Notes will depend upon
many factors, including, among others, prevailing interest rates, the market for
similar securities, and other factors, including general economic conditions and
the financial condition of the Company.
The Exchange Offer will not be conditioned upon any minimum or maximum
aggregate principal amount of Outstanding Notes being tendered for exchange. No
assurance can be given as to the liquidity of the trading market for the
Exchange Notes, or, in the case of non-tendering holders of the Outstanding
Notes, the trading market for the Outstanding Notes following the Exchange
Offer.
To the extent that all or most of the holders of the Outstanding Notes
tender such Notes, the liquidity of the Exchange Notes should be increased as a
result of the larger size of the issue. However, there can be no assurance that
any or all holders of the Outstanding Notes will accept the Exchange Offer. To
the extent that fewer of the holders of the Outstanding Notes accept the
Exchange Offer, the liquidity of the Exchange Notes could be decreased. In
addition, wide acceptance of the Exchange Offer will affect and could decrease
the liquidity of the Outstanding Notes held by non-tendering holders.
The liquidity of, and trading market for, the Outstanding Notes or the
Exchange Notes also may be adversely affected by general declines in the market
for similar securities. Such a decline may adversely affect such liquidity and
trading markets independent of the financial performance of, and prospects for,
the Company.
YEAR 2000 COMPLIANCE
The Company has implemented a Year 2000 compliance program designed to
ensure that the Company's medical equipment, computer systems and applications
will function properly beyond 1999. Although the Company believes that it has
allocated adequate resources for this purpose and expects its Year 2000 date
conversion program to be completed on a timely basis without incurring
significant expenditures to address this issue, there can be no assurance that
the Company will not experience unforeseen difficulties. The failure by medical
equipment suppliers or third-party payors, such as private insurers, managed
care providers, healthcare organizations, preferred provider organizations, and
federal and state government agencies that administer Medicare and/or Medicaid,
to adequately address their Year 2000 issues could impact their ability to
reimburse the Company or otherwise adversely affect the Company's business,
financial condition, cash flows, and results of operations.
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THE EXCHANGE OFFER
PURPOSE AND EFFECT OF THE EXCHANGE OFFER
The Outstanding Notes were sold by the Company on March 16, 1998, to the
Initial Purchasers pursuant to the Purchase Agreement. The Initial Purchasers
subsequently placed the Outstanding Notes with QIBs in reliance on Rule 144A
under the Securities Act. As a condition of the purchase of the Outstanding
Notes by the Initial Purchasers, the Company, and the Guarantors entered into
the Registration Rights Agreement with the Initial Purchasers, which requires,
among other things, that the Company and the Guarantors file with the Commission
a registration statement under the Securities Act with respect to an offer by
the Company to the holders of the Outstanding Notes to issue and deliver to such
holders, in exchange for Outstanding Notes, a like principal amount of Exchange
Notes. The Company and the Guarantors are required to use their best efforts to
cause the registration statement relating to the Exchange Offer (the
"Registration Statement") to be declared effective by the Commission under the
Securities Act and commence the Exchange Offer. The Exchange Notes are to be
issued without a restrictive legend, and based on interpretations by the staff
of the Commission, the Company believes that the Exchange Notes may be reoffered
and resold by a holder that is not an "affiliate" of the Company within the
meaning of Rule 405 under the Securities Act without compliance with the
registration and prospectus delivery provisions of the Securities Act, provided
that the holder is acquiring the Exchange Notes in its ordinary course of
business and is not participating in and has no arrangement or understanding
with any person to participate in the distribution of the Exchange Notes. A copy
of the Registration Rights Agreement has been filed as an exhibit to the
Registration Statement of which this Prospectus is a part. See "-- Resale of
Exchange Notes."
Each broker-dealer that receives Exchange Notes for its own account in
exchange for Outstanding Notes, where such Outstanding Notes were acquired by
such broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Notes. See "Plan of Distribution."
The term "Holder" with respect to the Exchange Offer means any person in
whose name the Outstanding Notes are registered on the books of the Company or
any other person who has obtained a properly completed bond power from the
registered holder.
TERMS OF THE EXCHANGE OFFER
Upon the terms and subject to the conditions set forth in this Prospectus
and in the Letter of Transmittal, the Company will accept any and all
Outstanding Notes validly tendered and not withdrawn prior to 5:00 p.m., E.D.T.,
on the Expiration Date. On the Exchange Date, the Company will issue $1,000
principal amount of Exchange Notes in exchange for $1,000 principal amount of
Outstanding Notes accepted in the Exchange Offer. Holders may tender some or all
of their Outstanding Notes pursuant to the Exchange Offer. However, Outstanding
Notes may be tendered only in integral multiples of $1,000.
The form and terms of the Exchange Notes are the same as the form and terms
of the Outstanding Notes except that (i) the Exchange Notes have been registered
under the Securities Act and hence will not bear legends restricting the
transfer thereof and (ii) the holders of the Exchange Notes will not be entitled
to certain rights under the Registration Rights Agreement. The Exchange Notes
will evidence the same debt as the Outstanding Notes and will be entitled the
benefits of the Indenture.
As of the date of this Prospectus, $150.0 million aggregate principal
amount of the Outstanding Notes was outstanding and registered in the name of
Cede & Co., as nominee for the Depositary. The Company has fixed the close of
business of , 1998, as the record date for the Exchange Offer for
purposes of determining the persons to whom this Prospectus and the Letter of
Transmittal will be mailed initially.
Holders of Outstanding Notes do not have any appraisal or dissenters'
rights under the General Corporation Law of Delaware or the Indenture in
connection with the Exchange Offer. The Company intends to conduct the Exchange
Offer in accordance with the applicable requirements of the Exchange Act and the
rules and regulations of the Commission thereunder, including Rule 14e-1
thereunder.
20
<PAGE> 28
The Company shall be deemed to have accepted validly tendered Outstanding
Notes when, as and if the Company has given oral or written notice thereof to
the Exchange Agent. The Exchange Agent will act as agent for the tendering
Holders for the purpose of receiving the Exchange Notes from the Company.
If any tendered Outstanding Notes are not accepted for exchange because of
an invalid tender, the occurrence of certain other events set forth herein or
otherwise, the certificates for any such unaccepted Outstanding Notes will be
returned, without expense, to the tendering Holder thereof as promptly as
practicable after the Expiration Date.
Holders who tender Outstanding Notes in the Exchange Offer will not be
required to pay brokerage commissions or fees or, subject to the instructions in
the Letter of Transmittal, transfer taxes with respect to the exchange of
Outstanding Notes pursuant to the Exchange Offer. The Company will pay all
charges and expenses, other than transfer taxes in certain circumstances, in
connection with the Exchange Offer. See "-- Fees and Expenses."
INTEREST ON THE EXCHANGE NOTES
Interest on the Exchange Notes will accrue at a rate of 7 7/8% per annum
and will be payable semi-annually in arrears on March 15 and September 15 of
each year, commencing September 15, 1998. Interest on the Exchange Notes will
accrue from the most recent date to which interest has been paid on the
Outstanding Notes or, if no interest has been paid, from the date of original
issuance of the Outstanding Notes.
PROCEDURES FOR TENDERING
Only a Holder of Outstanding Notes may tender such Outstanding Notes in the
Exchange Offer. To tender in the Exchange Offer, a Holder must complete, sign,
and date the Letter of Transmittal, or a facsimile thereof, have the signatures
thereon guaranteed if required by the Letter of Transmittal and mail or
otherwise deliver such Letter of Transmittal or such facsimile, together with
the Outstanding Notes and any other required documents, to the Exchange Agent
prior to 5:00 p.m., E.D.T., on the Expiration Date. The Company is not asking
any Holder for a proxy, and no Holder is requested to send the Company a proxy.
To be tendered effectively, the Outstanding Notes, Letter of Transmittal, and
other required documents must be received by the Exchange Agent at the address
set forth below under "-- Exchange Agent" prior to 5:00 p.m., E.D.T., on the
Expiration Date. Delivery of the Outstanding Notes may be made by book-entry
transfer in accordance with the procedures described below. Confirmation of such
book-entry transfer must be received by the Exchange Agent prior to the
Expiration Date.
By executing the Letter of Transmittal, each Holder will make to the
Company the representations set forth below in the second paragraph under the
heading "-- Resale of Exchange Notes."
The tender by a Holder and the acceptance thereof by the Company will
constitute agreement between such Holder and the Company in accordance with the
terms and subject to the conditions set forth herein and in the Letter of
Transmittal.
THE METHOD OF DELIVERY OF OUTSTANDING NOTES AND THE LETTER OF TRANSMITTAL
AND ALL OTHER REQUIRED DOCUMENTS TO THE EXCHANGE AGENT IS AT THE ELECTION AND
RISK OF THE HOLDER. INSTEAD OF DELIVERY BY MAIL, IT IS RECOMMENDED THAT HOLDERS
USE AN OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL CASES, SUFFICIENT TIME SHOULD
BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE.
NO LETTER OF TRANSMITTAL OR OUTSTANDING NOTES SHOULD BE SENT TO THE COMPANY.
HOLDERS MAY REQUEST THEIR RESPECTIVE BROKERS, DEALERS, COMMERCIAL BANKS, TRUST
COMPANIES OR NOMINEES TO EFFECT THE ABOVE TRANSACTIONS FOR SUCH HOLDERS.
Any beneficial owner whose Outstanding Notes are registered in the name of
a broker, dealer, commercial bank, trust company or other nominee and who wishes
to tender should contact the registered Holder promptly and instruct such
registered Holder to tender on such beneficial owner's behalf.
21
<PAGE> 29
Signatures on the Letter of Transmittal or a notice of withdrawal, as the
case may be, must be guaranteed by an Eligible Institution (as defined below)
unless the Outstanding Notes tendered pursuant thereto are tendered (i) by a
registered Holder who has not completed the box entitled "Special Delivery
Instructions" on the Letter of Transmittal or (ii) for the account of an
Eligible Institution. In the event that signatures on a Letter of Transmittal or
a notice of withdrawal, as the case may be, are required to be guaranteed, such
guarantee must be by a member firm of a registered national securities exchange
or of the National Association of Securities Dealers, Inc., a commercial bank or
trust company having an office or correspondent in the United States or an
"eligible guarantor institution" within the meaning of Rule 17Ad-15 under the
Exchange Act (an "Eligible Institution").
If the Letter of Transmittal is signed by a person other than the
registered holder of any Outstanding Notes listed therein, such Outstanding
Notes must be endorsed or accompanied by a properly completed bond power, signed
by such registered holder as such registered holder's name appears on such
Outstanding Notes with the signature thereon guaranteed by an Eligible
Institution.
If the Letter of Transmittal or any Outstanding Notes or bond powers are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing, and unless waived by the
Company, evidence satisfactory to the Company of their authority to so act must
be submitted with the Letter of Transmittal.
The Company understands that the Exchange Agent will make a request
promptly after the date of this Prospectus to establish accounts with respect to
the Exchange Notes at the Depositary (the "Book-Entry Transfer Facility") for
the purpose of facilitating the Exchange Offer, and subject to the establishment
thereof, any financial institution that is a participant in the Book-Entry
Transfer Facility's system may make book-entry delivery of the Outstanding Notes
by causing such Book-Entry Transfer Facility to transfer such Outstanding Notes
into the Exchange Agent's account with respect to the Outstanding Notes in
accordance with the Book-Entry Transfer Facility's procedures for such transfer.
Although delivery of the Outstanding Notes may be effected through book-entry
transfer into the Exchange Agent's account at the Book-Entry Transfer Facility,
an appropriate Letter of Transmittal properly completed and duly executed with
any required signature guarantee and all other required documents must in each
case be transmitted to and received or confirmed by the Exchange Agent at its
address set forth below on or prior to the Expiration Date, or, if the
guaranteed delivery procedures described below are complied with, within the
time period provided under such procedures; provided, however, that a
participant in the Book-Entry Transfer Facility's book-entry system may, in
accordance with the Book-Entry Transfer Facility's Automated Tender Offer
Program procedures and in lieu of physical delivery to the Exchange Agent of a
Letter of Transmittal, electronically acknowledge its receipt of, and agreement
to be bound by, the terms of the Letter of Transmittal. Delivery of documents to
the Book-Entry Transfer Facility does not constitute delivery to the Exchange
Agent.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance and withdrawal of tendered Outstanding Notes will be
determined by the Company in its sole discretion, which determination will be
final and binding. The Company reserves the absolute right to reject any and all
Outstanding Notes not properly tendered or any Outstanding Notes the Company's
acceptance of which would, in the opinion of counsel for the Company, be
unlawful. The Company also reserves the right to waive any defects,
irregularities or conditions of tender as to particular Outstanding Notes. The
Company's interpretation of the terms and conditions of the Exchange Offer
(including the instructions in the Letter of Transmittal) will be final and
binding on all parties. Unless waived, any defects or irregularities in
connection with tenders of Outstanding Notes must be cured within such time as
the Company shall determine. Although the Company intends to notify Holders of
defects or irregularities with respect to tenders of Outstanding Notes, neither
the Company, the Exchange Agent nor any other person shall incur any liability
for failure to give such notification. Tenders of Outstanding Notes will not be
deemed to have been made until such defects or irregularities have been cured or
waived. Any Outstanding Notes received by the Exchange Agent that are not
properly tendered and as to which the defects or irregularities have not been
cured or waived will be returned by the Exchange Agent to the tendering Holders,
unless otherwise provided in the Letter of Transmittal, as soon as practicable
following the Expiration Date.
22
<PAGE> 30
Each broker-dealer that receives Exchange Notes for its own account in
exchange for Outstanding Notes, where such Outstanding Notes were acquired by
such broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Notes. See "Plan of Distribution."
GUARANTEED DELIVERY PROCEDURES
Holders who wish to tender their Outstanding Notes and (i) whose
Outstanding Notes are not immediately available, (ii) who cannot deliver their
Outstanding Notes, the Letter of Transmittal or any other required documents to
the Exchange Agent or (iii) who cannot complete the procedures for book-entry
transfer, prior to the Expiration Date, may effect a tender if:
(a) the tender is made through an Eligible Institution;
(b) prior to the Expiration Date, the Exchange Agent receives from
such Eligible Institution a properly completed and duly executed Notice of
Guaranteed Delivery (by facsimile transmission, mail or hand delivery)
setting forth the name and address of the Holder, the certificate number(s)
of such Outstanding Notes and the principal amount of Outstanding Notes
tendered, stating that the tender is being made thereby and guaranteeing
that, within five Nasdaq Stock Market trading days after the Expiration
Date, the Letter of Transmittal (or facsimile thereof), together with the
certificate(s) representing the Outstanding Notes (or a confirmation of
book-entry transfer of such Outstanding Notes into the Exchange Agent's
account at the Book-Entry Transfer Facility) and any other documents
required by the Letter of Transmittal, will be deposited by the Eligible
Institution with the Exchange Agent; and
(c) such properly completed and executed Letter of Transmittal (or
facsimile thereof), as well as the certificate(s) representing all tendered
Outstanding Notes in proper form for transfer (or a confirmation of
book-entry transfer of such Outstanding Notes into the Exchange Agent's
account at the Book-Entry Transfer Facility) and all other documents
required by the Letter of Transmittal, are received by the Exchange Agent
within five Nasdaq Stock Market trading days after the Expiration Date.
Upon request to the Exchange Agent, a Notice of Guaranteed Delivery will be
sent to Holders who wish to tender their Outstanding Notes according to the
guaranteed delivery procedures set forth above.
WITHDRAWAL OF TENDERS
Except as otherwise provided herein, tenders of Outstanding Notes may be
withdrawn at any time prior to 5:00 p.m., E.D.T., on the Expiration Date.
To withdraw a tender of Outstanding Notes in the Exchange Offer, a written
or facsimile transmission notice of withdrawal must be received by the Exchange
Agent at its address set forth herein prior to 5:00 p.m., E.D.T., on the
Expiration Date. Any such notice of withdrawal must (i) specify the name of the
person having deposited the Outstanding Notes to be withdrawn (the "Depositor"),
(ii) identify the Outstanding Notes to be withdrawn (including the certificate
number(s) and principal amount of such Outstanding Notes, or, in the case of
Outstanding Notes transferred by book-entry transfer, the name and number of the
account at the Book-Entry Transfer Facility to be credited), (iii) be signed by
the Holder in the same manner as the original signature on the Letter of
Transmittal by which such Outstanding Notes were tendered (including any
required signature guarantees) or be accompanied by documents of transfer
sufficient to have the Trustee with respect to the Outstanding Notes register
the transfer of such Outstanding Notes into the name of the person withdrawing
the tender, (iv) specify the name in which any such Outstanding Notes are to be
registered, if different from that of the Depositor and (v) if applicable
because the Outstanding Notes have been tendered pursuant to book-entry
procedures, specify the name and number of the participant's account at the
Book-Entry Transfer Facility to be credited, if different from that of the
Depositor. All questions as to the validity, form and eligibility (including
time of receipt) of such notices will be determined by the Company, whose
determination shall be final and binding on all parties. Any Outstanding Notes
so withdrawn will be deemed not to have been validly tendered for purposes of
the Exchange Offer and no Exchange Notes will be
23
<PAGE> 31
issued with respect thereto unless the Outstanding Notes so withdrawn are
validly retendered. Any Outstanding Notes which have been tendered but which are
not accepted for exchange, will be returned to the Holder thereof without cost
to such Holder as soon as practicable after withdrawal, rejection of tender or
termination of the Exchange Offer. Properly withdrawn Outstanding Notes may be
retendered by following one of the procedures described above under "--
Procedures for Tendering" at any time prior to the Expiration Date.
EXCHANGE AGENT
The First National Bank of Chicago has been appointed as Exchange Agent for
the Exchange Offer. Questions and requests for assistance, requests for
additional copies of this Prospectus or of the Letter of Transmittal and
requests for Notice of Guaranteed Delivery should be directed to the Exchange
Agent addressed as follows:
<TABLE>
<S> <C>
The First National Bank of Chicago By Facsimile: (312) 407-1708
One North State Street Confirm by Telephone: (312) 732-4000
Ninth Floor, Suite 0126
Chicago, Illinois 60670-0126
Attention: Corporate Trust Administration
</TABLE>
FEES AND EXPENSES
The expenses of soliciting tenders pursuant to the Exchange Offer will be
borne by the Company. The principal solicitation is being made by mail; however,
additional solicitation may be made by telegraph, telephone, facsimile or in
person by officers and regular employees of the Company and its affiliates.
The Company has not retained any dealer-manager in connection with the
Exchange Offer and will not make any payments to brokers or others soliciting
acceptances of the Exchange Offer. The Company, however, will pay the Exchange
Agent reasonable and customary fees for its services and registration expenses,
including fees and expenses of the Trustee, filing fees, blue sky fees and
printing and distribution expenses.
The Company will pay all transfer taxes, if any, applicable to the exchange
of the Outstanding Notes pursuant to the Exchange Offer. If, however,
certificates representing the Exchange Notes or the Outstanding Notes for the
principal amounts not tendered or accepted for exchange are to be delivered to,
or are to be issued in the name of, any person other than the person signing the
Letter of Transmittal, or if a transfer tax is imposed for any reason other than
the exchange of the Outstanding Notes pursuant to the Exchange Offer, then the
amount of any such transfer taxes (whether imposed on the registered holder or
any other person) will be payable by the tendering Holder.
ACCOUNTING TREATMENT
The Exchange Notes will be recorded at the same carrying value as the
Outstanding Notes, which is face value, less a discount, as reflected in the
Company's accounting records on the Exchange Date. Accordingly, no gain or loss
for accounting purposes will be recognized. The expenses of the Exchange Offer
will be amortized over the term of the Exchange Notes.
RESALE OF EXCHANGE NOTES
Based on an interpretation by the staff of the Commission set forth in
no-action letters issued to third parties, the Company believes that Exchange
Notes issued pursuant to the Exchange Offer in exchange for Outstanding Notes
may be offered for resale, resold and otherwise transferred by any holder of
such Exchange Notes (other than any such holder which is an "affiliate" of the
Company within the meaning of Rule 405 under the Securities Act) without
compliance with the registration and prospectus delivery provisions of the
Securities Act, provided that such Exchange Notes are acquired in the ordinary
course of such holder's business and such holder does not intend to participate
and has no arrangement or understanding with any person to participate in the
distribution of such Exchange Notes. Any holder who tenders in the Exchange
24
<PAGE> 32
Offer with the intention to participate, or for the purpose of participating, in
a distribution of the Exchange Notes may not rely on the position of the staff
of the Commission enunciated in Exxon Capital Holdings Corporation and Morgan
Stanley & Co., Incorporated, or similar no-action letters, but rather must
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any resale transaction. In addition, any such
resale transaction should be covered by an effective registration statement
containing the selling security holders information required by Item 507 of
Regulation S-K of the Securities Act. Each broker-dealer that receives Exchange
Notes for its own account in exchange for Outstanding Notes, where such
Outstanding Notes were acquired by such broker-dealer as a result of market-
making activities or other trading activities, must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Notes. See
"Plan of Distribution."
By tendering in the Exchange Offer, each Holder will represent to the
Company that, among other things, (i) the Exchange Notes acquired pursuant to
the Exchange Offer are being obtained in the ordinary course of business of the
person receiving such Exchange Notes, whether or not such person is a Holder,
(ii) neither the Holder nor any such other person is engaged in or intends to
engage in, or has an arrangement or understanding with any person to participate
in the distribution of such Exchange Notes and (iii) the Holder and such other
person acknowledge that if they participate in the Exchange Offer for the
purpose of distributing the Exchange Notes (a) they must, in the absence of an
exemption therefrom, comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any resale of the Exchange
Notes and cannot rely on the no-action letters referenced above and (b) failure
to comply with such requirements in such instance could result in such Holder
incurring liability under the Securities Act for which such Holder is not
indemnified by the Company. Further, by tendering in the Exchange Offer, each
Holder that may be deemed an "affiliate" (as defined under Rule 405 of the
Securities Act) of the Company will represent to the Company that such Holder
understands and acknowledges that the Exchange Notes may not be offered for
resale, resold or otherwise transferred by that Holder without registration
under the Securities Act or an exemption therefrom.
As set forth above, affiliates of the Company are not entitled to rely on
the foregoing interpretations of the staff of the Commission with respect to
resales of the Exchange Notes without compliance with the registration and
prospectus delivery requirements of the Securities Act.
SHELF REGISTRATION STATEMENT
If the Company is not permitted to consummate the Exchange Offer because
the Exchange Offer is not permitted by any applicable law or applicable
interpretation of the Commission or the staff of the Commission, the Company and
the Guarantors have agreed to file with the Commission and use their best
efforts to have declared effective and keep continuously effective for up to two
years a registration statement that would allow resales of Outstanding Notes
owned by such holders.
OTHER
Participation in the Exchange Offer is voluntary and holders should
carefully consider whether to accept. Holders of the Outstanding Notes are urged
to consult their financial and tax advisors in making their own decision on what
action to take.
The Company may in the future seek to acquire untendered Outstanding Notes
in open market or privately negotiated transactions, through subsequent exchange
offers or otherwise. The Company, however, has no present plans to acquire any
Outstanding Notes that are not tendered in the Exchange Offer or to file a
registration statement to permit resales of any untendered Outstanding Notes.
25
<PAGE> 33
USE OF PROCEEDS
This Exchange Offer is intended to satisfy certain of the Company's
obligations under the Purchase Agreement and the Registration Rights Agreement
with respect to the Outstanding Notes. The Company will not receive any cash
proceeds from the issuance of the Exchange Notes offered hereby. In
consideration for issuing the Exchange Notes contemplated in this Prospectus,
the Company will receive Outstanding Notes in like principal amount, the form
and terms of which are substantially similar to the form and terms of the
Exchange Notes, except as otherwise described herein. The Outstanding Notes
surrendered in exchange for Exchange Notes will be retired and canceled and
cannot be reissued. Accordingly, issuance of the Exchange Notes will not result
in any increase or decrease in the indebtedness of the Company.
26
<PAGE> 34
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL DATA
During the fiscal year ended June 30, 1997, 19 acquisitions were completed
and nine such acquisitions were made during the six months ended December 31,
1997. The acquisitions occurring during the year ended June 30, 1997 are
referred to as "the fiscal 1997 acquisitions" and the acquisitions made during
the six months ended December 31, 1997 are referred to as "the fiscal 1998
acquisitions." All of these acquisitions were accounted for in accordance with
Accounting Principles Board Opinion ("APB") No. 16. The aggregate purchase price
for the fiscal 1997 and 1998 acquisitions accounted for as purchases consisted
of the following:
<TABLE>
<CAPTION>
FISCAL 1997 FISCAL 1998
ACQUISITIONS ACQUISITIONS TOTAL
------------ ------------ --------
(IN THOUSANDS)
<S> <C> <C> <C>
Cash................................... $35,512 $ 9,824 $ 45,336
Rural/Metro Common Stock............... 18,699 325 19,024
Notes payable to sellers............... 4,477 6,470 10,947
Assumption of liabilities.............. 23,915 13,889 37,804
------- ------- --------
$82,603 $30,508 $113,111
======= ======= ========
</TABLE>
In addition, the Company issued 361,970 and 641,009 shares of Common Stock,
respectively, related to pooling-of-interests transactions during the fiscal
year ended June 30, 1997 and the six months ended December 31, 1997.
The following Unaudited Pro Forma Consolidated Statements of Income for the
fiscal year ended June 30, 1997 and the six months ended December 31, 1997
reflect (i) the fiscal 1997 and 1998 acquisitions as if each of the acquisitions
were consummated on July 1, 1996 and (ii) the receipt and application of the net
proceeds (after deducting expenses related to the Initial Offering) from the
Initial Offering, as if the Initial Offering were completed on July 1, 1996.
The following Unaudited Pro Forma Consolidated Balance Sheet as of December
31, 1997 reflects the application of the net proceeds (after deducting expenses
related to the Initial Offering) from the Initial Offering as if such
transaction had occurred as of December 31, 1997.
The following Unaudited Pro Forma Consolidated Statements of Income and the
Unaudited Pro Forma Consolidated Balance Sheet does not give effect to the
acquisition of ECCO. Summarized below is selected combined operating data of
ECCO for its most recent fiscal year ended September 30, 1997. As of September
30, 1997, ECCO had approximately $240,000 of indebtedness. Such financial
information has been prepared in accordance with Argentina GAAP. Argentina GAAP
and U.S. GAAP differ in certain respects. ECCO's combined operating data for its
fiscal year ended September 30, 1997 and its balance sheet as of September 30,
1997 prepared in accordance with U.S. GAAP are not expected to differ materially
from its financial results determined in accordance with Argentina GAAP.
<TABLE>
<CAPTION>
FISCAL YEAR ENDED
SEPTEMBER 30, 1997
------------------
<S> <C>
Net revenues.............................................. $43,445
Income before income tax.................................. 5,917
</TABLE>
The Company usually implements significant changes to the operations of the
entities that it acquires to enhance profitability. The expected benefits and
cost reductions anticipated by the Company have not been reflected in the
accompanying unaudited pro forma consolidated financial statements. Accordingly,
these pro forma consolidated financial statements are not necessarily indicative
of the results of operations that would have been achieved had the fiscal 1997
and 1998 acquisitions occurred as of July 1, 1996.
The pro forma adjustments are based upon available information. These
adjustments are directly attributable to the transactions referenced above and
are expected to have a continuing impact on the Company's business, financial
condition, cash flows, and results of operations. The following unaudited pro
forma consolidated financial statements should be read in conjunction with the
Consolidated Financial Statements of the Company, including the notes thereto,
which are contained elsewhere or incorporated by reference in this Prospectus.
See "Selected Consolidated Financial Data" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations."
The unaudited pro forma consolidated financial data does not purport to
represent what the Company's actual results of operations would have been had
each transaction occurred as of the beginning of each respective period nor does
it project the Company's results of operations for any future period.
27
<PAGE> 35
UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, 1997
--------------------------------------------------------------------
BUSINESSES PRO FORMA
HISTORICAL(1) ACQUIRED(2) ADJUSTMENTS OFFERING PRO FORMA
------------- ----------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C>
Revenue
Ambulance services................ $257,488 $104,505 $ -- $ -- $361,993
Fire protection services.......... 42,163 -- -- -- 42,163
Other............................. 20,154 2,757 -- -- 22,911
-------- -------- ------- ------- --------
Total..................... 319,805 107,262 -- -- 427,067
-------- -------- ------- ------- --------
Operating expenses
Payroll and employee benefits..... 170,833 51,440 (3,929)(3) -- 218,344
Provision for doubtful accounts... 43,424 19,471 -- -- 62,895
Depreciation...................... 12,136 4,176 (110)(4) -- 16,202
Amortization of intangibles....... 4,660 194 2,252(5) 494(10) 7,600
Other operating expenses.......... 54,922 24,419 (2,285)(6) -- 77,056
Loss contract/restructuring
charge......................... 6,026 -- -- -- 6,026
-------- -------- ------- ------- --------
Total..................... 292,001 99,700 (4,072) 494 388,123
-------- -------- ------- ------- --------
Operating income.................... 27,804 7,562 4,072 (494) 38,944
Interest expense, net............. 5,720 1,584 1,888(7) 4,345(10) 13,537
Other............................. -- -- 152(2) -- 152
-------- -------- ------- ------- --------
Income before income taxes.......... 22,084 5,978 2,032 (4,839) 25,255
Provision for income taxes........ 9,364 539 2,921(8) (2,052)(8) 10,772
-------- -------- ------- ------- --------
Net income.......................... $ 12,720 $ 5,439 $ (889) $(2,787) $ 14,483
======== ======== ======= ======= ========
Basic earnings per share............ $ 1.10 $ 1.09
======== ========
Diluted earnings per share.......... $ 1.04 $ 1.04
======== ========
Weighted average number of shares
outstanding -- Basic.............. 11,585 1,722(9) 13,307
Weighted average number of shares
outstanding -- Diluted............ 12,271 1,722(9) 13,993
</TABLE>
The accompanying notes are an integral part of these financial statements.
28
<PAGE> 36
UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
SIX MONTHS ENDED DECEMBER 31, 1997
-------------------------------------------------------------------
BUSINESSES PRO FORMA
HISTORICAL(1) ACQUIRED(2) ADJUSTMENTS OFFERING PRO FORMA
------------- ----------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C>
Revenue
Ambulance services................ $167,367 $14,158 $ -- $ -- $181,525
Fire protection services.......... 22,563 -- -- -- 22,563
Other............................. 19,185 685 -- -- 19,870
-------- ------- ------- -------- --------
Total..................... 209,115 14,843 -- -- 223,958
-------- ------- ------- -------- --------
Operating expenses
Payroll and employee benefits..... 110,504 7,834 (546)(3) -- 117,792
Provision for doubtful accounts... 28,826 2,096 -- -- 30,922
Depreciation...................... 8,813 531 -- -- 9,344
Amortization of intangibles....... 3,145 54 249(5) 247(10) 3,695
Other operating expenses.......... 35,282 3,426 (405)(6) -- 38,303
-------- ------- ------- -------- --------
Total..................... 186,570 13,941 (702) 247 200,056
-------- ------- ------- -------- --------
Operating income.................... 22,545 902 702 (247) 23,902
Interest expense, net............. 5,409 199 167(7) 1,166(10) 6,941
Other............................. 130 -- 51(2) -- 181
-------- ------- ------- -------- --------
Income before income taxes.......... 17,006 703 484 (1,413) 16,780
Provision for income taxes........ 6,924 97 407(8) (575)(8) 6,853
-------- ------- ------- -------- --------
Net income.......................... $ 10,082 $ 606 $ 77 $ (838) $ 9,927
======== ======= ======= ======== ========
Basic earnings per share.......... $ 0.76 $ 0.74
======== ========
Diluted earnings per share........ $ 0.73 $ 0.71
======== ========
Weighted average number of shares
outstanding -- Basic.............. 13,196 275 (9) 13,471
Weighted average number of shares
outstanding -- Diluted............ 13,805 275 (9) 14,080
</TABLE>
The accompanying notes are an integral part of these financial statements.
29
<PAGE> 37
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1997
(IN THOUSANDS)
<TABLE>
<CAPTION>
PRO FORMA
HISTORICAL OFFERING(11) AS ADJUSTED
------------ ------------ -----------
<S> <C> <C> <C>
ASSETS
Current assets
Cash..................................................... $ 2,261 $ -- $ 2,261
Accounts receivable, net................................. 149,926 -- 149,926
Inventories.............................................. 9,757 -- 9,757
Prepaid expenses and other............................... 9,651 -- 9,651
-------- ------ --------
Total current assets............................. 171,595 -- 171,595
Property and equipment, net................................ 82,634 -- 82,634
Intangible assets, net..................................... 187,051 -- 187,051
Other assets............................................... 10,542 4,942 15,484
-------- ------ --------
Total assets..................................... $451,822 $4,942 $456,764
======== ====== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable......................................... $ 7,015 $ -- $ 7,015
Accrued liabilities...................................... 31,227 -- 31,227
Current portion of long-term debt........................ 16,435 (5,000) 11,435
-------- ------ --------
Total current liabilities............................. 54,677 (5,000) 49,677
Long-term debt, net of current portion..................... 187,334 9,942 197,276
Non-refundable subscription income......................... 13,248 -- 13,248
Deferred income taxes...................................... 12,836 -- 12,836
Other liabilities.......................................... 2,270 -- 2,270
-------- ------ --------
Total liabilities................................ 270,365 4,942 275,307
-------- ------ --------
Minority interest.......................................... 8,490 -- 8,490
-------- ------ --------
Stockholders' equity
Preferred stock.......................................... -- -- --
Common stock............................................. 139 -- 139
Additional paid-in capital............................... 124,038 -- 124,038
Retained earnings........................................ 50,487 -- 50,487
Deferred compensation.................................... (458) -- (458)
Treasury stock........................................... (1,239) -- (1,239)
-------- ------ --------
Total stockholders' equity....................... 172,967 -- 172,967
-------- ------ --------
$451,822 $4,942 $456,764
======== ====== ========
</TABLE>
The accompanying notes are an integral part of these statements.
30
<PAGE> 38
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL DATA
The foregoing unaudited pro forma consolidated financial data should be
read in conjunction with the Consolidated Financial Statements of the Company,
including the notes thereto, which are contained elsewhere or incorporated by
reference in this Prospectus. See "Selected Consolidated Financial Data" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."
(1) Reflects the results of operations of the respective acquisitions from the
dates of acquisition through the end of each respective period.
(2) Reflects the results of operations of the fiscal 1997 and 1998 acquisitions
from the beginning of the period through the respective dates of
acquisition.
(3) Adjustment for payroll and employee benefits to reflect the effects of
certain employees of the acquired businesses not being employed by the
Company and to reflect the differences between the actual compensation paid
to officers of the businesses acquired and the aggregate compensation such
individuals would have received under the terms of employment agreements
with the Company as if the businesses had been acquired as of the beginning
of the period.
(4) Adjustment for depreciation on assets not purchased in the acquisition
transactions.
(5) Adjustment for amortization to reflect amortization of the cost in excess
of the fair value of net assets acquired over a 35-year period.
(6) Adjustment for other operating expenses to reflect the reduction of
expenses related to certain real estate and buildings not acquired and
sellers' costs incurred in connection with the sale of their respective
businesses, had each of the acquisitions occurred as of the beginning of
the period.
(7) Adjustment for interest expense to reflect the interest expense related to
the debt issued in connection with the acquisitions.
(8) Adjustment for provision for income taxes to reflect the effect of the
adjustments described above and below and the tax effect of treating each
acquisition as if it had C corporation tax status.
(9) Adjustment for average number of shares outstanding as if the Common Stock
issued in connection with certain of the acquisitions had occurred as of
the beginning of the period.
(10) Reflects an adjustment for the amortization of an additional $4.9 million
of debt issuance costs and interest expense relating to the Initial
Offering net of decreases in interest expense relating to the use of
proceeds of the Initial Offering.
(11) Adjustments for the Initial Offering include the issuance and sale of the
Outstanding Notes, net of debt discount of $258,000, issued by the Company
and the retirement of approximately $139.8 of indebtedness outstanding
under the Company's prior revolving credit facility and a $5.0 million term
loan.
31
<PAGE> 39
SELECTED CONSOLIDATED FINANCIAL DATA
The following selected consolidated financial data for the fiscal years
ended June 30, 1997, 1996, 1995, 1994, and 1993 is derived from the consolidated
financial statements of the Company which have been audited by Arthur Andersen
LLP, independent public accountants. The selected consolidated financial data
for the six months ended December 31, 1996 and December 31, 1997 is derived from
consolidated financial statements that have not been subject to audit, but which
have been prepared on a basis consistent with the audited financial statements.
In the opinion of management, the unaudited consolidated financial data includes
all adjustments, consisting only of normal recurring adjustments, necessary for
a fair statement of the consolidated financial position and results of
operations for that period. The results of operations for the six months ended
December 31, 1997 are not necessarily indicative of the results of operations
for a full fiscal year. The selected consolidated financial data provided below
should be read in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the Consolidated Financial
Statements of the Company, including the notes thereto, which are contained
elsewhere or incorporated by reference in this Prospectus.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED JUNE 30, DECEMBER 31,
--------------------------------------------------- -------------------
1993 1994 1995 1996 1997 1996 1997
------- -------- -------- -------- -------- -------- --------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF INCOME DATA:
Revenue
Ambulance services................ $52,539 $ 68,942 $127,461 $197,201 $257,488 $121,493 $167,367
Fire protection services.......... 28,165 30,502 32,274 38,770 42,163 20,654 22,563
Other............................. 3,377 4,920 11,848 14,292 20,154 9,377 19,185
------- -------- -------- -------- -------- -------- --------
Total revenue.............. 84,081 104,364 171,583 250,263 319,805 151,524 209,115
Operating expenses
Payroll and employee benefits..... 44,178 54,750 90,843 135,464 170,833 82,501 110,504
Provision for doubtful accounts... 11,083 13,658 22,263 31,036 43,424 20,159 28,826
Depreciation...................... 3,522 4,369 6,654 9,778 12,136 5,651 8,813
Amortization of intangibles....... 448 584 2,074 3,569 4,660 2,200 3,145
Other operating expenses.......... 17,798 21,613 33,809 45,752 54,922 26,947 35,282
Loss contract/restructuring
charge.......................... -- -- -- -- 6,026 -- --
------- -------- -------- -------- -------- -------- --------
Operating income.................... 7,052 9,390 15,940 24,664 27,804 14,066 22,545
Interest expense, net............... 2,896 1,780 3,059 5,108 5,720 2,082 5,409
Other............................... -- -- -- -- -- -- 130
------- -------- -------- -------- -------- -------- --------
Income before income taxes and
extraordinary item................ 4,156 7,610 12,881 19,556 22,084 11,984 17,006
Provision for income taxes.......... (1,471) (2,884) (5,288) (8,044) (9,364) (4,914) (6,924)
------- -------- -------- -------- -------- -------- --------
Income before extraordinary item.... 2,685 4,726 7,593 11,512 12,720 7,070 10,082
Extraordinary item.................. -- -- (693) -- -- -- --
------- -------- -------- -------- -------- -------- --------
Net income........................ $ 2,685 $ 4,726 $ 6,900 $ 11,512 $ 12,720 $ 7,070 $ 10,082
======= ======== ======== ======== ======== ======== ========
Basic earnings per share(1)
Income before extraordinary
share........................... $ 0.66 $ 0.75 $ 0.96 $ 1.20 $ 1.10 $ 0.63 $ 0.76
Extraordinary item................ -- -- (0.09) -- -- -- --
------- -------- -------- -------- -------- -------- --------
Net income................. $ 0.66 $ 0.75 $ 0.87 $ 1.20 $ 1.10 $ 0.63 $ 0.76
======= ======== ======== ======== ======== ======== ========
Diluted earnings per share(1)
Income before extraordinary
item............................ $ 0.64 $ 0.71 $ 0.92 $ 1.14 $ 1.04 $ 0.59 $ 0.73
Extraordinary item................ -- -- (0.08) -- -- -- --
------- -------- -------- -------- -------- -------- --------
Net income................. $ 0.64 $ 0.71 $ .84 $ 1.14 $ 1.04 $ 0.59 $ 0.73
======= ======== ======== ======== ======== ======== ========
Weighted average number of shares
outstanding(1)
Basic............................. 4,081 6,329 7,924 9,570 11,585 11,213 13,196
Diluted........................... 4,171 6,668 8,249 10,075 12,271 12,082 13,805
</TABLE>
- ---------------
(1) Earnings per share for all periods presented has been restated in accordance
with Statement of Financial Accounting Standards No. 128, "Earnings Per
Share."
32
<PAGE> 40
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED JUNE 30, DECEMBER 31,
--------------------------------------------------- -------------------
1993 1994 1995 1996 1997 1996 1997
------- -------- -------- -------- -------- -------- --------
(IN THOUSANDS, EXCEPT STATISTICAL DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
OTHER FINANCIAL DATA:
Adjusted EBITDA(1).................. $11,022 $ 14,343 $ 24,668 $ 38,011 $ 50,626 $ 21,917 $ 34,503
Adjusted EBITDA margin(2)........... 13.1% 13.7% 14.4% 15.2% 15.8% 14.5% 16.5%
Depreciation and amortization....... $ 3,970 $ 4,953 $ 8,728 $ 13,347 $ 16,796 $ 7,851 $ 11,958
Capital expenditures................ 2,011 5,260 11,474 18,237 23,872 7,725 14,909
Ratio of adjusted EBITDA to interest
expense........................... 3.8x 8.1x 8.1x 7.4x 8.9x 10.5x 6.4x
Ratio of earnings to fixed
charges(3).......................... 2.1x 3.8x 3.8x 3.7x 3.5x 4.2x 3.2x
STATISTICAL DATA:
States of operation (at period
end).............................. 5 8 10 17 21 18 23
Ambulances (at period end).......... 190 334 761 1,243 1,561 1,621 1,883
Fire apparatus (at period end)...... 115 117 119 128 135 130 145
Sources of revenue
Ambulance services................ 62.5% 66.1% 74.3% 78.8% 80.5% 80.2% 80.0%
Fire protection services.......... 33.5 29.2 18.8 15.5 13.2 13.6 10.8
Other services.................... 4.0 4.7 6.9 5.7 6.3 6.2 9.2
------- -------- -------- -------- -------- -------- --------
Total...................... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
======= ======== ======== ======== ======== ======== ========
</TABLE>
- ---------------
(1) Adjusted EBITDA represents income before interest, extraordinary items,
depreciation and amortization expense, federal and state income taxes, and
other expense and excludes the $6,026,000 loss contract/restructuring charge
incurred during fiscal 1997. EBITDA is generally considered to provide
information regarding a company's ability to service and/or incur debt.
EBITDA should not be considered in isolation or as a substitute for net
income, cash flows from operations, or other consolidated income or cash
flow data prepared in accordance with generally accepted accounting
principles as a measure of a company's profitability or liquidity.
(2) Adjusted EBITDA margin as used herein consists of adjusted EBITDA divided by
revenue.
(3) For purposes of calculating the ratio of earnings to fixed charges, earnings
consist of income before provision for income taxes plus fixed charges.
Fixed charges consist of interest expense (including the amortization of
debt issuance costs) plus that portion of rental payments on operating
leases deemed representative of the interest factor.
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
-------------------------------------------------- -------------------
1993 1994 1995 1996 1997 1996 1997
------- ------- -------- -------- -------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working capital.................... $ 4,784 $23,915 $ 26,358 $ 55,402 $ 94,766 $ 67,597 $116,918
Total assets....................... 45,816 88,247 159,430 230,114 364,066 263,891 451,822
Current portion of long-term
debt(1).......................... 9,827 3,590 8,377 6,610 9,814 11,643 16,435
Long-term debt, net of current
portion(2)....................... 15,382 13,339 53,282 60,731 144,643 77,123 187,334
Stockholders' equity............... 4,093 47,349 65,648 119,966 159,808 133,734 172,967
</TABLE>
- ---------------
(1) Includes balances outstanding under the Company's prior revolving credit
facility of $6.7 million at June 30, 1993.
(2) Includes balances outstanding under the Company's prior revolving credit
facility of $34.9 million, $49.5 million, and $134.0 million at June 30,
1995, 1996, and 1997, respectively, and $69.6 million and $175.5 million at
December 31, 1996 and 1997, respectively.
33
<PAGE> 41
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with
the Selected Consolidated Financial Data and the Consolidated Financial
Statements of the Company, including the notes thereto, which are contained
elsewhere or incorporated by reference in this Prospectus.
INTRODUCTION
The Company derives its revenue primarily from fees charged for ambulance
and fire protection services. The Company provides ambulance services in
response to emergency medical calls ("911" emergency ambulance services) and
non-emergency transport services (general transport services) to patients on
both a fee-for-service basis and nonrefundable subscription fee basis. Per
transport revenue depends on various factors, including the mix of rates between
existing markets and new markets and the mix of activity between "911" emergency
ambulance services and general transport services as well as other competitive
factors. Fire protection services are provided either under contracts with
municipalities or fire districts or on a nonrefundable subscription fee basis to
individual homeowners or commercial property owners.
Ambulance service fees are recorded net of Medicare, Medicaid, and other
reimbursement limitations and are recognized when services are provided.
Payments received from third-party payors represent a substantial portion of the
Company's ambulance service fee receipts. The Company derived approximately 79%
and 74% of its net ambulance fee collections from such third-party payors during
1996 and 1997, respectively. Provision for doubtful accounts is made for the
expected difference between ambulance service fees charged and amounts actually
collected. The Company's provision for doubtful accounts generally is higher
with respect to collections to be derived directly from patients than for
collections to be derived from third-party payors and generally is higher for
"911" emergency ambulance services than for general transport services.
Because of the nature of the Company's ambulance services, it is necessary
to respond to a number of calls, primarily "911" emergency ambulance service
calls, which may not result in transports. Results of operations are discussed
below on the basis of actual transports since transports are more directly
related to revenue. Expenses associated with calls that do not result in
transports are included in operating expenses. The percentage of calls not
resulting in transports varies substantially depending upon the mix of general
transport and "911" emergency ambulance service calls in the Company's markets
and is generally higher in markets in which the calls are primarily "911"
emergency ambulance service calls. Rates in the Company's markets take into
account the anticipated number of calls that may not result in transports. The
Company does not separately account for expenses associated with calls that do
not result in transports.
Revenue generated under fire protection services contracts is recognized
over the life of the contract. Subscription fees received in advance are
deferred and recognized over the term of the subscription agreement, which
generally is one year.
Other revenue primarily consists of fees associated with alternative
transportation dispatch, fleet, billing and home health care services and is
recognized when the services are provided.
Other operating expenses primarily consist of rent and related occupancy
expenses, maintenance and repairs, insurance, fuel and supplies, travel, and
professional fees.
The Company's net income for the year ended June 30, 1997 was $12.7
million, or $1.04 per share (diluted). This compares to net income of $6.9
million and $11.5 million, or $0.84 and $1.14 per share (diluted), for the years
ended June 30, 1995 and 1996, respectively. Included in 1995 net income is an
extraordinary charge to earnings of $0.7 million, net of a $0.5 million tax
benefit, or $0.08 per share, to reflect the loss on early extinguishment of
debt. During fiscal 1997, the Company completed the acquisition of 19 companies
operating in Arizona, Arkansas, Georgia, Indiana, Kentucky, New York, Ohio,
Pennsylvania and Ontario, Canada. The following discussion provides greater
detail of the Company's results of operations and liquidity and capital
resources.
34
<PAGE> 42
RESULTS OF OPERATIONS
The following table sets forth for the years ended June 30, 1995, 1996 and
1997, and for the six months ended December 31, 1996 and 1997 certain items from
the Company's consolidated financial statements expressed as a percentage of
total revenue:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED JUNE 30, DECEMBER 31, 1997
----------------------- ------------------
1995 1996 1997 1996 1997
----- ----- ----- ------- -------
<S> <C> <C> <C> <C> <C>
Revenue
Ambulance services............................. 74.3% 78.8% 80.5% 80.2% 80.0%
Fire protection services....................... 18.8 15.5 13.2 13.6 10.8
Other.......................................... 6.9 5.7 6.3 6.2 9.2
----- ----- ----- ----- -----
Total revenue.......................... 100.0 100.0 100.0 100.0 100.0
Operating expenses
Payroll and employee benefits.................. 52.9 54.1 53.4 54.4 52.8
Provision for doubtful accounts................ 13.0 12.4 13.6 13.3 13.8
Depreciation................................... 3.9 3.9 3.8 3.7 4.2
Amortization of intangibles.................... 1.2 1.4 1.5 1.5 1.5
Other operating expenses....................... 19.7 18.3 17.1 17.8 16.9
Loss contract/restructuring charge............. -- -- 1.9 -- --
----- ----- ----- ----- -----
Operating income................................. 9.3 9.9 8.7 9.3 10.8
Interest expense, net 1.8.. 2.1 1.8 1.4 2.6
Other.......................................... -- -- -- -- 0.1
----- ----- ----- ----- -----
Income before income taxes and extraordinary
item........................................... 7.5 7.8 6.9 7.9 8.1
Provision for income taxes..................... 3.1 3.2 2.9 3.2 3.3
----- ----- ----- ----- -----
Income before extraordinary item................. 4.4% 4.6% 4.0% 4.7% 4.8%
===== ===== ===== ===== =====
</TABLE>
SIX MONTHS ENDED DECEMBER 31, 1996 COMPARED TO SIX MONTHS ENDED DECEMBER 31,
1997
Revenue
Total revenue increased $57.6 million, or 38.0%, from $151.5 million for
the six months ended December 31, 1996 to $209.1 million for the six months
ended December 31, 1997. Approximately $42.6 million of this increase resulted
from the acquisition of ambulance service providers during the last two quarters
of fiscal 1997 and the first two quarters of fiscal 1998. Ambulance service
revenue in markets served by the Company in both of the six month periods ended
December 31, 1996 and 1997 increased by 4.9%. Fire protection services revenue
increased by $1.9 million, or 9.2%, from $20.7 million for the six months ended
December 31, 1996 to $22.6 million for the six months ended December 31, 1997.
Other revenue increased by $9.8 million, or 104.3%, in the six months ended
December 31, 1997 compared to the six months ended December 31, 1996.
Total ambulance transports increased by 140,000, or 33.0%, from 424,000 for
the six months ended December 31, 1996 to 564,000 for the six months ended
December 31, 1997. The acquisitions of 21 ambulance service companies during the
last two quarters of fiscal 1997 and the first two quarters of fiscal 1998
accounted these additional transports.
Fire protection services revenue increased due to revenue generated from
new fire protection contracts awarded to the Company primarily through
competitive bidding and due to rate increases for fire protection services.
Other revenue increased primarily because of fees received for billing,
dispatch and other services pursuant to the Company's Agreement with San Diego
Fire and Life Safety Services.
35
<PAGE> 43
Operating Expenses
Payroll and employee benefit expenses increased $28.0 million, or 33.9%,
from $82.5 million for the six months ended December 31, 1996 to $110.5 million
for the six months ended December 31, 1997. This increase was primarily due to
the acquisition of 21 ambulance service providers during the last two quarters
of fiscal 1997 and the first two quarters of fiscal year 1998.
Provision for doubtful accounts increased $8.6 million, or 42.6%, from
$20.2 million for the six months ended December 31, 1996 to $28.8 million for
the six months ended December 31, 1997. Provision for doubtful accounts
increased from 13.3% of total revenue for the six months ended December 31, 1996
to 13.8% of total revenue for the six months ended December 31, 1997, reflecting
the effect of the acquisition of ambulance service providers during the second
half of fiscal 1997 and first half of fiscal 1998 operating in markets with a
greater mix of "911" emergency activity.
Depreciation increased $3.1 million, or 54.4%, from $5.7 million for the
six months ended December 31, 1996 to $8.8 million for the six months ended
December 31, 1997, primarily as a result of depreciation expense on property and
equipment obtained through recent ambulance service acquisitions. Depreciation
increased from 3.7% of total revenue for the six months ended December 31, 1996
to 4.2% of total revenue for the six months ended December 31, 1997.
Amortization of intangibles increased by $0.9 million, or 40.9%, from $2.2
million for the six months ended December 31, 1996 to $3.1 million for the six
months ended December 31, 1997. This increase is primarily a result of
intangible assets recorded in recent acquisitions. Amortization of intangibles
was 1.5% of total revenue for the six months ended December 1996 and 1997.
Other operating expenses increased approximately $8.4 million, or 31.2%,
from $26.9 million for the six months ended December 31, 1996 to $35.3 million
for the six months ended December 31, 1997, primarily due to increased expenses
associated with the operation of 21 ambulance service providers acquired during
the last two quarters of fiscal 1997 and the first two quarters of fiscal 1998.
Other operating expenses decreased from 17.8% of total revenue for the six
months ended December 31, 1996 to 16.9% of total revenue for the six months
ended December 31, 1997 as a result of operational efficiencies realized through
the integration of these acquired companies.
Interest expense increased by $3.3 million from $2.1 million for the six
months ended December 31, 1996 to $5.4 million for the six months ended December
31, 1997. This increase was attributable to increased borrowings on the
Company's prior revolving credit facility.
The Company's effective tax rate decreased from 41.0% for the six months
ended December 31, 1996 to 40.7% for the six months ended December 31, 1997,
primarily as a result of tax planning strategies implemented by the Company
during fiscal 1996.
YEAR ENDED JUNE 30, 1996 COMPARED TO YEAR ENDED JUNE 30, 1997
Revenue
Total revenue increased $69.5 million, or 27.8%, from $250.3 million for
the year ended June 30, 1996 to $319.8 million for the year ended June 30, 1997.
Approximately $43.6 million of this increase resulted from the acquisition of
ambulance service providers during fiscal 1997. Fire protection services revenue
increased by $3.4 million, and other revenue increased by $5.9 million.
Total ambulance transports increased by 205,000, or 28.9%, from 710,000 for
the year ended June 30, 1996 to 915,000 for the year ended June 30, 1997. The
acquisition of 18 ambulance service companies during fiscal 1997 accounted for
154,000 of these additional transports.
Fire protection services revenue increased due to rate increases for fire
protection services and greater utilization of the Company's services under
fee-for-service arrangements. The increase also resulted from the revenue
generated from new fire protection contracts awarded to the Company through
competitive bidding.
36
<PAGE> 44
Operating Expenses
Payroll and employee benefit expenses increased $35.4 million, or 26.1%,
from $135.4 million for the year ended June 30, 1996 to $170.8 million for the
year ended June 30, 1997. This increase was primarily due to the acquisition of
nineteen companies during fiscal 1997. Payroll and employee benefits decreased
from 54.1% of total revenue for the year ended June 30, 1996 to 53.4% of total
revenue for the year ended June 30, 1997 as a result of operational
efficiencies.
Provision for doubtful accounts increased $12.4 million, or 40.0%, from
$31.0 million for the year ended June 30, 1996 to $43.4 million for the year
ended June 30, 1997. Provision for doubtful accounts increased from 12.4% of
total revenue for the year ended June 30, 1996 to 13.6% of total revenue for the
year ended June 30, 1997, reflecting the effect of the acquisition of ambulance
service providers operating in markets with a greater mix of "911" emergency
activity.
Depreciation increased $2.3 million, or 23.5%, from $9.8 million for the
year ended June 30, 1996 to $12.1 million for the year ended June 30, 1997,
primarily due to increased property and equipment from recent acquisition
activity.
Amortization of intangibles increased by $1.1 million, or 30.6%, from $3.6
million for the year ended June 30, 1996 to $4.7 million for the year ended June
30, 1997. This increase was the result of increased intangible assets caused by
recent acquisition activity. Amortization of intangibles increased from 1.4% of
total revenue for the year ended June 30, 1996 to 1.5% for the year ended June
30, 1997.
Other operating expenses increased $9.2 million, or 20.1%, from $45.7
million for the year ended June 30, 1996 to $54.9 million for the year ended
June 30, 1997, primarily as a result of increased expenses associated with the
operation of the nineteen companies acquired during fiscal 1997. Other operating
expenses decreased from 18.3% of total revenue for the year ended June 30, 1996
to 17.1% of total revenue for the year ended June 30, 1997 as a result of
operational efficiencies.
The Company recorded a $6.0 million pre-tax charge for the year ended June
30, 1997. Included in this amount was an allowance of $3.2 million related to an
unprofitable ambulance service contract. Also included was a restructuring
charge of $2.8 million relating to the integration of ambulance company
acquisitions. The restructuring charge consists primarily of severance costs and
other costs related to the elimination of redundant functions. Management
expects the integration to be completed during fiscal 1998.
Interest expense increased by $0.6 million, or 11.8%, from $5.1 million for
the year ended June 30, 1996 to $5.7 million for the year ended June 30, 1997.
This increase was caused by higher debt balances, reflecting increased
borrowings on the Company's prior revolving credit facility.
The Company's effective tax rate increased from 41.1% for the year ended
June 30, 1996 to 42.4% for the year ended June 30, 1997, primarily the result of
a higher percentage of the Company's taxable income being generated in higher
tax rate states and the effect of nondeductible goodwill generated in connection
with the acquisition of certain ambulance service providers.
YEAR ENDED JUNE 30, 1995 COMPARED TO YEAR ENDED JUNE 30, 1996
Revenue
Total revenue increased $78.7 million, or 45.9%, from $171.6 million for
the year ended June 30, 1995 to $250.3 million for the year ended June 30, 1996.
Approximately $56.1 million of this increase resulted from the acquisition of
ambulance service providers during fiscal 1996. Fire protection services revenue
increased by $6.5 million, and other revenue increased by $2.4 million.
Total ambulance transports increased by 241,000, or 51.4%, from 469,000 for
the year ended June 30, 1995 to 710,000 for the year ended June 30, 1996. The
acquisition of 16 ambulance service companies during fiscal 1996 accounted for
227,000 of these additional transports.
37
<PAGE> 45
Fire protection services revenue increased due to rate increases for fire
protection services and greater utilization of the Company's services under
fee-for-service arrangements. The increase also resulted from the acquisition of
a fire protection service company during the first quarter of fiscal 1996 and
revenue generated from new fire protection contracts awarded to the Company
through competitive bidding.
Operating Expenses
Payroll and employee benefit expenses increased $44.6 million, or 49.1%,
from $90.8 million for the year ended June 30, 1995 to $135.4 million for the
year ended June 30, 1996. This increase was primarily due to the acquisition of
18 companies during fiscal 1996.
Provision for doubtful accounts increased $8.7 million, or 39.0%, from
$22.3 million for the year ended June 30, 1995 to $31.0 million for the year
ended June 30, 1996. Provision for doubtful accounts decreased from 13.0% of
total revenue for the year ended June 30, 1995 to 12.4% of total revenue for the
year ended June 30, 1996, reflecting the effect of the acquisition of ambulance
service providers operating in markets with higher receivable collections as a
result of a greater mix of general transport activity.
Depreciation increased $3.1 million, or 46.3%, from $6.7 million for the
year ended June 30, 1995 to $9.8 million for the year ended June 30, 1996,
primarily due to increased property and equipment from recent acquisition
activity.
Amortization of intangibles increased by $1.5 million, or 71.4%, from $2.1
million for the year ended June 30, 1995 to $3.6 million for the year ended June
30, 1996. This increase was the result of increased intangible assets caused by
recent acquisition activity. Amortization of intangibles increased from 1.2% of
total revenue for the year ended June 30, 1995 to 1.4% for the year ended June
30, 1996.
Other operating expenses increased $11.9 million, or 35.2%, from $33.8
million for the year ended June 30, 1995 to $45.7 million for the year ended
June 30, 1996, primarily as a result of increased expenses associated with the
operation of the 18 companies acquired during fiscal 1996. Other operating
expenses decreased from 19.7% of total revenue for the year ended June 30, 1995
to 18.3% of total revenue for the year ended June 30, 1996 as a result of
operational efficiencies.
Interest expense increased by $2.0 million, or 64.5%, from $3.1 million for
the year ended June 30, 1995 to $5.1 million for the year ended June 30, 1996.
This increase was caused by higher debt balances, reflecting increased
borrowings on the Company's revolving credit facility.
The Company's effective tax rate increased from 41.0% for the year ended
June 30, 1995 to 41.1% for the year ended June 30, 1996, primarily the result of
a higher percentage of the Company's taxable income being generated in higher
tax rate states and the effect of nondeductible goodwill generated in connection
with the acquisition of certain ambulance service providers. This increase was
partially offset by tax planning strategies implemented by the Company during
fiscal 1996.
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<PAGE> 46
SEASONALITY AND QUARTERLY RESULTS
The following table reflects certain selected unaudited quarterly operating
results for each of the eight quarters including the quarter ended December 31,
1997. The operating results of any quarter are not necessarily indicative of
results of any future period.
<TABLE>
<CAPTION>
MAR. 31, JUNE 30, SEPT. 30, DEC. 31, MAR. 31, JUNE 30, SEPT. 30, DEC. 31,
1996 1996 1996 1996 1997 1997(1) 1997 1997
--------- --------- --------- -------- --------- -------- --------- --------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Ambulance service.................. $51,789 $53,955 $59,028 $62,465 $69,161 $66,834 $77,598 $89,769
Fire protection.................... 9,813 10,267 10,305 10,349 10,551 10,958 11,212 11,351
Other revenue...................... 3,382 4,455 4,661 4,716 5,209 5,568 8,963 10,222
------- ------- ------- ------- ------- ------- ------- -------
Total revenue...................... 64,984 68,677 73,994 77,530 84,921 83,360 97,773 111,342
Operating income................... 6,775 7,736 6,592 7,474 9,500 4,238 10,346 12,199
Diluted net income................. 2,989 4,025 3,299 3,771 4,675 975 4,658 5,424
Diluted earnings per share........... $ 0.31 $ 0.35 $ 0.28 $ 0.31 $ 0.38 $ 0.08 $ 0.35 $ 0.38
======= ======= ======= ======= ======= ======= ======= =======
</TABLE>
- ---------------
(1) Includes a $6.0 million pre-tax charge for loss contract/restructuring.
The Company has historically experienced, and expects to continue to
experience, moderate seasonality in quarterly operating results. This
seasonality has resulted from a number of factors, including relatively higher
second and third fiscal quarter demand for transport services in the Company's
Arizona and Florida regions resulting from the greater winter populations in
those regions. The effect of the acquisition of ambulance service providers in
the northeastern and midwestern regions of the United States has reduced, and
will continue to reduce, the overall seasonality in operating results. However,
as a result of the Company's recent expansion into Latin America, the Company
may experience increased seasonality as a result of relatively higher first and
fourth quarter demand for services in the Latin American region during the
winter.
LIQUIDITY AND CAPITAL RESOURCES
Historically, the Company has financed its cash requirements principally
through cash flow from operating activities, term and revolving indebtedness,
capital equipment lease financing, the sale of stock through an initial public
offering in July 1993, subsequent public stock offerings in May 1994 and April
1996, and the ongoing exercise of stock options.
At December 31, 1997, the Company had working capital of $116.9 million,
including cash of $2.3 million, compared to working capital of $94.8 million,
including cash of $3.4 million at June 30, 1997. For the six months ended
December 31, 1997, net cash used in operations was $6.0 million compared to net
cash used in operations of $3.5 million for the six months ended December 31,
1996. Net cash provided by (used in) operations was $(11.1) million and $1.4
million for the fiscal years ended June 30, 1997 and June 30, 1996,
respectively. The increases in working capital are due primarily to increases in
accounts receivable, partially offset by increases in accrued liabilities and
accounts payable.
The Company's gross accounts receivable as of June 30, 1996, June 30, 1997,
and December 31, 1997 were $95.2 million, $142.8 million, and $194.9 million,
respectively. The Company's accounts receivable, net of the allowance for
doubtful account, were $68.6 million, $107.0 million, and $149.9 million as of
such dates, respectively. The Company believes that the increase in accounts
receivable is related significantly to acquisition activity and to recent
revenue growth. The Company also attributes the increase in accounts receivable
and the increased age of receivables to certain factors, including delays in
payments from certain third-party payors, particularly in certain of the
Company's regional billing areas, and a general industry trend towards a
lengthening payment cycle of accounts receivable due from third-party payors. In
addition, the Company believes certain transitional aspects of the integration
of acquired companies into the Company's centralized billing and collection
function has resulted in increases in the amount and age of accounts receivable
during the transition period.
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<PAGE> 47
During September 1995, the Company funded a fully underwritten credit
agreement for a $125.0 million revolving credit facility. The Company used the
proceeds from the credit facility to repay the Company's then existing revolving
credit facility and its notes payable. Costs previously deferred related to
certain indebtedness resulted in an extraordinary charge to earnings of
$693,000, net of a $480,000 tax benefit, or $.08 per share in the year ended
June 30, 1995. In May 1997, the credit facility was increased from $125.0
million to $175.0 million. In December 1997, the credit facility was increased
from $175.0 million to $200.0 million. At February 28, 1998, borrowings on the
credit facility were approximately $189.0 million. Contemporaneously with the
closing of the Initial Offering the Company entered into an amendment to the
credit facility (the "New Credit Facility"). See "Description of the New Credit
Facility." Following the closing of the Initial Offering and the use of the net
proceeds therefrom, borrowings under the New Credit Facility were approximately
$54.1 million as of March 18, 1998.
Exclusive of payments on the prior revolving credit facility, the Company
repaid $21.3 million of notes payable and capital lease obligations during the
year ended June 30, 1997 and $20.3 million during the year ended June 30, 1996.
Capital expenditures were $23.9 million during the year ended June 30, 1997
compared to $18.2 million during the prior year, of which $2.0 million was
financed through capital lease obligations in the year ended June 30, 1996.
Exclusive of payments on the prior revolving credit facility, the Company
repaid $14.4 million of notes payable and capital lease obligations during the
six months ended December 31, 1997 compared to $6.5 million during the six
months ended December 31, 1996. Capital expenditures were $14.9 million during
the six months ended December 31, 1997 compared to $7.7 million during the six
months ended December 31, 1996. The Company had $12.9 million of capital lease
obligations outstanding at December 31, 1997.
In November 1997, the Company entered into a $5.0 million term loan, which
matures on March 31, 1998. The Company used the proceeds from the loan to fund
acquisitions, capital expenditures and for general corporate purposes. The loan
has an interest rate of LIBOR plus 1.625%. The Company used the net proceeds
from the Initial Offering to repay the term loan.
During the year ended June 30, 1997, the Company purchased either all of
the issued and outstanding stock or certain of the assets of 19 companies
operating in Arizona, Arkansas, Georgia, Indiana, Kentucky, New York, Ohio,
Pennsylvania and Ontario, Canada. The combined purchase price was $82.6 million.
The Company paid cash of $35.5 million, issued notes payable to sellers totaling
$4.5 million, issued 1.2 million shares of Common Stock to sellers (361,970
shares were related to pooling-of-interests transactions and the remaining
shares were valued at $18.7 million), and assumed $23.9 million of liabilities.
The Company funded the cash portion of the acquisitions through operating cash
flow and from the prior revolving credit facility.
During the six months ended December 31, 1997, the Company purchased either
all the issued and outstanding stock or certain assets of nine ambulance service
providers with operations in Alabama, Arizona, Georgia, Maryland, Mississippi,
New Jersey, New York, South Carolina, Tennessee, Virginia, and the District of
Columbia. The combined purchase price of the operations accounted for as
purchases was $30.5 million. The Company paid cash of $9.8 million, issued notes
payable to sellers of $6.5 million, issued 659,191 shares of Common Stock to
sellers (641,009 shares were related to pooling-of-interests transactions and
the remaining shares were valued at $325,000), and assumed $13.9 million of
liabilities. The Company funded the cash portion of the acquisitions primarily
from the Company's prior revolving credit facility.
Subsequent to December 31, 1997, the Company purchased ECCO for $35.0
million, consisting of $25.0 million in cash and $10.0 million in shares of the
Company's Common Stock. See "Prospectus Summary -- Recent Developments."
The Company expects that the proceeds from the Initial Offering, cash flow
from operations, and additional borrowing capacity will be sufficient to meet
its operating and capital needs for existing operations as well as to fund
certain service area expansions and acquisitions for the 12 months subsequent to
December 31, 1997. The Company is engaged in an active acquisition program. In
addition to using cash from operations, credit facilities, seller notes payable
and the issuance of common stock, the Company may seek to
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<PAGE> 48
raise additional capital through public or private debt or equity financing to
fund acquisitions. The availability and desirability of these capital sources
will depend upon prevailing market conditions, interest rates and the financial
condition of the Company. There can be no assurance such financing will be
available on favorable terms, if at all.
EFFECTS OF INFLATION AND FOREIGN CURRENCY EXCHANGE FLUCTUATIONS
The results of operations of the Company for the periods discussed have not
been affected significantly by inflation or foreign currency fluctuations. The
Company's revenue from international operations is denominated primarily in the
currency of the country in which it is operating. Although the Company has not
incurred any material exchange gains or losses to date, there can be no
assurance that fluctuations in the currency exchange rates in the future will
not have an adverse effect on the Company's business, financial condition, cash
flows, and results of operations. The Company does not currently engage in
foreign currency hedging transactions. However, as the Company continues to
expand its international operations, exposure to gains and losses on foreign
currency transactions may increase. The Company may choose to limit such
exposure by entering into forward exchange contracts or engaging in similar
hedging strategies. See "Risk Factors -- Risks Associated with International
Operations and Foreign Currency Fluctuations."
YEAR 2000 COMPLIANCE
The Company has implemented a Year 2000 compliance program designed to
ensure that the Company's medical equipment, computer systems and applications
will function properly beyond 1999. Although the Company believes that it has
allocated adequate resources for this purpose and expects its Year 2000 date
conversion program to be completed on a timely basis without incurring
significant expenditures to address this issue, there can be no assurance that
the Company will not experience unforeseen difficulties. The failure by medical
equipment suppliers or third-party payors, such as private insurers, managed
care providers, healthcare organizations, preferred provider organizations, and
federal and state government agencies that administer Medicare and/or Medicaid,
to adequately address their Year 2000 issues could impact their ability to
reimburse the Company or otherwise adversely affect the Company's business,
financial condition, cash flows, and results of operations.
41
<PAGE> 49
BUSINESS
The Company is a leading provider of health and safety services, which
include "911" emergency ambulance and general transport services, fire
protection services, and other safety and health care related services to
municipal, residential, commercial, and industrial customers. The Company
believes that it is the only multi-state provider of both ambulance and fire
protection services in the United States and that it ranks as one of the largest
private-sector providers of ambulance and fire protection services in the world.
The Company currently serves over 400 communities in 25 states, the District of
Columbia, Canada, and Latin America. Ambulance services and fire protection
services accounted for approximately 80% and 11%, respectively, of the Company's
revenue for the six months ended December 31, 1997.
Founded in 1948, the Company has been instrumental in the development of
protocols and policies applicable to the emergency services industry. The
Company has grown significantly since the late 1970s both through internal
growth and through acquisitions. To manage this growth, the Company invested in
the development of management and operational systems that have resulted in
productivity gains and increased profitability. The Company believes its key
business competencies in communications and logistics management position it to
continue its growth internally as well as through acquisitions, joint ventures,
and business alliances and enable it to operate profitably in both large and
small communities. The Company completed 11 acquisitions in the fiscal year
ended June 30, 1995, 18 acquisitions in the fiscal year ended June 30, 1996, 19
acquisitions in the fiscal year ended June 30, 1997, and nine acquisitions
during the six months ended December 31, 1997.
INDUSTRY OVERVIEW
Based on generally available industry data, it is estimated that annual
expenditures for ambulance services in the United States are between $4 billion
and $7 billion. Public-sector entities, private companies, hospitals, and
volunteer organizations provide ambulance services. Public-sector entities often
serve as the first responder to requests for such emergency ambulance services
and often provide emergency ambulance transport. When the public sector serves
as first responder, private companies often serve as the second responder and
support the first responder as needed. The private sector provides the majority
of general transport services. It is estimated that the ambulance service
industry includes more than 10,000 providers of service, 2,000 or more of which
are private and approximately 1,000 of which are hospital-owned. Most commercial
providers are small companies serving one or a limited number of markets.
Several multi-state providers, including the Company, have emerged through the
acquisition and consolidation of smaller ambulance service providers in recent
years.
The growth in ambulance service expenditures has resulted from both an
increase in the number of transports and an increase in the average expenditures
per transport. The growth and aging of the population, the greater use of
outpatient care facilities and home care in response to health care cost
containment efforts, and increased patient travel between specialized treatment
health care facilities have increased the demand for emergency medical services
and general transport services. The increased availability of "911" emergency
service, the impact of educational programs on its use, and the practice of some
members of the population of utilizing a hospital's emergency room as the source
of their primary medical care also have increased the number of ambulance
transports. Industry considerations require ambulance service providers to
acquire more sophisticated emergency medical, dispatch, and communications
equipment, hire more highly trained personnel, and develop more sophisticated
dispatch and management systems to satisfy the faster response time and higher
quality of medical care assurance criteria required by municipalities and fire
districts for emergency ambulance services. Average expenditures per ambulance
transport have increased as a result of the additional costs to meet these
requirements. These requirements, combined with the fragmented nature of the
industry, are contributing to consolidation within the industry. Service
providers that do not have the financial or management resources to meet the
requirements for higher levels of service are candidates for acquisition.
Market reform continues to reshape the health care delivery system, with a
shift from fee-for-service providers to managed care providers. Managed care
providers are focusing on cost containment measures
42
<PAGE> 50
while seeking to provide the most appropriate level of service at the most
appropriate treatment facility. While ambulances typically transport patients to
the nearest treatment facility, managed care providers are attempting to manage
hospital utilization by working with ambulance service providers to ensure
transport of patients to affiliated facilities and avoid unnecessary
inter-facility transports. For non-life threatening medical emergencies, managed
care providers are beginning to explore programs where plan members are
encouraged to call the provider. Under this program, a nurse will answer the
call, analyze the medical situation, and determine the best course of action and
mode of transport. In an emergency situation, an advanced life support ambulance
will be dispatched. In certain cases, patients could receive the required
treatment level with a less costly basic life support ambulance. However, to
manage such a system, the managed care provider must contract with an ambulance
service provider that has the mix of vehicles and geographic scope to cover the
entire region served by the managed care provider and can provide call center
services.
The Company believes the trend toward managed care benefits larger
ambulance service providers, which can service a larger portion of a managed
care provider's needs. This allows the managed care provider to reduce its
number of suppliers, cutting administrative costs and allowing it to negotiate
more favorable rates.
Based on the Company's experience, the Company believes that its ambulance
and fire protection services are complementary. Municipal fire departments,
tax-supported fire districts, and volunteer fire departments constitute the
principal providers of fire protection services in the United States. In most of
the communities served by municipal fire departments and tax-supported fire
districts, the fire department is the first to respond to a call for emergency
medical services. Approximately 27,000 volunteer fire departments, covering
approximately 40% of the United States population, operate throughout the United
States. Volunteer fire departments range from departments comprised entirely of
volunteer personnel to departments that utilize one or more paid personnel
located at each station supplemented by volunteers who proceed directly to the
fire scene. In addition to providing fire protection services to municipalities
and tax-supported fire districts, the private sector also provides fire
protection services to industrial complexes, including airports, large
industrial and petrochemical plants, power plants, and other large
self-contained facilities.
STRATEGY
The Company's strategy is to leverage its experience and competencies in
communications and logistics management to enhance its position as a leading
provider of emergency response services in the United States and in other
countries. Key elements of this strategy include the acquisition of ambulance
service providers and increased marketing efforts to serve the health and safety
needs of the public and private sector, including services for health care
providers, expansion of fire protection and community safety services,
integration of health and safety operations, public/private partnering, and
outsourcing of other health and safety related services. The Company seeks to
improve productivity and to expand service offerings to customers and to seek
new potential customers through key business alliances, joint ventures, or other
strategic business arrangements.
Acquisition of Ambulance Service Providers
The Company seeks acquisitions that enable it to establish new service
areas both domestically and internationally and acquisitions that enable it to
expand its operations within its existing service areas. The Company believes
that the fragmented nature of the industry, combined with the lack of capital
and limited management systems that characterize many providers, continues to
provide an opportunity for the Company to acquire additional ambulance service
providers, including hospital-owned providers, that would benefit from its
management and operational systems, resulting in productivity gains and enhanced
levels of service.
The Company considers a number of factors in evaluating a proposed
acquisition candidate, including the quality of its management and medical
personnel, its historical operating results and future earnings potential, the
size and anticipated growth of its market, its relative position within that
market, and the competition to be encountered in such market. The Company pays
special attention to those potential service areas in which it can achieve
maximum productivity by achieving market leadership over a regional area, by
utilizing its ambulances to provide both "911" emergency ambulance and general
transport services, and by integrating
43
<PAGE> 51
ambulance services with fire protection services. The Company continues to build
its regional operations, which better position the Company to serve the
developing managed care customer base.
Expand Services to Meet the Evolving Needs of the Public Sector and Health
Care Providers
The Company plans to expand its general transport services through
increased marketing efforts to hospitals, health maintenance organizations, and
other health care providers and its emergency ambulance services through the
pursuit of new contracts and alliances with municipalities and fire districts.
Based on its public/private alliance with San Diego Fire & Life Safety Services,
the Company believes that, in certain circumstances, contracting and partnering
may provide a cost-effective approach to expanding into large urban markets. The
Company will continue to seek to enter into similar public/private alliances to
compete for new business. The Company intends to respond to the needs of health
care and managed care providers by delivering high quality, efficient,
cost-effective services and the ability to transport patients to the most
appropriate treatment facility, particularly in those geographic areas in which
it has been able to achieve market leadership. The Company intends to develop
and offer innovative value-added services to health care providers, such as
access to a medical call center, to better serve the demand management,
telephone triage, and medical transport needs of the managed care market. The
Company believes that its communications and logistics expertise will enable it
to offer services that will improve the responsiveness and cost-effectiveness of
health care services in a managed care environment. The Company expects to
pursue alliances with health care providers through the establishment of service
contracts, the development of relationships, and through acquisitions of health
care and safety-related providers, which would provide opportunities for the
Company to integrate its services with such other service providers.
Expansion and Integration of Health and Safety Services
The Company plans to continue its efforts to expand its community safety
services by providing fire protection and other safety-related services. In
seeking to expand its fire protection services, the Company plans to emphasize
the benefits of its services in terms of lower per capita fire service costs,
reduced insurance rates, and lower loss of life and property resulting from its
extensive experience, fire prevention initiatives, management and operational
systems, and the utilization of full-time fire fighters and part-time
reservists. The Company plans to respond to the economic pressures on the public
sector to reduce taxes and expenditures for emergency services including fire
protection and other safety-related services by establishing public/private
alliances with fire districts and municipalities. The Company also intends to
pursue opportunities to provide fire protection and safety services to large
industrial complexes, including airports, large industrial and petrochemical
plants, power plants, and other large self-contained facilities. The Company
currently offers other safety-related services on a limited basis, including its
security monitoring and personal emergency response systems. The Company intends
to continue to leverage its communications and logistics expertise to develop
and offer safety-related services. The Company also intends to leverage its
superior systems and substantial experience with third-party payors to provide
fire districts and municipalities with business services, such as billings and
collections services.
Because emergency medical response represents a significant portion of fire
response activity within many fire departments, the Company believes that its
ambulance and fire protection services operations are complementary. Building
upon the Company's successful integration of ambulance and fire services under
its contract with the City of Scottsdale and through its public/private alliance
with San Diego Fire & Life Safety Services, the Company plans to continue the
integration of its fire and ambulance services in certain of its service areas
and to pursue opportunities to provide integrated services in new service areas.
The Company believes that its integration of health and safety services can
provide operating economies, coordination of the delivery of services,
efficiencies in the use of personnel and equipment, and enhanced levels of
service, especially in lower-utilization communities.
Productivity Improvement and Enhancement
The Company intends to utilize its management and operational systems to
enhance productivity and profitability in its existing operations and in
acquired operations and to enhance its opportunities with joint
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<PAGE> 52
venture and business alliance partners. The centralization of key management and
operating systems development and the standardization of certain functions
permit the Company to achieve economies of scale at both the regional and
corporate levels. The Company believes that establishing market leadership in
its various service areas will enable it to more efficiently utilize its
equipment and personnel, to better serve large regional health care providers,
to more effectively market its services, and thereby continue to improve its
productivity. See "Risk Factors -- Risks Associated with Rapid Growth,
Acquisitions, and Integration."
Entrance into International Markets
The Company plans to expand its presence in international health and safety
and other related services markets initially in Canada and Latin America. The
Company intends to capitalize on the growth opportunities created by the
privatization of health and safety services in markets such as Ontario, Canada
and Argentina and the expansion of health insurance companies and health
maintenance organizations into Latin America. The Company believes select Latin
America markets, including Mexico and the nations of the MERCOSUR, represent a
growth opportunity and provide a model for a capitated health care environment
that encompasses not only ambulance transport but also mobile health care
utilizing call centers, telephone triage, and house calls by doctors and nurses.
The Company evaluates opportunities to enter into international markets through
acquisitions or alliances based on factors such as its ability to establish a
strong strategic local relationship and a solid corporate infrastructure of
systems and management talent, the potential to increase operating margins and
returns on capital, and the opportunity to offer value-added services that
broaden its participation in the health care market. In addition, the Company
seeks opportunities to provide fire protection and safety services to industrial
complexes, including airports and other large self-contained facilities. See
"Risk Factors -- Risks Associated with Rapid Growth, Acquisitions, and
Integration" and "-- Risks Associated with International Operations and Foreign
Currency Fluctuations."
CURRENT SERVICE AREAS
The Company provides its services in over 400 communities in the following
25 states, the District of Columbia, Canada, and Latin America:
<TABLE>
<S> <C> <C>
Alabama Kentucky Oregon
Arizona Louisiana Pennsylvania
Arkansas Maryland South Carolina
California Mississippi South Dakota
Florida Nebraska Tennessee
Georgia New Jersey Texas
Idaho New York Virginia
Indiana Ohio Washington
Iowa
</TABLE>
The Company provides ambulance services in these states, the District of
Columbia, and Canada primarily under the names Rural/Metro Ambulance and
Rural/Metro Medical Services and under the name Southwest Ambulance in some
areas of Arizona. The Company may operate under other names depending upon local
statutes or contractual agreements. The Company generally provides its ambulance
services pursuant to a contract or certificate of necessity on an exclusive or
nonexclusive basis. It provides "911" emergency ambulance services primarily
pursuant to contracts or as a result of providing fire protection services.
Ambulance service contracts in some service areas provide for the payment of a
subsidy to the Company.
In certain service areas, the Company is the only provider of both
emergency ambulance and general transport services. In other service areas, the
Company competes for general transport services. In all service areas, the
Company responds to "911" emergency calls if requested by a municipality or fire
district, even in the absence of a contract.
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<PAGE> 53
The Company provides fire protection services under the name Rural/Metro
Fire Department in seven states and in Latin America. Fire protection services
are provided pursuant to master contracts or on a subscription basis.
AMBULANCE AND TRANSPORT SERVICES
Emergency Medical Services
The Company generally provides emergency medical ambulance services
pursuant to contracts with counties, fire districts, and municipalities. These
contracts typically appoint the Company as the exclusive provider of "911"
emergency ambulance services in designated service areas and require the Company
to respond to every "911" emergency medical call in those areas. The Company
responds to virtually all "911" calls with advanced life support ("ALS")
ambulance units. The Company staffs its ALS ambulance units with two paramedics
or one paramedic and an emergency medical technician ("EMT") and equips such
units with ALS equipment (such as cardiac monitors, defibrillators, and oxygen
delivery systems) as well as pharmaceuticals and medical supplies.
Upon arrival at an emergency, the ALS crew members deploy portable life
support equipment, ascertain the patient's medical condition and, if required,
begin life support techniques and procedures that may include airway intubation,
cardiac monitoring, defibrillation of cardiac arrhythmias, and the
administration of medications and intravenous solutions. The crew also may
perform basic life support ("BLS") services which include basic airway
management, hemorrhage control, stabilization of fractures, emergency
childbirth, and basic vehicle extrication. As soon as medically appropriate, the
patient is placed on a portable gurney and carried into the ambulance. While a
paramedic monitors and treats the patient, the other crew member drives the
ambulance to a hospital designated either by the patient or the applicable
medical protocol. En route, the ALS crew alerts the hospital regarding the
patient's medical condition, and if necessary, the attending paramedic seeks
advice from a hospital emergency room physician as to treatment. Upon arrival at
the hospital, the patient generally is taken to the emergency room.
General Transport Services
The Company also provides ambulance services to patients requiring either
advanced or basic levels of medical supervision during transfer to and from
residences and health care facilities. These services may be provided when a
home-bound patient requires examination or treatment at a health care facility
or when a hospital inpatient requires tests or treatments (such as MRI testing,
CAT scans, dialysis, or chemotherapy treatment) available at another facility.
The Company utilizes ALS or BLS ambulance units to provide general ambulance
services depending on the patient's needs and the proximity of available units.
The Company staffs its BLS ambulance units with two EMTs and equips such units
with medical supplies and equipment necessary to administer first aid and basic
medical treatment.
The Company also provides critical care transport services to medically
unstable patients (such as cardiac patients and neonatal patients) who require
critical care while being transported between health care facilities. Critical
care services differ from ALS services in that the ambulance may be equipped
with additional medical equipment and may be staffed by a medical specialist
provided by the Company or by a health care facility to attend to a patient's
special medical needs.
In addition to ambulance services, the Company provides non-medical
transportation for the handicapped and certain non-ambulatory persons in some
service areas. Such transportation generally takes place between residences or
nursing homes and hospitals or other health care facilities. In providing this
service, the Company utilizes vans that contain hydraulic wheelchair lifts or
ramps operated by drivers who generally are trained in cardiopulmonary
resuscitation ("CPR").
The Company provides ambulance services, critical care transports, and
nonmedical transportation services pursuant to contracts with governmental
agencies, health care facilities, or at the request of a patient. Such services
may be scheduled in advance or provided on an as needed basis. Contracts with
managed care providers provide for reimbursement on a per transport basis or on
a capitated basis under which the Company
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<PAGE> 54
receives a fixed fee per person per month. The Company currently has a contract
to provide non-emergency ambulance transportation for Aetna Health Plan of
Ohio's 550,000 managed care plan members on a fee-for-service basis. The
contract may evolve into a capitated format after the service utilization
patterns are firmly established.
Medical Personnel and Quality Assurance
Paramedics and EMTs must be state certified in order to transport patients
and to perform emergency care services. Certification as an EMT requires
completion of a minimum of 164 hours of training in a program designated by the
United States Department of Transportation and supervised by state authorities.
EMTs also may complete advanced training courses to become certified to provide
certain additional emergency care services, such as administration of
intravenous fluids and advanced airway management. In addition to completion of
the EMT training program, the certification as a paramedic requires the
completion of more than 800 hours of training in advanced patient care
assessment, pharmacology, cardiology, and clinical and field skills. Many of the
paramedics currently employed by the Company served as EMTs for the Company
prior to their certification as paramedics.
Local physician advisory boards develop medical protocols to be followed by
paramedics and EMTs in a service area. In addition, instructions are conveyed on
a case-by-case basis through direct communications between the ambulance crew
and hospital emergency room physicians during the administration of advanced
life support procedures. Both paramedics and EMTs must complete continuing
education programs and, in some cases, state supervised refresher training
examinations to maintain their certifications. Certification and continuing
education requirements for paramedics and EMTs vary among states and counties.
The Company maintains a commitment to provide high quality pre-hospital
emergency medical care. In each location in which the Company provides services,
a medical director, who usually is a physician associated with a hospital the
Company serves, monitors adherence to medical protocol and conducts periodic
audits of the care provided. In addition, the Company holds retrospective care
audits with its employees to evaluate compliance with medical and performance
standards.
The Company was one of the first ambulance service providers to obtain
accreditation for many of its larger ambulance operations from the Commission on
Accreditation of Ambulance Services, a joint program between the American
Ambulance Association and the American College of Emergency Physicians. The
process is voluntary and evaluates numerous qualitative factors in the delivery
of services. The Company believes municipalities and managed care providers will
consider accreditation as one of the criteria in awarding contracts in the
future.
FIRE PROTECTION SERVICES
Fire protection services consist primarily of fire prevention and fire
suppression. Other fire protection related activities include hazardous material
containment, underwater search and recovery, mountain and confined space rescue,
and public education. The Company provides various levels of fire protection
services ranging from fire stations that are fully staffed 24 hours per day to
reserve stations. The Company generally provides its services to municipalities
and other governmental bodies pursuant to master contracts and to residences,
commercial establishments, and industrial complexes pursuant to subscription fee
and other fee-for-service arrangements. Federal and state governments contract
with the Company from time to time to suppress forest fires or wildfires on
government lands.
The Company has placed fire prevention and education in the forefront of
its fire protection services and has developed a comprehensive program to
prevent and minimize fires rather than emphasizing a standing army to respond to
fires that occur. The Company believes that effective fire protection requires
the intensive training of personnel, the effective utilization of fire
equipment, the establishment of effective communication centers for the receipt
of emergency calls and the dispatch of equipment and personnel, the
establishment and enforcement of strict fire codes, and community educational
efforts. The Company believes that it provides fire protection services at a
cost significantly lower than the national average as a result of its emphasis
on fire prevention, its advanced systems, and its use of a combination of
full-time fire fighters and part-time reservists.
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Based upon generally available industry data, the Company believes that fire
loss per capita in the areas serviced by the Company has been substantially less
than the national average.
Fire Protection Personnel
The Company's ability to provide its fire protection services at relatively
low costs results from its efficient use of personnel in addition to its fire
prevention efforts. Typically, personnel costs represent more than two-thirds of
the cost of providing fire protection services. The Company has been able to
reduce its labor costs through a system that utilizes full-time firefighters
complemented by paid part-time reservists as well as a modified every other day
shift schedule. By using trained reservists on an as needed basis, the Company
has the ability to supplement full-time fire fighters on a cost-effective basis.
Reservists comprise approximately 45% of the Company's operational work force.
All full-time and reservist firefighters undergo extensive training, which
exceeds the standards recommended by the National Fire Protection Association
("NFPA"), and must qualify for state certification before being eligible for
full-time employment by the Company. Since approximately 70% to 80% of the
Company's fire response activity consists of emergency medical response, all of
the Company's firefighters are trained EMTs and an increasing number of its
firefighters are paramedics. Ongoing training includes instruction in new fire
service tactics and fire fighting techniques as well as continual physical
conditioning.
Fire Response
An alarm typically results in the dispatch of one or more engine companies
(each of which consists of an engine and two to four firefighters, including a
captain), a fire chief, and such other equipment as circumstances warrant. The
amount of equipment and personnel depends upon the type, location, and severity
of the incident. The Company utilizes its dispatch capabilities to reposition
equipment and firefighters to maximize the availability and use of resources in
a cost-effective manner.
Fire Prevention
The Company believes that fire prevention programs result in both lower
fire loss and significant overall cost savings. The Company's fire prevention
programs include advice and recommendations for and the encouragement of various
fire prevention methods, including fire code design, building design to inhibit
the spread of fire, the design of automatic fire suppression sprinklers, fire
detector and smoke detector installations, the design of monitoring and alarm
systems, the placement and inspection of fire hydrants, fire code inspection and
enforcement, and the determination of fire cause and origin in arson suspected
fires. In addition, the Company's personnel perform community education programs
designed to reduce the risk of fire and increase the Company's community
profile.
The Company believes that its long standing public/private relationship
with the City of Scottsdale provides an example of an effective, cost-efficient
fire protection program. The Scottsdale program emphasizes the Company's
philosophy of fire prevention. With the cooperation and assistance of the
Company, the City of Scottsdale has designed comprehensive fire prevention
measures, including fire codes, inspections, and sprinkler and smoke detector
ordinances. The Company believes that as a result of strict fire codes, the
enactment of a sprinkler ordinance, and the effectiveness of the services
provided by the Company, Scottsdale's per capita cost for fire protection is 46%
lower than the national average and that its per capita fire loss is
approximately one-third of the national average.
INDUSTRIAL FIRE PROTECTION SERVICES
The Company provides fire protection services to large industrial
complexes, such as airports, large industrial and petrochemical plants, power
plants, and other self-contained facilities. During 1996, the Company signed a
three-year contract to provide firefighting and hazardous materials response
services to the Heath-Newark-Licking County Airport Authority, located outside
Columbus, Ohio and a four-year contract to provide crash/rescue firefighting
services at the Lafayette Regional Airport in Lafayette, Louisiana. In
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<PAGE> 56
1997, the Company entered into a five-year contract to provide crash/rescue
firefighting services to three airports in Bolivia. The Company intends to
pursue similar contracts domestically and internationally.
FIRE TRAINING SERVICES AND PROTECTION SERVICES
The Company has instituted industrial fire training services and protection
services and provides sophisticated training for industrial, professional, and
specialized firefighters using live burn training to simulate realistic
firefighting situations. The training permits fire brigade and emergency
response teams to meet increased federal training requirements, the Occupational
Safety and Health Act ("OSHA") requirements, and other regulatory requirements
for work place safety and on-site response teams.
The Company anticipates that its training services to industrial,
petrochemical, and other large private concerns will enhance its ability to
enter into contractual relationships to provide fire protection, security, and
other safety-related services to these concerns and permit the complexes to
replace their fire brigades with professional firefighters and emergency
response teams. These activities have not resulted in significant revenue to
date. The combination of fire protection services with security services in
large industrial complexes has the potential to provide for greater efficiency
and utilization in the delivery of such services and to result in reduced cost
to the industrial complexes for such services.
The Company utilizes its communications centers for home security, home
fire alarm monitoring, and personal emergency response systems monitoring to
complement the emergency services it offers. For example, in August 1997, the
Company commenced a five-year contract to monitor global positioning satellite
tracking systems in vehicles for emergency services and theft recovery. The
Company believes protection services can be integrated with fire protection and
ambulance services for optimal efficiency and maximum cost-effectiveness.
MANAGEMENT SYSTEMS
The Company utilizes sophisticated management systems, which it believes
enhance the productivity and profitability of the Company's existing operations
and enable it to enhance the productivity and profitability of acquired
operations. These systems permit the Company to achieve economies of scale at
the local operational level through the proper utilization of personnel and
equipment and at the corporate level through centralized systems for billings,
collections, purchasing, accounting, cash management, human resources, risk
management, and third-party reimbursement.
The Company has developed measurement systems that permit management to
monitor the performance level of each operation on a continual basis. The
Company's centralized management and information systems permit managers to
direct their attention primarily to operations. The systems include centralized
billings and collections procedures that provide for more efficient tracking and
collection of accounts receivable. Centralized purchasing permits the Company to
achieve significant discounts in the purchase of equipment and supplies through
a Company-developed catalogue from which managers select items needed for their
operations. Centralized third-party reimbursement allows the Company to maximize
the utilization of its expertise in Medicare, Medicaid, and other third-party
payor reimbursement programs and to ensure the most favorable classification
permitted for all of the Company's operations under such programs.
The Company believes its investment in management systems and its effective
use of such systems represent key components in its success. The Company's
financial reporting system facilitates the Company's successful integration of
acquired companies. The Company places a high priority on rapidly evaluating the
management and reporting systems of acquired operations and subsequently
integrating or transitioning such systems to improve operating efficiencies.
Upon completion of an acquisition, the Company establishes critical success
factors, including number of transports, ratio of transports to calls, resource
utilization and pricing statistics, which are monitored daily. The Company
focuses on converting acquired businesses onto the Company's technology to
promote consistent and timely reporting, taking over cash management functions,
and integrating acquired businesses into the Company's LAN/WAN communications
infrastructure. The Company is committed to an ongoing enhancement of its
systems to provide productive, timely information and effective controls and
believes that its management systems have the capability to support sustained
long-term growth.
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HUMAN RESOURCES
The Company strives to maximize the operational autonomy of its managers.
Managers receive extensive training in the use of management systems, customer
service, and supervisory practices. The Company's human resources division is
involved in the training and integration of managers from acquired operations.
The Company's centralized human resources division increases the Company's
ability to assign the most appropriate personnel for a position within any given
operation and to reassign personnel as necessary to meet operational needs. The
human resources department participates in all areas of training, career
development, and succession planning of employees and assesses the Company's
personnel needs.
DISPATCH AND COMMUNICATIONS
The Company uses system status plans and flexible deployment systems to
position its ambulances within a designated service area because effective fleet
deployment represents a key factor in reducing response time and increasing
efficient use of resources. In certain service areas with a large volume of
calls, the Company analyzes data on traffic patterns, demographics, usage
frequency, and similar factors with the aid of computers to help it determine
optimal ambulance deployment and selection. The center that controls the
deployment and dispatch of ambulances in response to calls for ambulance service
may be owned and operated either by the applicable county or municipality or by
the Company itself. Each control center utilizes computer hardware and software
and sophisticated communications equipment and maintains responsibility for
fleet deployment and utilization 24 hours a day, seven days a week.
Depending on the emergency medical dispatch system used in a designated
service area, the public authority that receives "911" emergency medical calls
either dispatches the Company's ambulances directly from the public control
center or communicates information regarding the location and type of medical
emergency to the Company's control center which in turn dispatches ambulances to
the scene. In most service areas, the Company's control center receives the
calls from the police after the police have determined the call is for emergency
medical services. When the Company receives the "911" call, it dispatches one or
more ambulances directly from its control center while the call taker
communicates with the caller. All call takers and dispatchers are trained EMTs
with additional training that enables them to instruct a caller about applicable
pre-arrival emergency medical procedures, if necessary. In the Company's larger
control centers, a computer assists the dispatcher by analyzing a number of
factors, such as time of day, ambulance location, and historical traffic
patterns, in order to recommend optimal ambulance selection. In all cases, a
dispatcher selects and dispatches the ambulance. While the ambulance is en route
to the scene, the ambulance receives information concerning the patient's
condition prior to the ambulance's arrival at the scene.
The Company's communication systems allow the ambulance crew to communicate
directly with the destination hospital to alert hospital medical personnel of
the arrival of the patient and the patient's condition and to receive
instructions directly from emergency room personnel on specific pre-hospital
medical treatment. These systems also facilitate close and direct coordination
with other emergency service providers, such as the appropriate police and fire
departments, that also may be responding to a call.
Deployment and dispatch also represent important factors in providing
non-emergency ambulance services. The Company implements system status plans for
these services designed to assure appropriate response times to non-emergency
calls. The Company intends to establish call centers that will enable it to
implement demand management strategies for health care providers. Through its
strategic alliance with National Health Enhancement Systems, Inc., the Company
is working to develop a demand management system that integrates medical
protocols with the Company's logistics and "911" based communications expertise.
By combining telephone triage and medical transport services, the Company can
improve the responsiveness and cost-effectiveness of health care delivery in a
managed care system. Managed care providers could encourage their plan members
to contact a call center in non-life threatening emergencies. The call centers
are staffed by nurses who use medical protocols to analyze and triage the
medical situation and determine the best mode of transport. In non-emergency
situations, the call centers could dispatch a BLS ambulance rather than a more
expensive ALS ambulance. The call center can also direct the ambulance to
transport the patient to an affiliated facility specified by the managed care
center rather than to a non-member facility or a hospital emergency room,
thereby further reducing costs for the provider.
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The Company utilizes communication centers in its fire protection
activities for the receipt of fire alarms and the dispatch of equipment and
personnel that are the same as or similar to those maintained for its ambulance
services. Response time represents an important criteria in the effectiveness of
fire suppression. Depending upon the area served, the Company's response time
from the receipt of a call to the arrival on the scene generally varies from 4
to 15 minutes. Response times depend on the level of protection sought by the
Company's customers in terms of fire station spacing, the size of the service
area covered, and the amount of equipment and personnel dedicated to fire
protection.
BILLINGS AND COLLECTIONS
The Company currently maintains 12 regional billing and payment processing
centers and a centralized collection system at its headquarters in Arizona.
Invoices are generated at the regional level, and the account is processed by
the centralized system only if payment is not received in a timely manner.
Customer service is directed from each of the regional centers. Depending on
size and geography, the Company will integrate acquired businesses into existing
regional billing and payment centers or create a stand-alone billing and payment
center. Substantially all of the Company's operations are billed and collected
through its integrated billing and collection system, except for its operations
in Columbus, Ohio; Rochester, New York; and New Jersey.
The Company derives a substantial portion of its ambulance fee collections
from reimbursement by third-party payors, including payments under Medicare,
Medicaid, and private insurance programs, typically invoicing and collecting
payments directly to and from those third-party payors. The Company also
collects payments directly from patients, including payments under deductible
and co-insurance provisions and otherwise. During fiscal 1995, 1996, and 1997,
the Company derived approximately 33%, 27%, and 26%, respectively, of its net
ambulance fee collections from Medicare, 12%, 11%, and 10%, respectively, from
Medicaid, 40%, 41%, and 38%, respectively, from private insurers (including
prepaid health plans and other non-government sources), and 15%, 21%, and 26%,
respectively, directly from patients. Companies in the ambulance service
industry maintain high provisions for doubtful accounts relative to companies in
other industries. Collection of complete and accurate patient billing
information during an emergency service call is sometimes difficult, and
incomplete information hinders post-service collection efforts. In addition, it
is not possible for the Company to evaluate the creditworthiness of patients
requiring emergency transport services. The Company's allowance for doubtful
accounts generally is higher with respect to revenue derived directly from
patients than for revenue derived from third-party payors and generally is
higher for transports resulting from "911" emergency calls than for general
transport requests. See "Risk Factors -- Dependence on Reimbursements by
Third-Party Payors and Individuals" and "-- Possible Adverse Changes in
Reimbursement Rates of Coverage."
The Company has substantial experience in processing claims to third-party
payors and employs a collection staff specifically trained in third-party
coverage and reimbursement procedures. The Company uses specialized proprietary
software systems to specifically tailor the submission of claims to Medicare,
Medicaid, and certain other third-party payors and has the capability to
electronically submit claims to the extent third-party payors' systems permit.
The Company's systems provide for accurate tracking of accounts receivable and
status pending payment, which facilitates the effective utilization of personnel
resources to resolve workload distribution and problem invoices. The Company
uses an automated dialer that preselects and dials accounts based on their
status within the billing and collection cycle, which optimizes the efficiency
of the collection staff.
The Company has leveraged its systems and experience in processing
third-party payor claims to provide billing and collection services to fire
departments and municipalities in Phoenix, Dallas, and San Diego. The Company
intends to seek opportunities to enter into similar contracts in other
communities.
State licensing requirements as well as contracts with counties,
municipalities, and health care facilities typically require the Company to
provide ambulance services without regard to a patient's insurance coverage or
ability to pay. As a result, the Company often does not receive compensation for
services provided to patients who are not covered by Medicare, Medicaid, or
private insurance. The anticipated level of uncompensated care and allowance for
uncollectible accounts may be considered in determining the Company's subsidy
and permitted rates under contracts with a county or municipality.
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MARKETING AND SALES
Counties, fire districts, and municipalities generally award contracts to
provide "911" emergency services either through requests for competitive
proposals or bidding processes. In some instances in which the Company is the
existing provider, the county or municipality may elect to renegotiate the
Company's existing contract rather than re-bid the contract. The Company
believes that counties, fire districts, and municipalities consider the quality
of care, historical response time performance, and total cost, both to the
municipality or county and to the public, to be among the most important factors
in awarding contracts. In addition, the Company will continue to seek to enter
into public/private alliances to compete for new business. The Company's
alliance with San Diego Fire & Life Safety Services allowed the entities to bid
for and win a contract to provide "911" and ambulance services throughout the
city of San Diego.
The Company markets its non-emergency ambulance services to hospitals,
health maintenance organizations, convalescent homes, and other health care
facilities that require a stable and reliable source of medical transportation
for their patients. The Company believes that its status as a "911" provider in
a designated service area increases its visibility and enhances its marketing
efforts for non-emergency services in that area. Contracts for non-emergency
services usually are based on criteria (such as quality of care, customer
service, response time, and cost) similar to those in contracts for emergency
services. The Company further believes that its strategy of building regional
operations will better position it to serve the developing managed care market.
The Company has implemented customer service training for all its personnel in
recognition of the increasing awareness of managed care providers to the
importance of customer service.
The Company markets its fire protection services to subscribers in rural
and suburban areas, volunteer fire departments, tax-supported fire districts and
municipalities, newly developed communities, and industrial complexes, including
airports, large industrial and petrochemical plants, power plants, and other
large self-contained facilities. Subscription fees are collected annually in
advance. In the event that the Company provides service for a nonsubscriber, the
Company directly bills the property owner for the cost of services rendered. The
Company also provides fire protection services to newly developed communities
where the subscription fee is included in the homeowner's association
assessment.
CONTRACTS
The Company enters into contracts with counties, municipalities, and fire
districts to provide "911" emergency ambulance services in designated service
areas. These contracts typically specify maximum fees that the Company may
charge and set forth required criteria, such as response times, staffing levels,
types of vehicles and equipment, quality assurance, and insurance coverage.
Counties, municipalities, and fire districts also may require the Company to
provide a performance bond or other assurances of financial responsibility. The
amount of the subsidy, if any, that the Company receives from a county,
municipality, or fire district, and the rates that the Company may charge for
services under a contract for emergency ambulance services, depend in large part
on the nature of the services rendered and performance requirements. The four
largest ambulance contracts accounted for 24%, 16%, and 13% of total revenue for
the fiscal years ended June 30, 1995, 1996, and 1997, respectively, with the
contract with Orange County, Florida accounting for 9%, 7%, and 5%,
respectively, of total revenue for the same periods. Rates to be charged under
the Orange County contract are agreed upon between the Company and the county.
The Company does not receive any subsidy from the county under this contract.
The Orange County contract was first entered into in 1962 by a provider acquired
by the Company in 1984. The Company will begin to negotiate an extension of this
contract in the summer of 1998. Although the Company expects that this contract
will be renewed, no assurance can be given that the Company will retain this
contract on terms as favorable, if at all.
The Company provides fire protection services pursuant to master contracts
or on a subscription basis. Master contracts provide for negotiated rates with
governmental entities. Certain contracts are performance based and require the
Company to meet certain dispatch and response times in a certain percentage of
responses. These contracts also set maximum thresholds for variances from the
performance criteria. These contracts establish the level of service required
and may encompass fire prevention and education activities as well as fire
suppression. Other contracts are level-of-effort based and require the Company
to provide a certain number of personnel for a certain time period for a
particular function, such as fire prevention or fire
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suppression. The largest of these contracts accounted for 6%, 4%, and 3% of
total revenue for the fiscal years ended June 30, 1995, 1996, and 1997,
respectively.
The Company provides fire protection services on a subscription basis in
areas where no governmental entity has assumed the financial responsibility for
providing fire protection. The Company derived approximately 56% of its fire
protection service revenue from subscriptions for fiscal 1995, 51% for fiscal
1996, and 50% for fiscal 1997. The Company experienced renewal rates of
approximately 88% during the prior three fiscal years. Fire subscription rates
are not currently regulated by any government agency in the Company's service
areas.
The Company's contracts generally extend for terms of two to five years,
with several contracts having terms of up to 10 years. The Company attempts to
renegotiate contracts in advance of the expiration date and generally has been
successful in such renegotiations. The Company monitors its performance under
each contract. From time to time, the Company may decide that certain contracts
are no longer favorable and may seek to modify or terminate such contracts. The
following table sets forth certain information regarding the Company's five
primary contracts at June 30, 1997 with counties, fire districts, and
municipalities for ambulance services and for fire protection services.
<TABLE>
<CAPTION>
EXPIRATION
TERM IN YEARS DATE TYPE OF SERVICE(1)
------------- ------------------ ------------------
<S> <C> <C> <C>
Ambulance
Orange County, Florida(2)...... 2 October 1999 911/General
Rochester, New York(3)......... 4 October 2000 911
Knox County, Tennessee(4)...... 4 June 2002 911
Tucson, Arizona(5)............. 3 July 2000 911
Integrated Fire and Ambulance
Scottsdale, Arizona(6)......... 5 July 2001 911
</TABLE>
- ---------------
(1) Type of service for ambulance contracts indicates whether "911" emergency or
general ambulance services or both are provided pursuant to the contract.
(2) The contract was first entered into in 1962 by a provider that was acquired
by the Company in July 1984.
(3) The contract was first entered into in 1988 by a provider that was acquired
by the Company in May 1994.
(4) The contract was first entered into in July 1985 by the Company.
(5) The contract was first entered into in July 1993 by the Company and
subsequently awarded to an ambulance service provider acquired by the
Company.
(6) The contract was first entered into in 1952 by the Company. The contract has
two five-year renewal options exercisable by the City of Scottsdale.
The Company also enters into contracts with hospitals, nursing homes, and
other health care facilities to provide non-emergency and critical care
ambulance services. These contracts typically designate the Company as the first
ambulance service provider contacted to provide non-emergency ambulance services
to those facilities and permit the Company to charge a base fee, mileage
reimbursement, and additional fees for the use of particular medical equipment
and supplies. The Company provides a discount in rates charged to facilities
that assume the responsibility for payment of the charges to the persons
receiving services. See "Risk Factors -- Dependence on Certain Business
Relationships."
COMPETITION
The ambulance service industry is highly competitive. The principal
participants include governmental entities (including fire districts), other
national ambulance service providers, large regional ambulance service
providers, hospitals, and numerous local and volunteer private providers. There
can be no assurance that counties, municipalities, fire districts, hospitals, or
health care organizations that presently contract for ambulance services will
not choose to provide ambulance services directly in the future. The Company is
experiencing increased competition from fire departments to provide emergency
ambulance service. However, the Company believes that the general transport
services market currently is not attractive to fire departments.
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Some of the Company's current competitors and certain potential competitors have
greater capital and other resources than the Company. Ambulance and general
transport service providers compete primarily on the basis of quality of
service, performance, and cost. The Company believes that counties, fire
districts, and municipalities consider quality of care, historical response time
performance, and cost to be among the most important factors in awarding a
contract, although other factors, such as customer service, financial stability,
and personnel policies and practices, also may be considered. Although
commercial providers often compete intensely for business within a particular
community, it is generally difficult to displace a provider that has a history
of satisfying the quality of care and response time performance criteria
established within the service area. Moreover, significant start-up costs
together with the long-term nature of the contracts under which services are
provided and the relationships many providers have within their communities
create barriers to providers seeking to enter new markets other than through
acquisition. The Company believes that its status as a "911" provider in a
service area increases its visibility and stature and enhances its ability to
compete for non-emergency services within that area. Because smaller ambulance
providers do not have the infrastructure to provide "911" services, the Company
believes it can compete favorably with such competitors for general transport
services contracts.
Fire protection services for residential and commercial properties are
provided primarily by tax-supported fire districts, municipal fire departments,
and volunteer departments. Private providers represent a small portion of the
total fire protection market and generally provide fire protection services
where a tax-supported fire district or municipality has decided to contract for
the provision of fire protection services or has not assumed financial
responsibility for fire protection. No assurance can be given that fire
districts or municipalities will continue to contract for fire protection
services. In areas where no governmental entity has assumed financial
responsibility for providing fire protection, the Company provides fire
protection services on a subscription basis. No assurance can be given that a
subscription area will not be annexed by a municipality or be converted to a
fire district that provides service directly rather than through a master
contract. See "Risk Factors -- Competition."
GOVERNMENTAL REGULATION
The Company's business is subject to governmental regulation at the
federal, state, local, and foreign levels. At the federal level, the Company is
subject to regulations under OSHA designed to protect employees of the Company.
The federal government also recommends standards for ambulance design and
construction, medical training curriculum, and designation of appropriate trauma
facilities. Various state agencies may modify these standards.
Each state in which the Company operates regulates various aspects of its
ambulance and fire business. State requirements govern the licensing or
certification of ambulance service providers, training and certification of
medical personnel, the scope of services that may be provided by medical
personnel, staffing requirements, medical control, medical procedures,
communication systems, vehicles, and equipment. The Company's contracts in its
current service areas typically prescribe maximum rates that the Company may
charge for services. The process of determining rates includes cost reviews,
analyses of levels of reimbursement from all sources, and determination of
reasonable profits. Rate setting agencies may set rates to compensate service
providers by requiring paying customers to subsidize those who do not or cannot
pay. Regulations applicable to ambulance services may vary widely from state to
state.
Applicable federal, state, local, and foreign laws and regulations are
subject to change. The Company believes that it currently is in substantial
compliance with applicable regulatory requirements. These regulatory
requirements, however, may require the Company in the future to increase its
capital and operating expenditures in order to maintain current operations or
initiate new operations. See "Risk Factors -- Possible Adverse Change in
Reimbursement Rates of Coverages," "-- Impact of Rate Structures and Limitations
on Rates of Return," "-- Effect of Governmental Regulations," and "-- Health
Care Reforms and Cost Containment."
REIMBURSEMENT
The Company must comply with various requirements in connection with its
participation in Medicare and Medicaid. Medicare is a federal health insurance
program for the elderly and for chronically disabled
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individuals, which pays for ambulance services when medically necessary.
Medicare uses a charge-based reimbursement system for ambulance services and
reimburses 80% of charges determined to be reasonable by Medicare, subject to
the limits fixed for the particular geographic area. The patient is responsible
for paying the balance of the bill, and Medicare requires the Company to expend
reasonable efforts to collect the balance. In determining reasonable charges,
Medicare considers and applies the lowest of various charge factors, including
the actual charge, the customary charge, the prevailing charge in the same
locality, the amount of reimbursement for comparable services, or the
inflation-indexed charge limit.
Medicaid is a combined federal-state program for medical assistance to
impoverished individuals who are aged, blind, or disabled or members of families
with dependent children. Medicaid programs or a state equivalent exist in all
states in which the Company operates. Although Medicaid programs differ in
certain respects from state to state, all are subject to federal requirements.
State Medicaid agencies have the authority to set levels of reimbursement within
federal guidelines. The Company receives only the reimbursement permitted by
Medicaid and is not permitted to collect from the patient any difference between
its customary charge and the amount reimbursed.
Like other Medicare and Medicaid providers, the Company is subject to
governmental audits of its Medicare and Medicaid reimbursement claims. The
Company has not experienced significant losses as a result of any such audit.
Government funding for health care programs is subject to statutory and
regulatory changes, administrative rulings, interpretations of policy,
determinations by intermediaries and governmental funding restrictions, all of
which could materially increase or decrease program reimbursements for ambulance
services. In recent years, Congress has consistently attempted to curb federal
spending on such programs. During June 1997, the Health Care Financing
Administration ("HCFA") issued proposed rules that would revise Medicare policy
on the coverage of ambulance services. Reimbursement is currently permitted if,
based on an assessment of the patient's condition, it is determined that ALS
service is medically necessary or if ALS response is required under "911"
contracts or state or local law. The new proposal would reimburse at ALS rates
only if ALS services were medically necessary. The proposed HCFA rules would
also require, among other things, that a physician's certification be obtained
prior to furnishing non-emergency ambulance service to patients, that certain
ambulance staffing requirements be maintained, that certain equipment be present
in each ambulance, and that certain additional information and documentation be
provided in order to qualify for reimbursement under the Medicare program. The
proposed rules have not been finalized. If implemented, such rules could result
in contract renegotiations or other action by the Company to offset any negative
impact of the proposed change in reimbursement policies.
During August 1997, President Clinton signed the "Balanced Budget Act of
1997" (the "Budget Act"). The Budget Act provides for certain changes to the
Medicare reimbursement system, including the development and implementation of a
prospective fee schedule by January 2000 for ambulance services between HCFA and
ambulance service providers. The Budget Act mandates that this fee schedule be
developed through a negotiated rulemaking process between HFCA and ambulance
service providers and must consider the following: (i) data from industry and
other organizations involved in the delivery of ambulance services; (ii)
mechanisms to control increases in expenditures for ambulance services; (iii)
appropriate regional and operational differences; (iv) adjustments to payment
rates to account for inflation and other relevant factors; and (v) the phase-in
of payment rates under the fee schedule in an efficient and fair manner. Charges
for ambulance services provided during calendar years 1998 and 1999 will be
increased by the Consumer Price Index (CPI) less one percentage point.
The Budget Act also stipulates that individual states may now elect not to
provide payment for Medicare cost-sharing for coinsurance, or copayments, for
Medicaid beneficiaries. Medicare coverage has been extended for certain
paramedic services provided in rural areas.
Certain actions to partially mitigate any adverse effect of these changes
could be taken by the Company. These actions could include renegotiation of
rates and contract subsidies provided in the Company's "911" ambulance service
contracts and changes in staffing of ambulance crews based upon the negotiation
for longer response times under ambulance service contracts to reduce operating
costs.
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<PAGE> 63
There can be no assurance whether the proposed HCFA rules, a prospective
fee schedule, or other proposals involving various aspects of Medicare
reimbursements will be adopted or of the effect on the Company of any such
adoption. No assurance can be given that future funding levels for Medicare and
Medicaid programs will be comparable to present levels. Changes in the
reimbursement policies, or other government action, could adversely affect the
Company's business, financial condition, cash flows, and results of operations.
INSURANCE
The Company carries a broad range of automobile and general liability,
comprehensive property damage, malpractice, workers' compensation, and other
insurance coverages that the Company considers adequate for the protection of
its assets and operations, subject to certain self insurance retentions ranging
from $100,000 to $250,000. The Company operates in some states that adhere to
legal standards that hold emergency service providers to a gross negligence
standard in the delivery of emergency medical care, thereby subjecting them to
less exposure for tort judgments. The Company is subject to accident claims as a
result of the normal operation of its fleet of ambulances and fire vehicles.
There can be no assurance, however, that the coverage limits of the Company's
policies will be adequate or that such insurance will continue to be available
on commercially reasonable terms. A successful claim against the Company in
excess of its insurance coverage could have a material adverse effect on the
Company's business, financial condition, cash flows, and results of operations.
Claims against the Company, regardless of their merit or outcome, also may have
an adverse effect on the Company's reputation and business. The Company has
undertaken to minimize its exposure through an active risk management program.
EMPLOYEES
At March 31, 1998, the Company employed approximately 7,000 full-time and
4,000 part-time employees, including approximately 8,000 involved in ambulance
services, 600 in fire protection services, 550 in integrated ambulance and fire
protection services, and 1,850 in management, administrative, clerical, and
billing activities. Of these employees, 2,900 are paramedics and 4,300 are EMTs.
The Company is a party to collective bargaining agreements relating to its
Rochester, New York operations and to certain of its ambulance services
employees in Arizona. The Company considers its relations with employees to be
good.
FACILITIES AND EQUIPMENT
The Company leases its principal executive offices in Scottsdale, Arizona.
The Company leases administrative facilities and other facilities used
principally for ambulance and fire apparatus basing, garaging and maintenance in
those areas in which it provides ambulance and fire protection services. The
Company also owns seven administrative facilities and 12 other facilities within
its service areas. Aggregate rental expense was approximately $5.3 million and
$6.6 million during fiscal 1996 and 1997, respectively. At March 31, 1998, the
Company's fleet included 1,477 owned and 344 leased ambulances, 114 owned and 26
leased fire vehicles and 247 owned and 20 leased other vehicles. The Company
uses a combination of in-house and outsourced maintenance services to maintain
its fleet, depending on the size of the market and the availability of quality
outside maintenance services.
LEGAL PROCEEDINGS
The Company from time to time is subject to litigation arising in the
ordinary course of business. There can be no assurance that the Company's
insurance coverage will be adequate to cover all liabilities occurring out of
such claims. In the opinion of management, the Company is not engaged in any
legal proceedings expected to have a material adverse effect on the Company's
business, financial condition, cash flows, or results of operations of the
Company.
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<PAGE> 64
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information concerning each of the directors
and executive officers of the Company.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Warren S. Rustand............ 55 Chairman of the Board, Chief Executive Officer, President,
and Director(1)(2)(3)
Cor J. Clement............... 50 Vice Chairman of the Board and Director(5)
James H. Bolin............... 46 Vice Chairman of the Board and Director(3)
Robert T. Edwards............ 58 Executive Vice President and Director(3)
Jack E. Brucker.............. 46 Senior Vice President and Chief Operating Officer
William R. Crowell........... 38 Senior Vice President -- Finance & Acquisitions
William F. Gillis............ 49 Senior Vice President -- Enterprise Services & Chief
Information Officer
Mark E. Liebner.............. 45 Senior Vice President -- Chief Financial Officer &
Treasurer
Robert E. Ramsey, Jr......... 52 Senior Vice President and Director
Dean P. Hoffman.............. 38 Vice President -- Financial Services
Louis G. Jekel............... 56 Secretary and Director
Mary Anne Carpenter.......... 52 Director
William C. Turner............ 68 Director(1)(2)(3)(4)(5)
Henry G. Walker.............. 51 Director(1)(4)(5)
Louis A. Witzeman............ 73 Director(2)(4)
</TABLE>
- ---------------
(1) Member of the Human Resource/Compensation/Organization Committee.
(2) Member of the Nominating Committee.
(3) Member of the Executive Committee.
(4) Member of the Audit Committee.
(5) Member of the Senior Committee.
WARREN S. RUSTAND has served as Chief Executive Officer of the Company
since August 1996, President of the Company since January 1998, Chairman of the
Board of Directors since May 1994, and a member of the Board of Directors since
August 1993. Mr. Rustand has been Chairman and Chief Executive Officer of The
Cambridge Company, Ltd., a merchant banking and management consulting firm,
since 1987. He has served as Chairman of Health Partners of Arizona, a managed
care provider, since February 1996. Mr. Rustand is also Chairman of an
additional company and director of four companies, including LucasVarity PLC, a
New York Stock Exchange listed company. Mr. Rustand served as appointments
secretary to President Ford from 1974 to 1976, and as special assistant to Mr.
Ford while he was Vice President in 1973 and 1974.
COR J. CLEMENT has served as a member of the Board of Directors since May
1992, and as Vice Chairman of the Board of Directors since August 1994. Mr.
Clement served as the President and Chief Executive Officer of NVD, an
international provider of security and industrial fire protection services
headquartered in the Netherlands, from February 1980 until January 1997.
JAMES H. BOLIN has served as a member of the Board of Directors since
February 1981, and as Vice Chairman of the Board of Directors since January
1998. Mr. Bolin served as President of the Company from March 1995 until
December 1997. Mr. Bolin remains active as a consultant with the Company. Mr.
Bolin served as Senior Vice President -- Ambulance Services of the Company from
October 1991 until March 1995, Chief Financial Officer from October 1988 through
September 1991, Senior Vice President -- Finance from August 1986 through
September 1988, and Vice President -- Finance from April 1981 through July 1986.
Mr. Bolin is a certified public accountant.
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<PAGE> 65
ROBERT T. EDWARDS has served as Executive Vice President of the Company
since October 1995 and a member of its Board of Directors since May 1993. He
served as Senior Vice President -- Fire Protection Services of the Company from
August 1991 until October 1995. He served as Vice President and General Manager
of the Company's Maricopa County operations from February 1989 to August 1991
and as Vice President from July 1986 until August 1991. From 1978 to July 1986,
Mr. Edwards served in various capacities with the Company.
JACK E. BRUCKER has served as Senior Vice President and Chief Operating
Officer of the Company since January 1998. Mr. Brucker founded and served as
President of Pacific Holdings, a strategic consulting firm, from July 1989 until
December 1997. Mr. Brucker served as President of Pacific Precision Metals, a
consumer products company, from September 1987 until June 1989. Mr. Brucker
served in various senior management positions with Fairchild Industries,
including Chief Financial Officer and Chief Operating Officer of the VSI
subsidiary, from January 1982 to September 1987.
WILLIAM R. CROWELL has served as Senior Vice President -- Finance and
Acquisitions of the Company since July, 1997 after having served as Vice
President -- Financial Services of the Company since January 1993. Mr. Crowell
served as Director of Financial Services from July 1992 through December 1992.
Mr. Crowell served as Vice President -- Finance of Peter Piper, Inc., an
international franchisor and food-service retailer, from January 1990 through
June 1992 and as Assistant Corporate Controller of W.A. Krueger Co., a publicly
held printing company, from April 1988 through December 1989. Mr. Crowell is a
certified public accountant.
WILLIAM F. GILLIS has served as Senior Vice President -- Enterprise
Services and Chief Information Officer since July 1997. Mr. Gillis served as
President of Motorola's INFO Enterprises subsidiary from July 1992 through July
1996. From July 1996 until July 1997, he served as Interim Chief Information
Officer for the American Graduate School of International Management
(Thunderbird), where he has served on the Board of Trustees since 1992.
Concurrently, he formed ParentCare Corporation, an information service for the
progeny of elder Americans.
MARK E. LIEBNER has served as Senior Vice President of the Company since
August 1994 and as Chief Financial Officer of the Company since October 1991.
From October 1991 to August 1994, Mr. Liebner served as Vice President of the
Company. From July 1988 until September 1991, he was a Vice President of Van
Kampen Merritt, having served in a consulting capacity to the Company in
connection with its 1990 debt restructurings. From March 1982 until June 1988,
Mr. Liebner served as Vice President of Lloyds International Corporation, a
merchant banking affiliate of Lloyds Bank PLC.
ROBERT E. RAMSEY, JR. has served as Senior Vice President of the Company
and as a member of its Board of Directors since June 1997. Mr. Ramsey is
President and Chief Executive Officer of SW General, Inc. and affiliated
companies, which he founded in 1982. He is currently President of the Arizona
Ambulance Association. SW General, Inc. and affiliated companies were purchased
by the Company in June 1997.
DEAN P. HOFFMAN has served as Vice President -- Financial Services since
July 1997 after having served as Director of Finance from June 1994 to June
1997. Mr. Hoffman served as Director of Accounting and Budgets of Pinnacle West
Capital Corporation, a public utility and real estate holding company from June
1987 until October 1992. From October 1992 until June 1994, he was a business
consultant in private practice. Mr. Hoffman is a certified public accountant.
LOUIS G. JEKEL has served as Secretary of the Company and as a member of
its Board of Directors since 1968. Mr. Jekel directs the Company's Wildland Fire
Protection Operations with the State of Arizona and the federal government. Mr.
Jekel is also the Secretary of the Rural/Metro ESOP Administrative Committee.
Mr. Jekel is a partner in the law firm of Jekel & Howard, Scottsdale, Arizona.
MARY ANNE CARPENTER has been a member of the Board of Directors of the
Company since January 1998. Since 1993, Ms. Carpenter has served as Executive
Vice President and Executive Committee member of HealthCare COMPARE Corp., a
publicly traded managed health care company. From 1991 until 1993, Ms. Carpenter
served as Senior Vice President, and from 1986 through 1991, as Vice President
of HealthCare
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<PAGE> 66
COMPARE Corp. Ms. Carpenter is a board member of the American Association of
Health Plans and has served on panels for several other national health care
organizations.
WILLIAM C. TURNER has been a member of the Board of Directors of the
Company since November 1993. Mr. Turner is currently Chairman and Chief
Executive of Argyle Atlantic Corporation, an international merchant banking and
management consulting firm; Chairman of the Avon International Advisory Council
for Avon Products, Inc.; a director of the Goodyear Tire & Rubber Company; a
director of Microtest, Inc.; and a trustee and executive committee member of the
United States Council for International Business. Mr. Turner is also a former
United States Ambassador and permanent representative to the Organization for
Economic Cooperation and Development. Since returning to the United States from
his ambassador post in Paris, Mr. Turner has served on the boards of directors
and/or international advisory councils of ten large publicly held corporations.
HENRY G. WALKER has been a member of the Board of Directors of the Company
since September 1997. Since April 1997, he has served as President and Chief
Executive Officer of the Sisters of Providence Health System, comprised of
hospitals, long-term care facilities, physician practices, managed care plans,
and other health and social services. From 1996 to March 1997, Mr. Walker served
as President and Chief Executive Officer of Health Partners of Arizona, a
state-wide managed care company. From 1992 to 1996 he served as President and
Chief Executive Officer of TMCare, a healthcare delivery system. Mr. Walker is a
member of the National Advisory Council of The Healthcare Forum.
LOUIS A. WITZEMAN is the founder of the Company. Mr. Witzeman has served as
a member of the Board of Directors since the Company's formation in 1948,
currently serving as Chairman of the Board Emeritus. Mr. Witzeman served as
Chief Executive Officer of the Company until his retirement in 1980.
Directors hold office until their successors have been elected and
qualified. All officers serve at the pleasure of the Board of Directors. There
are no family relationships among any of the directors or officers of the
Company.
DESCRIPTION OF THE NEW CREDIT FACILITY
Contemporaneously with the closing of the Initial Offering, the Company
entered into an amendment to its prior revolving credit facility (the "New
Credit Facility") with First Union National Bank, as lender and agent. The
present and future domestic, direct and indirect, wholly owned Subsidiaries of
the Company will guarantee the indebtedness of the Company under the New Credit
Facility. The following is a summary of the material terms and conditions of the
New Credit Facility and various related documents entered into in connection
with the New Credit Facility.
General. The New Credit Facility consists of an unsecured five-year
revolving credit facility providing up to $200.0 million of availability with a
$10.0 million sublimit for the issuance of standby letters of credit. The New
Credit Facility is available in multiple drawings from time to time, subject to
certain conditions and limitations, and amounts borrowed and repaid may be
reborrowed until the fifth anniversary of the closing date (the "Revolving
Maturity Date"). Letters of credit may be issued with maturities of up to one
year, but shall not extend beyond the Revolving Maturity Date. Advances under
the New Credit Facility will be used to refinance certain indebtedness
outstanding under the Existing Credit Facility, to finance acquisitions, and to
finance the working capital and general corporate requirements of the Company
and its subsidiaries.
Interest Rates; Fees. Amounts outstanding under the New Credit Facility
will bear interest at a rate based upon the higher of (i) the prime rate or (ii)
the Federal Funds Rate plus 0.5% per annum ("Base Rate Loans"), or, at the
option of the Company, at LIBOR plus a specified margin ranging from 0.875% to
1.75% ("LIBOR Loans"). Interest on the amounts outstanding under the New Credit
Facility will be payable in arrears on the last day of each quarter for Base
Rate Loans and on the last day of each interest period in the case of LIBOR
Loans, calculated on an actual/365 day basis for Base Rate Loans and an
actual/360 day basis for LIBOR Loans.
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<PAGE> 67
The Company will pay a commitment fee on the unused portion of the New
Credit Facility, which will be payable quarterly in arrears. The amount of the
commitment fee will range from 0.25% to 0.375%. The New Credit Facility will
also provide for payment of fees with respect to letters of credit issued
thereunder equal to the applicable margin on LIBOR Loans on a per annum basis,
plus a fronting fee of 0.125% per annum. The Company will also pay agency fees
and upfront fees as set forth in separate letter agreements.
Covenants. The Company and each of its existing and future subsidiaries
are subject to certain affirmative and negative covenants contained in the New
Credit Facility, including, without limitation, covenants that restrict, subject
to specified exceptions: (i) the incurrence of additional indebtedness and other
obligations and the granting of additional liens; (ii) mergers, acquisitions,
investments, and acquisitions and dispositions of assets; (iii) capital
expenditures; (iv) the incurrence of capitalized lease obligations; (v)
dividends; and (vi) other customary covenants. There are also covenants relating
to compliance with ERISA and environmental and other laws, payment of taxes,
maintenance of corporate existence and rights, maintenance of insurance, and
financial reporting. In addition, the New Credit Facility requires the Company
to maintain compliance with certain specified financial covenants, including
covenants relating to total debt leverage ratios, total debt to total
capitalization ratios, and fixed charge ratios.
Events of Default. The New Credit Facility includes customary events of
default, including, without limitation, defaults for nonpayment, covenant
non-compliance, breach of representations and warranties, default under other
debt in excess of $2.0 million, unpermitted warrants or writs of attachment or
execution in excess of $1.0 million, judgements in excess of $1.0 million, a
bankruptcy or insolvency, termination of contracts potentially resulting in a
material adverse effect to the Company, defaults under the guaranty, change of
control, and non-compliance with certain health care license and regulatory
matters. The occurrence of any of such events of default could result in
acceleration of the Company's obligations under the New Credit Facility, which
could have a material adverse effect on holders of the Exchange Notes.
DESCRIPTION OF THE EXCHANGE NOTES
The Outstanding Notes were, and the Exchange Notes will be, issued pursuant
to an Indenture dated as of March 16, 1998 (the "Indenture"), among the Company,
the Guarantors, and The First National Bank of Chicago, as trustee (the
"Trustee"). The terms of the Exchange Notes are identical in all material
respects to the Outstanding Notes, except that the Exchange Notes have been
registered under the Securities Act and, therefore, will not bear legends
restricting their transfer.
The terms of the Exchange Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"), as in effect from time to time.
The Exchange Notes are subject to all such terms, and holders of the Exchange
Notes are referred to the Indenture and the Trust Indenture Act for a statement
of them. The following is a summary of certain terms and provisions of the
Indenture, the Registration Rights Agreement, and the Notes. This summary does
not purport to be a complete description of the Indenture, the Registration
Rights Agreement, or the Exchange Notes and is subject to the detailed
provisions of, and qualified in its entirety by reference to, the Indenture and
the Registration Rights Agreement (including the definitions contained therein).
For purposes of this section of the Prospectus, the term "the Company" means
Rural/Metro Corporation, a Delaware corporation. Definitions relating to certain
capitalized terms are set forth under "Certain Definitions" and throughout this
description. Capitalized terms that are used but not otherwise defined herein
have the meanings assigned to them in the Indenture and such definitions are
incorporated herein by reference.
GENERAL
The Exchange Notes will be general unsecured obligations of the Company
ranking senior in right of payment to all existing and future Subordinated
Indebtedness and pari passu in right of payment with all other Indebtedness and
liabilities (including trade payables) of the Company. The Exchange Notes will
be effectively subordinated to all present or future secured Indebtedness of the
Company to the extent of the value of the collateral securing such Indebtedness.
As of December 31, 1997, on a pro forma basis after giving
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<PAGE> 68
effect to the issuance and sale of the Outstanding Notes and the use of the net
proceeds therefrom, the Company would have had $208.7 million secured and other
Indebtedness outstanding.
The Company is a holding company and has no material assets or operations
other than its investments in its subsidiaries. The Notes will be fully and
unconditionally guaranteed on a senior, unsecured, and joint and several basis
(the "Guarantees") by the Company's present and future domestic, direct and
indirect, Wholly Owned Subsidiaries other than Coronado Health Services, Inc.
(collectively, the "Guarantors"). The term "Subsidiaries" does not include
Unrestricted Subsidiaries and under certain circumstances the Company will be
permitted to designate certain of its Subsidiaries as Unrestricted Subsidiaries;
however, as of the date hereof the Company has no Unrestricted Subsidiaries. The
Guarantees will rank senior in right of payment to all existing and future
Subordinated Indebtedness of the Guarantors, will be effectively subordinated to
all secured Indebtedness of the Guarantors to the extent of the value of the
assets securing such Indebtedness, and will rank pari passu in right of payment
with all other Indebtedness and liabilities (including trade payables) of the
Guarantors. As of December 31, 1997, on a pro forma basis after giving effect to
the issuance and sale of the Outstanding Notes and the use of the net proceeds
therefrom, the Guarantors would have had $12.9 million principal amount of
secured Indebtedness and $1.3 million in other Indebtedness outstanding.
Any right of the Company or a Guarantor to receive assets of any of the
Company's subsidiaries that is not a Guarantor upon the latter's liquidation or
reorganization (and the consequent right of the holders of the Notes to
participate in those assets) will be effectively subordinated to the claims of
that subsidiary's creditors, except to the extent that the Company or a
Guarantor is itself recognized as a creditor of such subsidiary, in which case
the claims of the Company or such Guarantor would still be effectively
subordinated to any security interest in the assets of such subsidiary.
PRINCIPAL, MATURITY, AND INTEREST
The Exchange Notes will be limited in aggregate principal amount to $150.0
million and will mature on March 15, 2008. The Exchange Notes will bear interest
at a rate of 7 7/8% per annum from the date of original issuance until maturity.
Interest is payable semi-annually in arrears on March 15 and September 15 of
each year, commencing on September 15, 1998, to holders of record of the
Exchange Notes at the close of business on the immediately preceding March 1 and
September 1, respectively (whether or not a business day). Interest on the
Exchange Notes will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from the date of original issuance.
Interest will be computed on the basis of a 360-day year consisting of 12 30-day
months. The Exchange Notes will be issued in denominations of $1,000 and any
integral multiple of $1,000.
Principal of, premium, if any, interest and Liquidated Damages, if any, on
the Exchange Notes will be payable at the office or agency of the Company
maintained for such purpose within the City and State of New York or, at the
option of the Company, payment of interest may be made by check mailed to the
holders of the Exchange Notes at their respective addresses set forth in the
register of holders of Exchange Notes; provided that all payments with respect
to Exchange Notes, the holders of which have given wire transfer instructions to
the paying agent on or prior to the relevant record date will be required to be
made by wire transfer of immediately available funds to the accounts specified
by such holders. Until otherwise designated by the Company, the Company's office
or agency in New York will be the office of the Trustee maintained for such
purpose.
GUARANTEES
The Company's payment obligations under the Exchange Notes will be jointly
and severally and unconditionally guaranteed by the Guarantors. The obligations
of each Guarantor under its Guarantee will be limited so as not to constitute a
fraudulent conveyance under applicable law. Each Guarantor that makes a payment
or distribution under a Guarantee will be entitled to a contribution from each
other Guarantor in a pro rata amount based on the Adjusted Net Assets of each
Guarantor.
The Indenture provides that no Guarantor may consolidate with or merge with
or into (whether or not such Guarantor is the surviving Person), another Person
whether or not affiliated with such Guarantor unless
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<PAGE> 69
(i) subject to the provisions of the following paragraph, the Person formed by
or surviving any such consolidation or merger (if other than such Guarantor)
assumes all the obligations of such Guarantor, pursuant to a supplemental
indenture in form and substance reasonably satisfactory to the Trustee in
respect of the Notes, the Indenture, and such Guarantor's Guarantee and (ii)
immediately after giving effect to such transaction, no Default or Event of
Default exists.
The Indenture provides that in the event of a sale or other disposition of
all or substantially all of the assets of any Guarantor to a third party or an
Unrestricted Subsidiary in a transaction that does not violate any of the
covenants in the Indenture (including the covenant described under the caption
"-- Repurchase at the Option of Holders -- Asset Sales"), by way of merger,
consolidation or otherwise, or a sale or other disposition of all of the capital
stock of any Guarantor, or the designation of such Guarantor as an Unrestricted
Subsidiary in accordance with the Indenture, then (i) in the event of a sale or
other disposition, by way of such a merger, consolidation or otherwise, of all
of the capital stock of such Guarantor, or in the event of such designation,
such Guarantor will be released from and relieved of any obligations under its
Guarantee, or (ii) in the event of a sale or other disposition of all of the
assets of such Guarantor, the Person acquiring such assets will not be required
to assume the obligations of such Guarantor under its Guarantee.
Any Unrestricted Subsidiary that is a domestic, direct or indirect, Wholly
Owned Subsidiary that ceases to be an Unrestricted Subsidiary will be required
to execute a Guarantee in accordance with the terms of the Indenture. The
Indenture provides that if the New Credit Facility releases the guarantees of
such Indebtedness, and no Refinancing Indebtedness is guaranteed by the
Guarantors, upon the written request of the Company, the Guarantors shall be
released from their obligations under the Indenture.
OPTIONAL REDEMPTION
Except as set forth below, the Notes will not be redeemable at the option
of the Company prior to March 15, 2003. Thereafter, the Notes will be redeemable
at any time, and from time to time, at the option of the Company, in whole or in
part, at the following redemption prices (expressed as a percentage of principal
amount), together, in each case, with accrued and unpaid interest and Liquidated
Damages, if any, to the redemption date, if redeemed during the twelve-month
period beginning on March 15 of each year listed below:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
---- ----------
<S> <C>
2003........................................................ 103.938%
2004........................................................ 102.625%
2005........................................................ 101.313%
2006 and thereafter......................................... 100.000%
</TABLE>
Notwithstanding the foregoing, at any time prior to March 15, 2001 the
Company may redeem up to an aggregate of $52.0 million in principal amount of
Notes at a redemption price equal to 107.875% of the principal amount thereof,
plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the
redemption date with the net cash proceeds of one or more Public Equity
Offerings; provided that at least $98.0 million in principal amount of Notes
remains outstanding immediately following each such redemption and that any such
redemption occurs within 90 days following the closing of any such Public Equity
Offering.
In the event of redemption of fewer than all of the Notes, the Trustee
shall select pro rata, by lot or in such other manner as it shall deem fair and
equitable, the Notes to be redeemed. No Notes of $1,000 or less shall be
redeemed in part. Subject to the limitations described herein, the Notes will be
redeemable in whole or in part upon not less than 30 nor more than 60 days'
prior written notice, mailed by first class mail to a holder's last address as
it shall appear on the register maintained by the Registrar of the Notes.
Notices of redemption may not be conditional. If any Note is to be redeemed in
part only, the notice of redemption that relates to such Note shall state the
portion of the principal amount thereof to be redeemed. A new Note, in a
principal amount equal to the unredeemed portion thereof will be issued in the
name of the holder thereof upon cancellation of the original Note. After any
redemption date, unless the Company shall default in the
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<PAGE> 70
payment of the redemption price, interest will cease to accrue on the Notes or
portions thereof called for redemption.
MANDATORY REDEMPTION
Except as set forth under "-- Repurchase at the Option of Holders," the
Company is not obligated to make any mandatory redemption of or sinking fund
payments with respect to the Notes.
REPURCHASE AT THE OPTION OF HOLDERS
Change of Control Offer
Within 30 days of the occurrence of a Change of Control, the Company shall
notify the Trustee in writing of such occurrence and shall make an offer to
purchase (the "Change of Control Offer") all or any portion (equal to $1,000 or
an integral multiple of $1,000) of the outstanding Notes at a cash purchase
price equal to (x) 101%, in the case of a Change of Control which was approved
by the Board of Directors of the Company (as evidenced by a resolution of such
Board), or (y) 105%, in the case of a Change of Control which was not approved
by the Board of Directors of the Company, of the principal amount of the
outstanding Notes plus any accrued and unpaid interest and Liquidated Damages,
if any, thereon to the Change of Control Payment Date (as hereinafter defined)
(such applicable purchase price being hereinafter referred to as the "Change of
Control Purchase Price") in accordance with the procedures set forth in this
covenant.
Within 30 days of the occurrence of a Change of Control, the Company also
shall (i) cause a notice of the Change of Control Offer to be sent at least once
to the Dow Jones News Service or similar business news service in the United
States and (ii) send by first-class mail, postage prepaid, to the Trustee and to
each holder of the Notes, at the address appearing in the register maintained by
the Registrar of the Notes, a notice describing the transactions constituting a
Change of Control and stating:
(1) that the Change of Control Offer is being made pursuant to this
covenant and that all Notes tendered will be accepted for payment, subject
to the terms and conditions set forth herein;
(2) the Change of Control Purchase Price and the purchase date (which
shall be a business day no earlier than 20 business days and no later than
60 days from the date such notice is mailed (the "Change of Control Payment
Date"));
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Company defaults in the payment of the Change of
Control Purchase Price, any Notes accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest after the Change of
Control Payment Date;
(5) that holders accepting the offer to have their Notes purchased
pursuant to a Change of Control Offer will be required to surrender the
Notes to the Paying Agent at the address specified in the notice prior to
the close of business on the Business Day preceding the Change of Control
Payment Date;
(6) that holders will be entitled to withdraw their acceptance if the
Paying Agent receives, not later than the close of business on the fifth
Business Day preceding the Change of Control Payment Date, a telegram,
telex, facsimile transmission, or letter setting forth the name of the
holder, the principal amount of the Notes delivered for purchase, and a
statement that such holder is withdrawing its election to have such Notes
purchased;
(7) that holders whose Notes are being purchased only in part will be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered; provided that each Note purchased and each such new
Note issued shall be in an original principal amount in denominations of
$1,000 and integral multiples thereof;
(8) any other reasonable procedures that a holder must follow to
accept a Change of Control Offer or effect withdrawal of such acceptance;
and
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(9) the name and address of the Paying Agent.
On the Change of Control Payment Date, the Company shall, to the extent
lawful, (i) accept for payment all Notes or portions thereof or beneficial
interests under a Global Note tendered pursuant to the Change of Control Offer,
(ii) deposit with the Paying Agent money sufficient to pay the purchase price of
all Notes or portions thereof or beneficial interests so tendered, and (iii)
deliver or cause to be delivered to the Trustee Notes so accepted together with
an Officers' Certificate stating the Notes or portions thereof tendered to the
Company. The Paying Agent shall promptly (1) mail to each holder of Notes so
accepted and (2) cause to be credited to the respective accounts of the holders
under a Global Note of beneficial interests so accepted payment in an amount
equal to the Change of Control Purchase Price for such Notes, and the Company
shall execute and issue, and the Trustee shall promptly authenticate and mail to
such holder, a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered and shall issue a new Global Note equal in principal
amount to any unpurchased portion of beneficial interest so surrendered or shall
reflect on such Global Note or a schedule thereto such change in beneficial
interest; provided, however, that each such new Note shall be issued in an
original principal amount in denominations of $1,000 and integral multiples
thereof.
The Change of Control provisions described above will be applicable whether
or not any other provisions of the Indenture are applicable. Except as described
above with respect to a Change of Control, the Indenture does not contain
provisions that permit the holders of the Notes to require that the Company
repurchase or redeem the Notes in the event of a takeover, recapitalization, or
similar transaction.
The Company will not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in the Indenture applicable to a Change of Control Offer made by the Company and
purchases all Notes validly tendered and not withdrawn under such Change of
Control Offer.
The definition of Change of Control includes a phrase relating to the sale,
lease, transfer, conveyance, or other disposition of "all or substantially all"
of the assets of the Company and its Subsidiaries taken as a whole. Although
there is a developing body of case law interpreting the phrase "substantially
all," there is no precise established definition of the phrase under applicable
law. Accordingly, the ability of a holder of Notes to require the Company to
repurchase such Notes as a result of a sale, lease, transfer, conveyance, or
other disposition of less than all of the assets of the Company and its
Subsidiaries taken as a whole to another Person or group may be uncertain.
Asset Sales
The Company will not, and will not permit any of its Subsidiaries to,
consummate an Asset Sale unless (i) the Company or such Subsidiary, as the case
may be, receives consideration at the time of such sale or other disposition at
least equal to the fair market value thereof (as reasonably determined for Asset
Sales in excess of $1.0 million in good faith by its Board of Directors, as
evidenced by a Board resolution); (ii) not less than 75% of the consideration
received by the Company or the Subsidiary, as the case may be, from such Asset
Sale is in the form of cash or Temporary Cash Investments; provided that the
amount of (a) any liabilities (as shown on the Company's or a Subsidiary's most
recent balance sheet) of the Company or a Subsidiary (other than contingent
liabilities and liabilities that are by their terms subordinated to the Notes or
any Guarantee thereof) that are assumed by the transferee of any such assets or
an Affiliate thereof pursuant to a customary novation agreement that releases
the Company or such Subsidiary from further liability and (b) any securities,
notes, or other obligations received by the Company or a Subsidiary from such
transferee or an Affiliate thereof that are converted by the Company or a
Subsidiary into cash prior to the Reinvestment Date shall be deemed (to the
extent of the cash received) to be cash for purposes of this provision; and
(iii) the Asset Sale Proceeds received by the Company or such Subsidiary are
applied, to the extent the Company or such Subsidiary elects, (A) to repay and
permanently reduce outstanding Senior Indebtedness under the New Credit
Facility, other secured Senior Indebtedness, or any other Senior Indebtedness
that has a maturity date earlier than the maturity of the Notes and to
permanently reduce the commitments in respect thereof; provided, however, that
such repayment and commitment reduction occurs prior to the Reinvestment Date or
(B) to make any Permitted Investment of the type described in clause (ii)(C) of
the definition of
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Permitted Investment (to the extent otherwise permitted by the Indenture),
acquire a controlling interest in another business, make capital expenditures,
or acquire other long-term assets; provided, however, that such investment
occurs or the Company or a Subsidiary enters into contractual commitments to
make such investment, subject only to customary conditions (other than the
obtaining of financing), on or prior to the 270th day following receipt of such
Asset Sale Proceeds (the "Reinvestment Date") (and notifies the Trustee of the
same in writing) and Asset Sale Proceeds contractually committed are so applied
within 360 days following the receipt of such Asset Sale Proceeds or (C) as
Excess Proceeds as set forth below. Pending the final application of any such
Asset Sale Proceeds, the Company or such Subsidiary may temporarily reduce
Senior Indebtedness or otherwise invest such Asset Sale Proceeds in any manner
that is not prohibited by the Indenture. Any Asset Sale Proceeds that are not
applied as permitted by clause (iii)(A) or (iii)(B) of the second preceding
sentence shall constitute "Excess Proceeds." If at any time from and after the
Issue Date the aggregate amount of Excess Proceeds exceeds $10.0 million, the
Company shall offer (an "Excess Proceeds Offer") to purchase from all holders of
Notes, pursuant to procedures set forth in the Indenture and if the Company is
required to do so under the terms of any other Senior Indebtedness, to purchase
from the holders of such other Senior Indebtedness the maximum principal amount
of Notes and principal of such other Senior Indebtedness that may be purchased
with such Excess Proceeds at a purchase price in cash equal to 100% of the
principal amount thereof plus accrued interest, and Liquidated Damages, if any,
to the date of the purchase. To the extent that the purchase price of Notes and
the purchase price of such other Senior Indebtedness tendered pursuant to such
Excess Proceeds Offer is less than the amount of Excess Proceeds, the Company
may use such portion of the Excess Proceeds that is not used to purchase Notes
or such other Senior Indebtedness so tendered for general corporate purposes not
inconsistent with the Notes or the Indenture. If the aggregate purchase price of
Notes and the purchase price of such other Senior Indebtedness tendered pursuant
to such Excess Proceeds Offer is more than the amount of the Excess Proceeds,
the Notes and principal of such other Senior Indebtedness tendered will be
repurchased on a basis pro rata to the amount tendered or by such other method
as the Trustee shall deem fair and appropriate. Upon the completion of any
Excess Proceeds Offer and the closing of any repurchase of Notes and principal
of such other Senior Indebtedness tendered pursuant to such Excess Proceeds
Offer, the amount of Excess Proceeds shall be deemed to be zero.
If the Company is required to make an Excess Proceeds Offer, the Company
shall mail, within 30 days following the Reinvestment Date, a notice to the
holders of the Notes describing the transactions giving rise to the Excess
Proceeds Offer and stating, among other things: (1) that such holders have the
right to require the Company to apply the Excess Proceeds to repurchase such
Notes at a purchase price in cash equal to 100% of the principal amount thereof
plus accrued and unpaid interest and Liquidated Damages, if any, to the date of
purchase; (2) the purchase date, which shall be no earlier than 30 days and not
later than 60 days from the date such notice is mailed; (3) the instructions,
reasonably determined by the Company, that each holder of Notes must follow in
order to have such Notes repurchased; and (4) the calculations used in
determining the amount of Excess Proceeds to be applied to the repurchase of
such Notes.
The Company or any of its Subsidiaries may engage in transactions in which
assets are transferred in exchange for one or more like-kind assets; provided
that if the fair market value of the assets to be transferred by the Company or
such Subsidiary, plus the fair market value of any other consideration paid or
credited by the Company or such Subsidiary exceeds $1.0 million, such
transaction shall require approval of the Board of Directors of the Company;
provided that no such transaction shall be permitted if the Consolidated Fixed
Charge Coverage Ratio of the Company would be reduced after giving effect to
such transaction. In addition, each such transaction shall be valued at an
amount equal to all consideration received by the Company or such Subsidiary in
such transaction, other than the like-kind assets received pursuant to such
exchange ("Other Consideration"), for purposes of determining whether an Asset
Sale has occurred. If the Other Consideration is of an amount and character such
that such transaction constitutes an Asset Sale, then the first paragraph of
this "Asset Sales" covenant shall be applicable to any Asset Sale Proceeds of
such Other Consideration.
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General
The Indenture requires that if any Indebtedness under the New Credit
Facility is outstanding at the time of the occurrence of a Change of Control or
at the time the Company is required to make an Excess Proceeds Offer, and the
New Credit Facility shall prohibit the Company from fully complying with its
obligations to make and consummate a Change in Control Offer or an Excess
Proceeds Offer, prior to the mailing of the notice to holders described in the
preceding paragraphs, but in any event within 30 days following any Change of
Control or Reinvestment Date, the Company shall (i) repay in full all
obligations and terminate all commitments under the New Credit Facility or offer
to repay in full all obligations and terminate all commitments under the New
Credit Facility or (ii) obtain the requisite consent under the New Credit
Facility to permit the making of, and the repurchase of the Notes pursuant to,
the Change of Control Offer or the Excess Proceeds Offer. The time by which the
Company is requested to commence and consummate a Change of Control Offer or an
Excess Proceeds Offer shall be deferred until the Company has taken the actions
required by this paragraph. The Company's failure to comply with the covenant
described in the first sentence of this paragraph constitutes an Event of
Default. As a result of the foregoing, a holder of the Notes may not be able to
compel the Company to purchase the Notes unless the Company is able at the time
to refinance the Indebtedness under the New Credit Facility or obtain requisite
consents thereunder.
The Indenture provides that, (A) if the Company or any Guarantor has issued
any outstanding (i) Subordinated Indebtedness or (ii) Preferred Equity
Interests, and the Company is required to make a Change of Control Offer or the
Company or such Guarantor is required to make an Excess Proceeds Offer or to
make a distribution with respect to such Subordinated Indebtedness or Preferred
Equity Interests in the event of a change of control or sale of assets, the
Company and such Guarantor shall not consummate any such offer or distribution
with respect to such Subordinated Indebtedness or Preferred Equity Interests
until such time as the Company shall have paid the Change of Control Purchase
Price in full to the holders of Notes that have accepted the Company's Change of
Control Offer and shall otherwise have consummated the Change of Control Offer
made to holders of the Notes, or until such time as the Company has paid the
Excess Proceeds to holders of the Notes that have accepted the Excess Proceeds
Offer and shall otherwise have consummated the Excess Proceeds Offer, as the
case may be, and (B) neither the Company nor any Guarantor will issue
Subordinated Indebtedness or Preferred Equity Interests with change of control
provisions or asset sales provisions requiring the payment of such Subordinated
Indebtedness or Preferred Equity Interests prior to the payment in full to the
holders of Notes that have accepted the Company's Change of Control Offer
following a Change in Control Offer or payment of the Excess Proceeds to holders
of Notes that have accepted the Excess Proceeds Offer, as the case may be.
The Company will comply with any applicable requirements of Rule 14e-1 as
then in effect with respect to any Change in Control Offer or Excess Proceeds
Offer and the purchase of any Notes thereunder. The Company's ability to
purchase the Notes will be limited by the Company's then available financial
resources and, if such financial resources are insufficient, its ability to
arrange financing to effect such purchases. There can be no assurance that the
Company will have sufficient funds to repurchase the Notes upon a Change of
Control or Asset Sale or that the Company will be able to arrange financing for
such purpose.
CERTAIN COVENANTS
The Indenture contains, among others, the following covenants:
Limitation on Restricted Payments
The Company and the Guarantors will not, and will not permit any of their
Subsidiaries to, directly or indirectly, make, any Restricted Payment unless:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of or immediately after giving effect to such
Restricted Payment;
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(b) immediately after giving pro forma effect to such Restricted
Payment, the Company could incur $1.00 of additional Indebtedness (other
than Permitted Indebtedness) under the covenant set forth under "Limitation
on Additional Indebtedness"; and
(c) immediately after giving effect to such Restricted Payment, the
aggregate of all Restricted Payments declared or made after the Issue Date
through and including the date of such Restricted Payment (the "Base
Period") does not exceed the sum of (1) 50% of the Company's Consolidated
Net Income (or in the event such Consolidated Net Income shall be a
deficit, minus 100% of such deficit) from the Issue Date to the end of the
Company's most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment, without
duplication of any amounts included pursuant to clause (3) below, (2) 100%
of the aggregate net cash proceeds received by the Company from the issue
or sale, during the Base Period, of Equity Interests (other than
Disqualified Equity Interests or Equity Interests of the Company issued to
any Subsidiary of the Company) of the Company or any Indebtedness or other
securities of the Company convertible into or exercisable or exchangeable
for Equity Interests (other than Disqualified Equity Interests) of the
Company which have been so converted or exercised or exchanged, as the case
may be, (3) an amount equal to the net cash proceeds received by the
Company or any Subsidiary from Investments (other than Permitted
Investments) made from and after the Issue Date in any Person resulting
from payments of interest on Indebtedness, dividends, repayments of loans
or advances, or from the net cash proceeds from the sale of any such
Investment (except, in each case, to the extent any such proceeds are
included in the calculation of Consolidated Net Income), not to exceed, in
each case, the amount of such Investments previously made by the Company or
any Subsidiary in such Person or Subsidiary, (4) in the event an
Unrestricted Subsidiary is redesignated as a Subsidiary, an amount equal to
the lesser of (i) the net book value of Investments made in such
Unrestricted Subsidiary at the time of such designation, (ii) the fair
market value of Investments made in such Unrestricted Subsidiary at the
time of such designation and (iii) the original fair market value of
Investments made in such Unrestricted Subsidiary at the time they were
made, and (5) $10.0 million.
The provisions of this covenant shall not prohibit (i) the payment of any
dividend within 60 days after the date of declaration thereof, if at the date of
declaration such payment would have complied with the provisions of the
Indenture, (ii) the purchase, redemption, or other acquisition or retirement of
any Equity Interests or the making of any principal payment on, or the purchase,
defeasance, repurchase, redemption, or other acquisition or retirement of
Subordinated Indebtedness by conversion into, or by or in exchange for, Equity
Interests (other than Disqualified Equity Interests), or out of, the net cash
proceeds of the substantially concurrent sale (other than to a Subsidiary of the
Company) of other Equity Interests of the Company (other than Disqualified
Equity Interests), (iii) the making of any principal payment on, or the
purchase, defeasance, repurchase, redemption, or other acquisition or retirement
of Subordinated Indebtedness in exchange for, by conversion into, or out of the
net cash proceeds of, a substantially concurrent sale or incurrence of
Indebtedness (including Disqualified Equity Interests) (other than any
Indebtedness owed to a Subsidiary) of the Company or a Subsidiary that (1) is
contractually subordinated in right of payment to the Notes to at least the same
extent as, and (2) has a final maturity date later than the final maturity date
of, and has a weighted average life to maturity at least equal to the weighted
average life to maturity of, the Subordinated Indebtedness being paid,
purchased, defeased, repurchased, redeemed, or otherwise acquired or retired,
(iv) the purchase, redemption, or other acquisition or retirement of any
Disqualified Equity Interests by conversion into, or by exchange for, shares of
Disqualified Equity Interests or out of the net cash proceeds of the
substantially concurrent sale (other than to a Subsidiary of the Company) of
other Disqualified Equity Interests, in each case with a final maturity date
later than the final maturity date of, and with a weighted average life to
maturity (in each case including any security into which such Disqualified
Equity Interest is convertible or for which it is exchangeable at the option of
the holder) at least equal to the weighted average life to maturity of, the
Disqualified Equity Interest being purchased, redeemed, or otherwise acquired or
retired, and (v) the purchase, redemption, or other acquisition or retirement
for value of any Equity Interests held by any current or past member of the
Company's (or any of its Subsidiary's) management or board of directors (or the
estate, heirs or legatees of any such individual) pursuant to any management
equity subscription agreement, stock option agreement, or other similar
agreement not to exceed $500,000 in any
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12 month period; provided, however, that in the case of the immediately
preceding clauses (ii), (iii), (iv) and (v), no Default or Event of Default
shall have occurred and be continuing at the time of such Restricted Payment or
would occur as a result thereof.
The Indenture provides that in determining the aggregate amount of
Restricted Payments made subsequent to the Issue Date for purposes of clause (c)
above, amounts expended pursuant to clauses (i), (ii), and (v) of the
immediately preceding paragraph shall be included, but without duplication, in
such calculation, and amounts expended pursuant to clauses (iii) and (iv)
thereof shall be excluded.
The Indenture provides that for purposes of calculating the net cash
proceeds received by the Company from the issuance or sale of its Equity
Interests either upon the conversion of, or exchange for, Indebtedness of the
Company or any Subsidiary, such amount will be deemed to be an amount equal to
the difference of (a) the sum of (i) the principal amount or accreted value
(whichever is less) of such Indebtedness on the date of such conversion or
exchange and (ii) the additional cash consideration, if any, received by the
Company upon such conversion or exchange, less any payment on account of
fractional shares, minus (b) all expenses incurred in connection with such
issuance or sale. In addition, for purposes of calculating the net cash proceeds
received by the Company from the issuance or sale of its Equity Interests upon
the exercise of any options or warrants of the Company, such amount will be
deemed to be an amount equal to the difference of (a) the additional cash
consideration, if any, received by the Company upon such exercise, minus (b) all
expenses incurred in connection with such issuance or sale.
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 is permitted and setting forth the basis upon which the calculations
required by this covenant were computed, which calculations may be based upon
the Company's latest available financial statements, and, where required, that
no Default or Event of Default exists and is continuing and no Default or Event
of Default will occur immediately after giving effect to such Restricted
Payment.
Limitation on Subsidiaries and Unrestricted Subsidiaries
The Indenture provides that the Company may by written notice to the
Trustee designate any Subsidiary (including a newly acquired or a newly formed
Subsidiary) to be an Unrestricted Subsidiary; provided, however, that (i) no
Default or Event of Default shall have occurred and be continuing or would arise
therefrom and (ii) such designation is at that time permitted under the covenant
described under "Limitation on Restricted Payments." For purposes of the
covenant described under "Limitation on Restricted Payments" above, (1) an
"Investment" shall be deemed to have been made at the time any Subsidiary is
designated as an Unrestricted Subsidiary in an amount (proportionate to the
Company's percentage Common Equity Interest in such Subsidiary) equal to the
greatest of (a) the net book value of Investments made in such Unrestricted
Subsidiaries at the time of such designation, (b) the fair market value of
Investments made in such Unrestricted Subsidiaries at the time of such
designation, and (c) the original fair market value of Investments made in such
Unrestricted Subsidiaries at the time they were made; and (2) any property
transferred to or from an Unrestricted Subsidiary shall be valued at its fair
market value at the time of such transfer.
The Indenture provides that notwithstanding the foregoing, the Board of
Directors of the Company may not designate a Subsidiary of the Company to be an
Unrestricted Subsidiary unless such Subsidiary: (a) has no Indebtedness other
than Non-Recourse Debt; (b) is not party to any agreement, contract,
arrangement, or understanding with the Company or any Subsidiary of the Company
unless the terms of any such agreement, contract, arrangement, or understanding
are no less favorable to the Company or such Subsidiary than those that might be
obtained at the time from Persons who are not Affiliates of the Company; (c) is
a Person with respect to which neither the Company nor any of its Subsidiaries
has any direct or indirect obligation (1) to subscribe for additional Equity
Interests or (2) to maintain or preserve such Person's financial condition or to
cause such Person to achieve any specified levels of operating results; (d) does
not guarantee or otherwise directly or indirectly provide credit support for any
Indebtedness of the Company or any of its Subsidiaries; and (e) has at least one
director on its board of directors that is not a director or executive officer
of the
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Company or any of its Subsidiaries and has at least one executive officer that
is not a director or executive officer of the Company or any of its
Subsidiaries.
If, at any time, any Unrestricted Subsidiary would fail to meet the
definition of an Unrestricted Subsidiary, it shall thereafter cease to be an
Unrestricted Subsidiary for purposes of the Indenture and any Indebtedness of
such Person shall be deemed to be incurred by a Subsidiary of the Company as of
such date (and, if such Indebtedness is not permitted to be incurred as of such
date under the covenant described under the caption "-- Limitation on Additional
Indebtedness," the Company shall be in default of such covenant).
Limitation on Additional Indebtedness
The Indenture provides that the Company and the Guarantors will not, and
will not permit any of their Subsidiaries to, directly or indirectly, incur (as
defined) any Indebtedness (including Acquired Indebtedness) other than Permitted
Indebtedness; provided, however, that the Company and the Guarantors may incur
Indebtedness (including Acquired Indebtedness) if (a) after giving effect on a
pro forma basis to the incurrence of such Indebtedness and to the extent set
forth in the definition of Consolidated Fixed Charge Coverage Ratio the receipt
and application of the proceeds thereof, the Company's Consolidated Fixed Charge
Coverage Ratio would be greater than (i) 2.25 if such Indebtedness is to be
incurred on or before March 31, 2000; and (ii) 2.50 if such Indebtedness is to
be incurred after March 31, 2000; and (b) no Default or Event of Default shall
have occurred and be continuing at the time or as a consequence of the
incurrence of such Indebtedness. Notwithstanding any other provision of this
covenant, a guarantee of Indebtedness will not constitute a separate incurrence
of Indebtedness, if the Indebtedness being guaranteed was incurred in compliance
with the terms of the Indenture.
For purposes of determining compliance with this covenant, in the event
that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Indebtedness described in the definition thereof or is
otherwise entitled to be incurred pursuant to the first paragraph of this
covenant, the Company shall, in its sole discretion, classify such item of
Indebtedness in any manner that complies with this covenant and such item of
Indebtedness will be treated as having been incurred as so classified.
Limitation on Issuances of Guarantees by Subsidiaries Which Are Not
Guarantors
The Company will not permit any Subsidiary which is not a Guarantor,
directly or indirectly, to guarantee any Indebtedness of the Company or any
Guarantor (collectively, "Subsidiary Indebtedness"), unless (i) such Subsidiary
simultaneously executes and delivers a supplemental indenture to this Indenture
providing for a Guarantee of payment of the Notes by such Subsidiary and (ii)
such Subsidiary waives and will not in any manner whatsoever claim or take the
benefit or advantage of, any rights of reimbursement, indemnity, subrogation, or
any other rights against the Company or any other Subsidiary as a result of any
payment by such Subsidiary under its Guarantee.
Notwithstanding the foregoing, any such guarantee by a non-Wholly Owned
Subsidiary shall provide by its terms that it shall be automatically and
unconditionally released and discharged upon any sale, exchange, or transfer, to
any Person which is not an Affiliate of the Company of all of the Company's and
each Subsidiary's Common Equity Interest in, or substantially all the assets of,
such Subsidiary (which sale, exchange, or transfer is not prohibited by the
Indenture). The release or discharge of the Indebtedness or the guarantee which
resulted in the creation of such Guarantee by a non-Wholly Owned Subsidiary will
not release or discharge such Guarantee.
Limitation on Liens
The Company will not, and will not permit any of its Subsidiaries to,
create, assume, incur, or otherwise cause or suffer to exist or become effective
any Liens of any kind (other than Permitted Liens) upon any property or asset of
the Company or any Subsidiary of the Company whether owned on the Issue Date, or
acquired after the Issue Date or on any shares of stock or debt of any
Subsidiary, now owned or hereafter acquired, or on any income or profits
therefrom, or assign or otherwise convey any right to receive income or profits
thereon unless (i) if such Lien secures Senior Indebtedness, the Notes or such
Guarantee are secured
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on an equal and ratable basis with the obligation so secured until such time as
such obligation is no longer secured by a Lien or (ii) if such Lien secures
Subordinated Indebtedness, such Lien shall be subordinated to a Lien granted to
the Holders on the same collateral as that securing such Lien to the same extent
as such Subordinated Indebtedness is subordinated to the Notes or such
Guarantee.
Limitation on Transactions with Affiliates
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, enter into or suffer to exist any transaction or series
of related transactions (including, without limitation, the sale, purchase,
exchange, or lease of assets, property, or services) with any Affiliate of the
Company (including entities in which the Company or any Subsidiary thereof owns
a minority interest) (each such transaction, an "Affiliate Transaction") or
extend, renew, waive, or otherwise modify the terms of any Affiliate Transaction
entered into prior to the Issue Date unless (i) such Affiliate Transaction is
solely between or among the Company and its Wholly Owned Subsidiaries; (ii) such
Affiliate Transaction is solely between or among Wholly Owned Subsidiaries of
the Company; or (iii) the terms of such Affiliate Transaction are fair and
reasonable to the Company or such Subsidiary, as the case may be, and the terms
of such Affiliate Transaction are at least as favorable as the terms which could
be obtained by the Company or such Subsidiary, as the case may be, in a
comparable transaction made on an arm's-length basis between unaffiliated
parties. In any Affiliate Transaction involving an amount or having a value in
excess of $1.0 million in any one year which is not permitted under clause (i)
or (ii) above, the Company or such Subsidiary, as the case may be, must obtain a
resolution of its Board of Directors certifying that such Affiliate Transaction
complies with clause (iii) above. In transactions with a value in excess of
$10.0 million which are not permitted under clause (i) or (ii) above, the
Company or such Subsidiary, as the case may be, must obtain a written opinion as
to the fairness of such a transaction, from a financial point of view, from an
Independent Financial Advisor.
The foregoing provisions will not apply to (i) any transaction with any
current or former officer, director, or employee of the Company or any of its
Subsidiaries (in his or her capacity as such) (or the estate, heirs, or legatees
of any such individual) related to employment agreements, indemnification
agreements, and compensation and employee benefit plans entered into in the
ordinary course of business and consistent with past practices, and (ii)
Restricted Payments to the extent not prohibited by the covenant described under
"-- Limitation on Restricted Payments" and other transactions specifically
excluded from the definition of "Restricted Payments" by reason of exceptions
set forth in such definition.
Limitation on Issuances and Sales of Equity Interests of Subsidiaries
The Indenture provides that the Company (i) will not, and will not permit
any Subsidiary to, transfer, convey, sell, lease, or otherwise dispose of any
Equity Interests of any Subsidiary to any Person other than the Company or a
Wholly Owned Subsidiary (except directors' qualifying shares or shares required
to be held by foreign nationals, in each case to the extent mandated by
applicable law), unless (a) such transfer, conveyance, sale, lease, or other
disposition is of all the Equity Interests of such Subsidiary and (b) the net
cash proceeds from such transfer, conveyance, sale, lease, or other disposition
are applied in accordance with the "-- Asset Sales" covenant, and (ii) will not
permit any Subsidiary to issue any of its Equity Interests (except directors'
qualifying shares or shares required to be held by foreign nationals, in each
case to the extent mandated by applicable law) to any Person other than to the
Company or a Wholly Owned Subsidiary; provided, however, that the Company or any
Subsidiary may transfer, convey, sell, or issue Equity Interests of a Subsidiary
in connection with an Asset Acquisition as long as such Equity Interests (x) are
transferred, conveyed, sold, or issued to the Person or Persons which are
transferring, conveying, or selling the assets or stock to such Subsidiary, and
(y) the fair market value of the Equity Interests of such Subsidiary
transferred, conveyed, sold, or issued to such Person are not in excess of the
fair market value of the assets or stock acquired from such Person.
Limitation on Dividends and Other Payment Restrictions Affecting
Subsidiaries
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on
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the ability of any of its Subsidiaries to (a) pay dividends or make any other
distributions in cash or otherwise to the Company or any Subsidiary on its
Equity Interests, (b) pay any Indebtedness owed to the Company or loans or
advances to the Company or any Subsidiary thereof, (c) make loans or advances to
the Company or any Subsidiary thereof, (d) transfer any of its properties or
assets to the Company or any Subsidiary thereof (other than customary
restrictions on transfer of property subject to a Permitted Lien under the term
of the agreements creating such Permitted Lien (other than a Lien on cash not
constituting proceeds of non-cash property subject to a Permitted Lien) which
would not materially adversely affect the Company's ability to satisfy its
obligations under the Notes), or (e) guarantee the Notes, except, in each case,
for such encumbrances or restrictions existing under or contemplated by or by
reason of (i) the Notes or the Indenture, (ii) any restrictions existing under
or contemplated by agreements evidencing the New Credit Facility as in effect as
of the Issue Date, and any amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements, or refinancings thereof;
provided that such amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements, or refinancings are no more restrictive
with respect to such dividend and other payment restrictions affecting
Subsidiaries than those contained in the New Credit Facility as in effect on the
Issue Date, (iii) any restrictions with respect to a Subsidiary of the Company
that was not a Subsidiary of the Company on the Issue Date, which are in
existence at the time such Person becomes a Subsidiary of the Company (but not
created in connection with or contemplation of such Person becoming a Subsidiary
of the Company and which encumbrance or restriction is not applicable to any
Person or the property or assets of any Person other than such Person or the
property or assets of such Person so acquired), (iv) any agreement that governs
Refinancing Indebtedness; provided, however, that the terms and conditions of
any such restrictions are not materially less favorable in the aggregate to the
holders of the Notes than those under or pursuant to the agreement evidencing
the Indebtedness being refinanced or replaced, (v) customary non-assignment
provisions in any contract or licensing agreement entered into by the Company or
any Subsidiary of the Company in the ordinary course of business or in any lease
governing any leasehold interest of the Company or a Subsidiary, (vi) purchase
money obligations for property acquired in the ordinary course of business that
impose restrictions of the nature described in clause (d) above on the property
so acquired, (vii) restrictions existing by reason of or under Indebtedness
existing on the Issue Date, (viii) any restrictions existing under any agreement
entered into with respect to the sale or disposition of all or substantially all
the Equity Interests or assets of a Subsidiary provided that the disposition or
sale is governed by the restrictions described under "Repurchase at the Option
of Holders," or (ix) restrictions contained in agreements governing other
Indebtedness permitted to be incurred in accordance with the Indenture; provided
that the restrictions are not materially more restrictive in the aggregate than
the restrictions contained in the Indenture.
Limitation on Sale and Lease-Back Transactions
The Company will not, and will not permit any of its Subsidiaries to, enter
into any Sale and Lease-Back Transaction unless (i) the consideration received
in such Sale and Lease-Back Transaction is at least equal to the fair market
value of the property sold, (ii) immediately prior to and after giving effect to
the Attributable Indebtedness in respect of such Sale and Lease-Back
Transaction, the Company could incur at least $1.00 of additional Indebtedness
(other than Permitted Indebtedness) in compliance with the covenant described
under "Limitation on Additional Indebtedness," and (iii) the net cash proceeds
received by the Company or its Subsidiaries from the Sale and Lease-Back
Transaction are applied in accordance with the provisions described above under
"Repurchase at the Option of Holders -- Asset Sales."
Payments for Consent
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee, or otherwise, to any holder of any Notes for or as an inducement
to any consent, waiver, or amendment of any of the terms or provisions of the
Indenture or the Notes unless such consideration is offered to be paid or agreed
to be paid to all holders of the Notes which so consent, waive, or agree to
amend within any time period set forth in the solicitation documents relating to
such consent, waiver, or agreement.
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Additional Guarantees
The Indenture provides that if the Company shall acquire or create another
domestic, direct or indirect, Wholly Owned Subsidiary after the Issue Date, then
such newly acquired or created, Wholly Owned Subsidiary will be required to
execute a Guarantee in accordance with the terms of the Indenture.
Line of Business
The Company will not, and will not permit any of its Subsidiaries to,
engage as a material part of its business in any business other than the
business conducted by the Company and its Subsidiaries as of the Issue Date or
any other business determined by the Company's Board of Directors, in good
faith, to be reasonably related to the foregoing.
Limitation on Status as Investment Company
The Indenture prohibits the Company and its Subsidiaries from being
required to register as an "investment company" (as that term is defined in the
Investment Company Act of 1940, as amended) or from otherwise becoming subject
to regulation as an investment company.
MERGER, CONSOLIDATION, OR SALE OF ASSETS
The Company will not consolidate with, merge with or into, or sell, assign,
lease, convey, transfer, or otherwise dispose of (a "transfer") all or
substantially all of its assets (as an entirety or substantially as an entirety
in one transaction or a series of related transactions), to any Person unless:
(i) the Company shall be the continuing Person, or the Person (if other than the
Company) formed by such consolidation or into which the Company is merged or to
which the properties and assets of the Company are transferred shall be a
corporation organized and existing under the laws of the United States or any
State thereof or the District of Columbia and shall expressly assume, by a
supplemental indenture, executed and delivered to the Trustee, in form
reasonably satisfactory to the Trustee, all of the obligations of the Company
under the Notes and the Indenture, and the obligations under the Indenture shall
remain in full force and effect; (ii) immediately before and immediately after
giving effect to such transaction, no Default or Event of Default shall have
occurred and be continuing; and (iii) except in the case of a merger or
consolidation of the Company with or into a Wholly Owned Subsidiary of the
Company, the Company or the Person formed by or surviving any such consolidation
or merger (if other than the Company), or to which such sale, assignment,
transfer, lease, conveyance, or other disposition shall have been made (a)
immediately after giving effect to such transaction on a pro forma basis could
incur at least $1.00 of additional Indebtedness (other than Permitted
Indebtedness) under the covenant set forth under "Limitation on Additional
Indebtedness" and (b) immediately thereafter shall have a Consolidated Net Worth
equal to or greater than the Consolidated Net Worth of the Company immediately
prior to such transaction.
In connection with any consolidation, merger, or transfer of assets
contemplated by this provision, the Company shall deliver, or cause to be
delivered, to the Trustee, in form and substance reasonably satisfactory to the
Trustee, an Officers' Certificate and an opinion of counsel relating to issues
of law, each stating that such consolidation, merger, or transfer and the
supplemental indenture in respect thereto comply with this provision and that
all conditions precedent herein provided for relating to such transaction or
transactions have been complied with.
EVENTS OF DEFAULT
The following events are defined in the Indenture as "Events of Default":
(i) default in payment of any principal of, or premium, if any, on the
Notes when such principal or premium becomes due and payable;
(ii) default for 30 days in the payment of any interest on or
Liquidated Damages, if any, with respect to the Notes after such interest
or Liquidated Damages becomes due and payable;
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(iii) the failure of the Company or its Subsidiaries to comply with
the limitations set forth in "-- Certain Covenants -- Limitation on
Restricted Payments," "Certain Covenants -- Limitation on Issuances of
Guarantees by Subsidiaries Which Are Not Guarantors," "-- Certain
Covenants -- Limitation on Additional Indebtedness," or "-- Merger,
Consolidation, or Sale of Assets" or to comply with any purchase or payment
obligations set forth in "-- Repurchase at the Option of Holders";
(iv) default by the Company or its Subsidiaries in the observance or
performance of any other provision in the Notes or the Indenture for 30
days after written notice from the Trustee or the holders of not less than
25% in aggregate principal amount of the Notes then outstanding;
(v) default under any agreement, mortgage, indenture, or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of its
Subsidiaries (or the payment of which is guaranteed by the Company or any
of its Subsidiaries), whether such Indebtedness or guarantee now exists or
is created after the Issue Date, which default (a) is caused by a failure
to pay principal of or premium, if any, or interest on such Indebtedness at
final maturity (a "Payment Default") or (b) results in the acceleration of
such Indebtedness prior to its express maturity and, in each case, the
principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness under which there has been a Payment
Default or the maturity of which has been so accelerated, aggregates $7.5
million or more;
(vi) any final judgment or judgments which can no longer be appealed
for the payment of money in excess of $7.5 million (which are not paid or
covered by third party insurance by financially sound insurers that have
not disclaimed or threatened to disclaim coverage) shall be rendered
against the Company or any Subsidiary thereof, and shall not be discharged
for any period of 60 consecutive days during which a stay of enforcement
shall not be in effect;
(vii) any Guarantee of a Significant Subsidiary shall be held in any
judicial proceeding to be unenforceable or invalid or shall cease for any
reason to be in full force and effect or any Guarantor that is a
Significant Subsidiary shall deny or disaffirm its obligations under its
Guarantee; and
(viii) certain events involving bankruptcy, insolvency, or
reorganization of the Company or any Subsidiary of the Company.
The Indenture provides that the Trustee may withhold notice to the holders
of the Notes of any default (except in payment of principal or premium, if any,
or interest on the Notes or that resulted from the failure of the Company to
comply with the provisions of "-- Repurchase at the Option of Holders") if the
Trustee considers it to be in the best interest of the holders of the Notes to
do so.
The Indenture provides that if an Event of Default (other than an Event of
Default resulting from certain events of bankruptcy, insolvency, or
reorganization) shall have occurred and be continuing, then the Trustee or the
holders of not less than 25% in aggregate principal amount of the Notes then
outstanding may declare to be immediately due and payable the entire principal
amount of all the Notes then outstanding plus accrued interest and Liquidated
Damages to the date of acceleration, provided, however, that after such
acceleration but before a judgment or decree based on such acceleration is
obtained by the Trustee, the holders of a majority in aggregate principal amount
of outstanding Notes may, under certain circumstances, rescind and annul such
acceleration if all Events of Default, other than nonpayment of accelerated
principal, premium, interest, and Liquidated Damages, have been cured or waived
as provided in the Indenture. In case an Event of Default resulting from certain
events of bankruptcy, insolvency, or reorganization shall occur, the principal,
premium, and interest amount with respect to all of the Notes shall ipso facto
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or the holders of the Notes.
The holders of a majority in principal amount of the Notes then outstanding
shall have the right to waive any existing default, except for any default in
the payment of principal of, interest on or Liquidated Damages with respect to
any Note which has not been cured, and the holders of a majority in principal
amount of the Notes shall have the right to waive compliance with other
provisions of the Indenture or the Notes and to direct the time, method, and
place of conducting any proceeding for any remedy available to the Trustee,
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subject to certain limitations specified in the Indenture. In the event of a
declaration of acceleration of the Notes because an Event of Default has
occurred and is continuing as a result of a Payment Default on or the
acceleration of any Indebtedness described in clause (v) in the first paragraph
above, the declaration of acceleration of the Notes shall be automatically
rescinded and annulled if such Payment Default is waived or cured or the holders
of such Indebtedness described in such clause (v) have rescinded the declaration
of acceleration in respect of such Indebtedness, as appropriate, within 30 days
from the date of such declaration and if (i) the rescission and annulment of the
acceleration of the Notes would not conflict with any judgment or decree of a
court of competent jurisdiction and (ii) all existing Events of Default, except
non-payment of principal, interest, or premium on the Notes that became due
solely because of the acceleration of the Notes, have been cured or waived.
No holder of any Note will have any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder, unless such holder shall
have previously given to the Trustee written notice (if a continuing Event of
Default) and unless also the holders of at least 25% in aggregate principal
amount of the outstanding Notes shall have made written request and offered
reasonable indemnity to the Trustee to institute such proceeding as a trustee,
and unless the Trustee shall not have received from the holders of a majority in
aggregate principal amount of the outstanding Notes a direction inconsistent
with such request and shall have failed to institute such proceeding within 60
days. However, such limitations do not apply to a suit instituted on such Note
on or after the respective due dates expressed in such Note.
In the case of any Event of Default occurring solely by reason of any
willful action (or inaction) taken (or not taken) by or on behalf of the Company
with the intention of avoiding payment of the premium that the Company would
have had to pay if the Company then had elected to redeem the Notes pursuant to
the optional redemption provisions of the Indenture, an equivalent premium shall
also become and be immediately due and payable to the extent permitted by law
upon the acceleration of the Notes.
NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES, INCORPORATORS, AND
STOCKHOLDERS
As more fully set forth in the Indenture, no director, officer, employee,
incorporator, stockholder, partner, affiliate, or beneficiary, as such, past,
present, or future, of the Company or any Subsidiary or any successor,
corporation (other than the Company and its Subsidiaries in their capacity as
stockholders), as such, shall have any liability for any obligations of the
Company or such Subsidiary under the Notes, any Guarantee thereof, the Indenture
or for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each holder of Notes by accepting a Note waives and releases all
such liability. The waiver and release are part of the consideration for
issuance of the Notes. Such waiver may not be effective to waive liabilities
under the federal securities laws and it is the view of the Commission that such
a waiver is against public policy.
DEFEASANCE AND COVENANT DEFEASANCE
The Indenture provides that the Company may elect either (a) to defease and
be discharged (and discharge the obligations of the Guarantors under the
Guarantees) from any and all obligations with respect to the Notes (except for
the obligations to register the transfer or exchange of such Notes, to replace
temporary or mutilated, destroyed, lost, or stolen Notes, to maintain an office
or agency in respect of the Notes and to hold monies for payment in trust) and
the Guarantees ("defeasance") or (b) to be released from its and its
Subsidiaries' obligations with respect to the Notes (including the Guarantors'
obligations under the Guarantees) under certain covenants contained in the
Indenture and described above under "Certain Covenants" ("covenant defeasance"),
upon the deposit with the Trustee (or other qualifying trustee), in trust for
such purpose, of money and/or U.S. Government Obligations which through the
payment of principal and interest in accordance with their terms will provide
money, in an amount sufficient to pay the principal of, premium, if any, and
interest on the Notes, on the scheduled due dates therefor or on a selected date
of redemption in accordance with the terms of the Indenture. Such a trust may
only be established if, among other things, the Company has delivered to the
Trustee an Opinion of Counsel (as specified in the Indenture) describing either
a private ruling concerning the Notes or a published ruling of the Internal
Revenue Service, to the effect that holders of the Notes or persons in their
positions will not recognize income, gain or loss for
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federal income tax purposes as a result of such deposit, defeasance, and
discharge and will be subject to federal income tax on the same amount and in
the same manner and at the same times, as would have been the case if such
deposit, defeasance and discharge had not occurred.
MODIFICATION OF INDENTURE
From time to time, the Company, the Guarantors, and the Trustee may,
without the consent of holders of the Notes, modify, amend, waive, or supplement
the provisions of the Indenture or the Notes for certain specified purposes,
including providing for uncertificated Notes in addition to certificated Notes,
and curing any ambiguity, defect, or inconsistency, or making any other change
that, in each case, does not adversely affect the rights of any holder. The
Indenture contains provisions permitting the Company, the Guarantors, and the
Trustee, with the consent of holders of at least a majority in principal amount
of the outstanding Notes, to modify, amend, waive, or supplement the Indenture,
the Notes, or the Guarantees except that no such modification shall, without the
consent of each holder affected thereby, (i) reduce the amount of Notes whose
holders must consent to an amendment, supplement, or waiver to the Indenture or
the Notes, (ii) reduce the rate of or change the time for payment of interest on
any Note, (iii) reduce the principal of or premium or Liquidated Damages on or
change the stated maturity of any Note, (iv) make any Note payable in money
other than that stated in the Note or change the place of payment to outside of
the United States, (v) change the amount or time of any payment required by the
Notes or reduce the premium payable upon any redemption of Notes or change the
time before which no such redemption may be made, (vi) waive a default on the
payment of the principal of, interest, premium, or Liquidated Damages on, or
redemption payment with respect to, any Note (except a rescission of
acceleration of the Notes by holders of at least a majority in aggregate
principal amount of the Notes and a waiver of the payment default that resulted
from such acceleration), (vii) subordinate in right of payment, or otherwise
subordinate, the Notes or the Guarantees to any other Indebtedness or obligation
of the Company or the Guarantors, (viii) amend, alter, change, or modify the
obligation of the Company to make and consummate a Change of Control Offer in
the event of a Change of Control or make and consummate an Excess Proceeds Offer
or waive any Default in the performance of any such offers or modify any of the
provisions or definitions with respect to any such offers, (ix) except pursuant
to the Indenture, release any Guarantor from its obligations under its
Guarantee, or change any Guarantee in a manner that adversely affects holders of
the Notes, or (x) take any other action otherwise expressly prohibited by the
Indenture to be taken without the consent of each holder affected thereby.
REPORTS TO HOLDERS
So long as any of the Notes are outstanding, whether or not the Company is
required to be subject to Section 13(a) or 15(d) of the Exchange Act, the
Company will furnish the information required thereby to the Commission, the
holders of the Notes, and the Trustee. The Indenture provides that even if the
Company is entitled under the Exchange Act not to furnish such information to
the Commission or to the holders of the Notes, it will nonetheless continue to
furnish such information to the Commission, the holders of the Notes, and the
Trustee and make such information available to securities analysts and
prospective investors upon request. In addition, the Company agrees and the
Guarantors agree that, for so long as any Notes remain outstanding, they will
furnish to the holders and to securities analysts and prospective investors,
upon their request, the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act.
COMPLIANCE CERTIFICATE
The Company will deliver to the Trustee on or before 90 days after the end
of the Company's fiscal year and on or before 45 days after the end of each of
the first, second, and third fiscal quarters in each year an Officers'
Certificate stating whether or not the signers know of any Default or Event of
Default that has occurred. If they do, the certificate will describe the Default
or Event of Default and its status.
THE TRUSTEE
The Trustee under the Indenture initially will be the Registrar and Paying
Agent with regard to the Notes. The Indenture provides that, except during the
continuance of an Event of Default, the Trustee will
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perform only such duties as are specifically set forth in the Indenture. During
the existence of an Event of Default, the Trustee will exercise such rights and
powers vested in it under the Indenture and use the same degree of care and
skill in its exercise as a prudent person would exercise under the circumstances
in the conduct of such person's own affairs.
TRANSFER AND EXCHANGE
Holders of the Notes may transfer or exchange Notes in accordance with the
Indenture. The Registrar under such Indenture may require a holder, among other
things, to furnish appropriate endorsements and transfer documents, and to pay
any taxes and fees required by law or permitted by the Indenture. The Registrar
is not required to transfer or exchange any Note selected for redemption. Also,
the Registrar is not required to transfer or exchange any Note for a period of
15 days before selection of the Notes to be redeemed.
The registered holder of a Note may be treated as its owner for all
purposes.
BOOK-ENTRY, DELIVERY, AND FORM
The Exchange Notes initially will be issued in the form of one Global
Exchange Note (the "Global Exchange Note"). The Global Exchange Note will be
deposited on the Exchange Date with the Depositary and registered in the name of
Cede & Co., as nominee of the Depositary (the "Global Exchange Note Holder").
Except as set forth below, the Global Exchange Note may be transferred, in whole
and not in part, only to another nominee of the Depositary or to a successor of
the Depositary or its nominee.
The Company expects that, pursuant to procedures established by the
Depositary, (i) upon deposit of the Global Exchange Note, the Depositary will
credit on its internal system the principal amounts of the Exchange Notes of the
individual beneficial interests represented by such Global Exchange Note to the
respective accounts of exchanging holders who have accounts with the Depositary
and (ii) ownership of such interest in the Global Exchange Note will be shown
on, and the transfer of ownership thereof will be effected only through, records
maintained by the Depositary (with respect to the interests of the Depositary's
Participants), the Depositary's Participants and the Depositary's Indirect
Participants. Prospective purchasers are advised that the laws of some states
require that certain persons take physical delivery in definitive form of
securities that they own. Consequently, the ability to transfer Exchange Notes
evidenced by the Global Exchange Note will be limited to such extent.
So long as the Global Exchange Note Holder is the registered owner of any
Exchange Notes, the Global Exchange Note Holder will be considered the sole
holder under the Indenture of any Exchange Notes evidenced by the Global
Exchange Note. Beneficial owners of Exchange Notes evidenced by the Global
Exchange Note will not be considered the owners or holders thereof under the
Indenture for any purpose, including with respect to the giving of any
directions, instructions or approvals to the Trustee thereunder. Neither the
Company nor the Trustee will have any responsibility or liability for any aspect
of the records of the Depositary or for maintaining, supervising or reviewing
any records of the Depositary relating to the Exchange Notes.
Payments in respect of the principal of and premium, interest and
Liquidated Damages, if any, on any Exchange Notes registered in the name of the
Global Exchange Note Holder on the applicable record date will be payable by the
Trustee to or at the direction of the Global Exchange Note Holder in its
capacity as the registered holder under the Indenture. Under the terms of the
Indenture, the Company and the Trustee may treat the persons in whose names
Exchange Notes, including the Global Exchange Note, are registered as the owners
thereof for the purpose of receiving such payments. Consequently, neither the
Company nor the Trustee has or will have any responsibility or liability for the
payment of such amounts to beneficial owners of Exchange Notes. The Company
believes, however, that it is currently the policy of the Depositary to
immediately credit the accounts of the relevant Participants with such payments,
in amounts proportionate to their respective holdings of beneficial interests in
the relevant security as shown on the records of the Depositary. Payments by the
Depositary's Participants and the Depositary's Indirect Participants to the
beneficial owners of Exchange Notes will be governed by standing instructions
and customary practice and will be the responsibility of the Depositary's
Participants or the Depositary's Indirect Participants.
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The Depositary has advised the Company as follows: The Depositary is a
limited-purpose trust company that was created to hold securities for its
participating organizations (collectively, the "Participants" or the
"Depositary's Participants") and to facilitate the clearance and settlement of
transactions in such securities between Participants through electronic
book-entry changes in accounts of its Participants. The Depositary's
Participants include securities brokers and dealers (including the Initial
Purchasers), banks and trust companies, clearing corporations, and certain other
organizations. Access to the Depositary's system is also available to other
entities such as banks, brokers, dealers, and trust companies (collectively, the
"Indirect Participants" or the "Depositary's Indirect Participants") that clear
through or maintain a custodial relationship with a Participant, either directly
or indirectly. Persons who are not Participants may beneficially own securities
held by or on behalf of the Depositary only through the Depositary's
Participants or the Depositary's Indirect Participants.
Certificated Securities
Subject to certain conditions, any person having a beneficial interest in a
Global Exchange Note may, upon request to the Trustee, exchange such beneficial
interest for Exchange Notes in the form of Certificated Securities. Upon any
such issuance, the Trustee is required to register such Certificated Securities
in the name of, and cause the same to be delivered to, such person or persons
(or the nominee of any thereof). In addition, if (i) the Company notifies the
Trustee in writing that the Depositary is no longer willing or able to act as a
depositary and the Company is unable to locate a qualified successor within 90
days or (ii) the Company, at its option, notifies the Trustee in writing that it
elects to cause the issuance of Exchange Notes in the form of Certificated
Securities under the Indenture, then, upon surrender by the Global Exchange Note
Holder of the Global Exchange Note, Exchange Notes in such form will be issued
to each person that the Global Exchange Note Holder and the Depositary identify
as being the beneficial owner of the related Exchange Notes.
Neither the Company nor the Trustee will be liable for any delay by the
Global Exchange Note Holder or the Depositary in identifying the beneficial
owners of Exchange Notes and the Company and the Trustee may conclusively rely
on, and will be protected in relying on, instructions from the Global Exchange
Note Holder or the Depositary for all purposes.
Same-Day Settlement and Payment
The Indenture requires that payments in respect of the Notes represented by
the Global Exchange Note (including principal, premium, interest, and Liquidated
Damages, if any) be made by wire transfer of immediately available funds to the
accounts specified by the Global Exchange Note Holder. With respect to
Certificated Securities, the Company will make all payments of principal,
premium, interest, and Liquidated Damages, if any, by wire transfer of
immediately available funds to the accounts specified by the Holders thereof or,
if no such account is specified, by mailing a check to each such Holder's
registered address.
The Exchange Notes represented by the Global Exchange Note are expected to
trade in the Depositary's Same-Day Funds Settlement System, and any permitted
secondary market trading activity in such Exchange Notes will, therefore, be
required by the Depositary to be settled in immediately available funds. The
Company expects the secondary trading in the Certificated Securities will also
be settled in immediately available funds.
REGISTRATION RIGHTS; LIQUIDATED DAMAGES
The Company, the Guarantors, and the Initial Purchasers entered into the
Registration Rights Agreement in connection with the issuance of the Outstanding
Notes. Pursuant to the Registration Rights Agreement, the Company and the
Guarantors agreed to file with the Commission the Exchange Offer Registration
Statement on the appropriate form under the Securities Act with respect to the
Exchange Notes. If (i) the Company and the Guarantors are not required to file
the Exchange Offer Registration Statement or permitted to consummate the
Exchange Offer because the Exchange Offer is not permitted by applicable law or
Commission policy or (ii) any holder of Transfer Restricted Securities notifies
the Company prior to the 20th day following consummation of the Exchange Offer
that (a) it is prohibited by law or Commission policy
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from participating in the Exchange Offer or (b) that it may not resell the
Exchange Notes acquired by it in the Exchange Offer to the public without
delivering a prospectus and the prospectus contained in the Exchange Offer
Registration Statement is not appropriate or available for such resales or (c)
that it is a broker-dealer and owns Notes acquired directly from the Company or
an affiliate of the Company, the Company and the Guarantors will file with the
Commission a Shelf Registration Statement to cover resales of the Notes by the
holders thereof who satisfy certain conditions relating to the provision of
information in connection with the Shelf Registration Statement. The Company and
the Guarantors will use their best efforts to cause the applicable registration
statement to be declared effective as promptly as possible by the Commission.
For purposes of the foregoing, "Transfer Restricted Securities" means each Note
until (i) the date on which such Note has been exchanged by a person other than
a broker-dealer for an Exchange Note in the Exchange Offer, (ii) following the
exchange by a broker-dealer in the Exchange Offer of a Note for an Exchange
Note, the date on which such Exchange Note is sold to a purchaser who receives
from such broker-dealer on or prior to the date of such sale a copy of the
prospectus contained in the Exchange Offer Registration Statement, (iii) the
date on which such Note has been effectively registered under the Securities Act
and disposed of in accordance with the Shelf Registration Statement, or (iv) the
date on which such Note is distributed to the public pursuant to Rule 144 under
the Securities Act.
The Registration Rights Agreement provides that (i) the Company and the
Guarantors will file an Exchange Offer Registration Statement with the
Commission on or prior to 45 days after the Issue Date, (ii) the Company and the
Guarantors will use their best efforts to have the Exchange Offer Registration
Statement declared effective by the Commission on or prior to 90 days after the
Issue Date, (iii) unless the Exchange Offer would not be permitted by applicable
law or Commission policy, the Company and the Guarantors will commence the
Exchange Offer and use their best efforts to issue, on or prior to 30 business
days after the date on which the Exchange Offer Registration Statement was
declared effective by the Commission, Exchange Notes in exchange for all Notes
tendered prior thereto in the Exchange Offer, and (iv) if obligated to file the
Shelf Registration Statement, the Company and the Guarantors will use their best
efforts to file the Shelf Registration Statement with the Commission on or prior
to 30 days after such filing obligation arises and to cause the Shelf
Registration to be declared effective by the Commission on or prior to 90 days
after such obligation arises. If (a) the Company and the Guarantors fail to file
any of the Registration Statements required by the Registration Rights Agreement
on or before the date specified for such filing, (b) any of such Registration
Statements is not declared effective by the Commission on or prior to the date
specified for such effectiveness (the "Effectiveness Target Date"), (c) the
Company fails to consummate the Exchange Offer within 30 business days of the
Effectiveness Target Date with respect to the Exchange Offer Registration
Statement, or (d) the Shelf Registration Statement or the Exchange Offer
Registration Statement is declared effective but thereafter ceases to be
effective or usable in connection with resales of Transfer Restricted Securities
during the periods specified in the Registration Rights Agreement (each such
event referred to in clauses (a) through (d) above a "Registration Default"),
then the Company will pay Liquidated Damages to each holder of Notes, with
respect to the first 90-day period immediately following the occurrence of the
first Registration Default, in an amount equal to one-half of one percentage
point (0.5%) per annum of the principal amount of Notes held by such holder. The
amount of the Liquidated Damages will increase by an additional one-half of one
percent (0.5%) per annum for each subsequent 90-day period until all
Registration Defaults have been cured, up to a maximum amount of one and
one-half percent (1.5%) per annum. All accrued Liquidated Damages will be paid
by the Company on each interest payment date to the Global Note Holder by wire
transfer of immediately available funds or by federal funds check and to holders
of Certificated Securities by wire transfer to the accounts specified by them or
by mailing checks to their registered addresses if no such accounts have been
specified. The filing of a Registration Statement after the date specified for
such filing, the declaration of effectiveness of a Registration Statement after
the Effectiveness Target Date, or the consummation of the Exchange Offer at any
time, as appropriate, shall constitute a cure of the related Registration
Default. Following the cure of all Registration Defaults, the accrual of
Liquidated Damages will cease.
Holders of Notes will be required to make certain representations to the
Company and the Guarantors (as described in the Registration Rights Agreement)
in order to participate in the Exchange Offer and will be required to deliver
information to be used in connection with the Shelf Registration Statement and
to provide
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comments on the Shelf Registration Statement within the time periods set forth
in the Registration Rights Agreement in order to have their Notes included in
the Shelf Registration Statement and benefit from the provisions regarding
Liquidated Damages set forth above.
CERTAIN DEFINITIONS
Set forth below is a summary of certain of the defined terms used in the
covenants contained in the Indenture. Reference is made to the Indenture for the
full definition of all such terms as well as any other capitalized terms used
herein for which no definition is provided.
"Acquired Indebtedness" means Indebtedness of a Person existing at the time
such Person becomes a Subsidiary or assumed in connection with an Asset
Acquisition from such Person.
"Adjusted Net Assets" of a Guarantor at any date shall mean the lesser of
the amount by which (x) the fair value of the property of such Guarantor exceeds
the total amount of liabilities, including, without limitation, contingent
liabilities (after giving effect to all other fixed and contingent liabilities
(including, without limitation, any guarantees of Indebtedness)), but excluding
liabilities under the Guarantee, of such Guarantor at such date and (y) the
present fair salable value of the assets of such Guarantor exceeds the total
amount of its debts (after giving effect to all other fixed and contingent
liabilities (including, without limitation, any guarantees of Indebtedness) and
after giving effect to any collection from any Subsidiary of such Guarantor in
respect of the obligations of such Subsidiary under the Guarantee), excluding
Indebtedness in respect of the Guarantee, as they become absolute and matured.
"Affiliate" of any specified Person means any other Person which directly
or indirectly through one or more intermediaries controls, or is controlled by,
or is under common control with, such specified Person. For the purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlling," "controlled by," and "under common control with"), as used with
respect to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by agreement or
otherwise; provided that beneficial ownership of 10% or more of the voting
securities of a Person shall be deemed to be control.
"Asset Acquisition" means (a) an Investment by the Company or any
Subsidiary of the Company in any other Person pursuant to which such Person
shall become a Subsidiary of the Company, or shall be merged with or into the
Company or any Subsidiary of the Company, (b) the acquisition by the Company or
any Subsidiary of the Company of the assets of any Person (other than a
Subsidiary of the Company) or (c) the acquisition by the Company or any
Subsidiary of the Company of any division or line of business of any Person
(other than a Subsidiary of the Company); provided, in each case, that the
assets acquired are to be used in the business conducted by the Company and its
Subsidiaries as of the Issue Date or any other business determined by the
Company's Board of Directors, in good faith, to be reasonably related thereto.
"Asset Sale" means (x) the direct or indirect sale, transfer, issuance,
conveyance, lease (other than operating leases entered into in the ordinary
course of business pursuant to ordinary business terms, including, without
limitation, any equipment lease reasonably entered into in connection with any
acquisition or potential acquisition consistent with past practice), assignment
or other disposition (including, without limitation, by eminent domain,
condemnation or similar governmental proceeding) (each, a "disposition" or
"issuance"), and (y) any merger or consolidation of any Subsidiary of the
Company with or into another Person (other than the Company or any Wholly Owned
Subsidiary of the Company) whereby such Subsidiary shall cease to be a Wholly
Owned Subsidiary, if such disposition, issuance, merger, or consolidation
involves property or assets with a fair market value in excess of $1.0 million,
whether in a single transaction or in a series of related transactions, of (a)
any Equity Interest in any Subsidiary, (b) real property owned by the Company or
any Subsidiary thereof, or a division, line of business, or comparable business
segment of the Company or any Subsidiary thereof or (c) other property, assets,
or rights (including, without limitation leasehold rights) of the Company or any
Subsidiary thereof; provided, however, that, except as noted in the last
sentence of this paragraph, Asset Sales shall not include (i) dispositions or
issuances to the Company or to a Subsidiary thereof or to any other Person if
after giving effect to such disposition or issuance such other Person becomes a
Wholly Owned Subsidiary of the Company, (ii) transactions involving the Company
which are subject to and
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effected in compliance with "Merger, Consolidation, or Sale of Assets" above,
(iii) dispositions of services and products in the ordinary course of business,
(iv) a disposition that is an Investment or a Restricted Payment not prohibited
by the "Limitation on Restricted Payments" covenant, (v) a sale, transfer,
conveyance, or issuance of an Equity Interest that constitutes a Permitted
Investment pursuant to clause (ii)(C) of the definition thereof or that complies
with the limitations set forth in "-- Limitation on Restricted Payments" if, in
each case, the assets received in consideration therefor are to be used in the
business conducted by the Company and its Subsidiaries as of the Issue Date or
any other business determined by the Company's Board of Directors, in good
faith, to be reasonably related thereto, (vi) exchanges of assets that comply
with the requirements described in the final paragraph under "-- Repurchase at
the Option of Holders -- Asset Sales," (vii) a designation of a Subsidiary as an
Unrestricted Subsidiary if permitted under the Indenture, (viii) the disposition
of any Temporary Cash Investment, and (ix) the grant of any Lien securing
Indebtedness permitted under the Indenture. Notwithstanding any provision of the
Indenture to the contrary, the expiration or non-renewal of any lease of
property at the normal expiration date thereof shall not constitute an Asset
Sale. For purposes of the definition of Consolidated Fixed Charge Coverage
Ratio, transactions referred to in clauses (iv) and (vi) shall be included as
Asset Sales.
"Asset Sale Proceeds" means, with respect to any Asset Sale, (i) cash
received by the Company or any Subsidiary thereof from such Asset Sale after (a)
provision for all income or other taxes measured by or resulting from such Asset
Sale, (b) payment of all brokerage commissions, underwriting, legal, accounting,
title, and other reasonable fees, costs, and expenses, consistent with past
practice, related to such Asset Sale, (c) provision for minority interest
holders in any Subsidiary or in any asset subject to such Asset Sale as a result
of such Asset Sale, (d) payments made to retire Indebtedness secured by the
assets subject to such Asset Sale or otherwise required to be paid, and (e)
deduction of appropriate amounts to be provided by the Company or a Subsidiary
thereof as a reserve, in accordance with GAAP, against any liabilities
associated with the assets disposed of in such Asset Sale and retained by the
Company or a Subsidiary thereof after such Asset Sale including, without
limitation, pension and other post employment benefit liabilities and
liabilities related to environmental matters or against any indemnification
obligations associated with the assets disposed of in such Asset Sale and (ii)
any securities, notes, or other obligations received by the Company or any
Subsidiary thereof from such Asset Sale upon the liquidation or conversion of
such securities, notes, or other obligations into cash prior to the Reinvestment
Date.
"Attributable Indebtedness" when used with respect to any Sale and
Lease-Back Transaction means, as at the time of determination, the present value
(discounted at a rate equivalent to the interest rate implicit in the lease,
compounded on a semi-annual basis) of the total obligations of the lessee for
rental payments (after excluding all amounts required to be paid on account of
maintenance and repairs, insurance, taxes, utilities, and other similar expenses
payable by the lessee pursuant to the terms of the lease) during the remaining
term of the lease included in any such Sale and Lease-Back Transaction or until
the earliest date on which the lessee may terminate such lease without penalty
or upon payment of a penalty (in which case the rental payments shall include
such penalty).
"Board of Directors" means, as to any Person, the board of directors or any
duly authorized committee thereof of such Person or, if such Person is a
partnership (or other non-corporate Person), of the managing general partner or
partners (or Persons serving an analogous function) of such Person.
"Capital Lease Obligations" means Indebtedness represented by obligations
under a lease that is required to be capitalized for financial reporting
purposes in accordance with GAAP, and the amount of such Indebtedness shall be
the capitalized amount of such obligations determined in accordance with GAAP.
"Change of Control" means the occurrence of any of the following: (i) the
sale, lease, transfer, conveyance, or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Subsidiaries taken as a
whole to any "person" (as such term is used in Section 13(d)(3) of the Exchange
Act); (ii) the adoption of a plan relating to the liquidation or dissolution of
the Company; (iii) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as defined above) is or becomes the "beneficial owner" (as such term
is defined in Rule 13d-3 and Rule 13d-5 under the Exchange
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Act, except that a 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), directly or indirectly, of more than 40% of the Common Equity
Interest of the Company (measured by voting power rather than number of shares
or equivalent units); or (iv) the first day on which less than a majority of the
members of the Board of Directors of the Company are Continuing Directors.
"Common Equity Interest" of any Person means all Equity Interests of such
Person that are generally entitled to (i) vote in the election of directors of
such Person or (ii) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers, or
others that will control the management and policies of such Person.
"Consolidated Cash Flow" means, with respect to any Person for any period,
the Consolidated Net Income of such Person for such period plus, to the extent
deducted in computing such Consolidated Net Income, (i) an amount equal to any
extraordinary loss plus any net loss realized in connection with an Asset Sale,
(ii) provision for taxes based on income or profits, (iii) consolidated interest
expense whether paid or accrued and whether or not capitalized (including,
without limitation, amortization of debt issuance costs and original issue
discount, non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated with
Capital Lease Obligations, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance financings, and
net payments (if any) pursuant to Hedging Obligations), and (iv) depreciation
and amortization (including amortization of goodwill and other intangibles but
excluding amortization of prepaid cash expenses that were paid in a prior
period) in each case, on a consolidated basis and determined in accordance with
GAAP. Notwithstanding the foregoing, the provision for taxes based on the income
or profits of, and the depreciation and amortization of, a Subsidiary of a
Person shall be added to Consolidated Net Income to compute Consolidated Cash
Flow only to the extent (and in the same proportion) that the Net Income of such
Subsidiary was included in calculating the Consolidated Net Income of such
Person and only if a corresponding amount would be permitted at the date of
determination to be dividend to the Company by such Subsidiary without prior
approval (that has not been obtained) pursuant to the terms of its charter and
all agreements, instruments, judgments, decrees, orders, statutes, rules, and
governmental regulations applicable to such Subsidiary or its stockholders.
"Consolidated Fixed Charge Coverage Ratio" means with respect to any
Person, the ratio of the aggregate amount of Consolidated Cash Flow of such
Person for the four full fiscal quarters immediately preceding the date of the
transaction (the "Transaction Date") giving rise to the need to calculate the
Consolidated Fixed Charge Coverage Ratio (such four full fiscal quarter period
being referred to herein as the "Four Quarter Period") to the aggregate amount
of 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 Cash Flow" and "Consolidated Fixed Charges" shall be
calculated after giving effect on a pro forma basis for the period of such
calculation to, without duplication, (a) the incurrence of any Indebtedness of
such Person or any of its Subsidiaries (and the application of the net proceeds
thereof) during the period commencing on the first day of the Four Quarter
Period to and including the Transaction Date (the "Reference Period"),
including, without limitation, the incurrence of the Indebtedness giving rise to
the need to make such calculation (and the application of the net proceeds
thereof), as if such incurrence (and application) occurred on the first day of
the Four Quarter Period (it being understood that with respect to Indebtedness
incurred under a revolving facility used primarily to finance working capital,
the average daily principal amount outstanding during the Reference Period shall
be deemed to be the amount incurred during the Reference Period) and (b) any
Asset Sales 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 Subsidiaries (including any Person who becomes a Subsidiary
as a result of the Asset Acquisition) incurring, assuming or otherwise being
liable for Acquired Indebtedness) occurring during the Reference Period, as if
such Asset Sale or Asset Acquisition occurred on the first day of the Four
Quarter Period. Furthermore, in calculating "Consolidated Fixed Charges" for
purposes of determining this "Consolidated Fixed Charge Coverage Ratio," (i)
interest on outstanding Indebtedness determined on a fluctuating basis as of the
Transaction Date and
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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 (ii) if interest on
indebtedness actually incurred on the Transaction Date may optionally be
determined at an interest rate based upon a factor of a prime or similar rate, a
eurocurrency interbank offered rate, or other rates, then the interest rate in
effect on the Transaction Date will be deemed to have been in effect during the
Four Quarter Period. In calculating the Consolidated Fixed Charge Coverage Ratio
and giving pro forma effect to the incurrence of Indebtedness during a Reference
Period, pro forma effect shall be given to use of proceeds thereof to
permanently repay or retire Indebtedness. If such Person or any of its
Subsidiaries directly or indirectly guarantees Indebtedness of a third Person,
for purposes of determining the "Consolidated Fixed Charge Coverage Ratio,"
effect shall be given to the incurrence of such guaranteed Indebtedness as if
such Person or such Subsidiary had directly incurred or otherwise assumed such
guaranteed Indebtedness.
"Consolidated Fixed Charges" means, with respect to any Person for any
period, the sum of, without duplication, the amounts for such period of (i) the
consolidated interest expense of such Person and its Subsidiaries for such
period, whether paid or accrued (including, without limitation, amortization of
debt issuance costs and original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, commissions,
discounts and other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net payments (if any) pursuant to Hedging
Obligations), (ii) the consolidated interest expense of such Person and its
Subsidiaries that was capitalized during such period, (iii) an interest expense
on Indebtedness of another Person that is guaranteed by such Person or one of
its Subsidiaries or secured by a Lien on assets of such Person or one of its
Subsidiaries (whether or not such guarantee or Lien is called upon), and (iv)
the product of (a) all dividend payments, whether or not in cash, on any series
of Disqualified Equity Interests of such Person or any of its Subsidiaries,
other than dividend payments on Disqualified Equity Interests payable solely in
Equity Interests of the Company, times (b) a fraction, the numerator of which is
one and the denominator of which is one minus the then current combined federal,
state and local statutory tax rate of such Person, expressed as a decimal, in
each case, on a consolidated basis and in accordance with GAAP.
"Consolidated Net Income" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its subsidiaries for such
period, on a consolidated basis, determined in accordance with GAAP; provided
that (i) the Net Income (but not loss) of any Person that is not a Subsidiary or
that is accounted for by the equity method of accounting shall be included only
to the extent of the amount of dividends or distributions paid in cash to the
referent Person or a Wholly Owned Subsidiary thereof, (ii) the Net Income of any
Subsidiary shall be excluded to the extent that the declaration or payment of
dividends or similar distributions by that Subsidiary of that Net Income is not
at the date of determination permitted without any prior governmental approval
(that has not been obtained) or, directly or indirectly, by operation of the
terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule, or governmental regulation applicable to that Subsidiary or its
stockholders, (iii) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition shall
be excluded, (iv) the cumulative effect of a change in accounting principles
shall be excluded, and (v) any non-cash compensation expense in connection with
the issuance of employee stock options shall be excluded.
"Consolidated Net Worth" means, with respect to any Person at any date, the
consolidated stockholders' equity of such Person less the amount of such
stockholders' equity attributable to Disqualified Equity Interests of such
Person and its Subsidiaries, as determined in accordance with GAAP, less (i) all
write-ups (other than write-ups of tangible assets of a going concern business
made within 12 months after the acquisition of such business) subsequent to the
Issue Date in the book value of any asset owned by such Person or a consolidated
Subsidiary of such Person, (ii) all investments as of such date in
unconsolidated Subsidiaries and in Persons that are not Subsidiaries and (iii)
all unamortized debt discount and expense and unamortized deferred charges as of
such date, in each case determined in accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any member
of the Board of Directors of the Company who (i) was a member of such Board of
Directors on the date of the Indenture or (ii) was
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nominated for election or elected to such Board of Directors with the approval
of a majority of the Continuing Directors who were members of such Board at the
time of such nomination or election.
"Default" means any event that is, or after notice or passage of time or
both would be, an Event of Default.
"Disqualified Equity Interests" means any Equity Interest 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), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the date that is 91 days following the
maturity date of the Notes, for cash or securities constituting Indebtedness;
provided, however, that Preferred Equity Interests of the Company or any
Subsidiary thereof that are issued with the benefit of provisions requiring a
change of control offer or asset sale proceeds offer to be made for such
Preferred Equity Interest in the event of a change of control or sale of assets
of the Company or such Subsidiary, which provisions have substantially the same
effect as the provisions of the Indenture described under "Repurchase at the
Option of Holders -- Change of Control Offer" or "Repurchase at the Option of
Holders -- Asset Sales," shall not be deemed to be Disqualified Equity Interests
solely by virtue of such provisions.
"Equity Interests" means, with respect to any Person, any and all shares or
other equivalents (however designated) of capital stock, partnership interests,
membership interests, or any other participation, right, or other interests in
the nature of an equity interest in such Person or any option, warrant, or other
security convertible into or exchangeable for any of the foregoing.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the notes issued in the Exchange Offer.
"fair market value" or "fair value" means, with respect to any assets or
property, the price which could be negotiated in an arm's-length free market
transaction, for cash, between a willing seller and a fully informed, willing,
and able buyer, neither of whom is under undue pressure or compulsion to
complete the transaction, all as reasonably determined by a majority of the
Board of Directors acting in good faith, such determination to be evidenced by a
board resolution delivered to the Trustee. No such determination need be
supported by an appraisal or expert opinion.
"GAAP" means generally accepted accounting principles consistently applied
as in effect in the United States on the Issue Date.
"guarantee" means, with respect to any Person, any obligation, contingent
or otherwise, of such Person directly or indirectly guaranteeing any
Indebtedness or other obligation of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of such Person (i) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness or other obligation of such other
Person (whether arising by virtue of partnership arrangements, or by agreements
to keep-well, to purchase assets, goods, securities or services, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (ii) entered into
for purposes of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided 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.
"Hedging Obligations" means, for any Person, any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement, or other
similar agreement designed to protect the party indicated therein against
fluctuations in interest rates, currency exchange rates, or commodity prices.
"incur" means, with respect to any Indebtedness or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise), assume,
guarantee, or otherwise become, directly or indirectly, liable in respect of
such Indebtedness or other obligation or the recording, as required pursuant to
GAAP or otherwise, of any such Indebtedness or other obligation on the balance
sheet of such person (and
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"incurrence," "incurred, "incurable," and "incurring" shall have meanings
correlative to the foregoing); provided, however, that a change in GAAP that
results in an obligation of such Person that exists at such time becoming
Indebtedness shall not be deemed an incurrence of such Indebtedness; and
provided, further that accrual of interest, the accretion of accreted value, and
the payment of interest in the form of additional Indebtedness will not be
deemed to be an incurrence of Indebtedness. Any Indebtedness or Equity Interests
of a Person existing at the time such Person becomes a Subsidiary (whether by
merger, consolidation, acquisition, or otherwise) shall be deemed to be incurred
by such Person at the time it becomes a Subsidiary. Indebtedness consisting of
reimbursement obligations in respect of a letter of credit will be deemed to be
incurred when the letter of credit is issued or renewed.
"Indebtedness" means (without duplication), with respect to any Person, any
indebtedness at any time outstanding, secured or unsecured, contingent or
otherwise, which is for borrowed money (whether or not the recourse of the
lender is to the whole of the assets of such Person or only to a portion
thereof), or evidenced by bonds, notes, debentures, or similar instruments, or
representing the balance deferred and unpaid of the purchase price of any
property (excluding, without limitation, any balances that constitute accounts
payable or trade payables, and other liabilities arising in the ordinary course
of business) and shall also include, to the extent not otherwise included (i)
any Capital Lease Obligations, (ii) obligations of Persons other than such
Person secured by a Lien to which the property or assets owned or held by such
Person is subject, whether or not the obligation or obligations secured thereby
shall have been incurred or assumed by such Person, (iii) all Indebtedness of
others of the types described in the other clauses of this definition (including
all dividends of other Persons) the payment of which is guaranteed, directly or
indirectly, by such Person or that is otherwise its legal liability or which
such Person has agreed to purchase or repurchase or in respect of which such
Person has agreed contingently to supply or advance funds (whether or not such
items would appear upon the balance sheet of the guarantor), (iv) all
obligations for the reimbursement of any obligation or on any letter of credit,
banker's acceptance or similar credit transaction, (v) Disqualified Equity
Interests, (vi) Hedging Obligations of any such Person, and (vii) Attributable
Indebtedness. The amount of Indebtedness of any Person at any date shall be the
principal (or face) amount outstanding at such date of all unconditional
obligations as described above and, with respect to contingent obligations, the
maximum liability upon the occurrence of the contingency giving rise to the
obligation; provided, however, that Indebtedness shall not include any liability
for federal, state, local, or other taxes. Notwithstanding any other provision
of the foregoing definition, any trade payable arising from the purchase of
goods or materials or for services obtained in the ordinary course of business
shall not be deemed to be "Indebtedness" for purposes of this definition.
Furthermore, guarantees of (or obligations with respect to letters of credit
supporting) Indebtedness otherwise included in the determination of such amount
shall not also be included.
"Independent Financial Advisor" means an accounting, appraisal, investment
banking, or consulting firm of nationally recognized standing that is, in the
good faith judgment of the Board of Directors of the Company, qualified to
perform the task for which such firm has been engaged.
"Investments" means, directly or indirectly, any advance, account
receivable (other than an account receivable arising in the ordinary course of
business (including accounts receivable arising in the ordinary course of
business and acquired as a part of the assets acquired by the Company or a
Subsidiary in connection with an acquisition of assets which is otherwise
permitted by the terms of the Indenture)), loan or capital contribution to (by
means of transfers of property to others, payments for property or services for
the account or use of others or otherwise), the purchase of any stock, bonds,
notes, debentures, partnership or joint venture interests, or other securities
of, the acquisition, by purchase or otherwise, of all or substantially all of
the business or stock or other evidence of beneficial ownership of, any Person,
the guarantee or assumption of the Indebtedness of any other Person (except for
an assumption of Indebtedness for which the assuming Person receives
consideration with a fair market value at least equal to the principal amount of
the Indebtedness assumed), the designation of a Subsidiary as an Unrestricted
Subsidiary, or the making of any investment in any Person and all other items
that would be classified as investments on a balance sheet of such Person
prepared in accordance with GAAP. Investments shall exclude (i) extensions of
trade credit on commercially reasonable terms in accordance with normal trade
practices, (ii) endorsements of negotiable instruments for collection or deposit
in the ordinary course of business, (iii) commission, travel, payroll, and
similar advances
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to directors, officers, and employees made in the ordinary course of business,
and (iv) workers' compensation, utility, lease, and similar deposits and prepaid
expenses in the ordinary course of business. If the Company or any Subsidiary of
the Company sells or otherwise disposes of any Equity Interests of any direct or
indirect Subsidiary of the Company such that, after giving effect to any such
sale or disposition, such Person is no longer a Subsidiary of the Company, the
Company or such Subsidiary 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
Equity Interests of such Subsidiary not sold or disposed of in an amount
determined as provided in the penultimate paragraph of the covenant described
above under the caption "-- Certain Covenants -- Limitation on Restricted
Payments." In determining the amount of any Investment in respect of any
Property other than cash, such Property shall be valued at its fair market value
at the time of such Investment.
"Issue Date" means the closing date for the sale and original issuance of
the Notes to the Initial Purchasers.
"Lien" means, with respect to any property or assets of any Person, any
mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance, preference,
priority, or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or assets (including
without limitation, any Capital Lease Obligation, conditional sales, or other
title retention agreement having substantially the same economic effect as any
of the foregoing).
"Liquidated Damages" means all liquidated damages owing pursuant to the
Registration Rights Agreement.
"Net Income" means, with respect to any Person for any period, the net
income (loss) of such Person determined in accordance with GAAP and before any
reduction in respect of dividends on Preferred Equity Interests, excluding,
however, (i) any gain, together with any related provision for taxes on such
gain, realized in connection with (a) any Asset Sale or (b) the disposition of
any securities by such Person or any of its Subsidiaries or the extinguishment
of any Indebtedness of such Person or any of its Subsidiaries and (ii) any
extraordinary or nonrecurring gain (or loss incurred prior to the Issue Date,
but not loss incurred after the Issue Date), together with any related provision
for taxes on such extraordinary or nonrecurring gain (but not loss, except to
the extent referred to above).
"Net Investments" means the excess of (i) the aggregate of all Investments
made by the Company or a Subsidiary thereof on or after the Issue Date (in the
case of an Investment made other than in cash, the amount shall be the fair
market value of such Investment at the time made as determined in good faith by
the Board of Directors of the Company) over (ii) the sum of (a) the aggregate
amount returned in cash on such Investments (in the case of a noncash return on
such Investments, the amount thereof shall be the fair market value of such
noncash consideration at the time of receipt thereof as determined in good faith
by the Board of Directors of the Company) whether through interest payments,
principal payments, dividends, or other distributions and (b) the net cash
proceeds received by the Company or such Subsidiary from the disposition of all
or any portion of such Investments (other than to a Subsidiary of the Company);
provided, however, that with respect to all Investments made in Unrestricted
Subsidiaries the sum of clauses (a) and (b) above with respect to such
Investments shall not exceed the aggregate amount of all Investments made in all
Unrestricted Subsidiaries.
"New Credit Facility" means that certain Amended and Restated Credit
Agreement, dated as of March 16, 1998, by and among the Company, certain
financial institutions as lenders and First Union National Bank, as Agent,
including any related notes, guarantees (by subsidiaries of the Company or
otherwise), collateral documents, instruments and agreements executed in
connection therewith, and in each case as amended, restated, modified, renewed,
refunded, replaced or refinanced (in each case, in whole or in part, and without
limitation as to amount, terms, conditions, covenants and other provisions),
with the same or other agents and lenders, in whole or in part, from time to
time and any agreement (and related documents) governing Indebtedness incurred
to refinance or refund borrowings and commitments then outstanding or permitted
to be outstanding under such credit facility or a successor New Credit Facility,
whether by the same or other agent lender or group of lenders.
"Non-Recourse Debt" means Indebtedness: (i) as to which neither the Company
nor any of its Subsidiaries (a) provides credit support of any kind (including
any undertaking, agreement, or instrument that
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would constitute Indebtedness), (b) is directly or indirectly liable (as a
guarantor or otherwise), or (c) constitutes the lender; (ii) no default with
respect to which (including any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness of the
Company or any of its Subsidiaries to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity; and (iii) as to which the lenders have been notified in
writing that they will not have any recourse to the stock or assets of the
Company or any of its Subsidiaries.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages, and other liabilities payable under
the documentation governing any Indebtedness.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by the Chief Executive Officer, the President, or any Vice President and
the Chief Financial Officer or any Treasurer or assistant Treasurer of such
Person (or, in the case of a Person that is a partnership (or other
non-corporate Person), of a general partner (or analogous individuals) of such
Person in such capacity) that shall comply with applicable provisions of the
Indenture.
"Permitted Indebtedness" means:
(i) Indebtedness (plus interest, premium, fees, and other obligations
associated therewith) of the Company or any Guarantor arising under or in
connection with the New Credit Facility of up to $200.0 million;
(ii) Indebtedness under the Notes and the Guarantees;
(iii) Indebtedness outstanding on the Issue Date after giving effect
to the application of the proceeds of the Initial Offering (including
repayment of all obligations under the Company's prior revolving credit
facility);
(iv) Hedging Obligations of the Company or any Subsidiary;
(v) Indebtedness of a Wholly Owned Subsidiary issued to and held by
the Company or a Wholly Owned Subsidiary or Indebtedness of the Company to
a Wholly Owned Subsidiary in respect of intercompany advances or
transactions;
(vi) (a) Purchase Money Indebtedness, (b) Capital Lease Obligations,
and (c) Indebtedness incurred in connection with an Asset Acquisition
(including Acquired Indebtedness), in each case incurred by the Company or
any Subsidiary, in an aggregate principal amount outstanding at any time
not to exceed $25.0 million;
(vii) Indebtedness constituting an agreement or commitment to pay a
dividend that has been declared or otherwise to make a payment or
distribution as described in clause (i) of the second paragraph of the
covenant entitled "-- Certain Covenants -- Limitation on Restricted
Payments";
(viii) Indebtedness in connection with one or more letters of credit,
guarantees, bid, surety or performance bonds, or other reimbursement
obligations or bankers' acceptances, in each case issued in the ordinary
course of business and not in connection with the borrowing of money or the
obtaining of advances or credit;
(ix) additional Indebtedness of the Company or any Subsidiary (which
may be Indebtedness under the New Credit Facility) in an aggregate
principal amount outstanding at any time not to exceed $15.0 million; and
(x) Refinancing Indebtedness.
"Permitted Investments" means, for any Person, Investments made on or after
the Issue Date consisting of:
(i) Temporary Cash Investments;
(ii) (A) Investments in the Company or a Subsidiary of the Company,
(B) Investments in any Person, if (1) as a result of such Investment (y)
such Person or a Subsidiary of such Person becomes a Subsidiary of the
Company or (z) such Person or a Subsidiary of such Person is merged,
consolidated, or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Company or a
Subsidiary thereof and (2) after giving effect to such Investment, the
Company is in compliance with the covenant described under "Line of
Business" above, and (C) Net Investments in
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any Persons primarily engaged or preparing to engage in the business
conducted by the Company and its Subsidiaries as of the Issue Date or any
other business determined by the Company's Board of Directors, in good
faith, to be reasonably related thereto; provided, however, that the
aggregate amount of all such Net Investments described in this clause (C),
shall not exceed at any one time outstanding 10.0% of the consolidated
total assets of the Company as reflected on the most recent balance sheet
delivered by the Company to the Trustee;
(iii) Investments represented by accounts receivable created or
acquired in the ordinary course of business;
(iv) advances to employees, officers, and directors in the ordinary
course of business not to exceed an aggregate of $1.0 million outstanding
at any one time;
(v) Investments under or pursuant to Hedging Obligations;
(vi) an Investment that is made by the Company or a Subsidiary thereof
in the form of any Equity Interests, Indebtedness, or other assets received
as partial consideration for the consummation of a transaction that is
otherwise permitted under the covenant described under "-- Asset Sales";
(vii) Investments in the Notes otherwise permitted under the
Indenture;
(viii) Investments existing on the Issue Date;
(ix) any Investment acquired solely in exchange for, by conversion of,
or out of the net cash proceeds of, the issuance of Equity Interests (other
than Disqualified Equity Interests) of the Company;
(x) stocks, obligations, or other securities received in settlement of
debts (including, without limitation, under any bankruptcy or other similar
proceeding) owing to the Company or any of its Subsidiaries as a result of
foreclosure, perfection, enforcement, or settlement of any Indebtedness or
Liens in favor of the Company or a Subsidiary; and
(xi) guarantees not prohibited by the "Limitation on Additional
Indebtedness" covenant or the "Limitation on Issuances of Guarantees by
Subsidiaries Which Are Not Guarantors" covenant.
"Permitted Liens" means, without duplication, (i) Liens existing on the
Issue Date, (ii) Liens in favor of the Company or any Subsidiary thereof, (iii)
Liens on the Equity Interests or property of a Person existing at the time such
Person becomes a Subsidiary of, or is acquired by, merged into or consolidated
with the Company or any Subsidiary thereof, or such property is acquired by the
Company or a Subsidiary; provided, however, that such Liens (a) were not created
in connection with or in anticipation of such acquisition, merger, or
consolidation or such Person becoming a Subsidiary and (b) are not applicable to
any other property of the Company or any of the other Subsidiaries of the
Company, (iv) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently conducted; provided,
however, that any reserve or other appropriate provision as shall be required in
conformity with GAAP shall have been made therefor, (v) landlords', carriers',
warehousemen's, mechanics', materialmen's, repairmen's, or other like Liens
arising in the ordinary course of business (whether contractual, statutory or
constitutional in nature) and with respect to amounts which are not yet
delinquent or are being contested in good faith by appropriate proceedings, (vi)
pledges or deposits made in the ordinary course of business in connection with
(a) leases, performance bonds, and similar obligations, (b) workers'
compensation, unemployment insurance, and other social security legislation, or
(c) securing the performance of surety bonds and appeal bonds required (1) in
the ordinary course of business or in connection with the enforcement of rights
or claims of the Company or a Subsidiary thereof or (2) in connection with
judgments that do not give rise to an Event of Default, (vii) easements,
rights-of-way, restrictions, minor defects, or irregularities in title and other
similar encumbrances which, in the aggregate, do not materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the Company or any Subsidiary in connection
therewith, (viii) Liens to secure Purchase Money Indebtedness that is otherwise
permitted under the Indenture; provided, however, that (a) any such Lien is
created solely for the purpose of securing Indebtedness representing, or
incurred to finance, refinance, or refund, the cost (including commissions,
sales and excise taxes, installation and delivery charges, and other direct
costs of, and other direct expenses paid or charged in connection with, such
purchase or construction and such financing) of such Property, (b) the principal
amount of the Indebtedness secured by such Lien does not exceed
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100% of such costs, and (c) such Lien does not extend to or cover any Property
other than such item of Property and any accessions, substitutions, or
improvements on, and proceeds from, such item, (ix) Liens securing Capital Lease
Obligations permitted to be incurred under the Indenture; provided, however,
that such Lien does not extend to any property other than that subject to the
underlying lease, (x) Liens to secure Indebtedness incurred pursuant to clause
(vi) of the definition of Permitted Indebtedness; provided, however, that (a)
any such Lien is created solely for the purpose of securing such Indebtedness,
(b) the principal amount of the Indebtedness secured by such Lien does not
exceed 100% of the purchase price for the Property acquired, and (c) such Lien
does not extend to or cover any Property other than the Property acquired and
any proceeds therefrom, (xi) Liens pursuant to leases and subleases of real
property which do not interfere with the ordinary conduct of the business of the
Company or any of its Subsidiaries and which are made on customary and usual
terms applicable to similar properties and do not extend to any property of the
Company or a Subsidiary other than the personal property located on such real
property, (xii) Liens securing reimbursement obligations under commercial
letters of credit, but only in or upon the goods the purchase of which were
financed by such letters of credit, (xiii) Liens arising under the Indenture in
favor of the Trustee for its own benefit or for the benefit of the holders,
(xiv) Liens resulting from the deposit of funds or government securities in
trust for the purpose of decreasing or defeasing Indebtedness of the Company and
its Subsidiaries so long as such deposit of funds or government securities and
such decreasing or defeasing of Indebtedness are permitted under the "Restricted
Payments" covenant, (xv) Liens constituting licenses not otherwise prohibited
under the terms of the Indenture, (xvi) setoff, chargeback, and other rights of
depository and collecting banks and other regulated financial institutions with
respect to money or instruments of the Company or its Subsidiaries on deposit
with or in the possession of such institutions, (xvii) any interest or title of
a lessor in the property subject to any Capital Lease Obligation permitted under
the Indenture or operating lease, (xviii) Liens on Equity Interests of
Unrestricted Subsidiaries, (xix) judgment or attachment Liens not giving rise to
an Event of Default, (xx) any Lien arising under a contract entered into by the
Company or any of its Subsidiaries to the extent such contract requires the
Company or such Subsidiary to lease equipment at a fair market rental rate to
the counterparty under such contract upon the occurrence of a default by the
Company or such Subsidiary, (xxi) Liens in connection with Sale and Leaseback
Transactions otherwise permitted under the Indenture; and (xxii) Liens to secure
Indebtedness in an aggregate amount not in excess of $2.0 million at any one
time outstanding and that (a) are not incurred in connection with the borrowing
of money or the obtaining of advances or credit (other than trade credit in the
ordinary course of business) and (b) do not in the aggregate materially detract
from the value of the property or materially impair the use thereof in the
operation of business by the Company or any Subsidiary.
"Person" means any individual, corporation, partnership, limited liability
company or partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, or government (including any agency or political
subdivision thereof).
"Preferred Equity Interest" means any Equity Interest of a Person, however
designated, which entitles the holder thereof to a preference with respect to
dividends, distributions, or liquidation proceeds of such Person over the
holders of any other Equity Interest issued by such Person.
"Property" or "property" of any Person means all types of real, personal,
tangible, intangible, or mixed property owned by such Person whether or not
included in the most recent consolidated balance sheet of such Person and its
Subsidiaries under GAAP.
"Public Equity Offering" means, with respect to any Person, a public
offering by such Person of some or all of its Common Equity Interests other than
Disqualified Equity Interests (however designated and whether voting or
non-voting) and any and all rights, warrants, or options to acquire such Equity
Interests.
"Purchase Money Indebtedness" means Indebtedness incurred to finance the
purchase price of Property (including Indebtedness existing at the time such
Property was acquired if such Indebtedness was assumed in connection with such
acquisition); provided that the principal amount of such Indebtedness does not
exceed 100% of the purchase price of such Property.
"Refinancing Indebtedness" means Indebtedness that refunds, refinances,
renews, or replaces ("refinances") any Indebtedness of the Company or its
Subsidiaries outstanding on the Issue Date or other Indebtedness permitted to be
incurred by the Company or its Subsidiaries pursuant to the terms of the
Indenture, whether involving the same or any other lender or creditor or group
of lenders or creditors, but only
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to the extent that (i) the Refinancing Indebtedness is subordinated to the Notes
or the Guarantees, as applicable, to at least the same extent as the
Indebtedness being refinanced, if at all, (ii) the Refinancing Indebtedness is
scheduled to mature either (a) no earlier than the Indebtedness being refinanced
or (b) after the maturity date of the Notes, (iii) except where such Refinancing
Indebtedness is Attributable Indebtedness, has a weighted average life to
maturity at the time such Refinancing Indebtedness is incurred that is equal to
or greater than the weighted average life to maturity of the Indebtedness being
refinanced, (iv) except where such Refinancing Indebtedness is Attributable
Indebtedness, such Refinancing Indebtedness is in an aggregate principal amount
that is less than or equal to the aggregate principal or accreted amount (in the
case of any Indebtedness issued with original issue discount, as such) then
outstanding under the Indebtedness being refinanced plus the amount of all fees
and expenses (including premiums and penalties) associated with such
refinancing), and (v) such Refinancing Indebtedness is incurred by the same
Person that initially incurred the Indebtedness being refinanced, except that
the Company or a Guarantor may incur Refinancing Indebtedness to refinance
Indebtedness of the Company or any Guarantor.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Payment" means any of the following: (i) the declaration or
payment of any dividend or any other distribution or payment on Equity Interests
of the Company or any Subsidiary thereof (including, without limitation, any
payment in connection with any merger or consolidation including the Company) or
any payment made to the direct or indirect holders (in their capacities as such)
of Equity Interests of the Company or any Subsidiary or Affiliate thereof (other
than (a) dividends or distributions payable solely in Equity Interests of the
Company (other than Disqualified Equity Interests) or in options, warrants, or
other rights to purchase Equity Interests of the Company (other than
Disqualified Equity Interests) or (b) dividends or distributions payable to the
Company or to a Wholly Owned Subsidiary of the Company), (ii) the purchase,
redemption, or other acquisition or retirement for value of any Equity Interests
of the Company or any Subsidiary or Affiliate thereof (other than Equity
Interests owned by the Company or a Wholly Owned Subsidiary, excluding
Disqualified Equity Interests), (iii) the making of any principal payment on, or
the purchase, defeasance, repurchase, redemption, or other acquisition or
retirement for value, prior to any scheduled maturity, scheduled repayment, or
scheduled sinking fund payment, of any Subordinated Indebtedness (except, if no
Default or Event of Default is continuing or would result therefrom, any such
payment, purchase, defeasance, repurchase, redemption, or other acquisition or
retirement for value made (a) out of Excess Proceeds available for general
corporate purposes if (1) such payment or other action is required by the
indenture or other agreement or instrument pursuant to which such Subordinated
Indebtedness was issued and (2) the Company has purchased all Notes and other
Senior Indebtedness properly tendered pursuant to an Asset Sale Offer required
under "-- Repurchase at the Option of Holders -- Asset Sales" or (b) upon the
occurrence of a Change of Control if (1) such payment or other action is
required by the indenture or other agreement or instrument pursuant to which
such Subordinated Indebtedness was issued and (2) the Company has purchased all
Notes and other Senior Indebtedness properly tendered pursuant to the Change of
Control Offer resulting from such Change of Control), or (iv) the making of any
Restricted Investment. For purposes of determining the amount expended for
Restricted Payments, cash distributed or invested shall be valued at the face
amount thereof and property other than cash shall be valued at its fair market
value.
"Sale and Lease-Back Transaction" means any arrangement with any Person
providing for the leasing by the Company or any Subsidiary of the Company of any
real or tangible personal property, which (i) property has been or is to be
sold, conveyed, or transferred by the Company or such Subsidiary to such Person
in contemplation of such leasing and (ii) constitutes an Asset Sale permitted
under "-- Repurchase at the Option of Holders -- Asset Sales."
"Senior Indebtedness" means Indebtedness of any Person which is not
Subordinated Indebtedness.
"Significant Subsidiary" shall have the meaning set forth in Rule 1-02 of
Regulation S-X promulgated by the Commission.
"Subordinated Indebtedness" means Indebtedness of the Company or any
Guarantor which is expressly subordinated in right of payment to the Notes or a
Guarantee, as the case may be.
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"Subsidiary" of any specified Person means any corporation, partnership,
joint venture, association, or other business entity, whether now existing or
hereafter organized or acquired, (i) in the case of a corporation, of which more
than 50% of the total voting power of the Equity Interests entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, officers, or trustees thereof is held by such first-named Person or
any of its Subsidiaries or (ii) in the case of a partnership, joint venture,
association, or other business entity, with respect to which such first-named
Person or any of its Subsidiaries has the power to direct or cause the direction
of the management and policies of such entity by contract or otherwise or if in
accordance with GAAP such entity is consolidated with the first-named Person for
financial statement purposes. Notwithstanding the foregoing, an Unrestricted
Subsidiary shall not be deemed a Subsidiary of the Company other than for
purposes of the definition of Unrestricted Subsidiary, unless the Company shall
have designated such Unrestricted Subsidiary as a "Subsidiary" by written notice
to the Trustee. An Unrestricted Subsidiary may be designated as a Subsidiary at
any time by the Company by written notice to the Trustee; provided, however,
that (i) no Default or Event of Default shall have occurred and be continuing or
would arise therefrom and (ii) if such Unrestricted Subsidiary is an obligor of
any Indebtedness, any such designation shall be deemed to be an incurrence as of
the date of such designation by the Company of such Indebtedness and immediately
after giving effect to such designation, the Company could incur $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to the
covenant described under "Limitation on Additional Indebtedness."
"Temporary Cash Investments" means (i) United States dollars, (ii) any
evidence of Indebtedness issued or directly and fully guaranteed or insured by
the United States government or any agency or instrumentality thereof (provided
the full faith and credit of the United States government is behind such
obligation) having maturities of not more than six months from the date of
acquisition, (iii) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, demand deposits,
bankers' acceptances with maturities not exceeding six months, and overnight
bank deposits, in each case with any domestic commercial bank that is a member
of the Federal Reserve System and having capital and surplus in excess of $500.0
million, or whose short-term debt has the highest rating obtainable from Moody's
Investors Service, Inc. ("Moody's") or Standard & Poor's Ratings Group ("S&P"),
(iv) any money market deposit account issued or offered by a domestic commercial
bank that is a member of the Federal Reserve System and having capital and
surplus in excess of $500.0 million, or whose short-term debt has the highest
rating obtainable from Moody's or S&P, (v) repurchase obligations with a term of
not more than seven days for underlying securities of the types described in
clauses (ii) and (iii) above entered into with any financial institution meeting
the qualifications specified in clause (iii) above, (vi) commercial paper having
the highest rating obtainable from Moody's or S&P, and in each case maturing
within 180 days after the date of acquisition, and (vii) investments in money
market funds having assets in excess of $500.0 million, consisting solely of
investments of the types described in (i) through (vi) above.
"Unrestricted Subsidiary" means any Subsidiary of the Company which shall
have been designated as an Unrestricted Subsidiary in accordance with the
Indenture. An Unrestricted Subsidiary may be designated as a Subsidiary at a
later date in the manner provided in the definition of "Subsidiary" above.
"Wholly Owned Subsidiary" means any Subsidiary, all of the outstanding
Equity Interests (except directors' qualifying shares or shares required to be
held by foreign nationals, in each case to the extent mandated by applicable
law) of which are owned, directly or indirectly, by the Company.
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CERTAIN INCOME TAX CONSIDERATIONS
The following is a summary of certain United States federal income tax
consequences resulting from the acquisition, ownership, and disposition of the
Exchange Notes which may be relevant to a holder acquiring one or more of such
Exchange Notes for cash at original issuance. The following summary is of a
general nature only and is not intended to be, and should not be construed to
be, legal or tax advice to any prospective investor and no representation with
respect to the tax consequences of any particular investor is made.
The legal conclusions expressed in this summary are based upon current
provisions of the Internal Revenue Code of 1986, as amended (the "Code"),
applicable Treasury regulations ("Regulations"), judicial authority, and
administrative rulings and practice, all as in effect as of the date of this
Prospectus, and all of which are subject to change, either prospectively or
retroactively. There can be no assurance that the Internal Revenue Service (the
"Service") will not take a contrary view, and no rulings from the Service have
been or will be sought with respect to any matter involving the tax aspects of
the purchase, ownership, or exchange or other disposition of the Exchange Notes.
Legislative, judicial, or administrative changes or interpretations may be
forthcoming that could alter or modify the statements and conclusions set forth
herein.
This summary deals only with persons who will hold the Exchange Notes as
capital assets within the meaning of Section 1221 of the Code, and does not
address tax considerations applicable to investors who may be subject to special
tax rules, such as financial institutions, tax-exempt organizations, insurance
companies, dealers in securities or currencies, persons who hold Exchange Notes
as part of a "hedge," "straddle" or "conversion transaction" for tax purposes,
and persons who have a "functional currency" other than the U.S. dollar.
In addition, the description generally does not consider the effect of any
applicable foreign, state, local, or other tax laws or estate or gift tax
considerations.
PERSONS CONSIDERING THE ACQUISITION OF THE EXCHANGE NOTES SHOULD CONSULT
THEIR OWN TAX ADVISORS CONCERNING THE APPLICATION OF U.S. FEDERAL INCOME TAX
LAWS, AS WELL AS THE LAWS OF ANY STATE, LOCAL, OR FOREIGN TAXING JURISDICTION,
TO THEIR PARTICULAR SITUATIONS AND THE POSSIBLE EFFECT OF CHANGES IN U.S.
FEDERAL OR OTHER TAX LAWS.
U.S. HOLDERS
The following discussion is limited to the United States federal income tax
consequences relevant to a holder of the Exchange Notes that is a U.S. Holder.
The term "U.S. Holder" refers to a person that is classified for U.S. federal
tax purposes as a U.S. person. For this purpose, a U.S. person includes (i) a
current or, in certain circumstances, former citizen or resident of the United
States, (ii) a corporation, limited liability company, partnership, or other
business entity created or organized under the laws of the United States or of
any state or political subdivision thereof (unless, in the case of a
partnership, the Treasury provides otherwise by Regulations), (iii) an estate
whose income is includable in gross income for U.S. federal income tax purposes
regardless of its source, (iv) a trust if (A) a U.S. court is able to exercise
primary supervision over the administration of the trust and (B) one or more
U.S. persons have authority to control all substantial decisions of the trust,
or (v) a person whose worldwide income or gain is otherwise subject to U.S.
federal income taxation on a net basis.
The Exchange Offer. Pursuant to recently finalized Regulations, the
exchange of Outstanding Notes for Exchange Notes pursuant to the Exchange Offer
should not constitute a significant modification of the terms of the Outstanding
Notes and, accordingly, such exchange should be treated as a "non-event" for
federal income tax purposes. Therefore, such exchange should have no federal
income tax consequences to U.S. Holders of Outstanding Notes who exchange such
notes for Exchange Notes, the holding period of an Exchange Note should include
the holding period of the Outstanding Note for which it was exchanged, the basis
of an Exchange Note should be the same as the basis of the Outstanding Note for
which it was exchanged, and each U.S. Holder of Exchange Notes should continue
to be required to include interest on the
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Outstanding Notes in its gross income in accordance with its method of
accounting for federal income tax purposes.
Payment of Interest. Stated interest on an Exchange Note generally will be
includable in the income of a U.S. Holder as ordinary income at the time such
interest is received or accrued, in accordance with such U.S. Holder's method of
accounting for United States federal income tax purposes. The Company is
obligated to pay additional interest amounts in the event of a Registration
Default (as defined). Under the Regulations, certain contingent payments on debt
instruments must be accrued into gross income by a holder (regardless of such
holder's method of accounting). However, any payment subject to a remote or
incidental contingency (i.e., there is a remote likelihood that the contingency
will occur or the potential amount of the contingent payment is insignificant
relative to the total expected amount of remaining payments) is not treated as a
contingent payment and is ignored until payment, if any, is actually made. The
Company intends to take the position that the additional interest payments
resulting from a Registration Default are subject to a remote or incidental
contingency. Accordingly, a U.S. Holder of a Note should report any additional
interest payments resulting from a Registration Default as ordinary income in
accordance with such holder's method of accounting for United States federal
income tax purposes.
Liquidated Damages. The Company intends to take the position that the
Liquidated Damages described above under "Description of the Exchange
Notes -- Registration Rights; Liquidated Damages" will be taxable to a U.S.
Holder as ordinary income in accordance with such holder's method of accounting
for federal income tax purposes. The Service, however, may take a different
position, which could affect the timing of both a U.S. Holder's income and the
Company's deduction with respect to such Liquidated Damages.
Original Issue Discount. If the Notes are not issued at a discount or are
deemed to be issued with no discount because such discount is de minimis, a U.S.
Holder will include in income as ordinary interest income the gross amount of
interest paid or payable in respect of the Notes as provided above in
"-- Payment of Interest." An original issue discount ("OID") will be considered
de minimis and, thus, will be treated as zero discount if the OID is less than
one-fourth ( 1/4) of one percent of the stated redemption price at maturity,
multiplied by the number of complete years to maturity. The Company expects that
the Notes will not have OID.
Market Discount. The resale of Notes may be affected by the "market
discount" provisions of the Code. For this purpose, the market discount on a
Note generally will be equal to the amount, if any, by which the stated
redemption price at maturity of the Note immediately after its acquisition
exceeds the U.S. Holder's tax basis in the Note. Subject to a de minimis
exception, these provisions generally require a U.S. Holder of a Note acquired
at a market discount to treat as ordinary income any gain recognized on the
disposition of such Note to the extent of the "accrued market discount" on such
Note at the time of disposition, unless the U.S. Holder elects to include
accrued market discount in income currently. In general, market discount on a
Note will be treated as accruing on a straight-line basis over the term of such
Note, or, at the election of the U.S. Holder, under a constant yield method. A
U.S. Holder of a Note acquired at a market discount who does not elect to
include accrued market discount in income currently may be required to defer the
deduction of a portion of the interest on any indebtedness incurred or
maintained to purchase or carry the Note until the Note is disposed of in a
taxable transaction.
The Registered Exchange Offer. Pursuant to Regulations, the exchange of
Outstanding Notes for Exchange Notes pursuant to the Registered Exchange Offer
should not constitute a significant modification of the terms of the Outstanding
Notes and, accordingly, such exchange should be treated as a "non-event" for
federal income tax purposes. Therefore, such exchange should have no federal
income tax consequences to U.S. Holders of Outstanding Notes, the holding period
of an Exchange Note should include the holding period of the Outstanding Note
for which it was exchanged, the basis of an Exchange Note should be the same as
the basis of the Outstanding Note for which it was exchanged, and each U.S.
Holder of Notes should continue to be required to include interest on the Notes
in its gross income in accordance with its method of accounting for federal
income tax purposes.
92
<PAGE> 100
Sale, Exchange, or Retirement of Notes. Upon the sale, exchange,
redemption, retirement, or other disposition of a Note, other than the exchange
of a Note for an Exchange Note (see "-- The Registered Exchange Offer" above), a
U.S. Holder of a Note generally will recognize gain or loss in an amount equal
to the difference between the amount of cash and the fair market value of any
property received on the sale, exchange, or retirement of the Note (other than
in respect of accrued and unpaid interest on the Note, which such amounts are
treated as ordinary interest income) and such U.S. Holder's adjusted tax basis
in the Note. Such gain or loss will be capital gain or loss, except to the
extent of any accrued market discount (see "-- Market Discount" above). The
Taxpayer Relief Act of 1997 made certain changes to the Code with respect to the
taxation of capital gains of noncorporate taxpayers. In general, the maximum tax
rate for noncorporate taxpayers on long-term capital gains is 20% with respect
to capital assets (including the Notes), but only if they have been held for
more than 18 months at the time of disposition. Gain realized by noncorporate
taxpayers on capital assets sold, having a holding period of more than one year
but not more than 18 months, is taxed as "mid-term" gain at a maximum 28% rate.
Backup Withholding and Information Reporting. In general, information
reporting requirements will apply to interest payments on the Notes made to U.S.
Holders other than certain exempt recipients (such as corporations) and to
proceeds realized by such U.S. Holders on dispositions of Notes. A 31% backup
withholding tax will apply to such amounts if the U.S. Holder (i) fails to
furnish its taxpayer identification number ("TIN"), which, for an individual, is
generally his social security number, within a reasonable time after request
therefor, (ii) furnishes an incorrect TIN, (iii) fails to report properly
interest or dividend income, or (iv) fails, under certain circumstances, to
provide a certified statement, signed under penalty of perjury, that the TIN
provided is its correct number and that it is not subject to backup withholding.
A U.S. Holder's failure to provide a correct TIN may also subject the holder to
Service penalties. The Company will also institute backup withholding if
instructed to do so by the Service. Any amount withheld from a payment to a U.S.
Holder under the backup withholding rules is allowable as a credit against such
U.S. Holder's federal income tax liability or may be refunded, provided that the
requisite procedures are followed. U.S. Holders of Notes should consult their
tax advisors as to their qualification for exemption from backup withholding and
the procedure for obtaining such an exemption.
NON-U.S. HOLDERS
This Section summarizes certain U.S. federal tax consequences of the
ownership and disposition of Notes by "Non-U.S. Holders." The term "Non-U.S.
Holder" refers to a person that is not classified for U.S. federal tax purposes
as a "United States person," as defined in "-- U.S. Holders" above.
Interest on Notes. In general, a Non-U.S. Holder will not be subject to
U.S. federal income tax or regular withholding tax with respect to interest
received or accrued on the Notes so long as (a) such interest is not effectively
connected with the conduct of a trade or business within the United States (or,
if an income tax treaty applies, is attributable to a United States permanent
establishment) of the Non-U.S. Holder, (b) the Non-U.S. Holder does not actually
or constructively own 10% or more of the total combined voting power of all
classes of stock of the Company entitled to vote, (c) the Non-U.S. Holder is not
(A) controlled by a foreign corporation for U.S. federal income tax purposes
that is related to the Company actually or constructively through stock
ownership, or (B) a bank that received the Note on an extension of credit made
pursuant to a loan agreement entered into in the ordinary course of its trade or
business and (d) either (i) the beneficial owner of the Note certifies to the
Company or its agent, under penalties of perjury, that it is not a U.S. Holder
and provides its name and address on U.S. Treasury Form W-8 (or on a suitable
substitute form) or (ii) the Note is held by a securities clearing organization,
bank, or other financial institution that holds customers' securities in the
ordinary course of its trade or business (a "financial institution") on behalf
of such Non-U.S. Holder and such financial institution certifies under penalties
of perjury that such a Form W-8 (or suitable substitute form) has been received
from the beneficial owner by it or by a financial institution between it and the
beneficial owner and furnishes the payor with a copy thereof. Except as provided
in the following paragraph, a Non-U.S. Holder that cannot satisfy the foregoing
requirements will be subject to U.S. federal income tax withholding at a rate of
30% (or lower treaty rate).
93
<PAGE> 101
If interest received on the Notes by a Non-U.S. Holder is effectively
connected to the conduct by such Non-U.S. Holder of a trade or business within
the United States (or, if an income tax treaty applies, is attributable to a
United States permanent establishment of the Non-U.S. Holder), such interest
will be subject to U.S. federal income tax on a net basis at the rates
applicable to U.S. persons generally (and, with respect to corporate Non-U.S.
Holders under certain circumstances, may also be subject to a 30% branch profits
tax). If payments are subject to U.S. federal income tax on a net basis in
accordance with the rules described in the preceding sentence, such payments
will not be subject to U.S. withholding tax so long as the Non-U.S. Holder
provides the Company or its paying agent with a properly executed Form 4224.
Gain on Disposition of Notes. Non-U.S. Holders generally will not be
subject to U.S. federal income taxation on gain recognized on a disposition of
Notes so long as (i) the gain is not effectively connected with the conduct by
the Non-U.S. Holder of a trade or business within the United States (or, if an
income tax treaty applies, is attributable to a United States permanent
establishment of the Non-U.S. Holder) and (ii) in the case of a Non-U.S. Holder
who is an individual, either such Non-U.S. Holder is not present in the United
States for 183 days or more in the taxable year of disposition or such Non-U.S.
Holder does not have a "tax home" (within the meaning of section 911(d)(3) of
the Code) in the United States.
U.S. Estate Tax. Notes owned or treated as owned by an individual who is
not a citizen or resident (as specially defined for U.S. federal estate tax
purposes) of the United States at the time of death ("Nonresident Decedent")
will not be includable in the Nonresident Decedent's gross estate for U.S.
federal estate tax purposes as a result of the Nonresident Decedent's death,
provided that, at the time of death, the Nonresident Decedent does not own,
actually or constructively, 10% or more of the total combined voting power of
all classes of stock of the Company and payments with respect to such Notes
would not have been effectively connected with the conduct of a trade or
business in the United States by the Nonresident Decedent. A Nonresident
Decedent's estate may be subject to U.S. federal estate tax on property
includable in the estate for U.S. federal estate tax purposes.
U.S. Information Reporting Requirements and Backup Withholding. Generally,
payments of interest, OID, premium or principal on the Notes to Non-U.S. Holders
will not be subject to information reporting or backup withholding if the
Non-U.S. Holder complies with the certification requirements set forth in clause
(d) under "-- Interest on Notes" above.
Non-U.S. Holders will not be subject to information reporting or backup
withholding with respect to the payment of proceeds from the disposition of
Notes, effected by, to or through the foreign office of a broker; provided,
however, that if the broker is a U.S. person or a U.S.-related person,
information reporting will apply unless the broker has documentary evidence in
its records as to the Non-U.S. Holder's foreign status (and has not actual
knowledge to the contrary), or the Non-U.S. Holder certifies as to its non-U.S.
status under penalty of perjury or otherwise establishes an exemption. Backup
withholding will not apply to payments made through a foreign office of a broker
that is a U.S. person or a U.S. related person (absent actual knowledge that the
payee is a U.S. person). For these purposes, a "U.S. related person" is (i) a
controlled foreign corporation for U.S. federal income tax purposes or (ii) a
foreign person 50% or more of whose gross income from all sources for the
three-year period ending with the close of its taxable year preceding the
payment (or for such part of the period that the broker has been in existence)
is derived from the activities that are effectively connected with the conduct
of a U.S. trade or business.
The payment of the proceeds from the disposition of a Note to or through
the U.S. office of any U.S. or foreign broker will be subject to information
reporting and possibly backup withholding unless the Non-U.S. Holder of the Note
certifies as to its foreign status under penalties of perjury or otherwise
establishes an exemption, provided that the broker does not have actual
knowledge that the Non-U.S. Holder is a U.S. person or that the conditions of
any other exemption are not, in fact, satisfied. The payment of the proceeds
from the disposition of a Note to or through a non-U.S. office of a non-U.S.
broker that is not a U.S. related person will not be subject to information or
backup withholding.
Amounts withheld under the backup withholding rules do not constitute a
separate U.S. federal income tax. Rather, amounts withheld under the backup
withholding rules from a payments to a Non-U.S. Holder will be allowed as a
credit against such Non-U.S. Holder's U.S. federal income tax liability, if any,
and any
94
<PAGE> 102
amounts withheld in excess of such Non-U.S. Holder's U.S. federal income tax
liability will be refunded, provided that the requisite procedures are followed.
Prospective Final Regulations. On October 6, 1997, new Regulations ("New
Regulations") were issued that modify the requirements imposed on a Non-U.S.
Holder and certain intermediaries for establishing the recipient's status as a
Non-U.S. Holder eligible for exception from or reduction in U.S. withholding tax
and backup withholding described above. The New Regulations generally are
effective for payments made after December 31, 1998, subject to certain
transition rules. (However, new Temporary Regulations, effective for payments
made after December 31, 1997, require some Non-U.S. Holders to satisfy certain
residency requirements when claiming the benefits of an applicable income tax
treaty.) In general, the New Regulations do not significantly alter the
substantive withholding and information reporting requirements but rather unify
current certification procedures and forms and clarify reliance standards. In
addition the New Regulations impose more stringent conditions on the ability of
financial intermediaries acting for Non-U.S. Holders to provide certifications
on behalf of Non-U.S. Holders, which may include entering into an agreement with
the Service to audit certain documentation with respect to such certifications.
Non-U.S. Holders should consult their own tax advisors to determine the effects
of the application of the New Regulations to their particular circumstances.
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Notes for its own account
pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Notes. The Prospectus,
as it may be amended or supplemented from time to time, may be used by a
broker-dealer in connection with resales of Exchange Notes received in exchange
for Outstanding Notes where such Outstanding Notes were acquired as a result of
market-making activities or other trading activities. The Company has agreed
that, for a period of 180 days after the Expiration Date, it will make this
Prospectus, as amended or supplemented, available to any broker-dealer for use
in connection with such resale. In addition, until 25 days after the Expiration
Date, all dealers effecting transactions in the Exchange Notes may be required
to deliver a prospectus.
The Company will not receive any proceeds from any sale of Exchange Notes
by broker-dealers. Exchange Notes received by broker-dealers for their own
account pursuant to the Exchange Offer may be sold from time to time in one or
more transactions in the over-the-counter market, in negotiated transactions,
through the writing of options on the Exchange Notes or a combination of such
methods of resale, at market prices prevailing at the time of resale, at prices
related to such prevailing market prices or negotiated prices. Any such resale
may be made directly to purchasers or to or through brokers or dealers who may
receive compensation in the form of commissions or concessions from any such
broker-dealer or the purchasers of any such Exchange Notes. Any broker-dealer
that resells Exchange Notes that were received by it for its own account
pursuant to the Exchange Offer and any broker or dealer that participates in a
distribution of such Exchange Notes may be deemed to be an "underwriter" within
the meaning of the Securities Act and any profit on any such resale of Exchange
Notes and any commission or concessions received by any such persons may be
deemed to be underwriting compensation under the Securities Act. The Letter of
Transmittal states that, by acknowledging that it will deliver and by delivering
a Prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
For a period of 180 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Exchange Offer (including the expenses of one counsel for the
Holders of the Notes) other than commissions or concessions of any brokers or
dealers and will indemnify the Holders of the Notes (including any broker-
dealers) against certain liabilities, including liabilities under the Securities
Act.
95
<PAGE> 103
LEGAL MATTERS
Certain legal matters will be passed on for the Company by O'Connor,
Cavanagh, Anderson, Killingsworth & Beshears, a professional association,
Phoenix, Arizona.
EXPERTS
The consolidated financial statements of the Company as of June 30, 1996
and 1997 and for each of the three years in the period ended June 30, 1997
incorporated by reference into this Prospectus, have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their reports with
respect thereto, and are incorporated by reference upon the authority of such
firm as experts in auditing and accounting in giving said reports.
96
<PAGE> 104
RURAL/METRO CORPORATION
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Report of Independent Public Accountants.................... F-2
Consolidated Financial Statements
Consolidated Balance Sheets as of June 30, 1996 and
1997................................................... F-3
Consolidated Statements of Income for the years ended June
30, 1995, 1996 and 1997................................ F-4
Consolidated Statements of Changes in Stockholders' Equity
for the years ended June 30, 1995, 1996 and 1997....... F-5
Consolidated Statements of Cash Flows for the years ended
June 30, 1995, 1996 and 1997........................... F-6
Notes to Consolidated Financial Statements................ F-7
Consolidated Balance Sheets as of June 30, 1997 and
December 31, 1997 (unaudited).......................... F-20
Consolidated Statements of Income (unaudited) for the
three and six months ended December 31, 1996 and
1997................................................... F-21
Consolidated Statements of Cash Flows (unaudited) for the
six months ended December 31, 1996 and 1997............ F-22
Notes to Consolidated Financial Statements (unaudited).... F-23
</TABLE>
F-1
<PAGE> 105
ARTHUR ANDERSEN LLP
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To Rural/Metro Corporation:
We have audited the accompanying consolidated balance sheets of RURAL/METRO
CORPORATION (a Delaware corporation) and subsidiaries as of June 30, 1996 and
1997, and the related consolidated statements of income, changes in
stockholders' equity and cash flows for each of the three years in the period
ended June 30, 1997. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Rural/Metro Corporation and
subsidiaries as of June 30, 1996 and 1997, and the results of their operations
and their cash flows for each of the three years in the period ended June 30,
1997, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Phoenix, Arizona,
August 21, 1997.
F-2
<PAGE> 106
RURAL/METRO CORPORATION
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1996 AND 1997
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
1996 1997
-------- --------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash...................................................... $ 1,388 $ 3,398
Accounts receivable, net of allowance for doubtful
accounts of $26,571 and $35,814, respectively (Notes 1
and 4)................................................. 68,642 106,978
Inventories (Note 1)...................................... 5,170 8,645
Prepaid expenses and other................................ 5,710 7,162
-------- --------
Total current assets.............................. 80,910 126,183
PROPERTY AND EQUIPMENT, net (Notes 1 and 3)................. 48,401 70,645
INTANGIBLE ASSETS, net (Notes 1 and 2)...................... 96,373 160,282
OTHER ASSETS................................................ 4,430 6,956
-------- --------
$230,114 $364,066
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable.......................................... $ 4,092 $ 4,359
Accrued liabilities (Note 1).............................. 14,806 17,244
Current portion of long-term debt (Notes 3 and 4)......... 6,610 9,814
-------- --------
Total current liabilities......................... 25,508 31,417
LONG-TERM DEBT, net of current portion (Notes 3 and 4)...... 60,731 144,643
NON-REFUNDABLE SUBSCRIPTION INCOME.......................... 12,582 13,367
DEFERRED INCOME TAXES (Note 9).............................. 9,060 10,772
OTHER LIABILITIES........................................... 2,267 4,059
-------- --------
Total liabilities................................. 110,148 204,258
-------- --------
COMMITMENTS AND CONTINGENCIES (Note 5)
STOCKHOLDERS' EQUITY (Notes 2, 6 and 7)
Preferred stock, $.01 par value, 2,000,000 shares
authorized, none issued at June 30, 1996 and 1997...... -- --
Common stock, $.01 par value, 23,000,000 shares
authorized; 11,092,736 and 12,770,147 shares
outstanding at June 30, 1996 and 1997, respectively.... 113 130
Additional paid-in capital................................ 92,359 121,355
Retained earnings......................................... 30,181 40,334
Deferred compensation..................................... (1,448) (772)
Treasury stock, at cost, 149,456 shares at June 30, 1996
and 1997............................................... (1,239) (1,239)
-------- --------
Total stockholders' equity........................ 119,966 159,808
-------- --------
$230,114 $364,066
======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated balance
sheets.
F-3
<PAGE> 107
RURAL/METRO CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED JUNE 30, 1995, 1996 AND 1997
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
1995 1996 1997
-------- -------- --------
<S> <C> <C> <C>
REVENUE
Ambulance services....................................... $127,461 $197,201 $257,488
Fire protection services................................. 32,274 38,770 42,163
Other.................................................... 11,848 14,292 20,154
-------- -------- --------
Total revenue.................................... 171,583 250,263 319,805
-------- -------- --------
OPERATING EXPENSES
Payroll and employee benefits............................ 90,843 135,464 170,833
Provision for doubtful accounts.......................... 22,263 31,036 43,424
Depreciation............................................. 6,654 9,778 12,136
Amortization of intangible assets........................ 2,074 3,569 4,660
Other operating expenses................................. 33,809 45,752 54,922
Loss contract/restructuring charge (Note 1).............. -- -- 6,026
-------- -------- --------
Total expenses................................... 155,643 225,599 292,001
-------- -------- --------
OPERATING INCOME........................................... 15,940 24,664 27,804
INTEREST EXPENSE, net (Note 4)............................. 3,059 5,108 5,720
-------- -------- --------
INCOME BEFORE INCOME TAXES AND EXTRAORDINARY ITEM.......... 12,881 19,556 22,084
PROVISION FOR INCOME TAXES (Note 9)........................ 5,288 8,044 9,364
-------- -------- --------
INCOME BEFORE EXTRAORDINARY ITEM........................... 7,593 11,512 12,720
EXTRAORDINARY ITEM (Note 4)
Loss on early extinguishment of debt (net of tax effect
of $480).............................................. 693 -- --
-------- -------- --------
NET INCOME................................................. $ 6,900 $ 11,512 $ 12,720
======== ======== ========
BASIC EARNINGS PER SHARE
Income before extraordinary item......................... $ 0.96 $ 1.20 $ 1.10
Extraordinary item....................................... (0.09) -- --
-------- -------- --------
Net income....................................... $ 0.87 $ 1.20 $ 1.10
======== ======== ========
DILUTED EARNINGS PER SHARE (Note 1)
Income before extraordinary item......................... $ 0.92 $ 1.14 $ 1.04
Extraordinary item....................................... (0.08) -- --
-------- -------- --------
Net income....................................... $ 0.84 $ 1.14 $ 1.04
======== ======== ========
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING -- BASIC..... 7,924 9,570 11,585
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING -- DILUTED... 8,249 10,075 12,271
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-4
<PAGE> 108
RURAL/METRO CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED JUNE 30, 1995, 1996 AND 1997
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
ADDITIONAL
PREFERRED COMMON PAID-IN RETAINED DEFERRED TREASURY
STOCK STOCK CAPITAL EARNINGS COMPENSATION STOCK TOTAL
--------- ------ ---------- -------- ------------ -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, June 30, 1994.................. $ -- $ 78 $ 43,415 $ 6,885 $(1,790) $(1,239) $ 47,349
Issuance of 507,692 shares of common
stock for pooling-of-interests (Note
2).................................. -- 5 27 2,127 -- -- 2,159
---- ---- -------- ------- ------- ------- --------
BALANCE, June 30, 1994 as restated for
effect of pooling-of-interests........ -- 83 43,442 9,012 (1,790) (1,239) 49,508
Issuance of 682,331 shares of common
stock............................... -- 7 8,613 -- (205) -- 8,415
Tax benefit related to the exercise
and vesting of nonqualified stock
options and stock grants............ -- -- 376 -- -- -- 376
Amortization of deferred
compensation........................ -- -- -- -- 449 -- 449
Net income............................ -- -- -- 6,900 -- -- 6,900
---- ---- -------- ------- ------- ------- --------
BALANCE, June 30, 1995.................. -- 90 52,431 15,912 (1,546) (1,239) 65,648
Issuance of 657,329 shares of common
stock for pooling-of-interests (Note
2).................................. -- 7 151 2,757 -- -- 2,915
---- ---- -------- ------- ------- ------- --------
BALANCE, June 30, 1995 as restated for
effect of pooling-of-interests........ -- 97 52,582 18,669 (1,546) (1,239) 68,563
Issuance of 1,657,512 shares of common
stock net of offering costs of
$2,506.............................. -- 16 38,795 -- (535) -- 38,276
Tax benefit related to the exercise
and vesting of nonqualified stock
options and stock grants............ -- -- 982 -- -- -- 982
Amortization of deferred
compensation........................ -- -- -- -- 633 -- 633
Net income............................ -- -- -- 11,512 -- -- 11,512
---- ---- -------- ------- ------- ------- --------
BALANCE, June 30, 1996.................. -- 113 92,359 30,181 (1,448) (1,239) 119,966
Issuance of 361,970 shares of common
stock for pooling-of-interests (Note
2).................................. -- 4 -- (2,567) -- -- (2,563)
---- ---- -------- ------- ------- ------- --------
BALANCE, June 30, 1996 as restated for
effect of pooling-of-interests........ -- 117 92,359 27,614 (1,448) (1,239) 117,403
Issuance of 1,315,441 shares of common
stock............................... -- 13 24,129 -- -- -- 24,142
Tax benefit related to the exercise
and vesting of nonqualified stock
options and stock grants............ -- -- 4,867 -- -- -- 4,867
Amortization of deferred
compensation........................ -- -- -- -- 676 -- 676
Net income............................ -- -- -- 12,720 -- -- 12,720
---- ---- -------- ------- ------- ------- --------
BALANCE, June 30, 1997.................. $ -- $130 $121,355 $40,334 $ (772) $(1,239) $159,808
==== ==== ======== ======= ======= ======= ========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-5
<PAGE> 109
RURAL/METRO CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED JUNE 30, 1995, 1996 AND 1997
(IN THOUSANDS)
<TABLE>
<CAPTION>
1995 1996 1997
-------- -------- --------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income............................................... $ 6,900 $ 11,512 $ 12,720
Adjustments to reconcile net income to net cash provided
by (used in) operating activities
Extraordinary item.................................... 693 -- --
Depreciation and amortization......................... 8,728 13,347 16,796
Amortization of deferred compensation................. 449 633 676
Amortization of gain on sale of real estate........... (103) (103) (103)
Provision for doubtful accounts....................... 22,263 31,036 43,424
Changes in assets and liabilities, net of effect of
businesses acquired
Increase in accounts receivable....................... (31,369) (52,474) (75,352)
Increase in inventories............................... (996) (1,684) (2,651)
Increase in prepaid expenses and other................ (273) (2,937) (1,867)
Increase (decrease) in accounts payable............... 1,946 (1,653) (1,255)
Increase (decrease) in accrued liabilities............ (1,586) 1,334 (4,380)
Increase in non-refundable subscription income........ 931 788 124
Increase in deferred income taxes..................... 966 1,580 806
-------- -------- --------
Net cash provided by (used in) operating
activities..................................... 8,549 1,379 (11,062)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowings on revolving credit facility, net............. 34,900 15,100 86,000
Repayment of debt and capital lease obligations.......... (10,784) (20,346) (21,328)
Borrowings of debt....................................... 2,702 2,016 --
Issuance of common stock................................. 998 38,048 10,310
-------- -------- --------
Net cash provided by financing activities........ 27,816 34,818 74,982
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Cash paid for businesses acquired (Note 2)............... (32,914) (17,164) (35,512)
Capital expenditures..................................... (11,474) (18,237) (23,872)
Increase in other assets................................. (926) (308) (2,526)
-------- -------- --------
Net cash used in investing activities............ (45,314) (35,709) (61,910)
-------- -------- --------
INCREASE (DECREASE) IN CASH................................ (8,949) 488 2,010
CASH, beginning of year.................................... 9,849 900 1,388
-------- -------- --------
CASH, end of year.......................................... $ 900 $ 1,388 $ 3,398
======== ======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-6
<PAGE> 110
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES
NATURE OF BUSINESS AND OPERATIONS
Rural/Metro Corporation, a Delaware corporation, and its subsidiaries
(collectively, the Company) is a diversified emergency services company
providing ambulance transport services, fire protection and training services,
and home health care services and equipment in 21 states, Canada and Latin
America. The Company provides "911" emergency and general transport ambulance
services to patients on both a fee-for-service basis and a non-refundable
subscription fee basis. Fire protection services are provided either under
contracts with municipalities or fire districts, or on a non-refundable
subscription fee basis to individual homeowners or commercial property owners.
The Company depends on certain contracts with municipalities or fire
districts to provide "911" emergency ambulance services and fire protection
services. The five largest contracts accounted for 30%, 22%, and 18% of total
revenue for the fiscal years ended June 30, 1995, 1996 and 1997, respectively,
with the largest of the five contracts accounting for 9%, 7%, and 5%,
respectively, of total revenue for the same periods. These contracts are subject
to requests for proposals, competitive bid processes or renegotiation upon
expiration and may be subject to termination for failure to meet performance
criteria.
PRINCIPLES OF CONSOLIDATION
The financial statements include the accounts of Rural/Metro Corporation
and its subsidiaries. All significant intercompany accounts and transactions
have been eliminated in consolidation.
REVENUE RECOGNITION
Ambulance service fees are recorded net of Medicare, Medicaid and other
reimbursement limitations and recognized when services are provided. During the
years ended June 30 1995, 1996 and 1997, the Company derived approximately 33%,
27% and 26%, respectively, of its net ambulance fee collections from Medicare
and 12%, 11% and 10%, respectively, from Medicaid. Provision for doubtful
accounts is recorded for the expected difference between net ambulance service
fees and amounts actually collected. The continuing efforts of third party
payors to control expenditures for health care could affect the revenue, cash
flows and profitability of the Company.
During August 1997, President Clinton signed the "Balanced Budget Act of
1997" (the Act). The Act provides for certain changes to the Medicare
reimbursement system. These changes include, among other things, the creation of
a Medicare Payment Advisory Commission to review payment policies and health
care delivery, and make recommendations to Congress concerning such payment
policies.
In addition, the Act provides for the development and implementation of a
prospective fee schedule, by January 2000, for ambulance services. The Act
mandates that this fee schedule be developed through a negotiated rulemaking
process and must consider the following: (i) data from industry and other
organizations involved in the delivery of ambulance services, (ii) mechanisms to
control increases in expenditures for ambulance services, (iii) appropriate
regional and operational differences, (iv) adjustments to payment rates to
account for inflation and other relevant factors, and (v) the phase-in of
payment rates under the fee schedule in an efficient and fair manner. Medicare
reimbursement for ambulance services provided during calendar years 1998 and
1999 will be increased by the Consumer Price Index (CPI) less one percentage
point.
The Act also stipulates that individual states may now elect to no longer
provide payment for Medicare cost-sharing for coinsurance, or copayments, for
Medicaid beneficiaries. The Act also extended Medicare coverage for certain
paramedic services provided in rural areas.
Due to the uncertainty associated with the negotiation and subsequent
outcome of the prospective fee schedule, the Company is unable to predict the
ultimate impact of the Act. However, future impact of the
F-7
<PAGE> 111
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
Act, together with the financial instability of private third-party payors,
budget pressures on payor sources and cost shifting by government, could
influence the timing and, potentially, the ultimate receipt of reimbursements.
Revenue generated under fire protection service contracts is recognized
over the life of the contract. Subscription fees received in advance are
deferred and recognized over the term of the subscription agreement, generally
one year.
Other revenue is comprised primarily of fees associated with alternative
transportation services and home health care services and is recognized when the
services are provided.
EARNINGS PER SHARE
In February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards (SFAS) No. 128, "Earnings Per Share", which
supersedes Accounting Principles Board (APB) Opinion No. 15, the existing
authoritative guidance. The statement modifies the calculation of primary and
fully diluted EPS and replaces them with basic and diluted EPS. SFAS No. 128 is
effective for financial statements for both interim and annual periods presented
after December 15, 1997 and as a result, all prior period earnings per share
(EPS) data presented has been restated.
A reconciliation of the numerators (income before extraordinary item) and
denominators (weighted average number of shares outstanding) of the basic and
diluted EPS computations before extraordinary item for the years ended June 30,
1995, 1996 and 1997 is as follows (in thousands, except per share amounts):
<TABLE>
<CAPTION>
1995 1996 1997
--------------------------------------- --------------------------------------- -----------
INCOME SHARES PER SHARE INCOME SHARES PER SHARE INCOME
(NUMERATOR) (DENOMINATOR) AMOUNT (NUMERATOR) (DENOMINATOR) AMOUNT (NUMERATOR)
<S> <C> <C> <C> <C> <C> <C> <C>
Basic EPS............ $7,593 7,924 $0.96 $11,512 9,570 $1.20 $12,720
===== =====
Effect of stock
options............ -- 325 -- 505 --
------ ----- ------- ------ -------
Diluted EPS.......... $7,593 8,249 $0.92 $11,512 10,075 $1.14 $12,720
====== ===== ===== ======= ====== ===== =======
<CAPTION>
1997
-------------------------
SHARES PER SHARE
(DENOMINATOR) AMOUNT
<S> <C> <C>
Basic EPS............ 11,585 $1.10
=====
Effect of stock
options............ 686
------
Diluted EPS.......... 12,271 $1.04
====== =====
</TABLE>
INVENTORIES
Inventories, consisting of ambulance, fire and home health care supplies,
are stated at the lower of cost, on a first-in, first-out basis, or market.
PROPERTY AND EQUIPMENT
Property and equipment is stated at cost, net of accumulated depreciation,
and is depreciated over the estimated useful lives using the straight-line
method. Equipment and vehicles are depreciated over three to ten years and
buildings are depreciated over fifteen to thirty years. Property and equipment
held under capital leases is stated at the present value of minimum lease
payments, net of accumulated amortization. These assets are amortized over the
lesser of the lease term or the estimated useful life of the underlying assets
using the straight-line method. Major additions and improvements are
capitalized; maintenance and repairs which do not improve or significantly
extend the life of assets are expensed as incurred.
INTANGIBLE ASSETS
Intangible assets include costs in excess of the fair value of net assets
of businesses acquired of $95,827,000 and $159,949,000 and covenants not to
compete of $546,000 and $333,000 at June 30, 1996 and 1997, respectively. Costs
in excess of the fair value of net assets acquired are amortized over
twenty-five to thirty-five years using the straight-line method. Covenants not
to compete are amortized using the straight-
F-8
<PAGE> 112
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
line method over the term of the related agreements, generally three to five
years. Accumulated amortization of these intangible assets was $6,092,000 and
$10,318,000 at June 30, 1996 and 1997, respectively.
ACCRUED LIABILITIES
Included in accrued liabilities is $6,450,000 and $7,556,000 for salaries,
wages and related payroll expenses and $1,618,000 and $1,679,000 for accrued
insurance premiums at June 30, 1996 and 1997, respectively.
LOSS CONTRACT/RESTRUCTURING CHARGE
During the year ended June 30, 1997 the Company recorded a pre-tax charge
of $6.0 million. Included in this amount was an allowance of $3.2 million
related to an unprofitable ambulance service contract of which $2.0 million of
the allowance remains at June 30, 1997. Also included was a pre-tax
restructuring charge of $2.8 million relating to the integration of ambulance
company acquisitions. The charge consists primarily of severance costs and other
costs related to the elimination of redundant functions. Management expects the
integration to be completed during fiscal 1998. The entire $2.8 million
allowance remains at June 30, 1997. Both allowances are included in accrued
liabilities on the accompanying consolidated balance sheets.
CONCENTRATIONS OF CREDIT RISK
Financial instruments which potentially subject the Company to
concentrations of credit risk consist principally of cash equivalents and
accounts receivable. The Company places its cash equivalents with
federally-insured institutions and limits the amount of credit exposure to any
one institution. Concentrations of credit risk with respect to accounts
receivable are limited due to the large number of customers comprising the
Company's credit base and the geographical dispersion of the customers.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the reporting
period. Actual results could differ from those estimates.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The estimated fair value of financial instruments has been determined by
the Company using available market information and valuation methodologies.
Considerable judgment is required in interpreting market data to develop the
estimates of fair value. Accordingly, the estimates may not be indicative of the
amounts that the Company could realize in a current market exchange. The use of
different market assumptions or valuation methodologies could have a material
effect on the estimated fair value assumptions. The carrying values of cash,
accounts receivable, accounts payable, accrued liabilities and other liabilities
approximate fair value due to the short-term maturities of these instruments.
The revolving line of credit approximates fair value as it bears interest at a
rate indexed to LIBOR. The note payable and capital lease obligations
approximate fair value as rates on these instruments, in the aggregate,
approximate market rates currently available for instruments with similar terms
and remaining maturities.
(2) ACQUISITIONS
The Company acquired the operations of eighteen companies during the year
ended June 30, 1996 and the operations of nineteen companies during the year
ended June 30, 1997. Fifteen of the acquisitions completed in the year ended
June 30, 1996 were accounted for as purchases in accordance with APB Opinion
F-9
<PAGE> 113
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
No. 16. Three acquisitions were accounted for as poolings-of-interests and were
not considered significant; accordingly, prior year financial statements have
not been restated. Seventeen of the acquisitions completed during the year ended
June 30, 1997 were accounted for as purchases in accordance with APB Opinion No.
16 and, accordingly, the purchased assets and assumed liabilities were recorded
at their estimated fair values at each respective acquisition date. Two
acquisitions were accounted for as a poolings-of-interests in accordance with
APB Opinion No. 16. The acquisitions accounted for as poolings-of-interests were
not considered significant; accordingly, prior year financial statements have
not been restated. Adjustments, if any, to the purchase price allocations are
not expected to have a material impact on the accompanying consolidated
financial statements.
The aggregate purchase price of the operations accounted for as purchases
in each year ended June 30 consisted of the following:
<TABLE>
<CAPTION>
1996 1997
------- -------
(IN THOUSANDS)
<S> <C> <C>
Cash..................................................... $17,164 $35,512
Common stock............................................. 1,212 18,699
Notes payable to sellers................................. 4,673 4,477
Assumption of liabilities................................ 8,221 23,915
------- -------
Total.......................................... $31,270 $82,603
======= =======
</TABLE>
The Company issued 657,329 and 361,970 shares of its common stock in
connection with the pooling-of-interests transactions completed during the years
ended June 30, 1996 and 1997, respectively.
The fair value of the assets purchased has been allocated as follows:
<TABLE>
<CAPTION>
1996 1997
------- -------
(IN THOUSANDS)
<S> <C> <C>
Property and equipment................................... $ 3,330 $ 8,629
Intangible assets........................................ 25,752 67,423
Other assets............................................. 2,188 6,551
------- -------
Total.......................................... $31,270 $82,603
======= =======
</TABLE>
The following consolidated pro forma financial information was prepared
assuming that each acquisition had occurred as of the beginning of each fiscal
year. This pro forma information does not necessarily reflect the results of
operations that would have occurred had the acquisitions taken place at the
beginning of each fiscal year and is not necessarily indicative of results that
may be obtained in the future (unaudited):
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
--------------------------
1996 1997
----------- -----------
(IN THOUSANDS, EXCEPT PER
SHARE AMOUNTS)
<S> <C> <C>
Revenue................................................ $348,539 $375,511
Net income............................................. $ 16,164 $ 15,070
Earnings per share..................................... $ 1.38 $ 1.13
</TABLE>
Subsequent to June 30, 1997 the Company purchased either all the issued and
outstanding stock or certain assets of four ambulance service providers with
operations in Alabama, Georgia, Mississippi, New Jersey, New York and Tennessee.
The combined purchase price of the operations accounted for as purchases was
$6.1 million. The Company paid cash of $3.7 million, issued notes payable to
sellers of $1.2 million and assumed $1.2 million of liabilities. The Company
issued 641,009 shares related to two of the acquisitions which were recorded as
pooling-of-interests transactions.
F-10
<PAGE> 114
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(3) PROPERTY AND EQUIPMENT
Property and equipment, including equipment held under capital leases,
consisted of the following:
<TABLE>
<CAPTION>
JUNE 30,
--------------------
1996 1997
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Equipment.............................................. $ 30,455 $ 37,040
Vehicles............................................... 42,596 57,312
Land and buildings..................................... 9,786 13,736
Leasehold improvements................................. 2,612 5,546
-------- --------
85,449 113,634
Less: Accumulated depreciation......................... (37,048) (42,989)
-------- --------
$ 48,401 $ 70,645
======== ========
</TABLE>
The Company acquired equipment of $3,603,000 and $2,698,000 under capital
lease and other financing agreements during the years ended June 30, 1995 and
1996, respectively. No equipment was acquired under capital lease or other
financing agreements during the year ended June 30, 1997.
The Company held vehicles and equipment with a net carrying value of
$7,528,000 and $7,748,000 at June 30, 1996 and 1997, respectively, under capital
lease agreements. Accumulated depreciation on these assets totaled 6,823,000 and
8,367,000 at June 30, 1996 and 1997, respectively.
(4) CREDIT AGREEMENTS AND BORROWINGS
Notes payable and capital lease obligations consisted of the following:
<TABLE>
<CAPTION>
JUNE 30,
-------------------
1996 1997
------- --------
(IN THOUSANDS)
<S> <C> <C>
Revolving credit facility............................... $49,500 $134,000
Unsecured promissory notes payable from acquisitions at
varying rates, from 7.0% to 9.0%, due through 2000.... 9,821 6,518
Capital lease obligations and other notes payable,
collateralized by property and equipment, at varying
rates, from 5.94% to 20.0%, due through 2001.......... 8,020 13,939
------- --------
67,341 154,457
Less: Current maturities................................ (6,610) (9,814)
------- --------
$60,731 $144,643
======= ========
</TABLE>
REVOLVING CREDIT FACILITY
During September 1995, the Company funded a fully underwritten credit
agreement for a $125.0 million revolving credit facility. The Company used the
proceeds from the facility to repay the Company's then existing revolving credit
facility and its notes payable. Costs previously deferred related to certain
indebtedness resulted in an extraordinary charge to earnings of $693,000, net of
a $480,000 tax benefit, or $.08 per share in the year ended June 30, 1995. In
May 1997, the credit agreement was increased form $125.0 million to $175.0
million. This six-year revolving credit facility is priced at the prime rate or
a LIBOR-based rate. The LIBOR-based rates range from LIBOR plus 0.75% to LIBOR
plus 1.75% depending upon the Company meeting certain financial covenants.
Beginning September 30, 1999, the amount available under the facility begins to
reduce at three-month intervals until the termination date at September 30,
2001. The facility is collateralized
F-11
<PAGE> 115
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
by the Company's accounts and notes receivable, common stock of its subsidiaries
and partnership interests. The Company is required to meet certain financial
covenants as defined in the credit agreement. At June 30, 1997, the Company had
approximately $37.0 million available under the revolving credit facility.
At June 30, 1997, the revolving credit facility was priced at LIBOR plus
1.125%. The weighted average interest rate on the revolving credit facility was
6.96% and 6.81% at June 30, 1996 and 1997, respectively.
Aggregate debt maturities for each of the years ending June 30 are as
follows:
<TABLE>
<CAPTION>
NOTES PAYABLE CAPITAL LEASES
------------- --------------
(IN THOUSANDS)
<S> <C> <C>
1998.............................................. $ 7,260 $ 3,179
1999.............................................. 4,712 2,366
2000.............................................. 1,062 1,368
2001.............................................. 19,877 220
2002.............................................. 115,006 28
Thereafter........................................ 383 128
-------- -------
$148,300 7,289
========
Less: Amounts representing interest............. (1,132)
-------
$ 6,157
=======
</TABLE>
The Company incurred interest expense of $3,167,000, $5,205,000 and
$5,739,000 and paid interest of $2,863,000, $5,324,000 and $6,223,000 in the
years ended June 30, 1995, 1996 and 1997, respectively.
The Company had outstanding letters of credit totaling $3,787,000 and
$3,980,000 at June 30, 1996 and 1997, respectively.
(5) COMMITMENTS AND CONTINGENCIES
OPERATING LEASES
The Company leases various facilities and equipment under non-cancelable
operating lease agreements. Rental expense charged to operations under these
leases was $4,002,000, $5,345,000 and $6,625,000 for the years ended June 30,
1995, 1996 and 1997, respectively.
Minimum rental commitments under non-cancelable operating leases for each
of the years ending June 30 are as follows (in thousands):
<TABLE>
<S> <C>
1998................................................ $4,367
1999................................................ 3,797
2000................................................ 3,123
2001................................................ 2,453
2002................................................ 1,589
Thereafter.......................................... 4,585
</TABLE>
OTHER
The Company is a party to various lawsuits arising in the ordinary course
of business. Management believes, based upon discussions with legal counsel,
that losses, if any, will be substantially covered under insurance policies and
will not have a material adverse effect on the consolidated financial
statements.
F-12
<PAGE> 116
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(6) EMPLOYEE BENEFIT PLANS
EMPLOYEE STOCK OWNERSHIP PLAN (ESOP)
The Company established the ESOP in 1979 and makes contributions to the
ESOP at the discretion of the Board of Directors. The Board of Directors
approved voluntary contributions of $290,000, $100,000 and $300,000 for the
years ended June 30, 1995, 1996 and 1997, respectively. The ESOP held, for the
benefit of all participants, approximately 10% and 8% as of June 30, 1996 and
1997, respectively, of the outstanding common stock of the Company. The ESOP is
administered by the ESOP's Administrative Committee, consisting of certain
members of the Board of Directors of the Company.
Most full and part-time employees of the Company who have completed 200
work hours per year and have reached age 21 are eligible for admission to the
ESOP. Each participant's account vests 20% after three years of service and an
additional 20% each year thereafter.
EMPLOYEE STOCK PURCHASE PLAN
The Company has an Employee Stock Purchase Plan (ESPP) through which
eligible employees may purchase shares of the Company's common stock, at
semi-annual intervals, through periodic payroll deductions. The ESPP is a
qualified employee benefit plan under Section 423 of the Internal Revenue Code.
The Company has reserved 150,000 shares of stock for issuance under the ESPP.
The purchase price per share will be the lower of 85% of the closing price of
the stock on the first day or the last day of the offering period or on the
nearest prior day on which trading occurred on the NASDAQ National Market
System. As of June 30, 1997, 84,891 shares of common stock have been issued
under the ESPP.
1992 STOCK OPTION PLAN
The Company's 1992 Stock Option Plan was adopted in November 1992 and
provides for the granting of options to acquire common stock of the Company,
direct granting of the common stock of the Company (Stock Awards), the granting
of stock appreciation rights (SARs), or the granting of other cash awards (Cash
Awards) (Stock Awards, SARs and Cash Awards are collectively referred to herein
as Awards). At June 30, 1997, the maximum number of shares of common stock
issuable under the 1992 Plan was 3,390,750. Options may be granted as incentive
stock options or non-qualified stock options.
Options and Awards may be granted only to persons who at the time of grant
are either (i) key personnel (including officers) of the Company or (ii)
consultants and independent contractors who provide valuable services to the
Company. Options that are incentive stock options may be granted only to key
personnel of the Company.
The 1992 Plan, as amended, provides for the automatic grant of options to
acquire the Company's common stock (the Automatic Grant Program), whereby each
non-employee member of the Board of Directors will be granted an option to
acquire 2,500 shares of common stock annually. Each non-employee member of the
Board of Directors also will receive an annual automatic grant of options to
acquire an additional number of shares equal to 1,000 shares for each $0.05
increase in the Company's earnings per share, subject to a maximum of 5,000
additional options. New non-employee members of the Board of Directors will
receive options to acquire 10,000 shares of common stock on the date of their
first appointment or election to the Board of Directors.
The expiration date, maximum number of shares purchasable and the other
provisions of the options will be established at the time of grant. Options may
be granted for terms of up to ten years and become exercisable in whole or in
one or more installments at such time as may be determined by the Plan
Administrator upon grant of the options. Options granted to date vest over
periods not exceeding five years. The exercise price of options will be
determined by the Plan Administrator, but may not be less than 100%
F-13
<PAGE> 117
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(110% if the option is granted to a stockholder who at the date the option is
granted owns stock possessing more than 10% of the total combined voting power
of all classes of stock of the Company or of its subsidiaries) of the fair
market value of the common stock at the date of the grant.
Awards granted in the form of SARs would entitle the recipient to receive a
payment equal to the appreciation in market value of a stated number of shares
of common stock from the price stated in the award agreement to the market value
of the common stock on the date first exercised or surrendered. The Plan
Administrator may determine such terms, conditions, restrictions and/or
limitations, if any, on any SARs.
The 1992 Plan states that it is not intended to be the exclusive means by
which the Company may issue options or warrants to acquire its common stock,
Awards or any other type of award. To the extent permitted by applicable law,
the Company may issue any other options, warrants or awards other than pursuant
to the 1992 Plan without shareholder approval. The 1992 Plan will remain in
force until November 5, 2002.
The following summarizes the activity for the stock options:
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, 1995
---------------------------------------------
WEIGHTED
NUMBER OF EXERCISE PRICE AVERAGE
SHARES PER SHARE EXERCISE PRICE
--------- --------------- --------------
<S> <C> <C> <C>
Options outstanding at beginning of year..... 842,880 $ 5.60 - $19.50 $10.52
Granted.................................... 425,825 $17.25 - $18.75 $17.45
Canceled................................... (49,750) $ 8.04 - $17.25 $ 8.32
Exercised.................................. (73,000) $ 5.60 - $ 8.04 $ 5.95
---------
Options outstanding at end of year........... 1,145,955 $ 5.60 - $19.50 $12.74
=========
Options exercisable at end of year........... 421,255 $ 5.60 - $19.50 $ 8.97
=========
Options available for grant at end of year... 1,196,050
=========
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, 1996
-----------------------------------------------
NUMBER OF EXERCISE PRICE WEIGHTED AVERAGE
SHARES PER SHARE EXERCISE PRICE
--------- --------------- ----------------
<S> <C> <C> <C>
Options outstanding at beginning of
year.................................... 1,145,955 $ 5.60 - $19.50 $12.74
Granted................................. 841,750 $22.50 - $24.25 $24.00
Canceled................................ (6,000) $24.00 $24.00
Exercised............................... (155,330) $ 5.60 - $17.25 $11.50
---------
Options outstanding at end of year........ 1,826,375 $ 5.60 - $24.25 $18.37
=========
Options exercisable at end of year........ 495,205 $ 5.60 - $19.50 $12.05
=========
Options available for grant at end of
year.................................... 1,573,820
=========
Weighted average fair value per share of
options granted......................... $9.80
==========
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, 1997
-----------------------------------------------
NUMBER OF EXERCISE PRICE WEIGHTED AVERAGE
SHARES PER SHARE EXERCISE PRICE
--------- --------------- ----------------
<S> <C> <C> <C>
Options outstanding at beginning of
year.................................... 1,826,375 $ 5.60 - $24.25 $18.37
Granted................................. 944,489 $31.25 - $36.00 $32.27
Canceled................................ (137,875) $ 8.04 - $32.25 $24.48
Exercised............................... (331,592) $ 5.60 - $24.00 $13.97
---------
Options outstanding at end of year........ 2,301,397 $ 5.60 - $36.00 $24.45
=========
Options exercisable at end of year........ 899,572 $ 5.60 - $32.25 $21.42
=========
Options available for grant at end of
year.................................... 767,206
=========
Weighted average fair value per share of
options granted......................... $10.25
===========
</TABLE>
F-14
<PAGE> 118
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
<TABLE>
<CAPTION>
OPTIONS OUTSTANDING OPTIONS EXERCISABLE
------------------------------------------ ----------------------------
WEIGHTED
AVERAGE
REMAINING WEIGHTED WEIGHTED
RANGE OF OPTIONS CONTRACTUAL AVERAGE OPTIONS AVERAGE
EXERCISE PRICES OUTSTANDING LIFE EXERCISE PRICE EXERCISABLE EXERCISE PRICE
- --------------- ----------- ----------- -------------- ----------- --------------
<S> <C> <C> <C> <C> <C>
$ 5.60 -
$ 8.04....... 116,783 5.00 $ 6.77 102,755 $ 6.59
$13.00 -
$18.75....... 564,875 6.72 16.61 271,203 16.42
$24.00 -
$24.50....... 744,625 8.19 23.99 331,875 23.98
$31.25 -
$36.00....... 875,114 9.16 32.27 193,739 31.89
--------- ---- ------ ------- ------
2,301,397 8.04 $24.45 899,572 $21.42
========= ==== ====== ======= ======
</TABLE>
STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO. 123
During 1995, the FASB issued SFAS No. 123, "Accounting for Stock-Based
Compensation", which defines a fair value based method of accounting for an
employee stock option or similar equity instruments and encourages all entities
to adopt that method of accounting for all of their employee stock compensation
plans. However, it also allows an entity to continue to measure compensation
cost related to stock options issued to employees under these plans using the
method of accounting prescribed by APB Opinion No. 25, "Accounting for Stock
Issued to Employees". Entities electing to remain with the accounting in APB
Opinion No. 25 must make pro forma disclosures of net income and earnings per
share, as if the fair value based method of accounting defined in SFAS No. 123
had been applied.
The Company has elected to account for its stock-based compensation plans
under APB Opinion No. 25; therefore, no compensation cost is recognized in the
accompanying financial statements for stock-based employee awards. However, the
Company has computed, for pro forma disclosure purposes, the value of all
options and ESPP shares granted during 1996 and 1997, using the Black-Scholes
option pricing model with the following weighted average assumptions:
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
------------------------------------------
1996 1997
------------------ ------------------
OPTIONS ESPP OPTIONS ESPP
------- ----- ------- -----
<S> <C> <C> <C> <C>
Risk free interest rate............. 6.14% 5.68% 6.23% 5.90%
Expected dividend yield............. 0.00% 0.00% 0.00% 0.00%
Expected lives in years (after
vesting for options).............. 1.59 0.5 1.59 0.5
Expected volatility................. 33.41% 32.59% 36.50% 43.60%
</TABLE>
The total value of options and ESPP shares granted was computed to be the
following approximate amounts, which would be amortized on the straight-line
basis over the vesting period (in thousands):
<TABLE>
<CAPTION>
OPTIONS ESPP
------- ----
<S> <C> <C>
For year ended June 30, 1996............... $ 8,250 $212
For year ended June 30, 1997............... $16,500 $306
</TABLE>
If the Company had accounted for its stock-based compensation plans using a
fair value based method of accounting, the Company's year end net income and
earnings per common stock and common stock equivalent would have been reported
as follows:
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
----------------------
1996 1997
--------- ---------
(IN THOUSANDS, EXCEPT
PER SHARE AMOUNTS)
<S> <C> <C>
Net income:
Historical............................................. $11,512 $12,720
Pro forma.............................................. 8,352 8,013
Earnings per common stock and common stock equivalent:
Historical............................................. $ 1.14 $ 1.04
Pro forma.............................................. $ 0.85 $ 0.65
</TABLE>
F-15
<PAGE> 119
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
The effects of applying SFAS 123 for providing pro forma disclosures for
1996 and 1997 are not likely to be representative of the effects on reported net
income and earnings per common stock and common stock equivalent for future
years, because options vest over several years and additional awards are made
each year.
401(K) PLAN
The Company has a contributory retirement plan (the 401(k) Plan) covering
eligible employees with at least one month of service. The 401(k) Plan is
designed to provide tax-deferred income to the Company's employees in accordance
with the provisions of Section 401(k) of the Internal Revenue Code.
The 401(k) Plan provides that each participant may contribute up to 12% of
their respective salary, not to exceed the statutory limit. The Company may
elect to make a fixed-matching contribution to each participant's account of up
to 2% of total annual cash compensation received by respective participants
and/or a discretionary-matching contribution in an amount equal to a percentage
of the contribution made by participants as determined by the Board of
Directors. Under the terms of the 401(k) Plan, the Company may also make
discretionary profit sharing contributions. Profit sharing contributions are
allocated among participants based on their annual compensation. Each
participant has the right to direct the investment of his or her funds among
certain named plans. The Company made fixed-matching contributions to the 401(k)
Plan aggregating approximately $995,000 and $1,515,000 for the 401(k) Plan years
ended December 31, 1995 and 1996, respectively.
(7) STOCKHOLDERS' EQUITY
PREFERRED STOCK
In August 1995, the Company's Board of Directors adopted a shareholder
rights plan, which authorized the distribution of one right to purchase one
one-thousandth of a share of $0.01 par value Series A Junior Participating
Preferred Stock (a Right) for each share of common stock of the Company. Rights
will become exercisable following the tenth day (or such later date as may be
determined by the Board of Directors) after a person or group (a) acquires
beneficial ownership of 15% or more of the Company's common stock or (b)
announces a tender or exchange offer, the consummation of which would result in
ownership by a person or group of 15% or more of the Company's common stock.
Upon exercise, each Right will entitle the holder (other than the party
seeking to acquire control of the Company) to acquire shares of the common stock
of the Company or, in certain circumstances, such acquiring person at a 50%
discount from market value. The Rights may be terminated by the Board of
Directors at any time prior to the date they become exercisable at a price of
$0.01 per Right; thereafter, they may be redeemed for a specified period of time
at $0.01 per Right.
COMMON STOCK
In April 1996, the Company issued 1,367,500 shares of common stock at
$27.25 per share, generating $34.8 million. The proceeds were used to reduce the
outstanding balance on the Company's revolving credit facility.
(8) RELATED PARTY TRANSACTIONS
The Company incurred legal fees of approximately $158,000, $122,000 and
$139,000 for the years ended June 30, 1995, 1996 and 1997, respectively, with a
law firm in which a member of the Board of Directors is a partner.
F-16
<PAGE> 120
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
The Company incurred rental expense of $635,000, $592,000 and $600,000 in
each of the years ended June 30, 1995, 1996 and 1997, respectively, related to
leases of fire and ambulance facilities with a director of the Company and with
employees that were previously owners of businesses acquired by the Company.
At June 30, 1996 and 1997, the Company had notes payable to employees that
were previously owners of businesses acquired by the Company totaling $4,617,000
and $1,770,000, respectively.
(9) INCOME TAXES
The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes". Deferred income taxes are provided for
differences between results of operations for financial reporting purposes and
income tax purposes.
The components of the provision for income taxes were as follows:
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
--------------------------
1995 1996 1997
------ ------ ------
(IN THOUSANDS)
<S> <C> <C> <C>
Current
Federal...................................... $3,188 $4,219 $2,761
State........................................ 1,115 796 618
------ ------ ------
4,303 5,015 3,379
Deferred....................................... 985 3,029 5,985
------ ------ ------
$5,288 $8,044 $9,364
====== ====== ======
</TABLE>
Deferred tax assets and liabilities are recorded based on differences
between the financial statement and tax bases of amounts of assets and
liabilities and the tax rates in effect when those differences are expected to
reverse.
The components of net deferred taxes were as follows:
<TABLE>
<CAPTION>
JUNE 30,
--------------------
1996 1997
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Deferred tax liabilities
Amortization and accelerated depreciation............ $ (9,340) $ (9,379)
Allowance for doubtful accounts...................... (2,274) (5,663)
Cash to accrual adjustment........................... (895) (944)
-------- --------
(12,509) (15,986)
-------- --------
Deferred tax assets
Writedown of investment in real estate............... 608 --
Installment gain from sale of real estate and
property and equipment............................ 196 158
Compensation related deferrals....................... 794 499
Self insurance reserve............................... 351 471
Restructuring charge................................. -- 1,912
-------- --------
1,949 3,040
-------- --------
Net deferred tax liability............................. (10,560) (12,946)
Less current portion................................... 1,500 2,174
-------- --------
Net long-term deferred tax liability................... $ (9,060) $(10,772)
======== ========
</TABLE>
F-17
<PAGE> 121
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
For the years ended June 30, 1996 and 1997 income tax benefits of $982,000
and $4,867,000, respectively, were allocated to additional paid-in capital for
tax benefits associated with the exercise and vesting of nonqualified stock
options and stock grants.
The provision for income taxes differs from the amount computed by applying
the statutory federal income tax rate to income before income taxes. The sources
and tax effects of the differences were as follows:
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
--------------------------
1995 1996 1997
------ ------ ------
(IN THOUSANDS)
<S> <C> <C> <C>
Federal income tax provision at statutory rate... $4,508 $6,845 $7,729
State taxes, net of federal benefit.............. 606 491 967
Amortization of nondeductible goodwill........... 331 646 663
Utilization of tax credits....................... (116) -- --
Other, net....................................... (41) 62 5
------ ------ ------
Provision for income taxes....................... $5,288 $8,044 $9,364
====== ====== ======
</TABLE>
Cash payments for income taxes were approximately $3,381,000, $2,848,000
and $8,197,000 during the years ended June 30, 1995, 1996 and 1997,
respectively.
(10) SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
Selected quarterly financial data for the years ended June 30, 1996 and
1997 is as follows:
<TABLE>
<CAPTION>
1996
--------------------------------------------
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER
-------- -------- -------- --------
(IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS)
<S> <C> <C> <C> <C>
Revenue............................. $55,763 $60,893 $64,984 $68,677
Operating income.................... 4,814 5,339 6,775 7,736
Net income.......................... 2,102 2,396 2,989 4,025
Earnings per share.................. $ .23 $ .25 $ .31 $ .35
</TABLE>
<TABLE>
<CAPTION>
1997
--------------------------------------------
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER
-------- -------- -------- --------
(IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS)
<S> <C> <C> <C> <C>
Revenue............................. $73,994 $77,530 $84,921 $83,360
Operating income.................... 6,592 7,474 9,500 4,238
Net income.......................... 3,299 3,771 4,675 975
Earnings per share.................. $ .28 $ .31 $ .38 $ .08
</TABLE>
F-18
<PAGE> 122
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(11) SUBSEQUENT EVENT -- ISSUANCE OF NOTES PAYABLE (UNAUDITED)
On March 16, 1998, the Company issued $150.0 million of 7 7/8% Senior Notes
due 2008 (the Notes) effected under Rule 144A under the Securities Act of 1933
as amended (Securities Act). A portion of the net proceeds of the offering, sold
through private placement transactions, was used to repay certain indebtedness.
Interest under the Notes is payable semi-annually commencing September 15, 1998,
and the Notes are not callable until March 2003 subject to the terms of the Note
Agreement. The Company incurred expenses related to the offering of
approximately $4.9 million and will amortize such costs over the life of the
Notes. The Company has agreed to file under the Securities Act a registration
statement relating to an exchange offer for the Notes. If this registration is
not declared effective prior to the 90th day after the issue date of March 16,
1998 or certain other conditions are not met, the interest rate can increase up
to a maximum of 9 3/8% per annum of the principal amount of such Notes. In
connection with the issuance of the Notes, the Company modified its revolving
credit facility whereby the total commitment has been increased to $200.0
million. The Notes are general unsecured obligations of the Company and are
unconditionally guaranteed on a joint and several basis by substantially all of
the Company's domestic wholly-owned current and future subsidiaries. The Notes
contain certain covenants which, among other things, limit the Company's ability
to incur any indebtedness, sell assets, or enter into certain mergers or
consolidations.
F-19
<PAGE> 123
RURAL/METRO CORPORATION
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1997 AND DECEMBER 31, 1997
(IN THOUSANDS)
<TABLE>
<CAPTION>
JUNE 30, 1997 DECEMBER 31, 1997
------------- -----------------
(UNAUDITED)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash...................................................... $ 3,398 $ 2,261
Accounts receivable, net.................................. 106,978 149,926
Inventories............................................... 8,645 9,757
Prepaid expenses and other................................ 7,162 9,651
-------- --------
Total current assets.............................. 126,183 171,595
PROPERTY AND EQUIPMENT, net................................. 70,645 82,634
INTANGIBLE ASSETS, net...................................... 160,282 187,051
OTHER ASSETS................................................ 6,956 10,542
-------- --------
$364,066 $451,822
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable.......................................... $ 4,359 $ 7,015
Accrued liabilities....................................... 17,244 31,227
Current portion of long-term debt......................... 9,814 16,435
-------- --------
Total current liabilities......................... 31,417 54,677
LONG-TERM DEBT, net of current portion...................... 144,643 187,334
NON-REFUNDABLE SUBSCRIPTION INCOME.......................... 13,367 13,248
DEFERRED INCOME TAXES....................................... 10,772 12,836
OTHER LIABILITIES........................................... 4,059 2,270
-------- --------
Total liabilities................................. 204,258 270,365
-------- --------
MINORITY INTEREST........................................... -- 8,490
-------- --------
STOCKHOLDERS' EQUITY
Common stock.............................................. 130 139
Additional paid-in capital................................ 121,355 124,038
Retained earnings......................................... 40,334 50,487
Deferred compensation..................................... (772) (458)
Treasury stock............................................ (1,239) (1,239)
-------- --------
Total stockholders' equity........................ 159,808 172,967
-------- --------
$364,066 $451,822
======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated balance
sheets.
F-20
<PAGE> 124
RURAL/METRO CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 1996 AND 1997
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
------------------ --------------------
1996 1997 1996 1997
------- ------- -------- --------
<S> <C> <C> <C> <C>
REVENUE
Ambulance services.............................. $62,465 $89,769 $121,493 $167,367
Fire protection services........................ 10,349 11,351 20,654 22,563
Other........................................... 4,716 10,222 9,377 19,185
------- ------- -------- --------
Total revenue........................... 77,530 111,342 151,524 209,115
------- ------- -------- --------
OPERATING EXPENSES
Payroll and employee benefits................... 41,867 58,269 82,501 110,504
Provision for doubtful accounts................. 10,404 15,612 20,159 28,826
Depreciation.................................... 2,918 4,712 5,651 8,813
Amortization of intangibles..................... 1,110 1,681 2,200 3,145
Other operating expenses........................ 13,757 18,869 26,947 35,282
------- ------- -------- --------
Total expenses.......................... 70,056 99,143 137,458 186,570
------- ------- -------- --------
OPERATING INCOME.................................. 7,474 12,199 14,066 22,545
Interest Expense, net............................. 1,072 2,958 2,082 5,409
Other............................................. -- 130 -- 130
------- ------- -------- --------
INCOME BEFORE INCOME TAXES........................ 6,402 9,111 11,984 17,006
PROVISION FOR INCOME TAXES........................ 2,631 3,687 4,914 6,924
------- ------- -------- --------
NET INCOME........................................ $ 3,771 $ 5,424 $ 7,070 $ 10,082
======= ======= ======== ========
BASIC EARNINGS PER SHARE.......................... $ 0.33 $ 0.40 $ 0.63 $ 0.76
======= ======= ======== ========
DILUTED EARNINGS PER SHARE........................ $ 0.31 $ 0.38 $ 0.59 $ 0.73
======= ======= ======== ========
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING -- BASIC............................ 11,296 13,482 11,213 13,196
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING -- DILUTED.......................... 12,175 14,200 12,082 13,805
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-21
<PAGE> 125
RURAL/METRO CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED DECEMBER 31, 1996 AND 1997
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31,
----------------------
1996 1997
-------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income................................................ $ 7,070 $ 10,082
Adjustments to reconcile net income to cash used in
operations --
Depreciation and amortization.......................... 7,851 11,958
Amortization of deferred compensation.................. 327 314
Amortization of gain on sale of real estate............ (52) (52)
Provision for doubtful accounts........................ 20,159 28,826
Undistributed earnings of minority shareholder............ -- 130
Change in assets and liabilities, net of effect of
businesses acquired --
Increase in accounts receivable........................ (34,355) (64,263)
Increase in inventories................................ (746) (997)
Increase in prepaid expenses and other................. (310) (2,213)
Increase (decrease) in accounts payable................ (838) 905
Increase (decrease) in accrued liabilities and other... (3,605) 8,905
(Decrease) increase in nonrefundable subscription
income................................................ 149 (129)
Increase in deferred income taxes...................... 870 516
-------- --------
Net cash used in operating activities............. (3,480) (6,018)
-------- --------
CASH FLOW FROM FINANCING ACTIVITIES
Borrowings on revolving credit facilities, net............ 19,600 45,300
Repayment of debt and capital lease obligations........... (6,488) (14,416)
Issuance of common stock.................................. 6,371 2,317
-------- --------
Net cash provided by financing activities......... 19,483 33,201
-------- --------
CASH FLOW FROM INVESTING ACTIVITIES
Cash paid for businesses acquired......................... (9,284) (9,824)
Capital expenditures...................................... (7,725) (14,909)
(Increase) decrease in other assets....................... 21 (3,587)
-------- --------
Net cash used in investing activities............. (16,988) (28,320)
-------- --------
DECREASE IN CASH............................................ (985) (1,137)
CASH, beginning of period................................... 1,388 3,398
-------- --------
CASH, end of period......................................... $ 403 $ 2,261
======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
F-22
<PAGE> 126
RURAL/METRO CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1997
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and the instructions to Form 10-Q. Accordingly, they do
not include all information and footnotes required by generally accepted
accounting principles for complete financial statements.
(1) Interim Results
In the opinion of management, the consolidated financial statements for the
three and six month periods ended December 31, 1996 and 1997 include all
adjustments, consisting only of normal recurring adjustments necessary for a
fair statement of the consolidated financial position and results of
operations for that period.
The results of operations for the three and six month periods ended December
31, 1996 and 1997 are not necessarily indicative of the results of
operations for a full fiscal year.
(2) Acquisitions
During the six months ended December 31, 1997, the Company purchased the
stock of ambulance service providers operating in Arizona and Georgia and
the assets of ambulance service providers operating in Alabama, Maryland,
New Jersey and South Carolina.
The acquisitions were accounted for as purchases in accordance with
Accounting Principles Board Opinion No. 16 (APB 16) and, accordingly, the
purchased assets and assumed liabilities were recorded at their estimated
fair values at each respective acquisition date.
The aggregate purchase price consisted of the following:
<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------
<S> <C>
Cash........................................................ $ 9,824
Rural/Metro common stock.................................... 325
Notes payable to sellers.................................... 6,470
Assumption of liabilities................................... 13,889
-------
$30,508
=======
</TABLE>
During the six months ended December 31, 1997, subsidiaries of the Company
merged with and into ambulance service providers operating in Mississippi,
New Jersey, New York and Tennessee. The Company issued an aggregate of
641,009 shares of its common stock in exchange for all of the issued and
outstanding stock of the acquired companies. The transactions were
accounted for as poolings-of-interest in accordance with APB 16. The
acquisitions were not considered significant; accordingly, prior year
financial statements have not been restated.
The unaudited pro forma combined condensed statements of income for the
fiscal year ended June 30, 1997 and the six months ended December 31, 1997
give effect to the acquisitions as if each had been consummated as of the
beginning of each respective period.
The pro forma combined condensed financial statements do not purport to
represent what the Company's actual results of operations or financial
position would have been had such transactions in fact occurred on such
dates. The pro forma combined condensed statements of income also do not
purport to project the results of operations of the Company for the current
year or for any future period.
F-23
<PAGE> 127
RURAL/METRO CORPORATION
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENTS OF INCOME
FOR THE YEAR ENDED JUNE 30, 1997
AND FOR THE SIX MONTHS ENDED DECEMBER 31, 1997
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS ENDED
JUNE 30, 1997 DECEMBER 31, 1997
---------------------- ----------------------
PROFORMA PROFORMA
HISTORICAL COMBINED HISTORICAL COMBINED
---------- -------- ---------- --------
<S> <C> <C> <C> <C>
Revenue................................. $319,805 $427,067 $209,115 $223,958
Net income.............................. $ 12,720 $ 17,270 $ 10,082 $ 10,765
Earnings per share -- basic............. $ 1.10 $ 1.30 $ 0.76 $ 0.80
Earnings per share -- diluted........... $ 1.04 $ 1.23 $ 0.73 $ 0.76
</TABLE>
Pro forma adjustments include adjustments to: (i) reflect amortization of
the cost in excess of the fair value of net assets acquired; (ii) adjust
payroll and related expenses for the effect of certain former owners of the
acquired businesses not being employed by the Company and to reflect the
difference between the actual compensation paid to officers of the
businesses acquired and the lower level of aggregate compensation such
individuals would have received under the terms of employment agreements
executed between the Company and such individuals; (iii) adjust other
operating expenses to reflect the reduction of expenses related to certain
real estate and buildings not acquired and sellers' costs incurred in
connection with the sale of their respective businesses; (iv) adjust
interest expense to reflect interest expense related to debt issued in
connection with the acquisitions; and (v) adjust income taxes to reflect
the tax effect of the adjustments and the tax effect of treating all of the
acquisitions as if they had C corporation status.
The pro-forma combined condensed statements of income do not include the
effects of the pending acquisition of Emergencias Cardio Coronarias (ECCO),
as more fully described in "Liquidity and Capital Resources" included in
Management's Discussion and Analysis of Financial Condition and Results of
Operations.
F-24
<PAGE> 128
======================================================
ALL TENDERED OUTSTANDING NOTES, EXECUTED LETTERS OF TRANSMITTAL AND OTHER
RELATED DOCUMENTS SHOULD BE DIRECTED TO THE EXCHANGE AGENT. QUESTIONS AND
REQUESTS FOR ASSISTANCE AND REQUESTS FOR ADDITIONAL COPIES OF THE PROSPECTUS,
THE LETTER OF TRANSMITTAL AND OTHER RELATED DOCUMENTS SHOULD BE ADDRESSED TO THE
EXCHANGE AGENT AS FOLLOWS:
THE FIRST NATIONAL BANK OF CHICAGO
ONE NORTH STATE STREET
NINTH FLOOR, SUITE 0126
CHICAGO, ILLINOIS 60670-0126
ATTENTION: CORPORATE TRUST ADMINISTRATION
By Facsimile: (312) 407-1708
Confirm by Telephone: (312) 732-4000
(Originals of all documents submitted by facsimile should be sent promptly by
hand, overnight delivery, or registered or certified mail.)
Until 25 days after the Expiration Date, all dealers effecting transactions
in the Exchange Notes, whether or not participating in this distribution, may be
required to deliver a prospectus. This is in addition to the obligation of
dealers to deliver a prospectus when acting as underwriter and with respect to
their unsold allotments or subscriptions.
No person has been authorized to give any information or to make any
representation other than those contained or incorporated by reference in this
Prospectus and the accompanying Letter of Transmittal, and, if given or made,
such information or representations must not be relied upon as having been
authorized. Neither the Prospectus nor the accompanying Letter of Transmittal
nor both together constitute an offer to sell or the solicitation of an offer to
buy any securities other than the securities to which the Prospectus relates or
an offer to sell or the solicitation of an offer to buy such securities in any
circumstances in which such offer or solicitation is unlawful. Neither the
delivery of this Prospectus or the Letter of Transmittal or both together nor
any exchange made hereunder shall, under any circumstances, create any
implication that the information contained or incorporated by reference herein
is correct as of any time subsequent to the date herein or that there has been
no change in the affairs of the Company since such date.
======================================================
======================================================
$150,000,000
[RURAL/METRO CORPORATION LOGO]
RURAL/METRO CORPORATION
7 7/8% SENIOR NOTES
DUE 2008
------------
PROSPECTUS
------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................. 1
Incorporation of Certain Documents by
Reference........................... 1
Disclosure Regarding Forward-Looking
Statements.......................... 2
Prospectus Summary.................... 3
Risk Factors.......................... 12
The Exchange Offer.................... 20
Use of Proceeds....................... 26
Capitalization........................
Unaudited Pro Forma Consolidated
Financial Data...................... 27
Selected Consolidated Financial
Data................................ 32
Management's Discussion and Analysis
of Financial Condition and Results
of Operations....................... 34
Business.............................. 42
Management............................ 57
Description of the New Credit
Facility............................ 59
Description of the Exchange Notes..... 60
Certain Federal Income Tax
Consequences........................ 91
Plan of Distribution.................. 95
Legal Matters......................... 96
Experts............................... 96
Index to Consolidated Financial
Statements.......................... F-1
</TABLE>
DATED , 1998
======================================================
<PAGE> 129
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's amended and restated Bylaws require the Company to indemnify
its directors, officers, employees and agents to the fullest extent permitted by
the Delaware General Corporation Law, including those circumstances in which
indemnification would otherwise be discretionary, except that the Company will
not be obligated to indemnify any such person (i) with respect to proceedings,
claims or actions initiated or brought voluntarily by any such person and not by
way of defense; (ii) for any amounts paid in settlement of an action indemnified
against by the Company without the proper written consent of the Company; or
(iii) in connection with any event in which the person did not act in good faith
and in a manner reasonably believed to be in, or not opposed to, the best
interests of the Company. In addition, the Company has entered or will enter
into Indemnity Agreements with each of its directors and officers providing for
indemnification of and advancement of expenses to the directors and officers to
the fullest extent permitted by law except (a) if and to the extent that payment
is made to the indemnitee under an insurance policy or otherwise; (b) if and to
the extent that a claim is decided adversely based on or attributable to the
indemnitee gaining any personal profit or advantage to which the indemnitee was
not legally entitled; (c) if and to the extent that the indemnifiable event
constituted or arose out of the indemnitee's willful misconduct or gross
negligence; or (d) if and to the extent that the proceeding is initiated by the
indemnitee against the Company of any of its officers or directors, unless the
Company has consented to or joined in the initiation of the proceeding. The
Delaware General Corporation Law contains an extensive indemnification provision
that permits a corporation to indemnify any person who is or was a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he or she is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him or her in connection with such action, suit or proceeding if he
or she acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his or her
conduct was unlawful.
The Company's Second Restated Certificate eliminates the personal liability
of the directors of the Company to the Company or its stockholders for monetary
damages for breach of their duty of care except to the extent that such
exemption from liability or limitation thereof is not permitted under the
Delaware General Corporation Law. The Delaware General Corporation Law prohibits
a corporation from eliminating or limiting the liability of a director (i) for
any breach of the director's duty of loyalty to the corporation or its
stockholders; (ii) for acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law; (iii) for liability under
Section 174 of the Delaware General Corporation Law (relating to certain
unlawful dividends, stock purchases or stock redemptions); or (iv) for any
transaction from which the director derived any improper personal benefit.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
- ----------- ----------------------
<C> <S>
2 Plan and Agreement of Merger and Reorganization, dated as of
April 26, 1993(1)
4.1 Specimen Certificate representing shares of Common Stock,
par value $.01 per share(1)
4.2 Indenture dated as of March 16, 1998, by and among the
Company, the Guarantors signatories thereto and The First
National Bank of Chicago, as Trustee.
4.3 Form of Global Note (included in Exhibit 4.2)
</TABLE>
II-1
<PAGE> 130
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
- ----------- ----------------------
<C> <S>
4.4 Registration Rights Agreement dated March 11, 1998 by and
among Bear Stearns & Co. Inc., Salomon Brothers Inc, SBC
Warburg Dillon Read Inc., First Union Capital Markets, the
Company, and certain subsidiaries of the Company, as
Guarantors
*4.5 Amended and Restated Credit Agreement dated as of March 16,
1998, by and among the Company as borrower, certain of its
subsidiaries as Guarantors, the lenders referred to therein,
and First Union National Bank, as agent and as lender, and
related Form of Amended and Restated Revolving Credit Note,
Form of Subsidiary Guarantee Agreement, and Form of
Intercompany Subordination Agreement
*5 Opinion of O'Connor, Cavanagh, Anderson, Killingsworth &
Beshears, P.A.
12 Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of O'Connor, Cavanagh, Anderson, Killingsworth &
Beshears, P.A. (to be included in its Opinion filed as
Exhibit 5)
23.2 Consent of Arthur Andersen LLP
24.1 Powers of Attorney of Directors and Executive Officers
(included on the Signature Page of this Registration
Statement)
24.2 Power of Attorney of Warren S. Rustand
25 Statement of Eligibility of Trustee on Form T-1 of The First
National Bank of Chicago
99 Form of Letter of Transmittal and Notice of Guaranteed
Delivery
</TABLE>
- ---------------
* To be filed by amendment.
(1) Incorporated by reference to the Registration Statement on Form S-1 of the
Registrant (Registration No. 33-63448) filed May 27, 1993 and declared
effective July 15, 1993.
(b) Financial Statement Schedules
Schedule II Valuation and Qualifying Accounts incorporated by reference to
the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30,
1997.
All other schedules have been omitted on the basis of immateriality or
because such schedules are not otherwise applicable.
ITEM 22. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(b) (1) The undersigned registrant hereby undertakes as follows: that prior
to any public reoffering of the securities registered hereunder through use of a
prospectus which is a part of this registration statement, by any person or
party who is deemed to be an underwriter within the meaning of Rule 145(c), the
issuer undertakes that such reoffering prospectus will contain the information
called for by the applicable registration form with respect to reofferings by
persons who may be deemed underwriters, in addition to the information called
for by the other items of the applicable form.
(2) The registrant undertakes that every prospectus: (i) that is filed
pursuant to paragraph (1) immediately preceding, or (ii) that purports to meet
the requirements of Section 10(a)(3) of the Act and is used in connection with
an offering of securities subject to Rule 415, will be filed as a part of an
amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-2
<PAGE> 131
(c) Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant, in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
(d) The undersigned registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Item 4, 10(b), 11, or 13 of this Form, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration statement through the
date of responding to the request.
(e) The undersigned registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction that was not
the subject of and included in the registration statement when it became
effective.
II-3
<PAGE> 132
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, State of
Arizona, on the 30th day of April, 1998.
RURAL/METRO CORPORATION
By: /s/ WARREN S. RUSTAND
------------------------------------
Warren S. Rustand, Chief Executive
Officer and President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints jointly and severally, Warren S. Rustand
and Mark E. Liebner, and each of them, as his true and lawful attorney-in-fact
and agents, with full power of substitution and resubstitution, for him and in
his name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration Statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in connection therewith, as fully to all intents and purposes as he might or
could do in person, hereby ratifying, and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
By: /s/ WARREN S. RUSTAND Chairman of the Board of Directors, April 30, 1998
---------------------------------------------- Chief Executive Officer and
Warren S. Rustand President (Principal Executive
Officer)
By: /s/ ROBERT T. EDWARDS Executive Vice President and April 30, 1998
---------------------------------------------- Director
Robert T. Edwards
By: /s/ MARK E. LIEBNER Senior Vice President, Chief April 30, 1998
---------------------------------------------- Financial Officer and Treasurer
Mark E. Liebner (Principal Financial Officer)
By: /s/ ROBERT E. RAMSEY Senior Vice President and Director April 30, 1998
----------------------------------------------
Robert E. Ramsey
By: /s/ DEAN P. HOFFMAN Vice President, Financial Services April 30, 1998
---------------------------------------------- (Principal Accounting Officer)
Dean P. Hoffman
By: /s/ JAMES H. BOLIN Director April 30, 1998
----------------------------------------------
James H. Bolin
By: Director
----------------------------------------------
Cor J. Clement
By: /s/ MARY ANNE CARPENTER Director April 30, 1998
----------------------------------------------
Mary Anne Carpenter
</TABLE>
II-4
<PAGE> 133
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
By: /s/ LOUIS G. JEKEL Director April 30, 1998
----------------------------------------------
Louis G. Jekel
By: Director
----------------------------------------------
William C. Turner
By: Director
----------------------------------------------
Henry G. Walker
By: /s/ LOUIS A. WITZEMAN Director April 30, 1998
----------------------------------------------
Louis A. Witzeman
</TABLE>
II-5
<PAGE> 134
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
AID AMBULANCE AT VIGO COUNTY, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND* /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-6
<PAGE> 135
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
AMBULANCE TRANSPORT SYSTEMS, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-7
<PAGE> 136
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
AMERICAN LIMOUSINE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent or his
substitute or may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND* /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-8
<PAGE> 137
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
ARROW AMBULANCE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND* /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-9
<PAGE> 138
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
BEACON TRANSPORTATION, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND* /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-10
<PAGE> 139
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
CITY WIDE AMBULANCE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-11
<PAGE> 140
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
CORNING AMBULANCE SERVICE INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-12
<PAGE> 141
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
DONLOCK, LTD.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-13
<PAGE> 142
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
E.M.S. VENTURES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-14
<PAGE> 143
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
EMS VENTURES OF SOUTH CAROLINA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-15
<PAGE> 144
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
EASTERN AMBULANCE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or
their or his substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-16
<PAGE> 145
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
EASTERN PARAMEDICS, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-17
<PAGE> 146
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
GOLD CROSS AMBULANCE SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-18
<PAGE> 147
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
GOLD CROSS AMBULANCE SERVICE OF PA.,
INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-19
<PAGE> 148
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
KEEFE & KEEFE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-20
<PAGE> 149
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
KEEFE & KEEFE AMBULETTE LTD.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-21
<PAGE> 150
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
LASALLE AMBULANCE INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-22
<PAGE> 151
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MEDI-CAB OF GEORGIA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner, or ,
as such signatory's true and lawful attorney-in-fact and agent, with full power
of substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-23
<PAGE> 152
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MEDICAL EMERGENCY DEVICES AND
SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-24
<PAGE> 153
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MEDICAL TRANSPORTATION SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-25
<PAGE> 154
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MEDSTAR EMERGENCY MEDICAL SERVICES,
INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-26
<PAGE> 155
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MERCURY AMBULANCE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-27
<PAGE> 156
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
METRO CARE CORP.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-28
<PAGE> 157
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MO-RO-KO, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-29
<PAGE> 158
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MULTI CAB INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-30
<PAGE> 159
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MULTI-CARE INTERNATIONAL, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-31
<PAGE> 160
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MULTI-CARE MEDICAL CAR SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-32
<PAGE> 161
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MULTI-HEALTH CORP.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-33
<PAGE> 162
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
MYERS AMBULANCE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-34
<PAGE> 163
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
NATIONAL AMBULANCE & OXYGEN SERVICE,
INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-35
<PAGE> 164
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
NORTH MISS. AMBULANCE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- -------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting
(Principal Executive Officer) Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-36
<PAGE> 165
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
PHYSICIANS AMBULANCE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-37
<PAGE> 166
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
PROFESSIONAL MEDICAL SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-38
<PAGE> 167
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RISC AMERICA ALABAMA FIRE SAFETY
SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-39
<PAGE> 168
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
R/M MANAGEMENT CO., INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-40
<PAGE> 169
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
R/M OF MISSISSIPPI, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-41
<PAGE> 170
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
R/M OF TENNESSEE G.P., INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-42
<PAGE> 171
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
R/M OF TENNESSEE L.P., INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND* /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-43
<PAGE> 172
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
R/M OF TEXAS G.P., INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-44
<PAGE> 173
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
R/M PARTNERS, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or
their or his substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-45
<PAGE> 174
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RMC CORPORATE CENTER, L.L.C.
By: Rural/Metro Corporation, an
Arizona corporation
Its Member
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or
their or his substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer) Rural/Metro Corporation, an Arizona
Rural/Metro Corporation, an Arizona corporation
corporation Member
Member
*By: /s/ MARK E. LIEBNER /s/ LOUIS G. JEKEL
- --------------------------------------------- ---------------------------------------------
Mark E. Liebner Louis G. Jekel
As Attorney-in-Fact, pursuant to Director
a Power of Attorney filed herewith. Rural/Metro Corporation, an Arizona
corporation
Member
</TABLE>
II-46
<PAGE> 175
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO ARGENTINA, L.L.C.
By: Rural/Metro International, Inc.
Its Member
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or
their or his substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer) Rural/Metro International, Inc.
Rural/Metro International, Inc. Member
Member
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-47
<PAGE> 176
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO BRASIL, L.L.C.
By: Rural/Metro International, Inc.
Its Member
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner, as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or
their or his substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer) Rural/Metro International, Inc.
Rural/Metro International, Inc. Member
Member
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-48
<PAGE> 177
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO CANADIAN HOLDINGS, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner, as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or
their or his substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-49
<PAGE> 178
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO COMMUNICATIONS SERVICES,
INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner, as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or
their or his substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-50
<PAGE> 179
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO CORPORATION, AN ARIZONA
CORPORATION
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER /s/ LOUIS G. JEKEL
- --------------------------------------------- ---------------------------------------------
Mark E. Liebner Louis G. Jekel
As Attorney-in-Fact, pursuant to Director
a Power of Attorney filed herewith.
</TABLE>
II-51
<PAGE> 180
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO CORPORATION OF FLORIDA
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner, as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-52
<PAGE> 181
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO CORPORATION OF TENNESSEE
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-53
<PAGE> 182
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO FIRE DEPT., INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-54
<PAGE> 183
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO INTERNATIONAL, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-55
<PAGE> 184
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO MID-ATLANTIC, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-56
<PAGE> 185
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF ALABAMA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-57
<PAGE> 186
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF ARGENTINA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-58
<PAGE> 187
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF ARKANSAS, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-59
<PAGE> 188
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF ARLINGTON, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-60
<PAGE> 189
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF BRASIL, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-61
<PAGE> 190
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF CALIFORNIA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-62
<PAGE> 191
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF CENTRAL ALABAMA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-63
<PAGE> 192
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF CENTRAL OHIO, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<CAPTION>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-64
<PAGE> 193
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF GEORGIA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-65
<PAGE> 194
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF INDIANA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<CAPTION>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-66
<PAGE> 195
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF INDIANA, L.P.
By: The Aid Ambulance Company, Inc.
Its General Partner
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
The Aid Ambulance Company, Inc. The Aid Ambulance Company, Inc.
General Partner General Partner
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-67
<PAGE> 196
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF INDIANA II, L.P.
By: The Aid Ambulance Company, Inc.,
Its General Partner
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
The Aid Ambulance Company, Inc. The Aid Ambulance Company, Inc.
General Partner General Partner
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-68
<PAGE> 197
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF KENTUCKY, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-69
<PAGE> 198
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF MISSISSIPPI, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND* /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-70
<PAGE> 199
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF NEBRASKA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-71
<PAGE> 200
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF NEW YORK, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-72
<PAGE> 201
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF NORTH FLORIDA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-73
<PAGE> 202
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF OHIO, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-74
<PAGE> 203
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF OREGON, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-75
<PAGE> 204
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF ROCHESTER, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-76
<PAGE> 205
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF SAN DIEGO, INC.
By: /s/ WILLIAM R. CROWELL
------------------------------------
William R. Crowell
Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Director
Director
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER /s/ WILLIAM R. CROWELL
- --------------------------------------------- ---------------------------------------------
Mark E. Liebner William R. Crowell
As Attorney-in-Fact, pursuant to Chief Financial Officer
a Power of Attorney filed herewith. (Principal Financial and
Accounting Officer)
</TABLE>
II-77
<PAGE> 206
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF SOUTH CAROLINA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-78
<PAGE> 207
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF SOUTH DAKOTA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-79
<PAGE> 208
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF TENNESSEE, L.P.
By: Rural/Metro of Tennessee, G.P.,
Inc.
Its General Partner
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
Rural/Metro of Tennessee, G.P., Inc. Rural/Metro of Tennessee, G.P., Inc.
General Partner General Partner
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-80
<PAGE> 209
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF TEXAS, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-81
<PAGE> 210
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO OF TEXAS, L.P.
By: R/M of Texas G.P., Inc.
Its General Partner
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer) R/M of Tennessee, G.P., Inc.
R/M of Tennessee, G.P., Inc. General Partner
General Partner
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-82
<PAGE> 211
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO PROTECTION SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-83
<PAGE> 212
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
RURAL/METRO TEXAS HOLDINGS, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-84
<PAGE> 213
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
SW GENERAL, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-85
<PAGE> 214
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
SIOUX FALLS AMBULANCE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-86
<PAGE> 215
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
SOUTH GEORGIA EMERGENCY MEDICAL
SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-87
<PAGE> 216
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
SOUTHWEST AMBULANCE OF CASA GRANDE,
INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-88
<PAGE> 217
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
SOUTHWEST AMBULANCE OF SOUTHEASTERN
ARIZONA, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-89
<PAGE> 218
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
SOUTHWEST AMBULANCE OF TUCSON, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director (Principal Financial and Accounting Officer)
(Principal Executive Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-90
<PAGE> 219
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
SOUTHWEST GENERAL SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-91
<PAGE> 220
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
THE AID AMBULANCE COMPANY, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-92
<PAGE> 221
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
THE AID COMPANY, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-93
<PAGE> 222
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
THE WESTERN NEW YORK EMERGENCY MEDICAL
SERVICES TRAINING INSTITUTE INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-94
<PAGE> 223
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
TOWNS AMBULANCE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director (Principal
Director (Principal Executive Officer) Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-95
<PAGE> 224
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
UNITED MEDICAL SERVICES, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-96
<PAGE> 225
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
VALLEY FIRE SERVICE, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and Vice President and Director
Director
(Principal Executive Officer) (Principal Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-97
<PAGE> 226
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Scottsdale, on this 30th
day of April, 1998.
W & W LEASING COMPANY, INC.
By: /s/ MARK E. LIEBNER
------------------------------------
Mark E. Liebner
Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Mark E. Liebner as such
signatory's true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for such signatory and in such signatory's
name, place and stead, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the foregoing, as fully as
to all intents and purposes as such signatory might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, or his
substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on April 30, 1998 by the following
persons in the capacities indicated.
<TABLE>
<S> <C>
By: /s/ WARREN S. RUSTAND * /s/ MARK E. LIEBNER
- --------------------------------------------- ---------------------------------------------
Warren S. Rustand Mark E. Liebner
President, Chief Executive Officer, and
Director
(Principal Executive Officer) Vice President and Director (Principal
Financial and Accounting Officer)
*By: /s/ MARK E. LIEBNER
- ---------------------------------------------
Mark E. Liebner
As Attorney-in-Fact, pursuant to
a Power of Attorney filed herewith.
</TABLE>
II-98
<PAGE> 1
Exhibit 4.2
================================================================================
RURAL/METRO CORPORATION, as Issuer,
THE GUARANTORS SIGNATORY HERETO, as Guarantors,
and
THE FIRST NATIONAL BANK OF CHICAGO, as Trustee
--------------------
INDENTURE
Dated as of March 16, 1998
$150,000,000
7-7/8% Senior Notes due 2008
================================================================================
<PAGE> 2
Reconciliation and Tie between Trust Indenture Act
of 1939 and Indenture, dated as of March 16, 1998*
Trust Indenture
Act Section Indenture Section
----------- -----------------
Section 310 (a)(1) 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
(b) 7.08
(b)(1) 7.10
(b)(9) 7.10
(c) N.A.
Section 311 (a) 7.11
(b) 7.11
(c) N.A.
Section 312 (a) 2.05
(b) 11.03
(c) 11.03
Section 313 (a) 7.06
(b)(1) N.A.
(b)(2) 7.06
(c) 7.06; 11.02
(d) 7.06
Section 314 (a) 4.02; 4.04; 11.02
(b) N.A.
(c)(1) 11.04; 11.05
(c)(2) 11.04; 11.05
(c)(3) 11.04; 11.05
(d) N.A.
(e) 11.05
(f) N.A.
Section 315 (a) 7.01; 7.02
(b) 7.05; 11.02
(c) 7.01
(d) 6.05; 7.01; 7.02
(e) 6.11
Section 316 (a)(last sentence) 11.06
(a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) 8.02
(b) 6.07
(c) 8.04
Section 317 (a)(1) 6.08
(a)(2) 6.09
(b) 7.12
Section 318 (a) 11.01
"N.A." means Not Applicable.
- ----------
* Note: This reconciliation and tie shall not, for any purpose, be deemed to be
part of this Indenture.
i
<PAGE> 3
TABLE OF CONTENTS
PAGE
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE...................1
Section 1.01. Definitions..................................................1
Section 1.02. Other Definitions...........................................23
Section 1.03. Incorporation by Reference of Trust Indenture Act...........24
Section 1.04. Rules of Construction.......................................24
ARTICLE 2. THE NOTES...................................................25
Section 2.01. Dating; Incorporation of Form in Indenture..................25
Section 2.02. Execution and Authentication................................25
Section 2.03. Registrar and Paying Agent..................................26
Section 2.04. Paying Agent to Hold Money in Trust.........................27
Section 2.05. Noteholder Lists............................................27
Section 2.06. Transfer and Exchange.......................................27
Section 2.07. Replacement Notes...........................................41
Section 2.08. Outstanding Notes...........................................42
Section 2.09. Temporary Notes.............................................42
Section 2.10. Cancellation................................................42
Section 2.11. Defaulted Interest..........................................43
Section 2.12. Deposit of Moneys...........................................43
Section 2.13. CUSIP Number................................................43
Section 2.14. Wire Payments to Holders....................................43
ARTICLE 3. REDEMPTION..................................................44
Section 3.01. Notices to Trustee..........................................44
Section 3.02. Selection by Trustee of Notes to be Redeemed................44
Section 3.03. Notice of Redemption........................................45
Section 3.04. Effect of Notice of Redemption..............................45
Section 3.05. Deposit of Redemption Price.................................46
Section 3.06. Notes Redeemed in Part......................................46
Section 3.07. Optional Redemption.........................................46
Section 3.08. Mandatory Redemption........................................47
ARTICLE 4. COVENANTS...................................................47
Section 4.01. Payment of Notes............................................47
Section 4.02. Reports.....................................................47
Section 4.03. Waiver of Stay, Extension or Usury Laws.....................48
Section 4.04. Compliance Certificate......................................48
Section 4.05. Taxes.......................................................49
Section 4.06. Limitations on Additional Indebtedness and Preferred
Equity Interests............................................50
Section 4.07. Limitation on Restricted Payments...........................53
Section 4.08. Limitation on Transactions with Affiliates..................53
Section 4.09. Limitations on Liens........................................53
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Section 4.10. Limitation on Issuances of Guarantees by Subsidiaries
Which Are Not Guarantors; Additional Guarantees.............54
Section 4.11. Limitation on Subsidiaries and Unrestricted Subsidiaries....54
Section 4.12. Limitation on Dividend and Other Payment Restrictions
Affecting Subsidiaries......................................55
Section 4.13. Restriction on Sale and Issuance of Subsidiary Interests....56
Section 4.14. Limitation on Sale and Lease-Back Transactions..............57
Section 4.15. Line of Business............................................57
Section 4.16. Limitation on Status as Investment Company..................57
Section 4.17. Payments for Consent........................................57
Section 4.18. Corporate Existence.........................................57
Section 4.19. Change of Control...........................................58
Section 4.20. Limitation on Certain Asset Sales...........................60
Section 4.21. General Provisions Related to Change of Control Offers
and Excess Proceeds Offers..................................62
Section 4.22. Maintenance of Office or Agency.............................62
Section 4.23. Maintenance of Properties and Insurance; Books and
Records; Compliance with Laws...............................63
Section 4.24. Further Assurance to the Trustee............................64
ARTICLE 5. SUCCESSOR CORPORATION.......................................64
Section 5.01. Merger, Consolidation or Sale of Assets.....................64
Section 5.02. Successor Person Substituted................................64
ARTICLE 6. DEFAULTS AND REMEDIES.......................................65
Section 6.01. Events of Default...........................................65
Section 6.02. Acceleration................................................67
Section 6.03. Other Remedies..............................................68
Section 6.04. Waiver of Past Defaults and Events of Default...............68
Section 6.05. Control by Majority.........................................68
Section 6.06. Limitation on Suits.........................................69
Section 6.07. Rights of Holders to Receive Payment........................69
Section 6.08. Collection Suit by Trustee..................................69
Section 6.09. Trustee May File Proofs of Claim............................70
Section 6.10. Priorities..................................................70
Section 6.11. Undertaking for Costs.......................................70
Section 6.12. Restoration of Rights and Remedies..........................71
ARTICLE 7. TRUSTEE.....................................................71
Section 7.01. Duties of Trustee...........................................71
Section 7.02. Rights of Trustee...........................................72
Section 7.03. Individual Rights of Trustee................................73
Section 7.04. Trustee's Disclaimer........................................73
Section 7.05. Notice of Defaults..........................................73
Section 7.06. Reports by Trustee to Holders...............................73
Section 7.07. Compensation and Indemnity..................................74
Section 7.08. Replacement of Trustee......................................75
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<PAGE> 5
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion....76
Section 7.10. Eligibility; Disqualification...............................76
Section 7.11. Preferential Collection of Claims Against Company...........76
Section 7.12. Paying Agents...............................................76
ARTICLE 8. AMENDMENTS, SUPPLEMENTS AND WAIVERS.........................77
Section 8.01. Without Consent of Holders..................................77
Section 8.02. With Consent of Holders.....................................77
Section 8.03. Compliance with Trust Indenture Act.........................78
Section 8.04. Revocation and Effect of Consents...........................78
Section 8.05. Notation on or Exchange of Notes............................79
Section 8.06. Trustee to Sign Amendments, etc.............................79
ARTICLE 9. DISCHARGE OF INDENTURE; DEFEASANCE..........................79
Section 9.01. Discharge of Indenture......................................79
Section 9.02. Legal Defeasance............................................80
Section 9.03. Covenant Defeasance.........................................80
Section 9.04. Conditions to Legal Defeasance or Covenant Defeasance.......81
Section 9.05. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions...............82
Section 9.06. Reinstatement...............................................83
Section 9.07. Moneys Held by Paying Agent.................................83
Section 9.08. Moneys Held by Trustee......................................83
ARTICLE 10. GUARANTEE OF NOTES..........................................84
Section 10.01. Guarantee...................................................84
Section 10.02. Execution and Delivery of Guarantees........................85
Section 10.03. Limitation of Guarantee.....................................86
Section 10.04. Release of Guarantor........................................86
Section 10.05. Additional Guarantors.......................................87
ARTICLE 11. MISCELLANEOUS...............................................87
Section 11.01. Trust Indenture Act Controls................................87
Section 11.02. Notices.....................................................88
Section 11.03. Communications by Holders with Other Holders................89
Section 11.04. Certificate and Opinion as to Conditions Precedent..........89
Section 11.05. Statements Required in Certificate and Opinion..............89
Section 11.06. When Treasury Notes Disregarded.............................90
Section 11.07. Rules by Trustee and Agents.................................90
Section 11.08. Business Days; Legal Holidays...............................90
Section 11.09. Governing Law...............................................90
Section 11.10. No Adverse Interpretation of Other Agreements...............90
Section 11.11. No Recourse Against Others..................................90
Section 11.12. Successors..................................................91
Section 11.13. Multiple Counterparts.......................................91
Section 11.14. Table of Contents, Headings, etc............................91
Section 11.15. Separability................................................91
iv
<PAGE> 6
INDENTURE
INDENTURE, dated as of March 16, 1998, among RURAL/METRO
CORPORATION, a Delaware corporation, as issuer (the "Company") the Guarantors
signatory hereto from time to time (the "Guarantors") and THE FIRST NATIONAL
BANK OF CHICAGO, as trustee (the "Trustee").
The Company and the Guarantors have duly authorized the execution
and delivery of this Indenture to provide for the issuance of the Notes (as
hereinafter defined) to be issued as provided for in this Indenture.
Each party agrees as follows for the benefit of the other parties
and for the equal and ratable benefit of the Holders of the Company's 7-7/8%
Senior Notes due 2008, unconditionally guaranteed by the Guarantors (the
"Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"144A Global Note" means the global note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold in reliance on Rule 144A.
"Acquired Indebtedness" means Indebtedness of a Person existing at
the time such Person becomes a Subsidiary or assumed in connection with an Asset
Acquisition from such Person.
"Adjusted Net Assets" of a Guarantor at any date shall mean the
lesser of the amount by which (x) the fair value of the property of such
Guarantor exceeds the total amount of liabilities, including, without
limitation, contingent liabilities (after giving effect to all other fixed and
contingent liabilities (including, without limitation, any guarantees of
Indebtedness)), but excluding liabilities under the Guarantee of such Guarantor
at such date and (y) the present fair salable value of the assets of such
Guarantor exceeds the total amount of its debts (after giving effect to all
other fixed and contingent liabilities (including, without limitation, any
guarantees of Indebtedness) and after giving effect to any collection from any
Subsidiary of such Guarantor in respect of the obligations of such Subsidiary
under the Guarantee), excluding Indebtedness in respect of the Guarantee, as
they become absolute and matured.
"Affiliate" of any specified Person means any other Person which
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such specified Person. For the
purposes of this definition, "control" (including, with correlative meanings,
the terms "controlling," "controlled by,"
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and "under common control with"), as used with respect to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the voting securities of a Person shall
be deemed to be control.
"Agent" means any Registrar, Paying Agent, co-registrar or agent for
service of notices and demands.
"Applicable Procedures" means with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Cedel that apply to such transfer or
exchange.
"Asset Acquisition" means (a) an Investment by the Company or any
Subsidiary of the Company in any other Person pursuant to which such Person
shall become a Subsidiary of the Company, or shall be merged with or into the
Company or any Subsidiary of the Company, (b) the acquisition by the Company or
any Subsidiary of the Company of the assets of any Person (other than a
Subsidiary of the Company) or (c) the acquisition by the Company or any
Subsidiary of the Company of any division or line of business of any Person
(other than a Subsidiary of the Company); provided, in each case, that the
assets acquired are to be used in the business conducted by the Company and its
Subsidiaries as of the Issue Date or any other business determined by the
Company's Board of Directors, in good faith, to be reasonably related thereto.
"Asset Sale" means (x) the direct or indirect sale, transfer,
issuance, conveyance, lease (other than operating leases entered into in the
ordinary course of business pursuant to ordinary business terms, including,
without limitation, any equipment lease reasonably entered into in connection
with any acquisition or potential acquisition consistent with past practice),
assignment or other disposition (including, without limitation, by eminent
domain, condemnation or similar governmental proceeding) (each, a "disposition"
or "issuance") and (y) any merger or consolidation of any Subsidiary of the
Company with or into another Person (other than the Company or any Wholly Owned
Subsidiary of the Company) whereby such Subsidiary shall cease to be a Wholly
Owned Subsidiary, if such disposition, issuance, merger, or consolidation
involves property or assets with a fair market value in excess of $1,000,000,
whether in a single transaction or in a series of related transactions, of (a)
any Equity Interest in any Subsidiary, (b) real property owned by the Company or
any Subsidiary thereof, or a division, line of business, or comparable business
segment of the Company or any Subsidiary thereof or (c) other property, assets,
or rights (including, without limitation leasehold rights) of the Company or any
Subsidiary thereof; provided, however, that, except as noted in the last
sentence in this paragraph, Asset Sales shall not include (i) dispositions or
issuances to or mergers or consolidations of, the Company or a Subsidiary
thereof or any other Person if after giving effect to such disposition,
issuance, merger or consolidation such other Person becomes a Wholly Owned
Subsidiary of the Company, (ii) transactions involving the Company which are
subject to and effected in compliance with Section 5.01, (iii) dispositions of
services and products in the ordinary course of business, (iv) a disposition
that is an Investment or a Restricted Payment not prohibited
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<PAGE> 8
by Section 4.07, (v) a sale, transfer, conveyance, or issuance of an Equity
Interest that constitutes a Permitted Investment pursuant to clause (ii)(C) of
the definition thereof or that complies with the limitations set forth in
Section 4.07, if, in each case, the assets received in consideration therefor
are to be used in the business conducted by the Company and its Subsidiaries as
of the Issue Date or any other business determined by the Company's Board of
Directors, in good faith, to be reasonably related thereto, (vi) exchanges of
assets that comply with the requirements of Section 4.20(c), (vii) a designation
of a Subsidiary as an Unrestricted Subsidiary if permitted under this Indenture,
(viii) the disposition of any Temporary Cash Investment, and (ix) the grant of
any Lien securing Indebtedness permitted under this Indenture. Notwithstanding
any provision of this Indenture to the contrary, the expiration or non-renewal
of any lease of property at the normal expiration date thereof shall not
constitute an Asset Sale. For purposes of the definition of Consolidated Fixed
Charge Coverage Ratio, transactions referred to in clauses (iv) and (vi) shall
be included as Asset Sales.
"Asset Sale Proceeds" means, with respect to any Asset Sale, (i)
cash received by the Company or any Subsidiary thereof from such Asset Sale
after (a) provision for all income or other taxes measured by or resulting from
such Asset Sale, (b) payment of all brokerage commissions, underwriting, legal,
accounting, title and other reasonable fees, costs and expenses, consistent with
past practice, related to such Asset Sale, (c) provision for minority interest
holders in any Subsidiary or in any asset subject to such Asset Sale as a result
of such Asset Sale, (d) payments made to retire Indebtedness secured by the
assets subject to such Asset Sale or otherwise required to be paid, and (e)
deduction of appropriate amounts to be provided by the Company or a Subsidiary
thereof as a reserve, in accordance with GAAP, against any liabilities
associated with the assets disposed of in such Asset Sale and retained by the
Company or a Subsidiary thereof after such Asset Sale including, without
limitation, pension and other post employment benefit liabilities and
liabilities related to environmental matters or against any indemnification
obligations associated with the assets disposed of in such Asset Sale and (ii)
any securities, notes, or other obligations received by the Company or any
Subsidiary thereof from such Asset Sale upon the liquidation or conversion of
such securities, notes, or other obligations into cash prior to the Reinvestment
Date.
"Attributable Indebtedness" when used with respect to any Sale and
Lease-Back Transaction means, as at the time of determination, the present value
(discounted at a rate equivalent to the interest rate implicit in the lease,
compounded on a semi-annual basis) of the total obligations of the lessee for
rental payments (after excluding all amounts required to be paid on account of
maintenance and repairs, insurance, taxes, utilities and other similar expenses
payable by the lessee pursuant to the terms of the lease) during the remaining
term of the lease included in any such Sale and Lease-Back Transaction or until
the earliest date on which the lessee may terminate such lease without penalty
or upon payment of a penalty (in which case the rental payments shall include
such penalty).
"Board of Directors" means, as to any Person, the board of directors
or any duly authorized committee thereof of such Person or, if such Person is a
partnership
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<PAGE> 9
(or other non-corporate Person), of the managing general partner or partners (or
Persons serving an analogous function) of such Person.
"Board Resolution" means, as to any Person, a copy of a resolution
certified pursuant to an Officers' Certificate to have been duly adopted by the
Board of Directors of such Person, and to be in full force and effect, and, if
required hereunder, delivered to the Trustee.
"Capital Lease Obligations" means Indebtedness represented by
obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP, and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with GAAP.
"Cedel" means Cedel Bank, societe anonyme.
"Certificated Note" means a certificated Note registered in the name
of the Holder thereof and issued in accordance with Section 2.06 hereof, in the
form of Exhibit A hereto except that such Note shall not bear the Global Note
Legend and shall not have the "Schedule of Exchanges of Interests in the Global
Note" attached thereto.
"Change of Control" means the occurrence of any of the following:
(i) the sale, lease, transfer, conveyance, or other disposition (other than by
way of merger or consolidation), in one or a series of related transactions, of
all or substantially all of the assets of the Company and its Subsidiaries taken
as a whole to any "person" (as such term is used in Section 13(d)(3) of the
Exchange Act); (ii) the adoption of a plan relating to the liquidation or
dissolution of the Company; (iii) the consummation of any transaction
(including, without limitation, any merger or consolidation) the result of which
is that any "person" (as defined above) is or becomes the "beneficial owner" (as
such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except
that a 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), directly or indirectly, of more than 40% of the Common Equity
Interest of the Company (measured by voting power rather than number of shares
or equivalent units); or (iv) the first day on which less than a majority of the
members of the Board of Directors of the Company are Continuing Directors.
Notwithstanding the foregoing, any such transaction described in clause (i) or
(ii) above which is consummated solely to change the state of incorporation of
the Company from Delaware to any other state in the United States shall not
constitute a Change of Control; provided, that all other requirements of this
Indenture in connection with such transaction have been complied with.
"Common Equity Interest" of any Person means all Equity Interests of
such Person that are generally entitled to (i) vote in the election of directors
of such Person or (ii) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers or others
that will control the management and policies of such Person.
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<PAGE> 10
"Company" means the party named as such in the first paragraph of
this Indenture until a successor replaces such party pursuant to Article 5 of
this Indenture and thereafter means the successor.
"Company Request" means any written request signed in the name of
the Company by any two of the following: the Chief Executive Officer; the
President; any Vice President; the Chief Financial Officer; the Treasurer; or
the Secretary or any Assistant Secretary (but not both the Secretary and any
Assistant Secretary) of the Company.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus, to the
extent deducted in computing such Consolidated Net Income, (i) an amount equal
to any extraordinary loss plus any net loss realized in connection with an Asset
Sale, (ii) provision for taxes based on income or profits, (iii) consolidated
interest expense whether paid or accrued and whether or not capitalized
(including, without limitation, amortization of debt issuance costs and original
issue discount, non-cash interest payments, the interest component of any
deferred payment obligations, the interest component of all payments associated
with Capital Lease Obligations, commissions, discounts and other fees and
charges incurred in respect of letter of credit or bankers' acceptance
financings, and net payments (if any) pursuant to Hedging Obligations), and (iv)
depreciation and amortization (including amortization of goodwill and other
intangibles but excluding amortization of prepaid cash expenses that were paid
in a prior period) in each case, on a consolidated basis and determined in
accordance with GAAP. Notwithstanding the foregoing, the provision for taxes
based on the income or profits of, and the depreciation and amortization of, a
Subsidiary of a Person shall be added to Consolidated Net Income to compute
Consolidated Cash Flow only to the extent (and in the same proportion) that the
Net Income of such Subsidiary was included in calculating the Consolidated Net
Income of such Person and only if a corresponding amount would be permitted at
the date of determination to be dividended to the Company by such Subsidiary
without prior approval (that has not been obtained) pursuant to the terms of its
charter and all agreements, instruments, judgments, decrees, orders, statutes,
rules, and governmental regulations applicable to such Subsidiary or its
stockholders.
"Consolidated Fixed Charge Coverage Ratio" means with respect to any
Person, the ratio of the aggregate amount of Consolidated Cash Flow of such
Person for the four full fiscal quarters immediately preceding the date of the
transaction (the "Transaction Date") giving rise to the need to calculate the
Consolidated Fixed Charge Coverage Ratio (such four full fiscal quarter period
being referred to herein as the "Four Quarter Period") to the aggregate amount
of 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 Cash Flow" and "Consolidated Fixed Charges" shall be
calculated after giving effect on a pro forma basis for the period of such
calculation to, without duplication, (a) the incurrence of any Indebtedness of
such Person or any of its Subsidiaries (and the application of the net proceeds
thereof) during the period commencing on the first day of the Four Quarter
Period to and including the Transaction Date (the "Reference Period"),
including, without limitation, the incurrence
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<PAGE> 11
of the Indebtedness giving rise to the need to make such calculation (and the
application of the net proceeds thereof), as if such incurrence (and
application) occurred on the first day of the Four Quarter Period (it being
understood that with respect to Indebtedness incurred under a revolving facility
used primarily to finance working capital, the average daily principal amount
outstanding during the Reference Period shall be deemed to be the amount
incurred during the Reference Period), and (b) any Asset Sales 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
Subsidiaries (including any Person who becomes a Subsidiary as a result of the
Asset Acquisition) incurring, assuming or otherwise being liable for Acquired
Indebtedness) occurring during the Reference Period, as if such Asset Sale or
Asset Acquisition occurred on the first day of the Four Quarter Period.
Furthermore, in calculating "Consolidated Fixed Charges" for purposes of
determining this "Consolidated Fixed Charge Coverage Ratio," (i) 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 (ii) if interest on
Indebtedness actually incurred on the Transaction Date may optionally be
determined at an interest rate based upon a factor of a prime or similar rate, a
eurocurrency interbank offered rate, or other rates, then the interest rate in
effect on the Transaction Date will be deemed to have been in effect during the
Four Quarter Period. In calculating the Consolidated Fixed Charge Coverage Ratio
and giving pro forma effect to the incurrence of Indebtedness during a Reference
Period, pro forma effect shall be given to use of proceeds thereof to
permanently repay or retire Indebtedness. If such Person or any of its
Subsidiaries directly or indirectly guarantees Indebtedness of a third Person,
for purposes of determining the "Consolidated Fixed Charge Coverage Ratio,"
effect shall be given to the incurrence of such guaranteed Indebtedness as if
such Person or such Subsidiary had directly incurred or otherwise assumed such
guaranteed Indebtedness.
"Consolidated Fixed Charges" means, with respect to any Person for
any period, the sum of, without duplication, the amounts for such period of (i)
the consolidated interest expense of such Person and its Subsidiaries for such
period, whether paid or accrued (including, without limitation, amortization of
debt issuance costs and original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, commissions,
discounts and other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net payments (if any) pursuant to Hedging
Obligations), (ii) the consolidated interest expense of such Person and its
Subsidiaries that was capitalized during such period, (iii) any interest expense
on Indebtedness of another Person that is guaranteed by such Person or one of
its Subsidiaries or secured by a Lien on assets of such Person or one of its
Subsidiaries (whether or not such guarantee or Lien is called upon), and (iv)
the product of (a) all dividend payments, whether or not in cash, on any series
of Disqualified Equity Interests of such Person or any of its Subsidiaries,
other than dividend payments on Disqualified Equity Interests payable solely in
Equity Interests of the Company, times (b) a fraction, the numerator of which is
one and the denominator of which is one minus the then
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<PAGE> 12
current combined federal, state and local statutory tax rate of such Person,
expressed as a decimal, in each case, on a consolidated basis and in accordance
with GAAP.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP;
provided that (i) the Net Income (but not loss) of any Person that is not a
Subsidiary or that is accounted for by the equity method of accounting shall be
included only to the extent of the amount of dividends or distributions paid in
cash to the referent Person or a Wholly Owned Subsidiary thereof, (ii) the Net
Income of any Subsidiary shall be excluded to the extent that the declaration or
payment of dividends or similar distributions by that Subsidiary of that Net
Income is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or indirectly,
by operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule, or governmental regulation applicable to that
Subsidiary or its stockholders, (iii) the Net Income of any Person acquired in a
pooling of interests transaction for any period prior to the date of such
acquisition shall be excluded, (iv) the cumulative effect of a change in
accounting principles shall be excluded, and (v) any non-cash compensation
expense in connection with the issuance of employee stock options shall be
excluded.
"Consolidated Net Worth" means, with respect to any Person at any
date, the consolidated stockholders' equity of such Person less the amount of
such stockholders' equity attributable to Disqualified Equity Interests of such
Person and its Subsidiaries, as determined in accordance with GAAP, less (i) all
write-ups (other than write-ups of tangible assets of a going concern business
made within 12 months after the acquisition of such business) subsequent to the
Issue Date in the book value of any asset owned by such Person or a consolidated
Subsidiary of such Person, (ii) all investments as of such date in
unconsolidated Subsidiaries and in Persons that are not Subsidiaries and (iii)
all unamortized debt discount and expense and unamortized deferred charges as of
such date, in each case determined in accordance with GAAP.
"Consolidated Total Assets" means, as of any date of determination,
the consolidated total assets of such Person, as reflected on the most recent
balance sheet of such Person prepared in accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of this Indenture or (ii) was nominated for
election or elected to such Board of Directors with the approval of a majority
of the Continuing Directors who were members of such Board at the time of such
nomination or election.
"Default" means any event that is, or after notice or passage of
time or both would be, an Event of Default.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary
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with respect to the Notes, and any and all successors thereto appointed as
depositary hereunder and having become such pursuant to the applicable provision
of this Indenture.
"Disqualified Equity Interests" means any Equity Interest 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), or upon the happening of
any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the date that is 91 days following the
maturity date of the Notes, for cash or securities constituting Indebtedness;
provided, however, that Preferred Equity Interests of the Company or any
Subsidiary thereof that are issued with the benefit of provisions requiring a
change of control offer or asset sale proceeds offer to be made for such
Preferred Equity Interest in the event of a change of control or sale of assets
of the Company or such Subsidiary, which provisions have substantially the same
effect as the provisions of this Indenture described under Section 4.19 or
Section 4.20, shall not be deemed to be Disqualified Equity Interests solely by
virtue of such provisions.
"Equity Interests" means, with respect to any Person, any and all
shares or other equivalents (however designated) of capital stock, partnership
interests, membership interests, or any other participation, right or other
interests in the nature of an equity interest in such Person or any option,
warrant or other security convertible into or exchangeable for any of the
foregoing.
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means the Notes issued in the Exchange Offer
pursuant to Section 2.06(f).
"Exchange Offer" means the "Registered Exchange Offer" as defined in
the Registration Rights Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Existing Credit Facility" means that certain Credit Agreement,
dated as of September 29, 1995 by and among the Company, as "Guarantor," certain
subsidiaries of the Company, as "Borrowers," the lenders party thereto and First
Union National Bank, as "Agent," as amended prior to the Issue Date.
"fair market value" or "fair value" means, with respect to any
assets or property, the price which could be negotiated in an arm's-length free
market transaction, for cash, between a willing seller and a fully informed,
willing and able buyer, neither of whom is under undue pressure or compulsion to
complete the transaction, all as reasonably determined by a majority of the
Board of Directors acting in good faith, such
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<PAGE> 14
determination to be evidenced by a board resolution delivered to the Trustee. No
such determination need be supported by an appraisal or expert opinion.
"GAAP" means generally accepted accounting principles applied as in
effect in the United States on the Issue Date.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"guarantee" means with respect to any Person, any obligation,
contingent or otherwise, of such Person directly or indirectly guaranteeing any
Indebtedness or other obligation of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of such Person (i) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness or other obligation of such other
Person (whether arising by virtue of partnership arrangements, or by agreements
to keep-well, to purchase assets, goods, securities or services, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (ii) entered into
for purposes of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided 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, as the context may require, individually, a
guarantee, or collectively, any and all guarantees, of the Obligations of the
Company with respect to the Notes by each Guarantor pursuant to the terms of
Article 10 hereof.
"Guarantor" means the parties named as such in the first paragraph
of this Indenture (which consist of all domestic Wholly Owned Subsidiaries as of
the Closing Date other than Coronado Health Services, Inc.) and any other
Person, in each case so long as such Person guarantees the Obligations of the
Company with respect to the Notes pursuant to the terms of Article 10 hereof.
"Hedging Obligations" means, for any Person, any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or other
similar agreement designed to protect the party indicated therein against
fluctuations in interest rates, currency exchange rates or commodity prices.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Registrar's books.
"IAI Global Note" means the global Note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes transferred to institutional accredited investors
subsequent to the initial issuance of the Notes.
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<PAGE> 15
"incur" means, with respect to any Indebtedness or other obligation
of any Person, to create, issue, incur (by conversion, exchange or otherwise),
assume, guarantee or otherwise become, directly or indirectly, liable in respect
of such Indebtedness or other obligation or the recording, as required pursuant
to GAAP or otherwise, of any such Indebtedness or other obligation on the
balance sheet of such person (and "incurrence," "incurred", "incurable," and
"incurring" shall have meanings correlative to the foregoing); provided,
however, that a change in GAAP that results in an obligation of such Person that
exists at such time becoming Indebtedness shall not be deemed an incurrence of
such Indebtedness; and provided, further, that accrual of interest, the
accretion of accreted value, and the payment of interest in the form of
additional Indebtedness will not be deemed to be an incurrence of Indebtedness.
Any Indebtedness or Equity Interests of a Person existing at the time such
Person becomes a Subsidiary (whether by merger, consolidation, acquisition or
otherwise) shall be deemed to be incurred by such Person at the time it becomes
a Subsidiary. Indebtedness consisting of reimbursement obligations in respect of
a letter of credit will be deemed to be incurred when the letter of credit is
issued or renewed.
"Indebtedness" means (without duplication), with respect to any
Person, any indebtedness at any time outstanding, secured or unsecured,
contingent or otherwise, which is for borrowed money (whether or not the
recourse of the lender is to the whole of the assets of such Person or only to a
portion thereof), or evidenced by bonds, notes, debentures or similar
instruments or representing the balance deferred and unpaid of the purchase
price of any property (excluding, without limitation, any balances that
constitute accounts payable or trade payables, and other liabilities arising in
the ordinary course of business) and shall also include, to the extent not
otherwise included (i) any Capital Lease Obligations, (ii) obligations of
Persons other than such Person secured by a Lien to which the property or assets
owned or held by such Person is subject, whether or not the obligation or
obligations secured thereby shall have been incurred or assumed by such Person,
(iii) all Indebtedness of others of the types described in the other clauses of
this definition (including all dividends of other Persons) the payment of which
is guaranteed, directly or indirectly, by such Person or that is otherwise its
legal liability or which such Person has agreed to purchase or repurchase or in
respect of which such Person has agreed contingently to supply or advance funds
(whether or not such items would appear upon the balance sheet of the
guarantor), (iv) all obligations for the reimbursement of any obligation or on
any letter of credit, banker's acceptance or similar credit transaction, (v)
Disqualified Equity Interests, (vi) Hedging Obligations of any such Person, and
(vii) Attributable Indebtedness. The amount of Indebtedness of any Person at any
date shall be the principal (or face) amount outstanding at such date of all
unconditional obligations as described above and, with respect to contingent
obligations, the maximum liability upon the occurrence of the contingency giving
rise to the obligation; provided, however, that Indebtedness shall not include
any liability for federal, state, local, or other taxes. Notwithstanding any
other provision of this definition, any trade payable arising from the purchase
of goods or materials or for services obtained in the ordinary course of
business shall not be deemed to be "Indebtedness" for purposes of this
definition. Furthermore, guarantees of (or obligations with respect to letters
of credit supporting) Indebtedness otherwise included in the determination of
such amount shall not also be included.
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"Indenture" means this Indenture as amended, restated or
supplemented from time to time.
"Independent Financial Advisor" means an accounting, appraisal,
investment banking, or consulting firm of nationally recognized standing that
is, in the good faith judgment of the Board of Directors of the Company,
qualified to perform the task for which such firm has been engaged.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"Interest" when used with respect to any Note, means the amount of
all interest accruing on such Note, including all interest accruing subsequent
to the occurrence of any events specified in Sections 6.01(8) and (9) or which
would have accrued but for any such event.
"Interest Payment Date" means the stated maturity of an installment
of interest on the Notes.
"Investments" means, directly or indirectly, any advance, account
receivable (other than an account receivable arising in the ordinary course of
business (including accounts receivable arising in the ordinary course of
business and acquired as a part of the assets acquired by the Company or a
Subsidiary in connection with an acquisition of assets which is otherwise
permitted by the terms of this Indenture)), loan or capital contribution to (by
means of transfers of property to others, payments for property or services for
the account or use of others or otherwise), the purchase of any stock, bonds,
notes, debentures, partnership or joint venture interests, or other securities
of, the acquisition, by purchase or otherwise, of all or substantially all of
the business or stock or other evidence of beneficial ownership of, any Person,
the guarantee or assumption of the Indebtedness of any other Person (except for
an assumption of Indebtedness for which the assuming Person receives
consideration with a fair market value at least equal to the principal amount of
the Indebtedness assumed), the designation of a Subsidiary as an Unrestricted
Subsidiary, or the making of any investment in any Person and all other items
that would be classified as investments on a balance sheet of such Person
prepared in accordance with GAAP. Investments shall exclude (i) extensions of
trade credit on commercially reasonable terms in accordance with normal trade
practices, (ii) endorsements of negotiable instruments for collection or deposit
in the ordinary course of business, (iii) commission, travel, payroll and
similar advances to directors, officers and employees made in the ordinary
course of business, and (iv) workers' compensation, utility, lease and similar
deposits and prepaid expenses in the ordinary course of business. If the Company
or any Subsidiary of the Company sells or otherwise disposes of any Equity
Interests of any direct or indirect Subsidiary of the Company such that, after
giving effect to any such sale or disposition, such Person is no longer a
Subsidiary of the Company, the Company or such Subsidiary 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 Equity Interests of such Subsidiary not sold or
disposed of in an amount determined as provided in the penultimate paragraph of
Section 4.07. In determining the amount of any
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<PAGE> 17
Investment in respect of any Property other than cash, such Property shall be
valued at its fair market value at the time of such Investment.
"Issue Date" means the closing date for the sale and original
issuance of the Notes to the Initial Holders.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Notes for use by such
Holders in connection with the Exchange Offer.
"Lien" means, with respect to any property or assets of any Person,
any mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance, preference,
priority, or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or assets (including
without limitation, any Capital Lease Obligation, conditional sales, or other
title retention agreement having substantially the same economic effect as any
of the foregoing).
"Liquidated Damages" means all liquidated damages then owing
pursuant to Section 6 of the Registration Rights Agreement.
"Maturity Date" means March 15, 2008.
"Net Income" means, with respect to any Person for any period, the
net income (loss) of such Person determined in accordance with GAAP and before
any reduction in respect of dividends on Preferred Equity Interests, excluding,
however, (i) any gain, together with any related provision for taxes on such
gain, realized in connection with (a) any Asset Sale or (b) the disposition of
any securities by such Person or any of its Subsidiaries or the extinguishment
of any Indebtedness of such Person or any of its Subsidiaries and (ii) any
extraordinary or nonrecurring gain (or loss incurred prior to the Issue Date,
but not loss incurred after the Issue Date), together with any related provision
for taxes on such extraordinary or nonrecurring gain (but not loss, except to
the extent referred to above).
"Net Investments" means the excess of (i) the aggregate of all
Investments made by the Company or a Subsidiary thereof on or after the Issue
Date (in the case of an Investment made other than in cash, the amount shall be
the fair market value of such Investment at the time made as determined in good
faith by the Board of Directors of the Company) over (ii) the sum of (a) the
aggregate amount returned in cash on such Investments (in the case of a noncash
return on such Investments, the amount thereof shall be the fair market value of
such noncash consideration at the time of receipt thereof as determined in good
faith by the Board of Directors of the Company) whether through interest
payments, principal payments, dividends or other distributions and (b) the net
cash proceeds received by the Company or such Subsidiary from the disposition of
all or any portion of such Investments (other than to a Subsidiary of the
Company); provided, however, that with respect to all Investments made in
Unrestricted Subsidiaries the sum
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<PAGE> 18
of clauses (a) and (b) above with respect to such Investments shall not exceed
the aggregate amount of all Investments made in all Unrestricted Subsidiaries.
"New Credit Facility" means that certain Amended and Restated Credit
Agreement, dated as of March 16, 1998, by and among the Company, the lenders
party thereto and First Union National Bank, as agent, including any related
notes, guarantees (by subsidiaries of the Company or otherwise), collateral
documents, instruments and agreements executed in connection therewith, and in
each case as amended, restated, modified, renewed, refunded, replaced or
refinanced (in each case, in whole or in part, and without limitation as to
amount, terms, conditions, covenants and other provisions), with the same or
other agents and lenders, in whole or in part, from time to time and any
agreement (and related documents) governing Indebtedness incurred to refinance
or refund borrowings and commitments then outstanding or permitted to be
outstanding under such credit facility or a successor New Credit Facility,
whether by the same or other agent lender or group of lenders.
"Non-Recourse Debt" means Indebtedness: (i) as to which neither the
Company nor any of its Subsidiaries (a) provides credit support of any kind
(including any undertaking, agreement or instrument that would constitute
Indebtedness), (b) is directly or indirectly liable (as a guarantor or
otherwise), or (c) constitutes the lender; (ii) no default with respect to which
(including any rights that the holders thereof may have to take enforcement
action against an Unrestricted Subsidiary) would permit (upon notice, lapse of
time or both) any holder of any other Indebtedness of the Company or any of its
Subsidiaries to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated maturity; and
(iii) as to which the lenders have been notified in writing that they will not
have any recourse to the stock or assets of the Company or any of its
Subsidiaries.
"Note Custodian" means the Trustee, as custodian with respect to the
Notes in global form, or any successor entity thereto.
"Notes" means the securities that are issued under this Indenture,
as amended or supplemented from time to time pursuant to this Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages, and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chief Executive
Officer, the President, any Vice President, the Chief Financial Officer or the
Treasurer of such Person, the Controller, the Secretary or any other officer
designated by the Board of Directors of such Person, as the case may be (or, in
the case of a Person that is a partnership (or other non-corporate Person), of a
general partner (or analogous individuals) of such Person in such capacity).
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chief Executive Officer, the President or any Vice
President and the Chief
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<PAGE> 19
Financial Officer or any Treasurer or Assistant Treasurer of such Person (or, in
the case of a Person that is a partnership (or other non-corporate Person), of a
general partner (or analogous individuals) of such Person in such capacity) that
shall comply with applicable provisions of this Indenture.
"Opinion of Counsel" means a written opinion from legal counsel
which counsel is reasonably acceptable to the Trustee.
"Participant" means, with respect to DTC, Euroclear or Cedel, a
Person who has an account with DTC, Euroclear or Cedel, respectively (and, with
respect to DTC, shall include Euroclear and Cedel).
"Permitted Indebtedness" means:
(i) Indebtedness (plus interest, premium, fees and other
obligations associated therewith) of the Company or any Guarantor arising
under or in connection with the New Credit Facility of up to $200,000,000;
(ii) Indebtedness under the Notes and the Guarantees;
(iii) Indebtedness outstanding on the Issue Date after giving
effect to the application of the proceeds of this Offering (including
repayment of all obligations under the Existing Credit Agreement);
(iv) Hedging Obligations of the Company or any Subsidiary;
(v) Indebtedness of a Wholly Owned Subsidiary issued to and
held by the Company or a Wholly Owned Subsidiary or Indebtedness of the
Company to a Wholly Owned Subsidiary in respect of intercompany advances
or transactions;
(vi) (a) Purchase Money Indebtedness, (b) Capital Lease
Obligations, and (c) Indebtedness incurred in connection with an Asset
Acquisition (including Acquired Indebtedness), in each case incurred by
the Company or any Subsidiary, in an aggregate principal amount
outstanding at any time not to exceed $25,000,000;
(vii) Indebtedness constituting an agreement or commitment to
pay a dividend that has been declared or otherwise to make a payment or
distribution as described in Section 4.07(b)(i);
(viii) Indebtedness in connection with one or more letters of
credit, guarantees, bid, surety or performance bonds, or other
reimbursement obligations or banker's acceptances, in each case issued in
the ordinary course of business and not in connection with the borrowing
of money or the obtaining of advances or credit;
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<PAGE> 20
(ix) additional Indebtedness of the Company or any Subsidiary
(which may be Indebtedness under the New Credit Facility) in an aggregate
principal amount outstanding at any time not to exceed $15,000,000; and
(x) Refinancing Indebtedness.
"Permitted Investments" means, for any Person, Investments made on
or after the Issue Date consisting of:
(i) Temporary Cash Investments;
(ii) (A) Investments in the Company or a Subsidiary of the
Company, (B) Investments in any Person, if (1) as a result of such
Investment (y) such Person or a Subsidiary of such Person becomes a
Subsidiary of the Company or (z) such Person or a Subsidiary of such
Person is merged, consolidated or amalgamated with or into, or transfers
or conveys substantially all of its assets to, or is liquidated into, the
Company or a Subsidiary thereof and (2) after giving effect to such
Investment, the Company is in compliance with Section 4.15, and (C) Net
Investments in any Persons primarily engaged or preparing to engage in the
business conducted by the Company and its Subsidiaries as of the Issue
Date or any other business determined by the Company's Board of Directors,
in good faith, to be reasonably related thereto; provided, however, that
the aggregate amount of all such Net Investments made pursuant to this
clause (C), shall not exceed at any one time outstanding 10.0% of the
Consolidated Total Assets of the Company as reflected on the most recent
balance sheet delivered by the Company to the Trustee;
(iii) Investments represented by accounts receivable created
or acquired in the ordinary course of business;
(iv) advances to employees, officers, and directors in the
ordinary course of business not to exceed an aggregate of $1,000,000
outstanding at any one time;
(v) Investments under or pursuant to Hedging Obligations;
(vi) an Investment that is made by the Company or a Subsidiary
thereof in the form of any Equity Interests, Indebtedness or other assets
received as partial consideration for the consummation of a transaction
that is otherwise permitted under Section 4.20;
(vii) Investments in the Notes otherwise permitted under this
Indenture;
(viii) Investments existing on the Issue Date;
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<PAGE> 21
(ix) any Investment acquired solely in exchange for, by
conversion of, or out of the net cash proceeds of, the issuance of Equity
Interests (other than Disqualified Equity Interests) of the Company;
(x) stocks, obligations or other securities received in
settlement of debts (including, without limitation, under any bankruptcy
or other similar proceeding) owing to the Company or any of its
Subsidiaries as a result of foreclosure, perfection, enforcement, or
settlement of any Indebtedness or Liens in favor of the Company or a
Subsidiary; and
(xi) guarantees not prohibited by Section 4.06 or Section
4.10.
"Permitted Liens" means, without duplication, (i) Liens existing on
the Issue Date, (ii) Liens in favor of the Company or any Subsidiary thereof,
(iii) Liens on the Equity Interests or property of a Person existing at the time
such Person becomes a Subsidiary of, or is acquired by, merged into or
consolidated with the Company or any Subsidiary thereof, or such property is
acquired by the Company or a Subsidiary; provided, however, that such Liens (a)
were not created in connection with or in anticipation of such acquisition,
merger, or consolidation or such Person becoming a Subsidiary and (b) are not
applicable to any other property of the Company or any of the other Subsidiaries
of the Company, (iv) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently conducted; provided,
however, that any reserve or other appropriate provision as shall be required in
conformity with GAAP shall have been made therefor, (v) landlords', carriers',
warehousemen's, mechanics', materialmen's, repairmen's or other like Liens
arising in the ordinary course of business (whether contractual, statutory or
constitutional in nature) and with respect to amounts which are not yet
delinquent or are being contested in good faith by appropriate proceedings, (vi)
pledges or deposits made in the ordinary course of business in connection with
(a) leases, performance bonds and similar obligations, (b) workers'
compensation, unemployment insurance and other social security legislation, or
(c) securing the performance of surety bonds and appeal bonds required (1) in
the ordinary course of business or in connection with the enforcement of rights
or claims of the Company or a Subsidiary thereof or (2) in connection with
judgments that do not give rise to an Event of Default, (vii) easements,
rights-of-way, restrictions, minor defects or irregularities in title and other
similar encumbrances which, in the aggregate, do not materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the Company or any Subsidiary in connection
therewith, (viii) Liens to secure Purchase Money Indebtedness that is otherwise
permitted under this Indenture; provided, however, that (a) any such Lien is
created solely for the purpose of securing Indebtedness representing, or
incurred to finance, refinance or refund, the cost (including commissions, sales
and excise taxes, installation and delivery charges and other direct costs of,
and other direct expenses paid or charged in connection with, such purchase or
construction and such financing) of such Property, (b) the principal amount of
the Indebtedness secured by such Lien does not exceed 100% of such costs, and
(c) such Lien does not extend to or cover any Property other than such item of
Property and any accessions, substitutions or improvements on,
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<PAGE> 22
and proceeds from, such item, (ix) Liens securing Capital Lease Obligations
permitted to be incurred under this Indenture; provided, however, that such Lien
does not extend to any property other than that subject to the underlying lease,
(x) Liens to secure Indebtedness incurred pursuant to clause (vi) of the
definition of Permitted Indebtedness; provided, however, that (a) any such Lien
is created solely for the purpose of securing such Indebtedness, (b) the
principal amount of the Indebtedness secured by such Lien does not exceed 100%
of the purchase price for the Property acquired and (c) such Lien does not
extend to or cover any Property other than the Property acquired and any
proceeds therefrom, (xi) Liens pursuant to leases and subleases of real property
which do not interfere with the ordinary conduct of the business of the Company
or any of its Subsidiaries and which are made on customary and usual terms
applicable to similar properties and do not extend to any property of the
Company or a Subsidiary other than the personal property located on such real
property, (xii) Liens securing reimbursement obligations under commercial
letters of credit, but only in or upon the goods the purchase of which were
financed by such letters of credit, (xiii) Liens arising under this Indenture in
favor of the Trustee for its own benefit or for the benefit of the Holders,
(xiv) Liens resulting from the deposit of funds or government securities in
trust for the purpose of decreasing or defeasing Indebtedness of the Company and
its Subsidiaries so long as such deposit of funds or government securities and
such decreasing or defeasing of Indebtedness are permitted under Section 4.07,
(xv) Liens constituting licenses not otherwise prohibited under the terms of
this Indenture, (xvi) setoff, chargeback and other rights of depository and
collecting banks and other regulated financial institutions with respect to
money or instruments of the Company or its Subsidiaries on deposit with or in
the possession of such institutions, (xvii) any interest or title of a lessor in
the property subject to any Capital Lease Obligation permitted under this
Indenture or any operating lease, (xviii) Liens on Equity Interests of
Unrestricted Subsidiaries, (xix) judgment or attachment Liens not giving rise to
an Event of Default, (xx) any Lien arising under a contract entered into by the
Company or any of its Subsidiaries to the extent such contract requires the
Company or such Subsidiary to lease equipment at a fair market rental rate to
the counterparty under such contract upon the occurrence of a default by the
Company or such Subsidiary, (xxi) Liens in connection with Sale and Lease-Back
Transactions otherwise permitted under the Indenture, and (xxii) Liens to secure
Indebtedness in an aggregate amount not in excess of $2,000,000 at any one time
outstanding and that (a) are not incurred in connection with the borrowing of
money or the obtaining of advances or credit (other than trade credit in the
ordinary course of business) and (b) do not in the aggregate materially detract
from the value of the property or materially impair the use thereof in the
operation of business by the Company or any Subsidiary.
"Person" means any individual, corporation, partnership, limited
liability company or partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, or government (including any agency
or political subdivision thereof).
"Preferred Equity Interest" means any Equity Interest of a Person,
however designated, which entitles the holder thereof to a preference with
respect to
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<PAGE> 23
dividends, distributions or liquidation proceeds of such Person over the holders
of any other Equity Interest issued by such Person.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i).
"Property" or "property" of any Person means all types of real,
personal, tangible, intangible or mixed property owned by such Person whether or
not included in the most recent consolidated balance sheet of such Person and
its Subsidiaries under GAAP.
"Public Equity Offering" means, with respect to any Person, a public
offering by such Person of some or all of its Common Equity Interests other than
Disqualified Equity Interests (however designated and whether voting or
non-voting) and any and all rights, warrants or options to acquire such Equity
Interests.
"Purchase Money Indebtedness" means Indebtedness incurred to finance
the purchase price of Property (including Indebtedness existing at the time such
Property was acquired if such Indebtedness was assumed in connection with such
acquisition); provided that the principal amount of such Indebtedness does not
exceed 100% of the purchase price of such Property.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A promulgated under the Securities Act.
"Redemption Date" when used with respect to any Note to be redeemed
means the date fixed for such redemption pursuant to this Indenture.
"Refinancing Indebtedness" means Indebtedness that refunds,
refinances, renews, or replaces ("refinances") any Indebtedness of the Company
or its Subsidiaries outstanding on the Issue Date or other Indebtedness
permitted to be incurred by the Company or its Subsidiaries pursuant to the
terms of this Indenture, whether involving the same or any other lender or
creditor or group of lenders or creditors, but only to the extent that (i) the
Refinancing Indebtedness is subordinated to the Notes or the Guarantees, as
applicable, to at least the same extent as the Indebtedness being refinanced, if
at all, (ii) the Refinancing Indebtedness is scheduled to mature either (a) no
earlier than the Indebtedness being refinanced, or (b) after the maturity date
of the Notes, (iii) except where such Refinancing Indebtedness is Attributable
Indebtedness, has a Weighted Average Life to Maturity at the time such
Refinancing Indebtedness is incurred that is equal to or greater than the
Weighted Average Life to Maturity of the Indebtedness being refinanced, (iv)
except where such Refinancing Indebtedness is Attributable Indebtedness, such
Refinancing Indebtedness is in an aggregate principal amount that is less than
or equal to the aggregate principal or accreted amount (in the case of any
Indebtedness issued with original issue discount, as such) then outstanding
under the Indebtedness being refinanced plus the amount of all fees and expenses
(including premiums and penalties) associated with such refinancing), and (v)
such Refinancing Indebtedness is incurred by the same Person that initially
incurred the Indebtedness being
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refinanced, except that the Company or a Guarantor may incur Refinancing
Indebtedness to refinance Indebtedness of the Company or any Guarantor.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of March 11, 1998, by and among the Company and the other
parties named on the signature pages thereof, as such agreement may be amended,
modified or supplemented from time to time.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Restricted Certificated Note" means a Certificated Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Payment" means any of the following: (i) the declaration
or payment of any dividend or any other distribution or payment on Equity
Interests of the Company or any Subsidiary thereof (including, without
limitation, any payment in connection with any merger or consolidation including
the Company) or any payment made to the direct or indirect holders (in their
capacities as such) of Equity Interests of the Company or any Subsidiary or
Affiliate thereof (other than (a) dividends or distributions payable solely in
Equity Interests of the Company (other than Disqualified Equity Interests) or in
options, warrants or other rights to purchase Equity Interests of the Company
(other than Disqualified Equity Interests) or (b) dividends or distributions
payable to the Company or to a Wholly Owned Subsidiary of the Company), (ii) the
purchase, redemption or other acquisition or retirement for value of any Equity
Interests of the Company or any Subsidiary or Affiliate thereof (other than
Equity Interests owned by the Company or a Wholly Owned Subsidiary, excluding
Disqualified Equity Interests), (iii) the making of any principal payment on, or
the purchase, defeasance, repurchase, redemption, or other acquisition or
retirement for value, prior to any scheduled maturity, scheduled repayment, or
scheduled sinking fund payment, of any Subordinated Indebtedness (except, if no
Default or Event of Default is continuing or would result therefrom, any such
payment, purchase, defeasance, repurchase, redemption, or other acquisition or
retirement for value made (a) out of Excess Proceeds available for general
corporate purposes if (1) such payment or other action is required by this
Indenture or other agreement or instrument pursuant to which such Subordinated
Indebtedness was issued and (2) the Company has purchased all Notes and other
Senior Indebtedness properly tendered pursuant to an Asset Sale Offer required
under Section 4.20 or (b) upon the occurrence of a Change of Control if (1) such
payment or other action is required by this Indenture or other agreement or
instrument pursuant to which such Subordinated Indebtedness was issued and (2)
the Company has purchased all Notes and other Senior Indebtedness properly
tendered pursuant to the Change of Control Offer resulting from such Change of
Control), or (iv) the making of any Restricted
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Investment. For purposes of determining the amount expended for Restricted
Payments, cash distributed or invested shall be valued at the face amount
thereof and property other than cash shall be valued at its fair market value.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Sale and Lease-Back Transaction" means any arrangement with any
Person providing for the leasing by the Company or any Subsidiary of the Company
of any real or tangible personal property, which (i) property has been or is to
be sold, conveyed, or transferred by the Company or such Subsidiary to such
Person in contemplation of such leasing and (ii) constitutes an Asset Sale
permitted under Section 4.20.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" means Indebtedness of any Person which is not
Subordinated Indebtedness.
"Shelf Registration Statement" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.
"Significant Subsidiary" shall have the meaning set forth in Rule
1-02 of Regulation S-X promulgated by the Commission.
"Subordinated Indebtedness" means Indebtedness of the Company or any
Guarantor which is expressly subordinated in right of payment to the Notes or a
Guarantee, as the case may be.
"Subsidiary" of any specified Person means any corporation,
partnership, joint venture, association or other business entity, whether now
existing or hereafter organized or acquired, (i) in the case of a corporation,
of which more than 50% of the total voting power of the Equity Interests
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, officers or trustees thereof is held by such first-named
Person or any of its Subsidiaries, or (ii) in the case of a partnership, joint
venture, association, or other business entity, with respect to which such
first-named Person or any of its Subsidiaries has the power to direct or cause
the direction of the management and policies of such entity by contract or
otherwise or if in accordance with GAAP such entity is consolidated with the
first-named Person for financial statement purposes. Notwithstanding the
foregoing, an Unrestricted Subsidiary shall not be deemed a Subsidiary of the
Company other than for purposes of the definition of Unrestricted Subsidiary,
unless the Company shall have designated such Unrestricted Subsidiary as a
"Subsidiary" by written notice to the Trustee. An Unrestricted Subsidiary may be
designated as a Subsidiary at any time by the Company by written notice to the
Trustee; provided, however, that (i) no Default or Event of Default shall have
occurred and be continuing or would arise therefrom and (ii) if such
Unrestricted Subsidiary is an obligor of any Indebtedness, any such designation
shall be deemed to be an incurrence as of the
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<PAGE> 26
date of such designation by the Company of such Indebtedness and immediately
after giving effect to such designation, the Company could incur $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to Section
4.06.
"Temporary Cash Investments" means (i) United States dollars, (ii)
any evidence of Indebtedness issued or directly and fully guaranteed or insured
by the United States government or any agency or instrumentality thereof
(provided the full faith and credit of the United States government is behind
such obligation) having maturities of not more than six months from the date of
acquisition, (iii) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, demand deposits,
bankers' acceptances with maturities not exceeding six months, and overnight
bank deposits, in each case with any domestic commercial bank that is a member
of the Federal Reserve System and having capital and surplus in excess of $500.0
million, or whose short-term debt has the highest rating obtainable from Moody's
Investors Service, Inc. ("Moody's") or Standard & Poor's Ratings Group ("S&P"),
(iv) any money market deposit account issued or offered by a domestic commercial
bank that is a member of the Federal Reserve System and having capital and
surplus in excess of $500.0 million, or whose short-term debt has the highest
rating obtainable from Moody's or S&P, (v) repurchase obligations with a term of
not more than seven days for underlying securities of the types described in
clauses (ii) and (iii) above entered into with any financial institution meeting
the qualifications specified in clause (iii) above, (vi) commercial paper having
the highest rating obtainable from Moody's or S&P, and in each case maturing
within 180 days after the date of acquisition, and (vii) investments in money
market funds having assets in excess of $500.0 million, consisting solely of
investments of the types described in (i) through (vi) above.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
Sections 77aaa-77bbbb) as in effect on the Issue Date (except as provided
in Section 8.03 hereof).
"Treasury Rate" means, at any time of computation, the yield to
maturity at such time (as compiled by and published in the most recent Federal
Reserve Statistical Release H.15(519), which has become publicly available at
least two business days prior to the date of the redemption notice or, if such
Statistical Release is no longer published, any publicly available source of
similar market data) of United States Treasury securities with a constant
maturity most nearly equal to the Make-Whole Average Life; provided, however,
that if the Make-Whole Average Life 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
Make-Whole Average Life 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.
"Trust Officer" when used with respect to the Trustee, means any
officer or assistant officer of the Trustee assigned to the Corporate Trust
Administration department or similar department performing corporate trust work
of the Trustee or any
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<PAGE> 27
successor to such department or, in the case of a successor Trustee, any officer
of such successor Trustee performing corporate trust functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Trustee" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Unrestricted Certificated Note" means one or more Certificated
Notes that do not bear and are not required to bear the Private Placement
Legend, do not contain Paragraph 1(b) of the form of Note attached hereto as
Exhibit A, and the principal of which does not accrue Liquidated Damages.
"Unrestricted Global Note" means a permanent global Note in the form
of Exhibit A attached hereto that bears the Global Note Legend and that has the
"Schedule of Exchanges of Interests in the Global Note" attached thereto, and
that is deposited with or on behalf of and registered in the name of the
Depositary, representing Notes that do not bear the Private Placement Legend, do
not contain Paragraph 1(b) of form of Note attached hereto as Exhibit A, and the
principal of which does not accrue Liquidated Damages.
"Unrestricted Subsidiary" means any Subsidiary of the Company which
shall have been designated as an Unrestricted Subsidiary in accordance with this
Indenture. An Unrestricted Subsidiary may be designated as a Subsidiary at a
later date in the manner provided in the definition of "Subsidiary" above.
"U.S. Government Obligations" means (i) securities that are direct
obligations of the United States of America for the payment of which its full
faith and credit are pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the Holder of
such depository receipt; provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
Holder of such depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or a specific payment of principal or
interest on any such U.S. Government Obligation held by such custodian for the
account of the Holder of such depository receipt.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date the number of years obtained by dividing (i) the sum of
the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment
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at final maturity, in respect thereof, by (b) the number of years (calculated to
the nearest one-twelfth) that will elapse between such date and the making of
such payment, by (ii) the then outstanding principal amount of such
Indebtedness.
"Wholly Owned Subsidiary" means any Subsidiary, all of the
outstanding Equity Interests (except directors' qualifying shares or shares
required to be held by foreign nationals, in each case to the extent mandated by
applicable law) of which are owned, directly or indirectly, by the Company.
Section 1.02. Other Definitions.
The definitions of the following terms may be found in the sections
indicated as follows:
Term Defined in Section
---- ------------------
"Affiliate Transaction".......................... 4.08
"Agent Members"...................................2.01
"Bankruptcy Law"..................................6.01
"Base Period......................................4.07
"Business Day"...................................11.08
"Change of Control Offer".........................4.19
"Change of Control Payment Date"..................4.19
"Change of Control Purchase Price"................4.19
"Covenant Defeasance".............................9.03
"Custodian".......................................6.01
"DTC".............................................2.03
"Event of Default"................................6.01
"Excess Proceeds".................................4.20
"Excess Proceeds Offer"...........................4.20
"Exchange Securities".............................2.02
"Global Notes"....................................2.01
"Legal Defeasance"................................9.02
"Legal Holiday"..................................11.08
"Other Consideration".............................4.20
"Noteholder" ("Holder") ..........................1.01
"Paying Agent"....................................2.03
"Physical Notes"..................................2.12
"Private Exchange"................................2.02
"Private Exchange Securities".....................2.02
"Registrar".......................................2.03
"Reinvestment Dates"..............................4.20
"Required Filing Date"............................4.02
"Subsidiary Indebtedness".........................4.10
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Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
portion of such provision required to be incorporated herein in order for this
Indenture to be qualified under the TIA is incorporated by reference in and made
a part of this Indenture. The following TIA terms used in this Indenture have
the following meanings:
"Commission" means the SEC.
"indenture securities" means the Notes.
"indenture securityholder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor on this Indenture securities" means the Company, the
Guarantors or any other obligor on the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined in the TIA by reference to another statute or defined by SEC rule have
the meanings therein assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein, whether defined
expressly or by reference;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) words used herein implying any gender shall apply to every
gender; and
(6) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
Subdivision, unless expressly stated otherwise.
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ARTICLE 2.
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto. The Notes may have notations,
legends or endorsements required by law, stock exchange rule or usage. Each Note
shall be dated the date of its authentication. The Notes shall be in
denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute,
and are hereby expressly made, a part of this Indenture and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions of
this Indenture, the provisions of this Indenture shall govern and be
controlling.
Notes issued in global form shall be substantially in the form of
Exhibit A attached hereto (including the Global Note Legend and the "Schedule of
Exchanges in the Global Note" attached thereto). Notes issued in certificated
form shall be substantially in the form of Exhibit A attached hereto (but
without the Global Note Legend and without the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Each Global Note shall
represent such of the outstanding Notes as shall be specified therein and each
shall provide that it shall represent the aggregate principal amount of
outstanding Notes from time to time endorsed thereon and that the aggregate
principal amount of outstanding Notes represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions.
Any endorsement of a Global Note to reflect the amount of any increase or
decrease in the aggregate principal amount of outstanding Notes represented
thereby shall be made by the Trustee or the Note Custodian, at the direction of
the Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Cedel Bank" and "Customer Handbook" of Cedel Bank shall be
applicable to transfers of beneficial interests in the Regulation S Restricted
Global Notes and the Unrestricted Global Notes, in the form of Exhibit A hereto
("Global Notes") that are held by the Members of, or participants in, the
Depositary ("Agent Members") through Euroclear or Cedel Bank.
Section 2.02. Execution and Authentication.
The Notes shall be executed on behalf of the Company by two Officers
of the Company or an Officer and an Assistant Secretary of the Company. Such
signatures may be either manual or facsimile.
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<PAGE> 31
If an Officer whose signature is on a Note no longer holds that
office at the time the Trustee authenticates the Note or at anytime thereafter,
the Note shall be valid nevertheless.
A Note shall not be valid until the Trustee manually signs the
certificate of authentication on the Note. Such signature shall be conclusive
evidence that the Note has been authenticated under this Indenture.
The Trustee or an authenticating agent shall authenticate Notes for
original issue in the aggregate principal amount of $150,000,000 upon a Company
Request. The aggregate principal amount of Notes outstanding at any time may not
exceed such amount except as provided in Section 2.07 hereof. Upon receipt of
the Company Request and an Officers' Certificate certifying that the
registration statement relating to the exchange offer specified in the
Registration Rights Agreement is effective or that the conditions precedent to a
Private Exchange (as defined in the Registration Rights Agreement) thereunder
have been met, the Trustee shall authenticate Notes in an aggregate principal
amount not to exceed $150,000,000 for issuance in exchange for all Notes
previously issued and tendered for exchange pursuant to an exchange offer
registered under the Securities Act or pursuant to a Private Exchange. Exchange
Securities (as defined in the Registration Rights Agreement) or Private Exchange
Securities (as defined in the Registration Rights Agreement) may have such
distinctive series designations and such changes in the form thereof as are
specified in the Company Request referred to in the preceding sentence. The
Notes shall be issuable only in registered form without coupons and only in
denominations of $1,000 and integral multiples thereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. Unless limited by the terms of such appointment,
an authenticating agent may authenticate Notes whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. Such authenticating agent shall have the same
right as the Trustee in dealing with the Company or an Affiliate.
Notwithstanding the foregoing, only the Trustee may authenticate any replacement
Note authenticated pursuant to Section 2.07.
Section 2.03. Registrar and Paying Agent.
The Company shall appoint a registrar, which shall maintain an
office or agency where Notes may be presented for registration of transfer or
for exchange ("Registrar"), and a paying agent, which shall maintain an office
or agency where Notes may be presented for payment ("Paying Agent") and shall
maintain an office or agency where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served, each located in the City
and State of New York. The Registrar shall keep a register of the Notes and of
their transfer and exchange. The Company may appoint one or more co-registrars
and one or more additional paying agents. Neither the Company nor any Affiliate
may act as Paying Agent. The Company may change any Paying Agent, Registrar or
co-registrar without notice to any Noteholder.
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The Company shall enter into an appropriate agency agreement with
any Registrar or Paying Agent not a party to this Indenture. The agreement shall
implement the provisions of this Indenture that relate to such Agent. The
Company shall notify the Trustee of the name and address of any such Agent. If
the Company fails to maintain a Registrar or Paying Agent, or agent for service
of notices and demands, or fails to give the foregoing notice, the Trustee shall
act as such and shall be entitled to appropriate compensation pursuant to
Section 7.07. The Company initially appoints the Trustee as Registrar, Paying
Agent and agent for service of notices and demands in connection with the Notes.
The Company initially appoints the Depositary Trust Company ("DTC") to act
as Depositary with respect to the Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
On or before each due date of the principal of and interest on any
Notes, the Company shall deposit with the Paying Agent a sum sufficient to pay
such principal and interest so becoming due. Each Paying Agent shall hold in
trust for the benefit of the Noteholders or the Trustee all money held by the
Paying Agent for the payment of principal of or interest on the Notes (whether
such money has been paid to it by the Company or any other obligor on the
Notes), and the Company and the Paying Agent shall notify the Trustee of any
default by the Company (or any other obligor on the Notes) in making any such
payment. Money held in trust by the Paying Agent need not be segregated except
as required by law and in no event shall the Paying Agent be liable for any
interest on any money received by it hereunder. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee and the
Trustee, may at any time during the continuance of any Event of Default
specified in Section 6.01(1) or (2), upon written request to a Paying Agent,
require such Paying Agent to forthwith pay to the Trustee all sums so held in
trust by such Paying Agent together with a complete accounting of such sums.
Upon doing so, the Paying Agent shall have no further liability for the money
delivered to the Trustee.
Section 2.05. Noteholder 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
Noteholders. If the Trustee is not the Registrar, the Company shall furnish to
the Trustee in writing on or before the fifth Business Day before each Interest
Payment Date, as of the relevant record 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 Noteholders,
including the aggregate principal amount of Notes held by each such Noteholder.
Section 2.06. Transfer and Exchange.
Holders of the Notes may transfer or exchange Notes in accordance
with this Indenture. The Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents, and to pay any taxes
and fees required
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<PAGE> 33
by law or permitted by this Indenture. The Registrar is not required to transfer
or exchange any Note selected for redemption. Also, the Registrar is not
required to transfer or exchange any Note for a period of 15 days before
selection of the Notes to be redeemed.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Certificated Notes if (i) the Company delivers to the Trustee
notice from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by the
Company within 90 days after the date of such notice from the Depositary or (ii)
the Company in its sole discretion determines that the Global Notes (in whole
but not in part) should be exchanged for Certificated Notes and delivers a
written notice to such effect to the Trustee. Upon the occurrence of either of
the preceding events in (i) or (ii) above, Certificated Notes shall be issued in
such names as the Depositary or the Company shall instruct the Trustee. Global
Notes also may be exchanged or replaced, in whole or in part, as provided in
Sections 2.07 and 2.10 hereof. Every Note authenticated and delivered in
exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for another
Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however,
that prior to the expiration of any restricted period under applicable
law, transfers of beneficial interests in the Regulation S Global Note may
not be made to a U.S. Person or for the account or benefit of a U.S.
Person (other than an Initial Purchaser). Beneficial interests in any
Unrestricted Global Note may be transferred only to Persons who take
delivery thereof in the form of a beneficial interest in an Unrestricted
Global
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<PAGE> 34
Note. No written orders or instructions shall be required to be delivered
to the Registrar to effect the transfers described in this Section
2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests
in Global Notes. In connection with all transfers and exchanges of
beneficial interests (other than a transfer of a beneficial interest in a
Global Note to a person who takes delivery thereof in the form of a
beneficial interest in the same Global Note), the transferor of such
beneficial interest must delivery to the Registrar either (A)(1) a written
order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial interest in
another Global Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given in accordance with the
Applicable Procedures containing information regarding the Participant
account to be credited with such increase or (B)(1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
cause to be issued a Certificated Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Registrar containing information regarding
the Person in whose name such Certificated Note shall be registered to
effect the transfer or exchange referred to in (1) above. Upon an Exchange
Offer by the Company in accordance with Section 2.06(f) hereof, the
requirements of this Section 2.06(b)(ii) shall be deemed to have been
satisfied upon receipt by the Registrar of the instructions contained in
the Letter of Transmittal delivered by the Holder of such beneficial
interests in the Restricted Global Notes. Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests in Global
Notes contained in this Indenture, the Notes and otherwise applicable
under the Securities Act, the Trustee shall adjust the principal amount of
the relevant Global Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of clause (ii) above and the Registrar
receives the following:
(A) if the transferee will take delivery in the form of
a beneficial interest in the 144A Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof;
(B) if the transferee will take delivery in the form of
a beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof; and
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(C) if the transferee will take delivery in the form of
a beneficial interest in the IAI Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications and certificates and an Opinion of
Counsel required by item (3) thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in the Unrestricted Global
Note. A beneficial interest in any Restricted Global Note may be exchanged
by any Holder thereof for a beneficial interest in an Unrestricted Global
Note or transferred to a Person who takes delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of clause (ii) above and:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration Rights
Agreement and the Holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in the
case of a transfer, is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration Statement
in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof;
(2) if the Holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note,
a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof; and
(3) in each such case set forth in this
subparagraph (D), an Opinion of Counsel in form reasonably
acceptable to the Registrar to the effect that such exchange
or
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transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are not required in order to maintain
compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an authentication order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of beneficial interests transferred pursuant to subparagraph
(B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Certificated
Notes.
(i) If any Holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Certificated Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Certificated Note, then, upon
receipt by the Registrar of the following documentation:
(A) if the Holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest
for a Certificated Note, a certificate from such Holder in the form
of Exhibit C hereto, including the certifications in item (2)(a)
thereof;
(B) if such beneficial interest is being transferred to
a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to
a Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904 under the Securities Act, a certificate to the
effect set forth in Exhibit B hereto, including the certifications
in item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act,
a certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (1)(a) thereof;
(E) if such beneficial interest is being transferred to
an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than
those listed in
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subparagraphs (C) through (D) above, a certificate to the effect set
forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such beneficial interest is being transferred to
the Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Certificated Note in the appropriate
principal amount. Any Certificated Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this section 2.06(c)(i) shall
be registered in such name or names and in such authorized denomination or
denominations as the Holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Certificated Notes to the
Person in whose names such Notes are so registered. Any Certificated Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(ii) Notwithstanding 2.06(c)(i) hereof, a Holder of a
beneficial interest in a Restricted Global Note may exchange such
beneficial interest for an Unrestricted Certificated Note or may transfer
such beneficial interest to a Person who takes delivery thereof in the
form of an Unrestricted Certificated Note only if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration Rights
Agreement and the Holder of such beneficial interest, in the case of
an exchange, or the transferee, in the case of a transfer, is not
(1) a broker-dealer, (2) a Person participating in the distribution
of the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration Statement
in accordance with the Registration Rights Agreement; or
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(D) the Registrar receives the following:
(1) if the Holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Certificated Note that does not bear the
Private Placement Legend, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications in
item (1)(b) thereof;
(2) if the Holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a Certificated Note that does not bear the Private
Placement Legend, a certificate from such Holder in the form
of Exhibit B hereto, including the certifications in item (4)
thereof; and
(3) in each such case set forth in this
subparagraph (D), an Opinion of Counsel in form reasonably
acceptable to the Company, to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are not required in order to maintain
compliance with the Securities Act.
(iii) If any Holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest for
a Certificated Note or to transfer such beneficial interest to a person
who takes delivery thereof in the form of a Certificated Note, then, upon
satisfaction of the conditions set forth in Section 2.06(b)(ii) hereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof,
and the Company shall execute and the Trustee shall authenticate and
deliver to the Person designated in the instructions a Certificated Note
in the appropriate principal amount. Any Certificated Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(iii)
shall be registered in such name or names and in such authorized
denomination or denominations as the Holder of such beneficial interest
shall instruct the Registrar through instructions from the Depositary and
the Participant or Indirect Participant. The Trustee shall deliver such
Certificated Notes to the Persons in whose names such Notes are so
registered. Any Certificated Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iii) shall not bear the Private
Placement Legend. A beneficial interest in an Unrestricted Global Note
cannot be exchanged for a Certificated Note bearing the Private Placement
Legend or transferred to a Person who takes delivery thereof in the form
of a Certificated Note bearing the Private Placement Legend.
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(d) Transfer and Exchange of Certificated Notes for Beneficial
Interests.
(i) If any Holder of a Restricted Certificated Note proposes
to exchange such Note for a beneficial interest in a Restricted Global
Note or to transfer such Certificated Notes to a Person who takes delivery
thereof in the form of a beneficial interest in a Restricted Global Note,
then, upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted Certificated Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note, a certificate from such Holder in the form
of Exhibit C hereto, including the certifications in item (2)(b)
thereof;
(B) if such Certificated Note is being transferred to a
QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (1) thereof;
(C) if such Certificated Note is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904 under the Securities Act, a certificate to the
effect set forth in Exhibit C hereto, including the certifications
in item (2) thereof;
(D) if such Certificated Note is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act,
a certificate to the effect set forth in Exhibit B hereto, including
the certifications in item 3(a) thereof;
(E) if such Certificated Note is being transferred to an
Institutional Accredited Investor in reliance on an exemption from
the registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such Certificated Note is being transferred to
the Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
(G) if such Certificated Note is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Certificated Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted
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Global Note, in the case of clause (B) above, the 144A Global Note, in the case
of clause (C) above, the Regulation S Global Note, and in all other cases, the
IAI Global Note.
(ii) A Holder of a Restricted Certificated Note may exchange
such Note for a beneficial interest in an Unrestricted Global Note or
transfer such Restricted Certificated Note to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note only if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, is not (1) a broker-dealer,
(2) a Person participating in the distribution of the Exchange Notes
or (3) a Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration Statement
in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Certificated Notes
proposes to exchange such Notes for a beneficial interest in
the Unrestricted Global Note, a certificate from such Holder
in the form of Exhibit C hereto, including the certifications
in item (1)(c) thereof;
(2) if the Holder of such Certificated Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in
the form of Exhibit B hereto, including the certifications in
item (4) thereof; and
(3) in each such case set forth in this
subparagraph (D), an Opinion of Counsel in form reasonably
acceptable to the Company to the effect that such exchange or
transfer is in compliance with the Securities Act, that the
restrictions on transfer contained herein and in the Private
Placement Legend are not required in order to maintain
compliance with the Securities Act, and such Certificated
Notes are being exchanged or transferred in compliance with
any applicable blue sky securities laws of any State of the
United States.
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Upon satisfaction of the conditions of any of the subparagraphs in this
Section 2.06(d)(ii), the Trustee shall cancel the Certificated Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
(iii) A Holder of an Unrestricted Certificated Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Certificated Notes to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note at any time. Upon receipt of a request for such an exchange or
transfer, the Trustee shall cancel the applicable Unrestricted
Certificated Note and increase or cause to be increased the aggregate
principal amount of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Certificated Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been issued,
the Company shall issue and, upon receipt of an authentication order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of beneficial interests transferred pursuant to subparagraphs
(ii)(B), (ii)(D) or (iii) above.
(e) Transfer and Exchange of Certificated Notes for Certificated
Notes. Upon request by a Holder of Certificated Notes and such Holder's
compliance with the provisions of this Section 2.06(e), the Registrar shall
register the transfer or exchange of Certificated Notes. Prior to such
registration of transfer or exchange, the requesting Holder shall present or
surrender to the Registrar the Certificated Notes duly endorsed or accompanied
by a written instruction of transfer in form satisfactory to the Registrar duly
executed by such Holder or by his attorney, duly authorized in writing. In
addition, the requesting Holder shall provide any additional certifications,
documents and information, as applicable, pursuant to the provisions of this
Section 2.06(e).
(i) Restricted Certificated Notes may be transferred to and
registered in the name of Persons who take delivery thereof if the
Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A
under the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications in item (2)
thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in the form of
Exhibit B hereto,
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including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(ii) Any Restricted Certificated Note may be exchanged by the
Holder thereof for an Unrestricted Certificated Note or transferred to a
Person or Persons who take delivery thereof in the form of an Unrestricted
Certificated Note if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, is not (1) a broker-dealer,
(2) a Person participating in the distribution of the Exchange Notes
or (3) a Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration Statement
in accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Certificated
Notes proposes to exchange such Notes for an Unrestricted
Certificated Note, a certificate from such Holder in the form
of Exhibit C hereto, including the certifications in item
(1)(a) thereof;
(2) if the Holder of such Restricted Certificated
Notes proposes to transfer such Notes to a Person who shall
take delivery thereof in the form of an Unrestricted
Certificated Note, a certificate from such Holder in the form
of Exhibit B hereto, including the certifications in item (4)
thereof; and
(3) in each such case set forth in this
subparagraph (D), an Opinion of Counsel in form reasonably
acceptable to the Company to the effect that such exchange or
transfer is in compliance with the Securities Act, that the
restrictions on transfer contained herein and in the Private
Placement Legend are not required in order to maintain
compliance with the Securities Act, and such Restricted
Certificated Note is being exchanged or transferred in
compliance with any applicable blue sky securities laws of any
State of the United States.
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(iii) A Holder of Unrestricted Certificated Notes may transfer
such Notes to a Person who takes delivery thereof in the form of an
Unrestricted Certificated Note. Upon receipt of a request for such a
transfer, the Registrar shall register the Unrestricted Certificated Notes
pursuant to the instructions from the Holder thereof. Unrestricted
Certificated Notes cannot be exchanged for or transferred to Persons who
take delivery thereof in the form of a Restricted Certificated Note.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue and,
upon receipt of an authentication order in accordance with the Section 2.02, the
Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by persons that
are not (x) broker-dealers, (y) Persons participating in the distribution of the
Exchange Notes or (z) Persons who are affiliates (as defined in Rule 144) of the
Company and accepted for exchange in the Exchange Offer and (ii) Certificated
Notes in an aggregate principal amount equal to the principal amount of the
Restricted Certificated Notes accepted for exchange in the Exchange Offer.
Concurrent with the issuance of such Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company and the Guarantors shall execute and the
Trustee shall authenticate and deliver to the Persons designated by the Holders
of Certificated Notes so accepted Certificated Notes in the appropriate
principal amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Certificated Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below each
Global Note and each Certificated Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear a legend in
substantially the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS
AND ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED 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 A NON-U.S. PERSON THAT IS OUTSIDE THE UNITED STATES; (2) AGREES
THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO
THE COMPANY, (B) TO A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
144A IN A TRANSACTION IN COMPLIANCE WITH
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RULE 144A UNDER THE SECURITIES ACT, (C) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D
UNDER THE SECURITIES ACT 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 CAN BE OBTAINED FROM THE TRUSTEE), (D) PURSUANT TO THE EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE), (E) OUTSIDE THE UNITED STATES TO A PERSON THAT IS NOT A "U.S.
PERSON" AS DEFINED IN RULE 902 UNDER THE SECURITIES ACT IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (F)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT,
SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE
DISPOSITION OF SUCH HOLDER'S PROPERTY OR THE PROPERTY OF SUCH ACCOUNT AT
ALL TIMES BE WITHIN ITS CONTROL AND TO COMPLIANCE WITH APPLICABLE
SECURITIES LAWS OF ANY JURISDICTION; AND (3) AGREES THAT IT WILL DELIVER
TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THE TRANSFER RESTRICTIONS SET FORTH IN THIS LEGEND. IN
CONNECTION WITH ANY TRANSFER OF ANY CERTIFICATED SECURITY, THE HOLDER MUST
CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE OF SUCH CERTIFICATED
SECURITY RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT SUCH
CERTIFICATED SECURITY TO THE TRUSTEE. IF ANY PROPOSED TRANSFEREE IS AN
INSTITUTIONAL ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH
TRANSFER, FURNISH TO THE TRUSTEE AND THE COMPANY SUCH CERTIFICATIONS,
LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY
REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OR APPLICABLE SECURITIES LAWS OF ANY
JURISDICTION. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO
REFUSE TO REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE
FOREGOING RESTRICTIONS."
(B) Notwithstanding the foregoing, any Global Note or
Certificated Note issued pursuant to subparagraphs (b)(iv), (c)(ii),
(c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this
Section 2.06 (and all Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement Legend.
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(ii) Global Note Legend. Each Global Note shall bear a
legend in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS THEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON
AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS
GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION
2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE
TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND
(IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH
THE PRIOR WRITTEN CONSENT OF THE COMPANY."
(h) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in a particular Global Note have been exchanged for
Certificated Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.10 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Note or for Certificated
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note, by the
Trustee or by the Depositary at the direction of the Trustee, to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note, by the Trustee or by the
Depositary at the direction of the Trustee, to reflect such increase. If
appropriate, in accordance with Section 2.02 hereof, the Trustee shall
authenticate one or more Global Notes in an aggregate principal amount equal to
the principal amount of beneficial interests so transferred.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Global Notes and
Certificated Notes upon the Company's order or at the Registrar's request.
(ii) No service charge shall be made to a Holder of a
beneficial interest in a Global Note or to a Holder of a Certificated Note
for any registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith.
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(iii) The Registrar shall not be required to register the
transfer of or exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Certificated Notes issued upon any
registration of transfer or exchange of Global Notes or Certificated Notes
shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global
Notes or Certificated Notes surrendered upon such registration of transfer
or exchange.
(v) The Company shall not be required (A) to issue, to
register the transfer of or to exchange Notes during a period beginning at
the opening of business 15 days before the day of any selection of Notes
for redemption under Section 3.02 hereof and ending at the close of
business on the day of selection, (B) to register the transfer of or to
exchange any Note so selected for redemption in whole or in part, except
the unredeemed portion of any Note being redeemed in part or (C) to
register the transfer of or to exchange a Note between a record date and
the next succeeding Interest Payment Date.
(vi) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company may deem and
treat the Person in whose name any Note is registered as the absolute
owner of such Note for the purpose of receiving payment of principal of
and interest on such Notes and for all other purposes, and none of the
Trustee, any Agent or the Company shall be affected by notice to the
contrary.
(vii) The Trustee shall authenticate Global Notes and
Certificated Notes in accordance with the provisions of Section 2.02
hereof.
(viii) All certifications, certificates and Opinions of
Counsel required to be submitted to the Registrar pursuant to this Section
2.06 to effect a transfer or exchange may be submitted by facsimile.
(ix) Neither the Company nor the Trustee will be liable for
any delay by the Global Note Holder or the Depositary in identifying the
beneficial owners of Notes and the Company and the Trustee may
conclusively rely on, and will be protected in relying on, instructions
from the Global Note Holder or the Depositary for all purposes.
Section 2.07. Replacement Notes.
If a mutilated Note is surrendered to the Registrar or Trustee or if
the Holder of a Note presents evidence to the satisfaction of the Company and
the Trustee that the Note has been lost, destroyed or wrongfully taken and of
the ownership thereof, the Company shall issue and the Trustee shall
authenticate a replacement Note if the Holder of such Note furnishes to the
Company and the Trustee evidence reasonably acceptable to them of the ownership
and destruction, loss or theft of such Note. An indemnity bond may be required
by the Company or the Trustee that is sufficient in the
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judgment of the Company and the Trustee to protect the Company, the Trustee or
any Agent from any loss which any of them may suffer if a Note is replaced. The
Company and the Trustee each may charge for its expenses (including reasonable
attorneys' fees and expenses) in replacing a Note. Every replacement Note is an
additional obligation of the Company.
Section 2.08. Outstanding Notes.
Notes outstanding at any time are all Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
and those described in this Section 2.08 as not outstanding.
If a Note is replaced pursuant to Section 2.07, it ceases to be
outstanding until the Company and the Trustee receive proof satisfactory to each
of them that the replaced Note is held by a bona fide purchaser in whose hands
such obligation is a legal, valid and binding obligation of the Company.
If a Paying Agent holds on a Redemption Date or the Maturity Date
money sufficient to pay the principal of, premium, if any, and all accrued
interest with respect to Notes payable on that date and is not prohibited from
paying such money to the Holders thereof pursuant to the terms of this
Indenture, then on and after that date such Notes cease to be outstanding and
interest on them ceases to accrue.
Subject to Section 11.06, a Note does not cease to be outstanding
solely because the Company or an Affiliate holds the Note.
Section 2.09. Temporary Notes.
Until definitive Notes are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Notes. Temporary Notes
shall be substantially in the form, and shall carry all rights, benefits and
privileges, of definitive Notes but may have variations that the Company
considers appropriate for temporary Notes. Without unreasonable delay, the
Company shall prepare and the Trustee shall authenticate definitive Notes in
exchange for temporary Notes presented to it.
Section 2.10. Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for transfer, exchange or payment. The Trustee
shall cancel and shall destroy (subject to the record-retention requirements of
the Exchange Act) or, upon written request of the Company, return to the Company
all Notes surrendered for transfer, exchange, payment or cancellation. If such
Notes are destroyed, upon written request of the Company, the Trustee shall
deliver a certificate of destruction to the Company. Subject to Section 2.07
hereof, the Company may not issue new Notes to replace Notes in respect of which
it has previously paid all principal, premium and interest accrued thereon, or
delivered to the Trustee for cancellation.
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Section 2.11. Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it
shall pay the defaulted amounts, plus (to the extent permitted by law) any
interest payable on defaulted amounts pursuant to Section 4.01 hereof, to the
Persons who are Noteholders on a subsequent special record date. The Company
shall fix the special record date and payment date in a manner satisfactory to
the Trustee and provide the Trustee at least twenty days notice of the proposed
amount of default interest to be paid and the special payment date. At least 15
days before the special record date, the Company shall mail or cause to be
mailed to each Noteholder at his address as it appears on the Notes register
maintained by the Registrar a notice that states the special record date, the
payment date (which shall be not less than five nor more than ten days after the
special record date), and the amount to be paid. In lieu of the foregoing
procedures, the Company may pay defaulted interest in any other lawful manner
satisfactory to the Trustee.
Section 2.12. Deposit of Moneys.
Prior to 10:00 a.m., New York City time, on each Interest Payment
Date and the Maturity Date, the Company shall have deposited with the Paying
Agent in New York, New York, or such other location as shall be designated by
the Paying Agent, in immediately available funds money sufficient to make cash
payments, if any (including, without limitation, Liquidated Damages, if any),
due on such Interest Payment Date or Maturity Date, as the case may be, in a
timely manner which permits the Trustee to remit payment to the Holders on such
Interest Payment Date or Maturity Date, as the case may be. Payments in respect
of the Global Notes (including principal, premium, interest and Liquidated
Damages, if any) shall be made by wire transfer of immediately available funds
to the accounts specified by the Holder of such Global Note. With respect to
Certificated Notes, the Company will make all payments of principal, premium,
interest and Liquidated Damages, if any, by wire transfer of immediately
available funds to the accounts specified by the Holders thereof or, if no such
account is specified, by mailing a check to each such Holder's registered
address.
Section 2.13. CUSIP Number.
The Company in issuing the Notes may use a "CUSIP" number (or
numbers), and if so, the Trustee shall use the CUSIP number(s) in notices of
redemption or exchange as a convenience to Holders; provided that any such
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP number(s) printed in the notice or on the Notes, and that
reliance may be placed only on the other identification numbers printed on the
Notes. The Company will promptly notify in writing the Trustee of any such CUSIP
number used by the Company in connection with the Notes and any change in such
CUSIP number.
Section 2.14. Wire Payments to Holders.
Notwithstanding any provisions of this Indenture and the Notes to
the contrary, at the request of a Holder, all payments with respect to any of
the Notes, may be made by the Paying Agent upon receipt from the Company of
immediately available
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funds prior to 11:30 a.m., New York City time, directly to the Holder of such
Note by wire transfer of immediately available funds to the accounts specified
by the Holder; provided, however, that no such payment in immediately available
funds shall be made to any Holder of Certificated Notes under this Section 2.14
unless such Holder has delivered written instructions to the Trustee prior to
the relevant record date for such payment requesting that such payment will be
so made and designating the bank account to which such payments shall be so made
and in the case of payments of principal, surrenders the Note to the Trustee in
exchange for a Note or Notes aggregating the same principal amount as the
unredeemed principal amount of the Notes surrendered. The Trustee shall be
entitled to rely on the last instruction delivered by the Holder pursuant to
this Section 2.14 unless a new instruction is delivered prior to the relevant
record date for a payment date. The Company will indemnify and hold the Trustee
harmless against any loss, liability or expense (including attorneys' fees and
expenses) resulting from any act or omission to act on the part of the Company
or any such Holder in connection with this Section 2.14 or which the Paying
Agent may incur as a result of making any payment in accordance with this
Section 2.14, other than acts or omissions constituting negligence, gross
negligence or willful misconduct.
ARTICLE 3.
REDEMPTION
Section 3.01. Notices to Trustee.
If the Company elects to redeem Notes pursuant to Section 3.07
hereof, (i) at least 60 days prior to the Redemption Date in the case of a
partial redemption, (ii) at least 45 days prior to the Redemption Date in the
case of a total redemption or (iii) during such other period as the Trustee may
agree to in writing, the Company shall notify the Trustee in writing of the
Redemption Date, the principal amount of Notes to be redeemed and the redemption
price, and deliver to the Trustee an Officers' Certificate stating that such
redemption will comply with the conditions contained in Section 3.07 hereof, as
appropriate.
Section 3.02. Selection by Trustee of Notes to be Redeemed.
In the event of redemption of fewer than all of the Notes, the
Trustee shall select pro rata, by lot or in such other manner as it shall deem
fair and equitable, the Notes to be redeemed. No Notes of $1,000 or less shall
be redeemed in part. Subject to the limitations described herein, the Notes will
be redeemable in whole or in part upon not less than 30 nor more than 60 days'
prior written notice, mailed by first class mail to a Holder's last address as
it shall appear on the register maintained by the Registrar of the Notes.
Notices of redemption may not be conditional. If any Note is to be redeemed in
part only, the notice of redemption that relates to such Note shall state the
portion of the principal amount thereof to be redeemed. A new Note, in a
principal amount equal to the unredeemed portion thereof will be issued in the
name of the Holder thereof upon cancellation of the original Note. After any
redemption date, unless the Company shall default in the payment of the
redemption price, interest will cease to accrue on the Notes or portions thereof
called for redemption.
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Section 3.03. Notice of Redemption.
At least 30 days, but no more than 60 days, before a Redemption
Date, the Company shall mail, or cause to be mailed, a notice of redemption by
first-class mail to each Holder of Notes to be redeemed at his or her last
address as the same appears on the registry books maintained by the Registrar
pursuant to Section 2.03 hereof.
The notice shall identify the Notes to be redeemed (including the
CUSIP number(s) thereof) and shall state:
(1) the Redemption Date;
(2) the redemption price and the amount of accrued interest, if any,
to be paid;
(3) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the Redemption Date
and upon surrender of such Note, a new Note or Notes in principal amount equal
to the unredeemed portion will be issued;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(6) that unless the Company defaults in making the redemption
payment, interest on Notes called for redemption ceases to accrue on and after
the Redemption Date and that the only remaining right of the Holders of such
Notes is to receive payment of the Notes redemption price upon surrender to the
Paying Agent of the Notes redeemed;
(7) the paragraph of Section 3.07 hereof pursuant to which the Notes
called for redemption are being redeemed; and
(8) the aggregate principal amount of Notes that are being redeemed.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's sole expense.
Section 3.04. Effect of Notice of Redemption.
Once the notice of redemption described in Section 3.03 is mailed,
Notes called for redemption become due and payable on the Redemption Date and at
the redemption price, including any premium, plus interest (and Liquidated
Damages, if any) accrued to the Redemption Date. Upon surrender to the Paying
Agent, such Notes shall be paid at the redemption price, including any premium,
plus interest (and Liquidated Damages, if any) accrued to the Redemption Date;
provided that if the Redemption Date is after a regular interest payment record
date and on or prior to the Interest Payment
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Date, the accrued interest (and Liquidated Damages, if any) shall be payable to
the Holder of the redeemed Notes registered on the relevant record date; and
provided, further, that if a Redemption Date is a Legal Holiday, payment shall
be made on the next succeeding Business Day and no interest (or Liquidated
Damages, if any) shall accrue for the period from such Redemption Date to such
succeeding Business Day.
Section 3.05. Deposit of Redemption Price.
On or prior to 10:00 A.M., New York City time, on each Redemption
Date, the Company shall deposit with the Paying Agent in immediately available
funds money sufficient to pay the redemption price of and accrued interest (and
Liquidated Damages, if any) on all Notes to be redeemed on that date other than
Notes or portions thereof called for redemption on that date which have been
delivered by the Company to the Trustee for cancellation.
On and after any Redemption Date, if money sufficient to pay the
redemption price of and accrued interest (and Liquidated Damages, if any) on
Notes called for redemption shall have been made available in accordance with
the preceding paragraph, the Notes called for redemption will cease to accrue
interest (and Liquidated Damages, if any) and the only right of the Holders of
such Notes will be to receive payment of the redemption price of and, subject to
the first proviso in Section 3.04, accrued and unpaid interest (and Liquidated
Damages, if any) on such Notes to the Redemption Date. If any Note called for
redemption shall not be so paid, interest (and Liquidated Damages, if any) will
be paid, from the Redemption Date until such redemption payment is made, on the
unpaid principal of the Note, premium, if any (and Liquidated Damages, if any),
and interest, if any, not paid on such unpaid principal, in each case, at the
rate and in the manner provided in the Notes.
Section 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Trustee shall
authenticate for a Holder a new Note equal in principal amount to the unredeemed
portion of the Note surrendered.
Section 3.07. Optional Redemption.
(a) Except as set forth below, the Notes will not be redeemable at
the option of the Company prior to March 15, 2003. Thereafter, the Notes will be
redeemable at any time, and from time to time, at the option of the Company, in
whole or in part, at the following redemption prices (expressed as a percentage
of principal amount), together, in each case, with accrued and unpaid interest
and Liquidated Damages, if any, to the redemption date, if redeemed during the
twelve-month period beginning on March 15, of each year listed below:
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---------------------------------------
YEAR PERCENTAGE
---------------------------------------
2003 103.938%
---------------------------------------
2004 102.625%
---------------------------------------
2005 101.313%
---------------------------------------
2006 100.00%
---------------------------------------
(a) Notwithstanding the foregoing, at any time prior to March 15,
2001, the Company may redeem up to an aggregate of $52,000,000 in principal
amount of Notes at a redemption price equal to 107.875% of the principal amount
thereof, plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the Redemption Date with the net cash proceeds of one or more Public
Equity Offerings; provided that at least $98,000,000 in principal amount of
Notes remains outstanding immediately following each such redemption and that
any such redemption occurs within 90 days following the closing of any such
Public Equity Offering.
Section 3.08. Mandatory Redemption.
Except as set forth under Sections 4.19 and 4.20 hereof, the Company
is not obligated to make any mandatory redemption of or sinking fund payments
with respect to the Notes.
ARTICLE 4.
COVENANTS
Section 4.01. Payment of Notes.
The Company shall pay the principal of, premium, if any, and
interest (plus all Liquidated Damages as provided in the Registration Rights
Agreement) on the Notes on the dates and in the manner provided in the Notes and
this Indenture. An installment of principal, interest or Liquidated Damages
shall be considered paid on the date it is due if the Trustee or Paying Agent
holds on that date money designated for and sufficient to pay such installment.
All payments hereunder shall be due and payable in New York, New York or, at the
option of the Company, payment of interest may be made by check mailed to the
Holders at their respective addresses set forth in the register of Holders;
provided that all payments with respect to Notes, the Holders of which have
given wire transfer instructions to the Paying Agent on or prior to the relevant
rcord date will be required to be made by wire transfer of immediately available
funds to the accounts specified by such Holders.
Section 4.02. Reports.
(a) The Company will file with the SEC all information, documents
and reports to be filed with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act, whether or not the Company is subject to such filing requirements,
on or prior to the respective dates (the "Required Filing Dates") by which the
Company would have been or is required to so file such documents. The Company
(at its own expense) shall also in any event within five days after each
Required Filing Date (i) transmit by mail to all
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Holders, at their addresses appearing in the register of Notes maintained by the
Registrar, (ii) file with the Trustee within five days after the Required Filing
Date, copies (without exhibits) of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) which the Company files with
the SEC pursuant to Section 13 or 15(d) of the Exchange Act and (iii) make such
information available to securities analysts and prospective investors upon
request. Upon qualification of this Indenture under the TIA, the Company shall
also comply with the provisions of TIA Section 314(a). Delivery of such reports,
information and documents to the Trustee is for informational purposes only and
the Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
(b) The Company will, upon request, provide to any Holder of Notes
or any prospective transferee of any such Holder or to securities analysts any
information concerning the Company (including financial statements) necessary in
order to permit such Holder to sell or transfer Notes in compliance with Rule
144A under the Securities Act.
Section 4.03. Waiver of Stay, Extension or Usury Laws.
The Company and each Guarantor covenants (to the extent that it may
lawfully do so) that it will not at any time insist upon, or plead (as a defense
or otherwise) 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 which would prohibit
or forgive the Company or such Guarantor, as the case may be, from paying all or
any portion of the principal of, premium, if any, and interest on the Notes 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) the Company and each Guarantor 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.
Section 4.04. Compliance Certificate.
(a) The Company shall deliver to the Trustee, on or before 90 days
after the end of the Company's fiscal year and on or before 45 days after the
end of the first, second and third fiscal quarters of each fiscal year, an
Officers' Certificate (one of the signers of which shall be the principal
executive officer, principal financial officer or principal accounting officer
of the Company) stating that a review of the activities of the Company during
such fiscal year or fiscal quarter, as the case may be, has been made under the
supervision of the signing Officers with a view to determining whether the
Company and each Guarantor 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 no Default or
Event of Default has occurred (or, if
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a Default or Event of Default shall have occurred (whether or not such Default
or Event of Default is continuing) describing all of such Defaults or Events of
Default of which he or she may have knowledge and what action the Company or
such Guarantor, as the case may be, is taking or proposes to take with respect
thereto) and that to the best of his or her knowledge no event has occurred and
remains in existence by reason of which payments on account of the principal of,
premium, if any, or interest on the Notes are prohibited or, if such event has
occurred, a description of the event and what action the Company or such
Guarantor, as the case may be, is taking or proposes to take with respect
thereto.
(b) So long as (and to the extent) not contrary to the then current
recommendations of the American Institute of Certified Public Accountants, the
year-end financial statements delivered pursuant to Section 4.02 shall be
accompanied by a written statement of the Company's independent public
accountants (which shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements
nothing has come to its attention which would lead it to believe that the
Company has violated any provisions of this Article 4 or Article 5 of this
Indenture 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 for any failure to obtain knowledge of any such
violation.
(c) The Company and each Guarantor will, so long as any of the Notes
are outstanding, deliver to the Trustee, forthwith upon any Officer becoming
aware of any Default or Event of Default, an Officers' Certificate specifying
such Default or Event of Default and what action the Company or such Guarantor,
as the case may be, is taking or proposes to take with respect thereto.
Section 4.05. Taxes.
The Company shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (a) all taxes, assessments
and governmental charges levied or imposed upon it or its Subsidiaries' or
Unrestricted Subsidiaries' income, profits or property and (b) all lawful claims
for labor, materials and supplies which, if unpaid, might by law become a Lien
upon any such Person's property; 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 which amount, applicability or validity is being
contested in good faith by appropriate negotiations or proceedings and for which
disputed amounts adequate reserves (in the good faith judgment of the Officers
of the Company) have been made.
Section 4.06. Limitations on Additional Indebtedness and Preferred Equity
Interests.
(a) The Company and the Guarantors will not, and will not permit any
of their Subsidiaries to, directly or indirectly, incur any Indebtedness
(including Acquired Indebtedness) other than Permitted Indebtedness; provided,
however, that the Company and the Guarantors may incur Indebtedness (including
Acquired Indebtedness) if (a) after giving effect on a pro forma basis to the
incurrence of such Indebtedness and to the extent set forth in the definition of
Consolidated Fixed Charge Coverage Ratio the receipt and
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application of the proceeds thereof, the Company's Consolidated Fixed Charge
Coverage Ratio would be greater than (i) 2.25 if such Indebtedness is to be
incurred on or before March 31, 2000; and (ii) 2.50 if such Indebtedness is to
be incurred after March 31, 2000; and (b) no Default or Event of Default shall
have occurred and be continuing at the time or as a consequence of the
incurrence of such Indebtedness. Notwithstanding any other provision of this
Section 4.06, a guarantee of Indebtedness will not constitute a separate
incurrence of Indebtedness, if the Indebtedness being guaranteed was incurred in
compliance with the terms of this Indenture.
(b) For purposes of determining compliance with this Section 4.06,
in the event that an item of Indebtedness meets the criteria of more than one of
the categories of Permitted Indebtedness described in the definition thereof or
is otherwise entitled to be incurred pursuant to Section 4.06(a), the Company
shall, in its sole discretion, classify such item of Indebtedness in any manner
that complies with this covenant and such item of Indebtedness will be treated
as having been incurred as so classified.
(c) Neither the Company nor any Guarantor will issue Subordinated
Indebtedness or Preferred Equity Interests with change of control provisions or
asset sales provisions requiring the payment of such Subordinated Indebtedness
or Preferred Equity Interests prior to the payment in full to the Holders of
Notes that have accepted the Company's Change of Control Offer following a
Change in Control or payment of the Excess Proceeds to Holders of Notes that
have accepted an Excess Proceeds Offer, as the case may be.
Section 4.07. Limitation on Restricted Payments.
(a) The Company and the Guarantors will not, and will not permit any
of their Subsidiaries to, directly or indirectly, make any Restricted Payment
unless:
(i) no Default or Event of Default shall have occurred and be
continuing at the time of or immediately after giving effect to such
Restricted Payment;
(ii) immediately after giving pro forma effect to such
Restricted Payment, the Company could incur $1.00 of additional
Indebtedness (other than Permitted Indebtedness) under Section 4.06; and
(iii) immediately after giving effect to such Restricted
Payment, the aggregate of all Restricted Payments declared or made after
the Issue Date through and including the date of such Restricted Payment
(the "Base Period") does not exceed the sum of (1) 50% of the Company's
Consolidated Net Income (or in the event such Consolidated Net Income
shall be a deficit, minus 100% of such deficit) from the Issue Date to the
end of the Company's most recently ended fiscal quarter for which internal
financial statements are available at the time of such Restricted Payment,
without duplication of any amounts included pursuant to clause (3) below,
(2) 100% of the aggregate net
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cash proceeds received by the Company from the issue or sale, during the
Base Period, of Equity Interests (other than Disqualified Equity Interests
or Equity Interests of the Company issued to any Subsidiary of the
Company) of the Company or any Indebtedness or other securities of the
Company convertible into or exercisable or exchangeable for Equity
Interests (other than Disqualified Equity Interests) of the Company which
have been so converted or exercised or exchanged, as the case may be, (3)
an amount equal to the net cash proceeds received by the Company or any
Subsidiary from Investments (other than Permitted Investments) made from
and after the Issue Date in any Person resulting from payments of interest
on Indebtedness, dividends, repayments of loans or advances, or from the
net cash proceeds from the sale of any such Investment (except, in each
case, to the extent any such proceeds are included in the calculation of
Consolidated Net Income), not to exceed, in each case, the amount of such
Investments previously made by the Company or any Subsidiary in such
Person or Subsidiary, (4) in the event an Unrestricted Subsidiary is
redesignated as a Subsidiary, an amount equal to the lesser of (i) the net
book value of Investments made in such Unrestricted Subsidiary at the time
of such designation, (ii) the fair market value of Investments made in
such Unrestricted Subsidiary at the time of such designation and (iii) the
original fair market value of Investments made in such Unrestricted
Subsidiary at the time they were made, and (5) $10,000,000.
(b) The provisions of this Section 4.07 shall not prohibit (i) the
payment of any dividend within 60 days after the date of declaration thereof, if
at the date of declaration such payment would have complied with the provisions
of this Indenture, (ii) the purchase, redemption or other acquisition or
retirement of any Equity Interests or the making of any principal payment on, or
the purchase, defeasance, repurchase, redemption or other acquisition or
retirement of Subordinated Indebtedness by conversion into, or by or in exchange
for, Equity Interests (other than Disqualified Equity Interests), or out of, the
net cash proceeds of the substantially concurrent sale (other than to a
Subsidiary of the Company) of other Equity Interests of the Company (other than
Disqualified Equity Interests), (iii) the making of any principal payment on, or
the purchase, defeasance, repurchase, redemption or other acquisition or
retirement of Subordinated Indebtedness in exchange for, by conversion into, or
out of the net cash proceeds of, a substantially concurrent sale or incurrence
of Indebtedness (including Disqualified Equity Interests) (other than any
Indebtedness owed to a Subsidiary) of the Company or a Subsidiary that (1) is
contractually subordinated in right of payment to the Notes to at least the same
extent as, and (2) has a final maturity date later than the final maturity date
of, and has a Weighted Average Life to Maturity at least equal to the Weighted
Average Life to Maturity of, the Subordinated Indebtedness being paid,
purchased, defeased, repurchased, redeemed or otherwise acquired or retired,
(iv) the purchase, redemption or other acquisition or retirement of any
Disqualified Equity Interests by conversion into, or by exchange for, shares of
Disqualified Equity Interests, or out of the net cash proceeds of the
substantially concurrent sale (other than to a Subsidiary of the Company) of
other Disqualified Equity Interests, in each case with a final maturity date
later than the final maturity date of, and with a Weighted Average Life
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to maturity (in each case including any security into which such Disqualified
Equity Interest is convertible or for which it is exchangeable at the option of
the holder) at least equal to the Weighted Average Life to Maturity of, the
Disqualified Equity Interest being purchased, redeemed or otherwise acquired or
retired, and (v) the purchase, redemption or other acquisition or retirement for
value of any Equity Interests held by any current or past member of the
Company's (or any of its Subsidiary's) management or board of directors (or the
estate, heirs or legatees of any such individual) pursuant to any management
equity subscription agreement, stock option agreement or other similar agreement
not to exceed $500,000 in any 12 month period; provided, however, that in the
case of the immediately preceding clauses (ii), (iii), (iv) and (v), no Default
or Event of Default shall have occurred and be continuing at the time of such
Restricted Payment or would occur as a result thereof.
(c) In determining the aggregate amount of Restricted Payments made
subsequent to the Issue Date for purposes of clause (iii) of Section 4.07(a),
amounts expended pursuant to clauses (i), (ii) and (v) of Section 4.07(b) shall
be included, but without duplication, in such calculation, and amounts expended
pursuant to clauses (iii) and (iv) thereof shall be excluded.
(d) For purposes of calculating the net cash proceeds received by
the Company from the issuance or sale of its Equity Interests either upon the
conversion of, or exchange for, Indebtedness of the Company or any Subsidiary,
such amount will be deemed to be an amount equal to the difference of (a) the
sum of (i) the principal amount or accreted value (whichever is less) of such
Indebtedness on the date of such conversion or exchange and (ii) the additional
cash consideration, if any, received by the Company upon such conversion or
exchange, less any payment on account of fractional shares, minus (b) all
expenses incurred in connection with such issuance or sale. For purposes of
calculating the net cash proceeds received by the Company from the issuance or
sale of its Equity Interests upon the exercise of any options or warrants of the
Company, such amount will be deemed to be an amount equal to the difference of
(a) the additional cash consideration, if any, received by the Company upon such
exercise, minus (b) all expenses incurred in connection with such issuance or
sale.
(e) 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 is permitted and setting forth the basis upon which the
calculations required by this Section 4.07 were computed, which calculations may
be based upon the Company's latest available financial statements, and, where
required, that no Default or Event of Default exists and is continuing and no
Default or Event of Default will occur immediately after giving effect to such
Restricted Payment.
(f) Section 4.21(b) contains additional limitations on certain types
of Restricted Payments.
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Section 4.08. Limitation on Transactions with Affiliates.
(a) The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, enter into or suffer to exist any
transaction or series of related transactions (including, without limitation,
the sale, purchase, exchange or lease of assets, property or services) with any
Affiliate of the Company (including entities in which the Company or any
Subsidiary thereof owns a minority interest) (each such transaction, an
"Affiliate Transaction") or extend, renew, waive or otherwise modify the terms
of any Affiliate Transaction entered into prior to the Issue Date unless (i)
such Affiliate Transaction is solely between or among the Company and its Wholly
Owned Subsidiaries; (ii) such Affiliate Transaction is solely between or among
Wholly Owned Subsidiaries of the Company; or (iii) the terms of such Affiliate
Transaction are fair and reasonable to the Company or such Subsidiary, as the
case may be, and the terms of such Affiliate Transaction are at least as
favorable as the terms which could be obtained by the Company or such
Subsidiary, as the case may be, in a comparable transaction made on an
arm's-length basis between unaffiliated parties. In any Affiliate Transaction
involving an amount or having a value in excess of $1,000,000 in any one year
which is not permitted under clause (i) or (ii) above, the Company or such
Subsidiary, as the case may be, must obtain a resolution of its Board of
Directors certifying that such Affiliate Transaction complies with clause (iii)
above. In transactions with a value in excess of $10,000,000 which are not
permitted under clause (i) or (ii) above, the Company or such Subsidiary, as the
case may be, must obtain a written opinion as to the fairness of such a
transaction, from a financial point of view, from an Independent Financial
Advisor.
(b) Section 4.08(a) shall not apply to (i) any transaction with any
current or former officer, director or employee of the Company or any Subsidiary
(in his or her capacity as such) (or the estate, heirs or legatees of any such
individual) related to employment agreements, indemnification agreements and
compensation and employee benefit plans in each case entered into in the
ordinary course of business and consistent with past practices, and (ii)
Restricted Payments to the extent not prohibited by Section 4.07 and other
transactions specifically excluded from the definition of "Restricted Payments"
by reason of exceptions set forth in such definition.
Section 4.09. Limitations on Liens.
The Company will not, and will not permit any of its Subsidiaries
to, create, assume, incur or otherwise cause or suffer to exist or become
effective any Liens of any kind (other than Permitted Liens) upon any property
or asset of the Company or any Subsidiary of the Company whether owned on the
Issue Date, or acquired after the Issue Date or on any shares of stock or debt
of any Subsidiary, now owned or hereafter acquired, or on any income or profits
therefrom, or assign or otherwise convey any right to receive income or profits
thereon unless (i) if such Lien secures Senior Indebtedness, the Notes or such
Guarantee are secured on an equal and ratable basis with the obligation so
secured until such time as such obligation is no longer secured by a Lien or
(ii) if such Lien secures Subordinated Indebtedness, such Lien shall be
subordinated to a Lien granted to the Holders on the same collateral as that
securing such Lien to the same
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extent as such Subordinated Indebtedness is subordinated to the Notes or such
Guarantees.
Section 4.10. Limitation on Issuances of Guarantees by Subsidiaries Which Are
Not Guarantors; Additional Guarantees.
(a) The Company will not permit any Subsidiary which is not a
Guarantor, directly or indirectly, to guarantee, or suffer to exist any
guarantee of, any Indebtedness of the Company or any Guarantor (collectively,
"Subsidiary Indebtedness"), unless (i) such Subsidiary simultaneously executes
and delivers a supplemental indenture to this Indenture providing for a
Guarantee of payment of the Notes by such Subsidiary, (ii) such Subsidiary
waives and will not in any manner whatsoever claim or take the benefit or
advantage of, any rights of reimbursement, indemnity, subrogation, or any other
rights against the Company or any other Subsidiary as a result of any payment by
such Subsidiary under its Guarantee, and (iii) such guarantee by a non-Wholly
Owned Subsidiary provides by its terms that it shall be automatically and
unconditionally released and discharged upon any sale, exchange, or transfer, to
any Person which is not an Affiliate of the Company of all of the Company's and
each Subsidiary's Common Equity Interest in, or substantially all the assets of,
such Subsidiary. The release or discharge of the Subsidiary Indebtedness which
resulted in the creation of such Guarantee shall not release or discharge such
Guarantee.
(b) If the Company shall acquire or create another domestic, Wholly
Owned Subsidiary after the Issue Date, then within ten Business Days after such
acquisition or creation, the Company shall cause such newly acquired or created
domestic, Wholly Owned Subsidiary to execute a supplemental indenture, in the
form attached as Exhibit E (which supplemental indenture may be executed by the
Company on behalf of the Guarantors (other than such newly created or acquired
domestic, Wholly Owned Subsidiary) pursuant to a power of attorney granted by
such Guarantors to the Company) and reasonably satisfactory in form and
substance to the Trustee (and with such documentation relating thereto as the
Trustee shall require, including, without limitation, if such Wholly Owned
Subsidiary is organized under the laws of the State of Arizona or the State of
Delaware, an Opinion of Counsel as to the enforceability (to the same extent
delivered by counsel to the Company as of the Closing Date) of such supplemental
indenture and Guarantee).
Section 4.11. Limitation on Subsidiaries and Unrestricted Subsidiaries.
(a) The Company may by written notice to the Trustee designate any
Subsidiary (including a newly acquired or a newly formed Subsidiary) to be an
Unrestricted Subsidiary; provided, however, that (i) no Default or Event of
Default shall have occurred and be continuing or would arise therefrom and (ii)
such designation is at that time permitted under Section 4.07. For purposes of
determining whether such designation is permitted under Section 4.07 above:
(i) an "Investment" shall be deemed to have been made at the
time any Subsidiary is designated as an Unrestricted Subsidiary in an
amount
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(proportionate to the Company's percentage Common Equity Interest in such
Subsidiary) equal to the greatest of (a) the net book value of Investments
made in such Unrestricted Subsidiaries at the time of such designation,
(b) the fair market value of Investments made in such Unrestricted
Subsidiaries at the time of such designation and (c) the original fair
market value of Investments made in such Unrestricted Subsidiaries at the
time they were made; and
(ii) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer.
(b) Notwithstanding paragraph (a), the Board of Directors of the
Company may not designate a Subsidiary of the Company to be an Unrestricted
Subsidiary unless such Subsidiary: (i) has no Indebtedness other than
Non-Recourse Debt; (ii) is not party to any agreement, contract, arrangement or
understanding with the Company or any Subsidiary of the Company unless the terms
of any such agreement, contract, arrangement or understanding are no less
favorable to the Company or such Subsidiary than those that might be obtained at
the time from Persons who are not Affiliates of the Company; (iii) is a Person
with respect to which neither the Company nor any of its Subsidiaries has any
direct or indirect obligation (1) to subscribe for additional Equity Interests
or (2) to maintain or preserve such Person's financial condition or to cause
such Person to achieve any specified levels of operating results; (iv) does not
guarantee or otherwise directly or indirectly provide credit support for any
Indebtedness of the Company or any of its Subsidiaries; and (v) has at least one
director on its board of directors that is not a director or executive officer
of the Company or any of its Subsidiaries and has at least one executive officer
that is not a director or executive officer of the Company or any of its
Subsidiaries.
(c) If, at any time, any Unrestricted Subsidiary would fail to meet
the definition of an Unrestricted Subsidiary, it shall thereafter cease to be an
Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of
such Person shall be deemed to be incurred by a Subsidiary of the Company as of
such date (and, if such Indebtedness is not permitted to be incurred as of such
date under Section 4.06, the Company shall be in default of such covenant).
Section 4.12. Limitation on Dividend and Other Payment Restrictions Affecting
Subsidiaries.
The Company will not, and will not permit any of its Subsidiaries
to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of any of its Subsidiaries to (a) pay dividends or make any other
distributions in cash or otherwise to the Company or any Subsidiary on its
Equity Interests, (b) pay any Indebtedness owed to the Company or loans or
advances to the Company or any Subsidiary thereof, (c) make loans or advances to
the Company or any Subsidiary thereof, (d) transfer any of its properties or
assets to the Company or any Subsidiary thereof (other than customary
restrictions on transfer of property subject to a Permitted Lien under the term
of the agreements creating such Permitted Lien (other than a Lien on cash not
constituting proceeds of non-cash
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property subject to a Permitted Lien) which would not materially adversely
affect the Company's ability to satisfy its obligations under the Notes), or (e)
guarantee the Notes, except, in each case, for such encumbrances or restrictions
existing under or contemplated by or by reason of (i) the Notes or this
Indenture; (ii) any restrictions existing under or contemplated by agreements
evidencing the New Credit Facility as in effect as of the Issue Date, and any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings thereof; provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are no more restrictive with respect to such
dividend and other payment restrictions affecting Subsidiaries than those
contained in the New Credit Facility as in effect on the Issue Date; (iii) any
restrictions with respect to a Subsidiary of the Company that was not a
Subsidiary of the Company on the Issue Date, which are in existence at the time
such Person becomes a Subsidiary of the Company (but not created in connection
with or contemplation of such Person becoming a Subsidiary of the Company and
which encumbrance or restriction is not applicable to any Person or the property
or assets of any Person other than such Person or the property or assets of such
Person so acquired); (iv) any agreement that governs Refinancing Indebtedness;
provided, however, that the terms and conditions of any such restrictions are
not materially less favorable in the aggregate to the Holders of the Notes than
those under or pursuant to the agreement evidencing the Indebtedness being
refinanced or replaced; (v) customary non-assignment provisions in any contract
or licensing agreement entered into by the Company or any Subsidiary of the
Company in the ordinary course of business or in any lease governing any
leasehold interest of the Company or a Subsidiary; (vi) purchase money
obligations for property acquired in the ordinary course of business that impose
restrictions of the nature described in clause (d) above on the property so
acquired; (vii) restrictions existing by reason of or under Indebtedness
existing on the Issue Date; (viii) any restrictions existing under any agreement
entered into with respect to the sale or disposition of all or substantially all
the Equity Interests or assets of a Subsidiary provided that the disposition or
sale is governed by the restrictions described under Sections 4.19 or 4.20; or
(ix) restrictions contained in agreements governing other Indebtedness permitted
to be incurred in accordance with this Indenture; provided that the restrictions
are not materially more restrictive in the aggregate than the restrictions
contained in this Indenture.
Section 4.13. Restriction on Sale and Issuance of Subsidiary Interests.
The Company (i) will not, and will not permit any Subsidiary to,
transfer, convey, sell, lease or otherwise dispose of any Equity Interests of
any Subsidiary to any Person other than the Company or a Wholly Owned Subsidiary
(except directors' qualifying shares or shares required to be held by foreign
nationals, in each case to the extent mandated by applicable law), unless (a)
such transfer, conveyance, sale, lease or other disposition is of all the Equity
Interests of such Subsidiary and (b) the net cash proceeds from such transfer,
conveyance, sale, lease or other disposition are applied in accordance with
Section 4.20 and (ii) will not permit any Subsidiary to issue any of its Equity
Interests (except directors' qualifying shares or shares required to be held by
foreign nationals, in each case to the extent mandated by applicable law) to any
Person other than to the Company or a Wholly Owned Subsidiary; provided,
however, that the
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Company or any Subsidiary may transfer, convey, sell or issue Equity Interests
of a Subsidiary formed in connection with an Asset Acquisition as long as such
Equity Interests (x) are transferred, conveyed, sold or issued to the Person or
Persons which are transferring, conveying or selling the assets or stock to such
Subsidiary, and (y) the fair market value of the Equity Interests of such
Subsidiary transferred, conveyed, sold or issued to such Person are not in
excess of the fair market value of the assets or stock acquired from such
Person.
Section 4.14. Limitation on Sale and Lease-Back Transactions.
The Company will not, and will not permit any of its Subsidiaries
to, enter into any Sale and Lease-Back Transaction unless (i) the consideration
received in such Sale and Lease-Back Transaction is at least equal to the fair
market value of the property sold, (ii) immediately prior to and after giving
effect to the Attributable Indebtedness in respect of such Sale and Lease-Back
Transaction, the Company could incur at least $1.00 of additional Indebtedness
(other than Permitted Indebtedness) in compliance with Section 4.06 and (iii)
the net cash proceeds received by the Company or its Subsidiaries from the Sale
and Lease-Back Transaction are applied in accordance with Section 4.20.
Section 4.15. Line of Business.
The Company will not, and will not permit any of its Subsidiaries
to, engage as a material part of its business in any business other than the
business conducted by the Company and its Subsidiaries as of the Issue Date or
any other business determined by the Company's Board of Directors, in good
faith, to be reasonably related to the foregoing.
Section 4.16. Limitation on Status as Investment Company.
Neither the Company nor any of its Subsidiaries shall take any
action or suffer to exist any condition that would require the Company or any of
its Subsidiaries to register as an "investment company" (as that term is defined
in the Investment Company Act of 1940, as amended), or to otherwise become
subject to regulation as an investment company.
Section 4.17. Payments for Consent.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Notes for or as an inducement
to any consent, waiver or amendment of any of the terms or provisions of this
Indenture or the Notes unless such consideration is offered to be paid or agreed
to be paid to all Holders of the Notes which so consent, waive or agree to amend
within any time period set forth in the solicitation documents relating to such
consent, waiver or agreement.
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Section 4.18. Corporate Existence.
Subject to Article 5 and Section 10.04 hereof, 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 Subsidiary, in accordance with the respective organizational
documents (as the same may be amended from time to time) of each Subsidiary and
the rights (charter and statutory), licenses and franchises of the Company and
its Subsidiaries; provided, however, that the Company shall not be required to
preserve any such right, license or franchise, or the corporate, partnership or
other existence of any of its Subsidiaries, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders.
Section 4.19. Change of Control.
(a) Within 30 days of the occurrence of a Change of Control, the
Company shall notify the Trustee in writing of such occurrence and shall make an
offer to purchase (the "Change of Control Offer") all or any portion (equal to
$1,000 or an integral multiple of $1,000) of the outstanding Notes at a cash
purchase price equal to (x) 101%, in the case of a Change of Control which was
approved by the Board of Directors of the Company (as evidenced by a resolution
of such Board), or (y) 105%, in the case of a Change of Control which was not
approved by the Board of Directors of the Company, of the principal amount of
the outstanding Notes plus any accrued and unpaid interest and Liquidated
Damages, if any, thereon to the Change of Control Payment Date (as hereinafter
defined) (such applicable purchase price being hereinafter referred to as the
"Change of Control Purchase Price") in accordance with the procedures set forth
in this covenant.
(b) Within 30 days of the occurrence of a Change of Control, the
Company also shall (i) cause a notice of the Change of Control Offer to be sent
at least once to the Dow Jones News Service or similar business news service in
the United States and (ii) send by first-class mail, postage prepaid, to the
Trustee and to each Holder of the Notes, at the address appearing in the
register maintained by the Registrar of the Notes, a notice describing the
transactions constituting a Change of Control and stating:
(1) that the Change of Control Offer is being made pursuant to
this Section 4.19 and that all Notes tendered will be accepted for
payment, subject to the terms and conditions set forth herein;
(2) the Change of Control Purchase Price and the purchase date
(which shall be a Business Day no earlier than 20 Business Days and no
later than 60 days from the date such notice is mailed (the "Change of
Control Payment Date"));
(3) that any Note not tendered will continue to accrue
interest;
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(4) that, unless the Company defaults in the payment of the
Change of Control Purchase Price, any Notes accepted for payment pursuant
to the Change of Control Offer shall cease to accrue interest after the
Change of Control Payment Date;
(5) that Holders accepting the offer to have their Notes
purchased pursuant to a Change of Control Offer will be required to
surrender the Notes to the Paying Agent at the address specified in the
notice prior to the close of business on the Business Day preceding the
Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their acceptance
if the Paying Agent receives, not later than the close of business on the
fifth Business Day preceding the Change of Control Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the name
of the Holder, the principal amount of the Notes delivered for purchase,
and a statement that such Holder is withdrawing its election to have such
Notes purchased;
(7) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered; provided that each Note purchased and
each such new Note issued shall be in an original principal amount in
denominations of $1,000 and integral multiples thereof;
(8) any other reasonable procedures that a Holder must follow
to accept a Change of Control Offer or effect withdrawal of such
acceptance; and
(9) the name and address of the Paying Agent.
(c) On the Change of Control Payment Date, the Company shall, to the
extent lawful, (i) accept for payment all Notes or portions thereof or
beneficial interests under a Global Note tendered pursuant to the Change of
Control Offer, (ii) deposit with the Paying Agent money sufficient to pay the
purchase price of all Notes or portions thereof or beneficial interests so
tendered, and (iii) deliver or cause to be delivered to the Trustee Notes so
accepted together with an Officers' Certificate stating the Notes or portions
thereof tendered to the Company. The Paying Agent shall promptly (1) mail to
each Holder of Notes so accepted and (2) cause to be credited to the respective
accounts of the Holders under a Global Note of beneficial interests so accepted
payment in an amount equal to the Change of Control Purchase Price for such
Notes, and the Company shall execute and issue, and the Trustee shall promptly
authenticate and mail to such Holder, a new Certificated Note equal in principal
amount to any unpurchased portion of the Certificated Notes surrendered and
shall issue a new Global Note equal in principal amount to any unpurchased
portion of beneficial interest so surrendered or shall reflect on such Global
Note or a schedule thereto such change in beneficial interest; provided,
however, that each such new Note shall be issued in an original principal amount
in denominations of $1,000 and integral multiples thereof.
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(d) The Change of Control provisions described above will be
applicable whether or not any other provisions of this Indenture are applicable.
The Company will not be required to make a Change of Control Offer upon a Change
of Control if a third party makes the Change or Control Offer in the manner, at
the times and otherwise in compliance with the requirements set forth in this
Indenture applicable to a Change of Control Offer made by the Company and
purchases all Notes validly tendered and not withdrawn under such Change of
Control Offer.
(e) Section 4.21 contains additional provisions relating to Change
of Control Offers.
Section 4.20. Limitation on Certain Asset Sales.
(a) The Company will not, and will not permit any of its
Subsidiaries to, consummate an Asset Sale unless (i) the Company or such
Subsidiary, as the case may be, receives consideration at the time of such sale
or other disposition at least equal to the fair market value thereof (as
reasonably determined for Asset Sales in excess of $1,000,000 in good faith by
its Board of Directors, as evidenced by a Board resolution); (ii) not less than
75% of the consideration received by the Company or the Subsidiary, as the case
may be, from such Asset Sale is in the form of cash or Temporary Cash
Investments; provided that the amount of (A) any liabilities (as shown on the
Company's or a Subsidiary's most recent balance sheet) of the Company or a
Subsidiary (other than contingent liabilities and liabilities that are by their
terms subordinated to the Notes or any Guarantee thereof) that are assumed by
the transferee of any such assets or an Affiliate thereof pursuant to a
customary novation agreement that releases the Company or such Subsidiary from
further liability and (B) any securities, notes or other obligations received by
the Company or a Subsidiary from such transferee or an Affiliate thereof that
are converted by the Company or a Subsidiary into cash prior to the Reinvestment
Date shall be deemed (to the extent of the cash received) to be cash for
purposes of this provision; and (iii) the Asset Sale Proceeds received by the
Company or such Subsidiary are applied, to the extent the Company or such
Subsidiary elects, (A) to repay and permanently reduce outstanding Senior
Indebtedness under the New Credit Facility, other secured Senior Indebtedness,
or any other Senior Indebtedness that has a maturity date earlier than the
maturity of the Notes and to permanently reduce the commitments in respect
thereof; provided, however, that such repayment and commitment reduction occurs
prior to the Reinvestment Date or (B) to make any Permitted Investment of the
type described in clause (ii)(C) of the definition of Permitted Investment (to
the extent otherwise permitted by this Indenture), acquire a controlling
interest in another business, make capital expenditures or acquire other
long-term assets; provided, however, that such investment occurs or the Company
or a Subsidiary enters into contractual commitments to make such investment,
subject only to customary conditions (other than the obtaining of financing), on
or prior to the 270th day following receipt of such Asset Sale Proceeds (the
"Reinvestment Date") (and notifies the Trustee of the same in writing) and Asset
Sale Proceeds contractually committed are so applied within 360 days following
the receipt of such Asset Sale Proceeds or (C) as Excess Proceeds as set forth
below. Pending the final application of any such Asset Sale Proceeds, the
Company or such Subsidiary may temporarily reduce Senior Indebtedness or
otherwise invest such Asset
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Sale Proceeds in any manner that is not prohibited by this Indenture. Any Asset
Sale Proceeds that are not applied as permitted by clause (iii)(A) or (iii)(B)
of the second preceding sentence shall constitute "Excess Proceeds." If at any
time from and after the Issue Date the aggregate amount of Excess Proceeds
exceeds $10,000,000, the Company shall offer (an "Excess Proceeds Offer") to
purchase from all Holders of Notes, pursuant to procedures set forth in this
Indenture and if the Company is required to do so under the terms of any other
Senior Indebtedness, to purchase from the Holders of such other Senior
Indebtedness the maximum principal amount of Notes and principal of such other
Senior Indebtedness that may be purchased with such Excess Proceeds at a
purchase price in cash equal to 100% of the principal amount thereof plus
accrued interest, and Liquidated Damages, if any, to the date of the purchase.
To the extent that the purchase price of Notes and the purchase price of such
other Senior Indebtedness tendered pursuant to such Excess Proceeds Offer is
less than the amount of Excess Proceeds, the Company may use such portion of the
Excess Proceeds that is not used to purchase Notes or such other Senior
Indebtedness so tendered for general corporate purposes not inconsistent with
the Notes or this Indenture. If the aggregate purchase price of Notes and the
purchase price of such other Senior Indebtedness tendered pursuant to such
Excess Proceeds Offer is more than the amount of the Excess Proceeds, the Notes
and principal of such other Senior Indebtedness tendered will be repurchased on
a basis pro rata to the amount tendered or by such other method as the Trustee
shall deem fair and appropriate. Upon the completion of any Excess Proceeds
Offer and the closing of any repurchase of Notes and principal of such other
Senior Indebtedness tendered pursuant to such Excess Proceeds Offer, the amount
of Excess Proceeds shall be deemed to be zero.
(b) If the Company is required to make an Excess Proceeds Offer, the
Company shall mail, within 30 days following the Reinvestment Date, a notice to
the Holders of the Notes describing the transactions giving rise to the Excess
Proceeds Offer and stating, among other things: (1) that such Holders have the
right to require the Company to apply the Excess Proceeds to repurchase such
Notes at a purchase price in cash equal to 100% of the principal amount thereof
plus accrued and unpaid interest and Liquidated Damages, if any, to the date of
purchase; (2) the purchase date, which shall be no earlier than 30 days and not
later than 60 days from the date such notice is mailed; (3) the instructions,
reasonably determined by the Company, that each Holder of Notes must follow in
order to have such Notes repurchased; and (4) the calculations used in
determining the amount of Excess Proceeds to be applied to the repurchase of
such Notes.
(c) The Company or any of its Subsidiaries may engage in
transactions in which assets are transferred in exchange for one or more
like-kind assets; provided that if the fair market value of the assets to be
transferred by the Company or such Subsidiary, plus the fair market value of any
other consideration paid or credited by the Company or such Subsidiary exceeds
$1,000,000, such transaction shall require approval of the Board of Directors of
the Company; provided that no such transaction shall be permitted if the
Consolidated Fixed Charge Coverage Ratio of the Company would be reduced after
giving effect to such transaction. Each transaction governed by this Section
4.20(c) shall be valued at an amount equal to all consideration received by the
Company or such Subsidiary in such transaction, other than the like-kind assets
received pursuant to such
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exchange ("Other Consideration"), for purposes of determining whether an Asset
Sale has occurred. If the Other Consideration is of an amount and character such
that such transaction constitutes an Asset Sale, then the first paragraph of
this Section 4.20 shall be applicable to any Asset Sale Proceeds of such Other
Consideration.
(d) Section 4.21 contains additional provisions relating to Excess
Proceeds Offers.
Section 4.21. General Provisions Related to Change of Control Offers and Excess
Proceeds Offers.
(a) If any Indebtedness under the New Credit Facility is outstanding
at the time of the occurrence of a Change of Control or at the time the Company
is required to make an Excess Proceeds Offer and the New Credit Facility shall
prohibit the Company from fully complying with its obligations to make and
consummate a Change in Control Offer or an Excess Proceeds Offer, prior to the
mailing of the notice to Holders described in the preceding paragraphs, but in
any event within 30 days following any Change of Control or Reinvestment Date,
the Company shall (i) repay in full all obligations and terminate all
commitments under the New Credit Facility or offer to repay in full all
obligations and terminate all commitments under the New Credit Facility or (ii)
obtain the requisite consent under the New Credit Facility to permit the making
of, and the repurchase of the Notes pursuant to, the Change of Control Offer or
the Excess Proceeds Offer. The time by which the Company is required to commence
and consummate a Change of Control Offer or an Excess Proceeds Offer shall be
deferred until the Company has taken the actions required by this Section
4.21(a).
(b) If the Company or any Guarantor has issued any outstanding (i)
Subordinated Indebtedness or (ii) Preferred Equity Interests, and the Company is
required to make a Change of Control Offer or the Company or such Guarantor is
required to make an Excess Proceeds Offer or to make a distribution with respect
to such Subordinated Indebtedness or Preferred Equity Interests in the event of
a change of control or sale of assets, the Company and such Guarantor shall not
consummate any such offer or distribution with respect to such Subordinated
Indebtedness or Preferred Equity Interests until such time as the Company shall
have paid the Change of Control Purchase Price in full to the Holders of Notes
that have accepted the Company's Change of Control Offer and shall otherwise
have consummated the Change of Control Offer made to Holders of the Notes, or
until such time as the Company has paid the Excess Proceeds to Holders of the
Notes that have accepted the Excess Proceeds Offer and shall otherwise have
consummated the Excess Proceeds Offer, as the case may be.
(c) The Company will comply with any applicable requirements of Rule
14e-1 as then in effect with respect to any Change in Control Offer or Excess
Proceeds Offer and the purchase of any Notes thereunder.
Section 4.22. Maintenance of Office or Agency.
The Company shall maintain in the City and State of New York an
office or agency where Notes may be surrendered for registration of transfer or
exchange or for
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presentation for payment and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the address of the Trustee as set forth in Section
10.02.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations. The
Company shall give prompt written notice to the Trustee of such designation or
rescission and of any change in the location of any such other office or agency;
provided, however, that no such designation or rescission shall relieve the
Company of its obligation to maintain an office or agency in the City and State
of New York for such purposes.
The Company hereby initially designates the office of the Trustee
specified in Section 11.02 as such office of the Company; provided, however,
that no such designation or rescission shall relieve the Company or its agent of
its obligation to maintain an office or agency in the Borough of Manhattan, City
of New York for such purposes.
Section 4.23. Maintenance of Properties and Insurance; Books and Records;
Compliance with Laws.
(a) The Company shall, and shall cause its Subsidiaries to, at all
times, cause all material properties used or useful to the conduct of their
business, taken as a whole, to be maintained and kept in good condition, repair
and working order (reasonable wear and tear excepted) as determined in the good
faith judgment of the Officers of the Company; provided, however, that the
Company or any Subsidiary shall not be prevented hereby from discontinuing the
operation or maintenance of any of such properties, or disposing of any of them,
if such discontinuance or disposal is in the good faith judgment of any Officer
or the Board of Directors of the Company or the Subsidiary concerned, as the
case may be, desirable in the conduct of the business of the Company or such
Subsidiary, as the case may be.
(b) The Company and each of its Subsidiaries shall provide or cause
to be provided, for itself and each of their respective Subsidiaries, insurance
(including appropriate self-insurance) that is adequate and appropriate (in the
good faith judgment of an Officer of the Company) for the conduct of the
business of the Company and such Subsidiaries in a prudent manner.
(c) The Company shall and shall cause each of its Subsidiaries to
keep books of record and account, in which entries shall be made of all material
financial transactions and the assets and business of the Company and its
Subsidiaries as are necessary to permit the Company to prepare financial
statements in accordance with GAAP.
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(d) The Company shall and shall cause each of its Subsidiaries to
comply in all material respects with all statutes, laws, ordinances, or
government rules and regulations to which they are subject, non-compliance with
which would materially adversely affect the financial condition of the Company
and its Subsidiaries taken as a whole.
Section 4.24. Further Assurance to the Trustee.
The Company shall, upon request of the Trustee, execute and deliver
such further instruments and do such further acts as may reasonably be necessary
or proper to carry out more effectively the provisions of this Indenture.
ARTICLE 5.
SUCCESSOR CORPORATION
Section 5.01. Merger, Consolidation or Sale of Assets.
(a) The Company will not consolidate with, merge with or into, or
sell, assign, lease, convey, transfer or otherwise dispose of (a "transfer") all
or substantially all of its assets (as an entirety or substantially as an
entirety in one transaction or a series of related transactions), to any Person
unless: (i) the Company shall be the continuing Person, or the Person (if other
than the Company) formed by such consolidation or into which the Company is
merged or to which the properties and assets of the Company are transferred
shall be a corporation organized and existing under the laws of the United
States or any State thereof or the District of Columbia and shall expressly
assume, by a supplemental indenture, executed and delivered to the Trustee, in
form reasonably satisfactory to the Trustee, all of the obligations of the
Company under the Notes and this Indenture, and the obligations under this
Indenture shall remain in full force and effect; (ii) immediately before and
immediately after giving effect to such transaction, no Default or Event of
Default shall have occurred and be continuing; and (iii) except in the case of a
merger or consolidation of the Company with or into a Wholly Owned Subsidiary of
the Company, the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made (a) immediately after giving effect to such transaction on a pro forma
basis could incur at least $1.00 of additional Indebtedness (other than
Permitted Indebtedness) under the covenant set forth under Section 4.06 and (b)
immediately thereafter shall have a Consolidated Net Worth equal to or greater
than the Consolidated Net Worth of the Company immediately prior to such
transaction.
(b) In connection with any consolidation, merger or transfer of
assets contemplated by this provision, the Company shall deliver, or cause to be
delivered, to the Trustee, in form and substance reasonably satisfactory to the
Trustee, an Officers' Certificate and an Opinion of Counsel relating to issues
of law, each stating that such consolidation, merger or transfer and the
supplemental indenture in respect thereto comply with this provision and that
all conditions precedent herein provided for relating to such transaction or
transactions have been complied with.
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Section 5.02. Successor Person Substituted.
Upon any consolidation or merger, or any transfer of all or
substantially all of the assets of the Company in accordance with Section 5.01,
the successor corporation formed by such consolidation or into which the Company
is merged or to which such transfer is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this Indenture
with the same effect as if such successor corporation had been named as the
Company herein, and thereafter the predecessor corporation shall be relieved of
all obligations and covenants under this Indenture and the Notes, except that
such predecessor corporation shall not be so relieved if it retains any material
assets other than (i) the proceeds of the sale of assets and (ii) Equity
Interests in Unrestricted Subsidiaries.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(1) there is a default in payment of any principal of, or premium,
if any, on the Notes when such principal or premium becomes due and payable;
(2) there is a default for 30 days in the payment of any interest on
or Liquidated Damages, if any, with respect to the Notes after such interest or
Liquidated Damages becomes due and payable;
(3) there is a failure of the Company or its Subsidiaries to comply
with any purchase or payment obligations set forth in Section 4.19 or Section
4.20 or with Section 4.06, Section 4.07, Section 4.10, or Section 5.01;
(4) there is a default by the Company or its Subsidiaries in the
observance or performance of any other provision in the Notes or this Indenture
for 30 days after written notice from the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Notes then outstanding;
(5) there is a default under any agreement, mortgage, indenture or
instrument under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of its
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
Subsidiaries), whether such Indebtedness or guarantee now exists or is created
after the Issue Date, which default (a) is caused by a failure to pay principal
of or premium, if any, or interest on such Indebtedness at final maturity (a
"Payment Default") or (b) results in the acceleration of such Indebtedness prior
to its express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $7,500,000 or more;
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(6) a court of competent jurisdiction enters any final judgment or
judgments which can no longer be appealed for the payment of money in excess of
$7,500,000 (which are not paid or covered by third party insurance by
financially sound insurers that have not disclaimed or threatened to disclaim
coverage) shall be rendered against the Company or any Subsidiary thereof, and
shall not be discharged for any period of 60 consecutive days during which a
stay of enforcement shall not be in effect;
(7) any Guarantee of a Significant Subsidiary shall be held in any
judicial proceeding to be unenforceable or invalid or shall cease for any reason
to be in full force and effect or any Guarantor that is a Significant Subsidiary
shall deny or disaffirm its obligations under its Guarantee;
(8) the Company or any Subsidiary pursuant to or within the meaning
of any Bankruptcy Law:
(A) commences a voluntary case or proceeding,
(B) consents to the entry of an order for relief against it in
an involuntary case or proceeding,
(C) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(D) makes a general assignment for the benefit of its
creditors, or
(E) generally is not paying its debts as they become due; and
(9) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any Subsidiary in an
involuntary case or proceeding,
(B) appoints a Custodian of the Company or any Subsidiary or
for all or substantially all of the property of the Company or any
Subsidiary, or
(C) orders the liquidation of the Company or any Subsidiary,
and, in each case under this clause (9), the order or decree remains
unstayed and in effect for 60 consecutive days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal or state law for the relief of debtors as in effect from time to time.
The term "Custodian," as used in this Article 6, means any receiver, trustee,
assignee, liquidator or similar official under any Bankruptcy Law.
Subject to the provisions of Sections 7.01 and 7.02, the Trustee
shall not be charged with knowledge of any Default or Event of Default unless
written notice
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thereof shall have been given to a Trust Officer at the address of the Trustee
for notices as specified in Section 11.02 by the Company or any other Person.
The Trustee may withhold notice to the Holders of the Notes of any
default (except in payment of principal or premium, if any, or interest on the
Notes or that resulted from the failure of the Company to comply with the
provisions of Section 4.19 or Section 4.20) if the Trustee considers it to be in
the best interest of the Holders of the Notes to do so.
Section 6.02. Acceleration.
(a) If an Event of Default (other than an Event of Default under
Section 6.01(8) or (9)) shall have occurred and be continuing, then the Trustee
or the Holders of not less than 25% in aggregate principal amount of the Notes
then outstanding may declare to be immediately due and payable the entire
principal amount of all the Notes then outstanding plus accrued interest and
Liquidated Damages to the date of acceleration. If an Event of Default specified
in Section 6.01(8) or (9) occurs, the principal of and interest on all the Notes
shall become immediately due and payable without any declaration or other act on
the part of the Trustee or any Holders. The Holders of a majority in aggregate
principal amount of outstanding Notes by notice to the Trustee may rescind and
annul an acceleration and its consequences if the rescission would not conflict
with any judgment or decree and if all existing Events of Default have been
cured or waived except nonpayment of principal, premium, interest and Liquidated
Damages that has become due solely because of acceleration. No such rescission
shall affect any subsequent Default or impair any right consequent thereto.
(b) Upon the occurrence of an Event of Default under Sections
6.01(8) or (9), the principal, premium and interest amount with respect to all
of the Notes shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or the Holders of the
Notes.
(c) In the event of a declaration of acceleration of the Notes
because an Event of Default has occurred and is continuing as a result of a
Payment Default on or the acceleration of any Indebtedness described in Section
6.01(5), the declaration of acceleration of the Notes shall be automatically
rescinded and annulled if such Payment Default is waived or cured or the holders
of such Indebtedness described in such Section 6.01(5) have rescinded the
declaration of acceleration in respect of such Indebtedness, as appropriate,
within 30 days from the date of such declaration and if (i) the rescission and
annulment of the acceleration of the Notes would not conflict with any judgment
or decree of a court of competent jurisdiction and (ii) all existing Events of
Default, except non-payment of principal, interest, Liquidated Damages or
premium on the Notes that became due solely because of the acceleration of the
Notes, have been cured or waived.
In the case of any Event of Default occurring solely by reason of
any willful action (or inaction) taken (or not taken) by or on behalf of the
Company with the intention of avoiding payment of the premium that the Company
would have had to pay
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if the Company then had elected to redeem the Notes pursuant to the optional
redemption provisions of this Indenture, an equivalent premium shall also become
and be immediately due and payable to the extent permitted by law upon the
acceleration of the Notes.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of, or premium, if any, interest and Liquidated Damages on
the Notes or to enforce the performance of any provision of the Notes or this
Indenture and make take any necessary action requested of it as Trustee to
settle, compromise, adjust or otherwise conclude any proceeding to which it is a
party.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Noteholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
Section 6.04. Waiver of Past Defaults and Events of Default.
Subject to Sections 6.07, 8.02 and 11.06 hereof, the Holders of a
majority in principal amount of the Notes then outstanding have the right to
waive any existing or potential future Default or Event of Default or compliance
with any provision of this Indenture or the Notes. Upon any such waiver, such
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured for every purpose; but no such waiver shall extend
to any subsequent or other Default or Event of Default or impair any right
consequent to any such subsequent Default or Event of Default except as
specifically contemplated thereby.
Section 6.05. Control by Majority.
The Holders of a majority in principal amount of the Notes then
outstanding shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee. The Trustee,
however, may refuse to follow any direction that conflicts with law or this
Indenture or that the Trustee determines may be unduly prejudicial to the rights
of another Noteholder not taking part in such direction, and the Trustee shall
have the right to decline to follow any such direction if the Trustee, being
advised by counsel, determines that the action so directed may not lawfully be
taken or if the Trustee in good faith shall determine that the proceedings so
directed may involve it in personal liability unless the Trustee has asked for
and received indemnification reasonably satisfactory to it against any loss,
liability or expense caused by its following such direction; provided that the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
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Section 6.06. Limitation on Suits.
Subject to Section 6.07 below, a Noteholder may not institute any
proceeding or pursue any remedy with respect to this Indenture or the Notes
unless:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(2) the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding make a written request to the Trustee to pursue the
remedy;
(3) such Holder or Holders offer, and if requested, provide to the
Trustee indemnity reasonably satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the provision of
indemnity; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60 day period by the Holders of a majority in
aggregate principal amount of the Notes then outstanding.
A Noteholder may not use this Indenture to prejudice the rights of
another Noteholder or to obtain a preference or priority over another
Noteholder.
Section 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal of, or premium, if any, and
interest of the Note on or after the respective due dates expressed in the Note,
or to bring suit for the enforcement of any such payment on or after such
respective dates, is absolute and unconditional and shall not be impaired or
affected without the consent of the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal, premium, interest or
Liquidated Damages specified in Section 6.01(1) or (2) hereof occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company or the Guarantor (or any other obligor on
the Notes) for the whole amount of unpaid principal and accrued interest
remaining unpaid, together with any premium, interest on overdue principal and,
to the extent that payment of such interest is lawful, interest on overdue
installments of interest, in each case at the rate then borne by the Notes, and
such further amounts as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, including all sums due and
owing to the Trustee pursuant to Section 7.07.
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Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Noteholders allowed in any judicial proceedings relative to the Company or the
Guarantors (or any other obligor upon the Notes), their respective creditors or
property and shall be entitled and empowered to collect and receive any monies
or other property payable or deliverable on any such claims and to distribute
the same after deduction of its reasonable charges and expenses to the extent
that any such charges and expenses are not paid out of the estate in any such
proceedings and any custodian in any such judicial proceeding is hereby
authorized by each Noteholder 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 Noteholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Noteholder any plan or
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Noteholder in any such proceedings.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article 6, it
shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07 hereof;
SECOND: to Noteholders for amounts due and unpaid on the Notes for
principal, premium, if any, interest and Liquidated Damages as to each, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes; and
THIRD: to the Company or, to the extent the Trustee collects any amount
from any Guarantor, to such Guarantor.
The Trustee may fix a record date and payment date for any payment
to Noteholders pursuant to this Section 6.10. The Trustee shall give the Company
prior notice of any such record date and payment date; provided, however, that
the failure to give any such notice shall not affect the establishment of such
record date or payment date or any payment to Noteholders pursuant to this
Section 6.10.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as 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,
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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 6.07 hereof or a suit by Holders of more
than 10% in principal amount of the Notes then outstanding.
Section 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 case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
ARTICLE 7.
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent man would exercise or use under the same circumstances in the conduct of
his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture and no others and no implied
covenants or obligations shall be read into this Indenture against the
Trustee, except for the covenant of good faith and fair dealing.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture but,
in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether or
not they conform to the requirements of this Indenture (but need not
confirm or investigate the accuracy of mathematical calculations or other
facts stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
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(1) This paragraph does not limit the effect of paragraph (b)
of this Section 7.01.
(2) In the absence of bad faith on its part, the Trustee shall
not be liable for any error of judgment made in good faith by a Trust
Officer, unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Sections 6.02 and 6.05 hereof.
(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 rights or powers if it shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity satisfactory to
it against such risk or liability is not reasonably assured to it.
(e) Whether or not therein expressly so provided, paragraphs (a),
(b), (c), (d), (f) and (g) of this Section 7.01 shall govern every provision of
this Indenture that in any way relates to the Trustee.
(f) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity reasonably satisfactory to it against any
loss, liability, expense or fee.
(g) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company or
any Guarantor. Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by the law.
Section 7.02. Rights of Trustee.
Subject to Section 7.01 hereof:
(1) The Trustee may rely on and shall be protected in acting or
refraining from acting upon any document reasonably 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.
(2) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel, or both, which shall conform
to the provisions of Section 11.05 hereof. The Trustee shall be protected and
shall not be liable for any action it takes or omits to take in good faith in
reliance on such certificate or opinion.
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(3) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent (other than the negligence or
willful misconduct of an agent who is an employee of the Trustee) appointed by
it with due care.
(4) 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; provided that the Trustee's conduct does not constitute
negligence or bad faith.
(5) The Trustee may consult with counsel of its selection, 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.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may make loans to, accept deposits from, perform
services for or otherwise deal with the Company or any Guarantor, or any
Affiliates thereof, with the same rights it would have if it were not Trustee.
Any Agent may do the same with like rights. The Trustee, however, shall be
subject to Sections 7.10 and 7.11 hereof.
Section 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy
of this Indenture or the Notes, it shall not be accountable for the Company's
use of the proceeds from the sale of Notes or any money paid to the Company
pursuant to the terms of this Indenture and it shall not be responsible for any
statement in the Notes or any document used in connection with the sale of the
Notes other than its certificate of authentication. The Trustee shall have no
liability or responsibility for the acts or omissions of any other trustee
appointed hereunder.
Section 7.05. Notice of Defaults.
If a Default occurs and is continuing and if it is known to the
Trustee based upon information contained in an Officers' Certificate or upon
notice from Holders of 25% or more of the aggregate principal amount of the
Notes then outstanding, the Trustee shall mail to each Noteholder notice of the
Default within 60 days after it occurs. Except in the case of a Default in
payment of principal or premium, if any, or interest on the Notes, or that
resulted from the failure of the Company to comply with Section 4.19 or 4.20,
the Trustee may withhold the notice if and so long as a committee of its Trust
Officers in good faith determines it to be in the best interests of the Holders
of the Notes to do so.
Section 7.06. Reports by Trustee to Holders.
If required by TIA Section 313(a), within 60 days after May 15 of
any year, commencing the May 15 following the date of this Indenture, the
Trustee shall mail to
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each Noteholder a brief report dated as of such May 15 that complies with TIA
Section 313(a); provided that no such report need be transmitted if no such
events listed in TIA Section 313(a) have occurred within such period. The
Trustee also shall comply with TIA Section 313(b)(2). The Trustee shall also
transmit by mail all reports as required by TIA Section 313(c) and TIA Section
313(d).
A copy of each report at the time of its mailing to Noteholders
shall be filed with the SEC and each stock exchange on which the Notes are
listed. The Company shall promptly notify the Trustee when the Notes are listed
on any stock exchange and the Trustee shall comply with TIA Section 313(d).
Section 7.07. Compensation and Indemnity.
The Company and the Guarantors (on a joint and several basis) shall
pay to the Trustee from time to time such reasonable compensation as shall be
agreed in writing between the Company and the Trustee for its services hereunder
(which compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust). The Company and the
Guarantors (on a joint and several basis) shall reimburse the Trustee upon
request for all reasonable disbursements, expenses and advances incurred or made
by it in connection with its duties under this Indenture, including the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
The Company and the Guarantors (on a joint and several basis) shall
indemnify each of the Trustee and any predecessor Trustee for, and hold it
harmless against, any and all loss, damage, claim, liability, reasonable expense
(including but not limited to reasonable attorneys' fees and expenses) or taxes
(other than taxes based on the income of the Trustee) incurred by it in
connection with the acceptance or performance of its duties under this Indenture
including the reasonable costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder (including, without limitation, settlement costs).
The Trustee shall notify the Company and the Guarantors in writing promptly of
any claim asserted against the Trustee for which it may seek indemnity. However,
the failure by the Trustee to so notify the Company and the Guarantors shall not
relieve the Company or any Guarantor of its obligations hereunder. The Company
need not pay for any settlement made without its consent, which consent shall
not be unreasonably withheld.
Notwithstanding the foregoing, the Company and the Guarantors need
not reimburse the Trustee for any expense or indemnify it against any loss or
liability incurred by the Trustee through its negligence or bad faith. The
obligations of the Company and the Guarantors under this Section 7.07 to
compensate and indemnify the Trustee and each predecessor Trustee and to pay or
reimburse the Trustee and each predecessor Trustee for expenses, disbursements
and advances shall be joint and several liabilities of the Company and the
Guarantors and shall survive the satisfaction and discharge of this Indenture,
including the termination or rejection hereof in any bankruptcy proceeding to
the extent permitted by law.
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When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(8) or (9) hereof occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
Section 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company and the
Guarantors in writing, such resignation to become effective upon the appointment
of a successor Trustee. The Holders of a majority in principal amount of the
outstanding Notes may remove the Trustee by notifying the removed Trustee in
writing and may appoint a successor Trustee with the Company's written consent
which consent shall not be unreasonably withheld. The Company may remove the
Trustee at its election if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee
or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed by the Company or by the
Holders of a majority in principal amount of the outstanding Notes and such
Holders do not reasonably promptly appoint a successor trustee, or if a vacancy
exists in the office of Trustee for any reason, the Company shall promptly
appoint a successor Trustee.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 25% in principal amount of the outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10 hereof, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately following
such delivery, the retiring Trustee shall, subject to its rights under Section
7.07 hereof, transfer all property held by it as Trustee to the successor
Trustee, 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 Noteholder. Notwithstanding replacement of the
Trustee pursuant to this Section 7.08, the Company's obligations under Section
7.07 hereof shall continue for the benefit of the retiring Trustee.
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Section 7.09. Successor Trustee by Consolidation, Merger or Conversion.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, bank, trust company or national banking association, subject to
Section 7.10 hereof, the successor corporation or national banking association
without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1) and (2) in every respect. The Trustee
shall have a combined capital and surplus of at least $100,000,000 as set forth
in its most recent published annual report of condition. The Trustee shall
comply with TIA Section 310(b), including the provision in Section 310(b)(1);
provided that there shall be excluded from the operation of TIA Section
310(b)(1) any indenture or indentures under which other securities, or conflicts
of interest or participation in other securities, of the Company or the
Guarantors are outstanding if the requirements for exclusion set forth in TIA
Section 310(b)(1) are met.
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
Section 7.12. Paying Agents.
The Company shall cause each Paying Agent other than the Trustee to
execute and deliver to it and the Trustee an instrument in which such agent
shall agree with the Trustee, subject to the provisions of this Section 7.12:
(A) that it will hold all sums held by it as agent for the payment
of principal of, or premium, if any, or interest on, the Notes (whether such
sums have been paid to it by the Company or by any obligor on the Notes) in
trust for the benefit of Holders of the Notes or the Trustee;
(B) that it will at any time during the continuance of any Event of
Default, upon written request from the Trustee, deliver to the Trustee all sums
so held in trust by it together with a full accounting thereof; and
(C) that it will give the Trustee written notice within three (3)
Business Days of any failure of the Company (or by any obligor on the Notes) in
the payment of any installment of the principal of, premium, if any, or interest
on, the Notes when the same shall be due and payable.
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ARTICLE 8.
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders.
The Company and/or one or more Guarantors and the Trustee may
modify, waive, amend or supplement this Indenture or the Notes without notice to
or consent of any Noteholder:
(1) to comply with Section 5.01;
(2) to provide for uncertificated Notes in addition to or in
place of Certificated Notes;
(3) to release a Guarantor in accordance with the express
provisions of this Indenture;
(4) to secure the Notes;
(5) to comply with any requirements of the SEC under the TIA;
(6) to cure any ambiguity, defect or inconsistency;
(7) to make any other change that does not adversely affect
the rights of any Noteholder;
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Notes; or
(9) to add additional Guarantors with respect to the Notes.
The Trustee is hereby authorized to join with the Company and
the Guarantors in the execution of any supplemental indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained, but the Trustee
shall not be obligated to enter into any such supplemental indenture which
adversely affects its own rights, duties or immunities under this Indenture.
Section 8.02. With Consent of Holders.
The Company and/or one or more Guarantors and the Trustee,
with the written consent of Holders of at least a majority in aggregate
principal amount of the outstanding Notes, may modify, amend, waive or
supplement this Indenture, the Notes or Guarantees, except that no such
modification amendment, waiver or supplement shall, without the consent of each
Holder affected thereby, (i) reduce the amount of Notes whose Holders must
consent to an amendment, modification, supplement, or waiver to this Indenture
or the Notes, (ii) reduce the rate of or change the time for payment of interest
on any Note, (iii) reduce the principal of or premium or Liquidated Damages on
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or change the stated maturity of any Note, (iv) make any Note payable in money
other than that stated in the Note or change the place of payment to outside of
the United States, (v) change the amount or time of any payment required by the
Notes or reduce the premium payable upon any redemption of Notes or change the
time before which no such redemption may be made, (vi) waive a default on the
payment of the principal of, interest, premium or Liquidated Damages on, or
redemption payment with respect to any Note (except a rescission of acceleration
of the Notes by Holders of at least a majority in aggregate principal amount of
the Notes and a waiver of the payment default that resulted from such
acceleration to the extent permitted under Section 6.02), (vii) subordinate in
right of payment, or otherwise subordinate, the Notes or any Guarantee to any
other Indebtedness or obligation of the Company or the Guarantors, (viii) amend,
alter, change or modify the obligation of the Company to make and consummate a
Change of Control Offer in the event of a Change of Control or make and
consummate an Excess Proceeds Offer or waive any Default in the performance of
any such offers or modify any of the provisions or definitions with respect to
any such offers, (ix) except pursuant to this Indenture, release any Guarantor
from its obligations under its Guarantee, or change any Guarantee in a manner
that adversely affects Holders of the Notes, (x) take any other action otherwise
expressly prohibited by this Indenture to be taken without the consent of each
Holder affected thereby or (xi) modify, amend, waive or supplement this Section
8.02, or Section 6.04 or Section 6.07.
After a modification, amendment, supplement or waiver under
this Section 8.02 becomes effective, the Company shall mail to the Holders a
notice briefly describing the modification, amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such modification,
amendment, supplement or waiver.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment,
modification, supplement or waiver, but it shall be sufficient if such consent
approves the substance thereof.
Section 8.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the
Notes shall comply with the TIA as then in effect.
Section 8.04. Revocation and Effect of Consents.
Until a modification, amendment, supplement, waiver or other
action becomes effective, a consent to it by a Holder of a Note is a continuing
consent conclusive and binding upon such Holder and every subsequent Holder of
the same Note or portion thereof, and of any Note issued upon the transfer
thereof or in exchange therefor or in place thereof, even if notation of the
consent is not made on any such Note. Any such Holder or subsequent Holder,
however, may revoke the consent as to his or her Note or portion of a Note, if
the Trustee receives the notice of revocation before the date the modification,
amendment, supplement, waiver or other action becomes effective. Notwithstanding
the foregoing, nothing in this paragraph shall impair the right of any Holder
under TIA Section 316(b).
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The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
modification, amendment, supplement, or waiver. If a record date is fixed, then,
notwithstanding the preceding paragraph, those Persons who were Holders at such
record date (or their duly designated proxies), and only such Persons, shall be
entitled to consent to such modification, amendment, supplement, or waiver or 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 unless the consent of the requisite
number of Holders has been obtained.
After a modification, amendment, supplement, waiver or other
action becomes effective, it shall bind every Noteholder and every subsequent
Noteholder.
Section 8.05. Notation on or Exchange of Notes.
If a modification, amendment, supplement or waiver changes the
terms of a Note, the Trustee may request the Holder of the Note to deliver it to
the Trustee. In such case, the Trustee shall place an appropriate notation on
the Note about the changed terms and return it to the Holder. Alternatively, if
the Company or the Trustee so determines, the Company in exchange for the Note
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 Note
shall not affect the validity and effect of such modification, amendment,
supplement or waiver.
Section 8.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any modification, amendment, supplement
or waiver authorized pursuant to this Article 8 if the modification, amendment,
supplement or waiver does not adversely affect the rights, duties, liabilities
or immunities of the Trustee. If it does, the Trustee may, but need not, sign
it. In signing or refusing to sign such modification, amendment, supplement or
waiver, the Trustee shall be entitled to receive and, subject to Section 7.01
hereof, shall be fully protected in relying upon an Officers' Certificate and an
Opinion of Counsel stating that such modification, amendment, supplement or
waiver is authorized or permitted by this Indenture and such supplemental
indenture constitutes the legal, valid and binding obligation of the Company and
the Guarantors enforceable against each of them in accordance with its terms
(subject to customary exceptions). The Company or any Guarantor may not sign a
modification, amendment or supplement under Section 8.02 until the Board of
Directors of the Company or such Guarantor, as appropriate, approves it.
ARTICLE 9.
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Discharge of Indenture.
The Company and the Guarantors may terminate their obligations
under the Notes, the Guarantees and this Indenture, except the obligations
referred to in the last
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paragraph of this Section 9.01, if (i) there shall have been canceled by the
Trustee or delivered to the Trustee for cancellation all Notes theretofore
authenticated and delivered (other than any Notes that are asserted to have been
destroyed, lost or stolen and that shall have been replaced as provided in
Section 2.07 hereof) or (ii) all Notes not theretofore surrendered or delivered
to the Trustee for cancellation shall have become due and payable, or are by
their terms to become due and payable within one year or are to be called for
redemption within one year under arrangements satisfactory to the Trustee, and
the Company has paid all sums payable by it hereunder or irrevocably deposited
all required sums with the Trustee.
After such delivery the Trustee upon request shall acknowledge
in writing the discharge of the Company's and the Guarantors' obligations under
the Notes, the Guarantees and this Indenture except for those surviving
obligations specified below.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company in Sections 2.07, 7.07, 9.05, 9.06 and
9.08 hereof shall survive.
Section 9.02. Legal Defeasance.
The Company may at its option, by Board Resolution, be
discharged from its obligations with respect to the Notes and the Guarantors
discharged from their obligations under the Guarantees on the date the
conditions set forth in Section 9.04 below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, such Legal Defeasance means that the Company
shall be deemed to have paid and discharged the entire indebtedness represented
by the Notes and to have satisfied all its other obligations under such Notes
and this Indenture insofar as such Notes are concerned (and the Trustee, at the
expense of the Company, shall, subject to Section 9.06 hereof, execute proper
instruments acknowledging the same), except for the following which shall
survive until otherwise terminated or discharged hereunder: (A) the rights of
Holders of outstanding Notes to receive solely from the trust funds described in
Section 9.04 hereof and as more fully set forth in such section, payments in
respect of the principal of, premium, if any, and interest on such Notes when
such payments are due, (B) the Company's obligations with respect to such Notes
under Sections 2.03, 2.04, 2.05, 2.06, 2.07, and 2.08, (C) the rights, powers,
trusts, duties, and immunities of the Trustee hereunder (including claims of, or
payments to, the Trustee under or pursuant to Section 7.07) and (D) this Article
9. Subject to compliance with this Article 9, the Company may exercise its
option under this Section 9.02 with respect to the Notes notwithstanding the
prior exercise of its option under Section 9.03 below with respect to the Notes.
Section 9.03. Covenant Defeasance.
At the option of the Company, pursuant to a Board Resolution,
the Company and the Guarantors shall be released from their respective
obligations under Sections 4.02 through 4.15, inclusive, Sections 4.17 through
4.21, inclusive, Section 4.23, Section 4.24, Section 5.01, Section 6.01(3),
Sections 6.01(5) through Section 6.01(7), inclusive, Sections 6.01(8) and
6.01(9) (only with respect to Subsidiaries) and Article 10 hereof with respect
to the outstanding Notes on and after the date the conditions set forth
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in Section 9.04 hereof are satisfied (hereinafter, "Covenant Defeasance") and
the Notes shall thereafter be deemed to not be outstanding for purposes of any
direction, waiver, consent, declaration or act of the Holders (and the
consequences thereof) in connection with such covenants but shall continue to be
outstanding for all other purposes hereunder. For this purpose, such Covenant
Defeasance means that the Company and the Guarantors may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such specified Section or portion thereof, whether directly or
indirectly by reason of any reference elsewhere herein to any such specified
Section or portion thereof or by reason of any reference in any such specified
Section or portion thereof to any other provision herein or in any other
document, but the remainder of this Indenture and the Notes shall be unaffected
thereby.
Section 9.04. Conditions to Legal Defeasance or Covenant Defeasance.
The following shall be the conditions to application of
Section 9.02 or Section 9.03 to the outstanding Notes:
(1) the Company shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satisfying the requirements of
Section 7.10 hereof who shall agree to comply with the provisions of this
Article 9 applicable to it) as funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of the Notes, (A) money in an amount, or (B) U.S.
Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide, not
later than the due date of any payment, money in an amount, or (C) a combination
thereof, in each case sufficient, in the opinion of a nationally-recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge, and which shall be applied by
the Trustee (or other qualifying trustee) to pay and discharge, the principal
of, premium, if any, and accrued interest on the outstanding Notes at the
maturity date of such principal, premium, if any, or interest, or on dates for
payment and redemption of such principal, premium, if any, and interest selected
in accordance with the terms of this Indenture and of the Notes;
(2) no Event of Default or Default (other than (i) Defaults or
Events of Default related to or arising out of incurrences of Indebtedness (and
liens and customary documentation related thereto) the proceeds of which are
used to satisfy the requirement in clause (1) above and (ii) Defaults and Events
of Default arising under Section 6.01(5) related to Defaults and Events of
Default described in clause (i) of this parenthetical) with respect to the Notes
shall have occurred and be continuing on the date of such deposit, or shall be
continuing on the 91st day after the date of such deposit or, if longer, ending
on the day following the expiration of the longest preference period under any
Bankruptcy Law applicable to the Company in respect of such deposit (it being
understood that this condition shall not be deemed satisfied until the
expiration of such period);
(3) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute default under any other
agreement or instrument to which the Company is a party or by which it is bound;
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(4) the Company shall have delivered to the Trustee an Opinion
of Counsel stating that, as a result of such Legal Defeasance or Covenant
Defeasance, neither the trust nor the Trustee will be required to register as an
investment company under the Investment Company Act of 1940, as amended;
(5) in the case of an election under Section 9.02, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that (i) the
Company has received from, or there has been published by, the Internal Revenue
Service a ruling to the effect that or (ii) there has been a change in any
applicable Federal income tax law with the effect that, and such opinion shall
confirm that, the Holders of the outstanding Notes or persons in their positions
will not recognize income, gain or loss for Federal income tax purposes solely
as a result of such deposit, defeasance and discharge and will be subject to
Federal income tax on the same amounts, in the same manner, including as a
result of prepayment, and at the same times as would have been the case if such
deposit, defeasance and discharge had not occurred;
(6) in the case of an election under Section 9.03, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of the outstanding Notes will not recognize income, gain or loss for
Federal income tax purposes as a result of such Covenant Defeasance and will be
subject to Federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Covenant Defeasance had not
occurred;
(7) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the Legal Defeasance under
Section 9.02 or the Covenant Defeasance under Section 9.03 (as the case may be)
have been complied with; and
(8) the Company shall have delivered to the Trustee a
certificate stating that the deposit under clause (1) was not made by the
Company with the intent of defeating, hindering, delaying or defrauding any
creditors of the Company or others.
Section 9.05. Deposited Money and U.S. Government Obligations to Be Held
in Trust; Other Miscellaneous Provisions.
All money and U.S. Government Obligations (including the
proceeds thereof) deposited with the Trustee pursuant to Section 9.04 hereof in
respect of the outstanding Notes shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Notes and this Indenture, to
the payment, either directly or through any Paying Agent as the Trustee may
determine, to the Holders of such Notes, of all sums due and to become due
thereon in respect of principal, premium, if any, and accrued interest, but such
money need not be segregated from other funds except to the extent required by
law. The Trustee shall be under no duty to invest such money or U.S. Government
Obligations.
The Company and the Guarantors shall pay and indemnify the
Trustee against any tax, fee or other charge imposed on or assessed against the
U.S. Government Obligations deposited pursuant to Section 9.04 hereof or the
principal, premium, if any,
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and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 9 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 9.04 hereof 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 which would then
be required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
Section 9.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with Section 9.01, 9.02 or 9.03 hereof
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 obligations of the Company and any Guarantor under this
Indenture, the Notes and the Guarantees shall be revived and reinstated as
though no deposit had occurred pursuant to this Article 9 until such time as the
Trustee or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with Section 9.01 hereof; provided, however, that if
the Company or any Guarantors have made any payment of principal of, premium, if
any, or accrued interest on any Notes because of the reinstatement of their
obligations, the Company or such Guarantors, as the case may be, shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money or U.S. Government Obligations held by the Trustee or Paying
Agent.
Section 9.07. Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this
Indenture, all moneys then held by any Paying Agent under the provisions of this
Indenture shall, upon demand of the Company, be paid to the Trustee, or if
sufficient moneys have been deposited pursuant to Section 9.04 hereof, to the
Company (or, if such moneys had been deposited by any Guarantors, to such
Guarantors),and thereupon such Paying Agent shall be released from all further
liability with respect to such moneys.
Section 9.08. Moneys Held by Trustee.
Any moneys deposited with the Trustee or any Paying Agent or
then held by the Company or any Guarantors in trust for the payment of the
principal of, or premium, if any, or interest on any Note that are not applied
but remain unclaimed by the Holder of such Note for two years after the date
upon which the principal of, or premium, if any, or interest on such Note shall
have respectively become due and payable shall be repaid to the Company (or, if
appropriate, the Guarantors) upon Company Request, or if such moneys are then
held by the Company or any Guarantors in trust, such moneys shall be released
from such trust; and the Holder of such Note entitled to receive such payment
shall thereafter, as an unsecured general creditor, look only to the Company and
the Guarantors for the payment thereof, and all liability of the Trustee or such
Paying Agent
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with respect to such trust money shall thereupon cease; provided, however, that
the Trustee or any such Paying Agent, before being required to make any such
repayment, may, at the expense of the Company and the Guarantors either mail to
each Noteholder affected, at the address shown in the register of the Notes
maintained by the Registrar pursuant to Section 2.03 hereof, or cause to be
published once a week for two successive weeks, in a newspaper published in the
English language, customarily published each Business Day and of general
circulation in The City of New York, New York, a notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such mailing or publication, any unclaimed balance of
such moneys then remaining will be repaid to the Company. After payment to the
Company or the Guarantors or the release of any money held in trust by the
Company or any Guarantors, as the case may be, Noteholders entitled to the money
must look only to the Company and any Guarantors for payment as general
unsecured creditors unless applicable abandoned property law designates another
person.
ARTICLE 10.
GUARANTEE OF NOTES
Section 10.01. Guarantee.
(a) Subject to the provisions of this Article 10, each
Guarantor hereby jointly and severally and unconditionally guarantees to each
Holder and to the Trustee, on behalf of the Holders, (i) the full and punctual
payment of the principal of, and premium, if any, and interest, and Liquidated
Damages, if any, on each Note, when and as the same shall become due and
payable, whether at maturity, by acceleration or otherwise, the due and punctual
payment of interest on the overdue principal of, and premium, if any, and
interest on the Notes, to the extent lawful, and the due and punctual
performance of all other Obligations of the Company to the Holders or the
Trustee all in accordance with the terms of such Note and this Indenture, and
(ii) in the case of any extension of time of payment or renewal of any Notes or
any of such other Obligations, that the same will be promptly paid in full when
due or performed in accordance with the terms of the extension or renewal, at
stated maturity, by acceleration or otherwise. Each Guarantor, by execution of
the Guarantee, agrees that its obligations thereunder and hereunder shall be
absolute and unconditional, irrespective of, and shall be unaffected by, any
invalidity, irregularity or unenforceability of any such Note or this Indenture,
any failure to enforce the provisions of any such Note or this Indenture, any
waiver, modification or indulgence granted to the Company with respect thereto
by the Holder of such Note or the Trustee, or any other circumstances which may
otherwise constitute a legal or equitable discharge of a surety or such
Guarantor.
(b) Each Guarantor, by execution of the Guarantee, waives
diligence, presentment, demand of payment, filing of claims with a court in the
event of merger or bankruptcy of the Company, any right to require a proceeding
first against the Company, protest or notice with respect to any such Note or
the Indebtedness evidenced thereby and all demands whatsoever, and covenants
that the Guarantee will not be discharged as to any such Note except by payment
in full of the principal thereof, premium if any, and
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interest thereon and as provided in Sections 9.01, 9.02, 9.03 and 10.04 hereof.
The obligations of each Guarantor hereunder shall not be affected by (i) the
failure of any Holder or the Trustee to assert any claim or demand or to enforce
any right or remedy against the Company or any other Person under this
Indenture, the Registration Rights Agreement, the Purchase Agreement, the Notes
or any other agreement or otherwise; (ii) any extension or renewal of any
thereof; (iii) any rescission, waiver, amendment or modification of any of the
terms or provisions of this Indenture, the Registration Rights Agreement, the
Notes or any other agreement; (iv) the release of any security held by any
Holder or the Trustee for the Obligations or any of them; (v) the failure of any
Holder or Trustee to exercise any right or remedy against any other Guarantor of
the Obligations; or (vi) any change in the ownership of such Guarantor, except
as provided in Section 10.04. If any Holder or the Trustee is required by any
court or otherwise to return to the Company or any Guarantor or any Custodian,
trustee, liquidator or other similar official acting in relation to either the
Company or any Guarantor, any amount paid by either the Company or any Guarantor
to the Holder or Trustee, each Guarantor's Guarantee, to the extent therefor
discharged, shall be reinstated in full force and effect. Each Guarantor further
agrees that, as between such Guarantor, on the one hand, and the Holders and the
Trustee, on the other hand, (x) the maturity of the Obligations guaranteed by
the Guarantee may be accelerated as provided in Article 6 hereof for the
purposes of the Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Obligations
guaranteed thereby, and (y) in the event of any declaration of acceleration of
such Obligations as provided in Article 6 hereof, such Obligations (whether or
not due and payable) shall forthwith become due and payable by each Guarantor
for the purpose of the Guarantee. In addition, without limiting the foregoing
provisions, upon the effectiveness of an acceleration under Article 6 hereof,
the Trustee shall promptly make a demand for payment on the Notes under the
Guarantee provided for in this Article 10. Failure to make such demand shall not
affect the validity or enforceability of the Guarantee upon any Guarantor.
(c) A Guarantee shall not be valid or become obligatory for
any purpose with respect to a Note unless the certificate of authentication on
such Note shall have been signed by or on behalf of the Trustee.
(d) Each Guarantor also agrees to pay any and all costs and
expenses (including reasonable attorneys' fees) incurred by the Trustee or any
Holder in enforcing any rights under this section.
Section 10.02. Execution and Delivery of Guarantees.
(a) To evidence the Guarantee set forth in this Article 10,
each Guarantor hereby agrees that a notation of such Guarantee may be placed on
each Note authenticated and made available for delivery by the Trustee and that
this Guarantee shall be executed on behalf of each Guarantor by the manual or
facsimile signature of an Officer of each Guarantor.
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(b) Each Guarantor hereby agrees that the Guarantee set forth
in Section 10.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Guarantee.
(c) If an Officer of a Guarantor whose signature is on the
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which the Guarantee is endorsed, the Guarantee shall be valid
nevertheless.
(d) The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the Guarantee
set forth in this Indenture on behalf of each Guarantor.
Section 10.03. Limitation of Guarantee.
The obligations of each Guarantor will be limited to the
maximum amount as will, after giving effect to all other contingent and fixed
liabilities of such Guarantor and after giving effect to any collections from or
payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant to its
contribution obligations under this Indenture, 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 a pro rata amount based on the Adjusted Net Assets
of each Guarantor.
Section 10.04. Release of Guarantor.
(a) No Guarantor may consolidate with or merge with or into
(whether or not such Guarantor is the surviving Person), another Person (other
than the Company or any other Guarantor) whether or not affiliated with such
Guarantor unless (i) subject to the provisions of the following paragraph (b),
the Person formed by or surviving any such consolidation or merger (if other
than such Guarantor) assumes all the obligations of such Guarantor, pursuant to
a supplemental indenture in form and substance reasonably satisfactory to the
Trustee in respect of the Notes, this Indenture and such Guarantor's Guarantee,
and (ii) immediately after giving effect to such transaction, no Default or
Event of Default exists.
(b) In the event of a sale or other disposition of all or
substantially all of the assets of any Guarantor to a third party or an
Unrestricted Subsidiary in a transaction that does not violate any of the
covenants in this Indenture (including, without limitation, Section 4.21), by
way of merger, consolidation or otherwise, or a sale or other disposition of all
of the capital stock of any Guarantor, or the designation of such Guarantor as
an Unrestricted Subsidiary in accordance with this Indenture, then (i) in the
event of a sale or other disposition, by way of such a merger, consolidation or
otherwise, of all of the capital stock of such Guarantor, or in the event of
such designation, such Guarantor will be released from and relieved of any
obligations under its Guarantee, or (ii) in the event of a sale or other
disposition of all of the assets of such Guarantor, the Person acquiring
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such assets will not be required to assume the obligations of such Guarantor
under its Guarantee.
(c) If the lenders under the New Credit Facility or under any
Refinancing Indebtedness related to the New Credit Facility release the
guarantees of such Indebtedness and no other Indebtedness is outstanding which
would require the execution and delivery of a Guarantee pursuant to Section 4.10
hereof, then upon written request of the Company, the Guarantors shall be
released from their obligations under this Indenture.
Section 10.05. Additional Guarantors.
(a) The Company covenants and agrees that it will cause any
Person which becomes obligated to guarantee the Notes, pursuant to the terms of
this Indenture, including, without limitation, Section 4.10 and Section 10.04
hereof, within ten Business Days after such obligation exists, to execute and
deliver to the Trustee a supplemental indenture in the form of Exhibit E hereto
(which supplemental indenture may be executed by the Company on behalf of the
Guarantors (other than such Person which becomes obligation to guarantee the
Notes) pursuant to a power of attorney granted by such Guarantors to the
Company) pursuant to which such Subsidiary shall become a Guarantor under this
Article 10 and shall Guarantee the Obligations. Concurrently with the execution
and delivery of such supplemental indenture, the Company shall deliver to the
Trustee an Opinion of Counsel and an Officers' Certificate to the effect that
such supplemental indenture has been duly authorized, executed and delivered by
such Subsidiary (such Opinion of Counsel regarding due authorization, execution
and delivery (to the same extent delivered by counsel to the Company as of the
Closing Date) shall be required only if such Guarantor is organized under the
laws of the State of Arizona or the State of Delaware) and that, subject to the
application of bankruptcy, insolvency, moratorium, fraudulent conveyance or
transfer and other similar laws relating to creditors' rights generally and to
the principles of equity, whether considered in a proceeding at law or in
equity, the Guarantee of such Guarantor is a legal, valid and binding obligation
of such Guarantor, enforceable against such Guarantor in accordance with its
terms; provided, that the enforceability opinion of such counsel may be limited
and qualified to the same extent as the opinion of counsel to the Company
delivered as of the Closing Date.
(b) Any Guarantor that is designated an Unrestricted
Subsidiary in accordance with the terms of this Indenture shall be released from
and relieved of its obligations under its Guarantee and any (i) Unrestricted
Subsidiary that ceases to be an Unrestricted Subsidiary and (ii) any Subsidiary
which is not a Guarantor which becomes a domestic, Wholly Owned Subsidiary
(excluding Coronado Health Services, Inc.) will be required to execute a
Guarantee in accordance with the terms of this Indenture.
ARTICLE 11.
MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control.
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Section 11.02. Notices.
Any notice or communication shall be given in writing and
delivered in person, sent by facsimile, delivered by commercial courier service
or mailed by first-class mail, postage prepaid, addressed as follows:
If to the Company or any Guarantor:
Rural/Metro Corporation
8401 East Indian School Road
Scottsdale, Arizona 85251
Attention: Chief Financial Officer, Mr. Mark Liebner
and to: General Counsel, Steven Lee, Esq.
Telecopier No.: 602-481-3328
With a copy to:
O'Connor, Cavanagh, Anderson, Killingsworth & Beshears
One East Camelback, Suite 1100
Phoenix, Arizona 85012
Attention: John Furman, Esq.
and to: Jean Harris, Esq.
Telecopier No.: 602-263-2900
If to the Trustee:
The First National Bank of Chicago
One North State Street
Ninth Floor, Suite 0126
Chicago, Illinois 60670-0126
Attention: Corporate Trust Administration
Telecopier No.: 312-407-1708
Such notices or communications shall be effective when
received and shall be sufficiently given if so given within the time prescribed
in this Indenture.
The Company, any Guarantor or the Trustee by written notice to
the other may designate additional or different addresses for subsequent notices
or communications.
Any notice or communication mailed to a Holder shall be mailed
to him or her by first-class mail, postage prepaid, at his or her address shown
on the register kept by the Registrar. If a notice or communication to a Holder
is mailed in the manner provided above, it shall be deemed duly given on the
date so deposited in the mail, whether or not the addressee receives it.
Failure to mail a notice or communication to a Holder or any
defect in it shall not affect its sufficiency with respect to other Holders.
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<PAGE> 94
In case, by reason of the suspension of regular mail service,
or by reason of any other cause, it shall be impossible to mail any notice as
required by this Indenture, then such method of notification as shall be made
with the approval of the Trustee shall constitute a sufficient mailing of such
notice.
Section 11.03. Communications by Holders with Other Holders.
Holders may communicate pursuant to TIA Section 312(b) with
other Holders with respect to their rights under this Indenture or the Notes.
The Company, the Guarantors, the Trustee, the Registrar and anyone else shall
have the protection of TIA Section 312(c).
Section 11.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company or any
Guarantor to the Trustee to take any action under this Indenture, the Company
shall furnish to the Trustee at the request of the Trustee:
(1) an Officers' Certificate (which shall include the
statements set forth in Section 11.05) in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied;
(2) an Opinion of Counsel (which shall include the statements
set forth in Section 11.05) in form and substance reasonably satisfactory to the
Trustee stating that, with respect to questions of law, in the opinion of such
counsel, all such conditions precedent and covenants have been satisfied; and
(3) where applicable, a certificate or opinion by an
independent certified public accountant satisfactory to the Trustee that
complies with TIA Section 314(c).
Section 11.05. Statements Required in Certificate and Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable her or him
to express an informed opinion as to whether or not such covenant or condition
has been satisfied; and
(4) a statement as to whether or not, in the opinion of such
Person, such covenant or condition has been satisfied.
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<PAGE> 95
Section 11.06. When Treasury Notes Disregarded.
In determining whether the Holders of the required aggregate
principal amount of Notes have concurred in any direction, waiver or consent,
Notes owned by the Company, any Guarantor or any other obligor on the Notes or
by any Affiliate of any of them shall be disregarded as though they were not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes which the Trustee actually knows are so owned shall be so disregarded.
Notes so owned which have been pledged in good faith shall not be disregarded if
the pledgee establishes to the satisfaction of the Trustee the pledgee's right
so to act with respect to the Notes and that the pledgee is not the Company, a
Guarantor or any other obligor upon the Notes or any Affiliate of any of them.
Section 11.07. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at
meetings of Holders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for their functions.
Section 11.08. Business Days; Legal Holidays.
A "Business Day" is a day that is not a Legal Holiday. A
"Legal Holiday" is a Saturday, a Sunday, a federally-recognized holiday or a day
on which banking institutions are not required to be open in the State of New
York. If a payment date is a Legal Holiday at a place of payment, payment may be
made at that place on the next succeeding day that is not a Legal Holiday, and
no interest shall accrue for the intervening period.
Section 11.09. Governing Law.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW. 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 OR THE NOTES.
Section 11.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan, security or debt agreement of the Company or any Subsidiary thereof. No
such indenture, loan, security or debt agreement may be used to interpret this
Indenture.
Section 11.11. No Recourse Against Others.
No recourse for the payment of the principal of or premium, if
any, or interest on any of the Notes, or for any claim based thereon or
otherwise in respect
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<PAGE> 96
thereof, and no recourse under or upon any obligation, covenant or agreement of
the Company or any Guarantor in this Indenture or in any supplemental indenture,
or in any of the Notes, or because of the creation of any Indebtedness
represented thereby, shall be had against any stockholder, incorporator,
officer, director, member, partner, affiliate, beneficiary or employee, as such,
past, present or future, of the Company or any Guarantor, or of any successor
corporation or against the property or assets of any such stockholder,
incorporator, officer, director, member, partner, affiliate, beneficiary or
employee, either directly or through the Company or any successor corporation
thereof, whether by virtue of any constitution, statute or rule of law, or by
the enforcement of any assessment or penalty or otherwise; it being expressly
understood that this Indenture and the Notes are solely obligations of the
Company and the Guarantors, and that no such personal liability whatever shall
attach to, or is or shall be incurred by, any stockholder, incorporator,
officer, director, member, partner, affiliate, beneficiary or employee of the
Company or any Guarantor, or any successor corporation thereof, because of the
creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or the Notes or
implied therefrom, and that any and all such personal liability of, and any and
all claims against every stockholder, incorporator, officer, director, member,
partner, affiliate, beneficiary and employee, are hereby expressly waived and
released as a condition of, and as a consideration for, the execution of this
Indenture and the issuance of the Notes. It is understood that this limitation
on recourse is made expressly for the benefit of any such stockholder,
incorporator, officer, director, member, partner, affiliate, beneficiary or
employee and may be enforced by any one or all of them.
Section 11.12. Successors.
All agreements of the Company and the Guarantors in this
Indenture and the Notes shall bind their respective successors except as
otherwise provided in Section 10.04. All agreements of the Trustee, any
additional trustee and any Paying Agents in this Indenture shall bind its
successor.
Section 11.13. Multiple Counterparts.
The parties may sign multiple counterparts of this Indenture.
Each signed counterpart shall be deemed an original, but all of them together
represent one and the same agreement.
Section 11.14. Table of Contents, Headings, etc.
The table of contents, cross-reference sheet and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
Section 11.15. Separability.
Each provision of this Indenture shall be considered separable
and if for any reason any provision which is not essential to the effectuation
of the basic purpose of
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<PAGE> 97
this Indenture or the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
IN WITNESS WHEREOF, the parties have caused this Indenture to
be duly executed, all as of the date and year first written above.
RURAL/METRO CORPORATION
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Chief Financial Officer and
Senior Vice President
----------------------------
THE FIRST NATIONAL BANK OF CHICAGO
as Trustee
By: /s/ Janice Ott Rotunno
-----------------------------------
Name: Janice Ott Rotunno
-----------------------------
Title: Vice President
----------------------------
AID AMBULANCE AT VIGO COUNTY, INC.
an Indiana corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
AMBULANCE TRANSPORT SYSTEMS, INC.
a New Jersey corporation
By: /s/ Mark E. Liebner
----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
AMERICAN LIMOUSINE SERVICE, INC.
an Ohio corporation
By: /s/ Mark E. Liebner
----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 98
ARROW AMBULANCE, INC.
an Idaho corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
BEACON TRANSPORTATION, INC.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
CITY WIDE AMBULANCE SERVICE, INC.
an Ohio corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
CORNING AMBULANCE SERVICE INC.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
DONLOCK, LTD.
a Pennsylvania corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
E.M.S. VENTURES, INC.
a Georgia corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 99
EMS VENTURES OF SOUTH CAROLINA, INC.
a South Carolina corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
EASTERN AMBULANCE SERVICE, INC.
a Nebraska corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
EASTERN PARAMEDICS, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
GOLD CROSS AMBULANCE SERVICES, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
GOLD CROSS AMBULANCE SERVICES OF PA., INC.
an Ohio corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
KEEFE & KEEFE, INC.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 100
KEEFE & KEEFE AMBULETTE, LTD.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
LASALLE AMBULANCE INC.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MEDI-CAB OF GEORGIA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MEDICAL EMERGENCY DEVICES AND SERVICES
(MEDS), INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MEDICAL TRANSPORTATION SERVICES, INC.
a South Dakota corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MEDSTAR EMERGENCY MEDICAL SERVICES, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 101
MERCURY AMBULANCE SERVICE, INC.
a Kentucky corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
METRO CARE CORP.
an Ohio corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MO-RO-KO, INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MULTI CAB INC..
a New Jersey corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MULTI-CARE INTERNATIONAL, INC.
a New Jersey corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MULTI-CARE MEDICAL CAR SERVICE, INC.
a New Jersey corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 102
MULTI-HEALTH CORP.
a Florida corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
MYERS AMBULANCE SERVICE, INC.
an Indiana corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
NATIONAL AMBULANCE & OXYGEN
SERVICE, INC.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
NORTH MISS. AMBULANCE SERVICE, INC.
a Mississippi corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
PHYSICIANS AMBULANCE SERVICE, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
PROFESSIONAL MEDICAL SERVICES, INC.
an Arkansas corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 103
RISC AMERICA ALABAMA
FIRE SAFETY SERVICES, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
R/M MANAGEMENT CO., INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
R/M OF MISSISSIPPI, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
R/M OF TENNESSEE G.P., INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
R/M OF TENNESSEE L.P., INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
R/M OF TEXAS G.P., INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 104
R/M PARTNERS, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RMC CORPORATE CENTER, L.L.C.
an Arizona limited liability company
By: RURAL/METRO CORPORATION,
an Arizona corporation
Its Member
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO ARGENTINA, L.L.C.
an Arizona limited liability company
By: RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
Its Member
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO BRASIL, L.L.C.
an Arizona corporation
By: RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
Its Member
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 105
RURAL/METRO CANADIAN HOLDINGS, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO COMMUNICATIONS
SERVICES, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO CORPORATION
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO CORPORATION OF FLORIDA
a Florida corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO CORPORATION OF TENNESSEE
a Tennessee corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO FIRE DEPT., INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 106
RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO MID-ATLANTIC, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF ALABAMA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF ARGENTINA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF ARKANSAS, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF ARLINGTON, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 107
RURAL/METRO OF BRASIL, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF CALIFORNIA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF CENTRAL ALABAMA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF CENTRAL OHIO, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF GEORGIA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF INDIANA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 108
RURAL/METRO OF INDIANA, L.P.
a Delaware limited partnership
By: THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
Its General Partner
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF INDIANA II., L.P.
a Delaware corporation
By: THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
Its General Partner
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF KENTUCKY, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF MISSISSIPPI, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF NEBRASKA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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RURAL/METRO OF NEW YORK, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF NORTH FLORIDA, INC.
a Florida corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF OHIO, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF OREGON, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF ROCHESTER, INC.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF SAN DIEGO, INC.
a California corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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<PAGE> 110
RURAL/METRO OF SOUTH CAROLINA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF SOUTH DAKOTA, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF TENNESSEE, L.P.
a Delaware limited partnership
By: R/M OF TENNESSEE, G.P., INC.,
a Delaware corporation
Its General Partner
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF TEXAS, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO OF TEXAS, L.P.
a Delaware limited partnership
By: R/M OF TEXAS G.P., INC.
a Delaware corporation
Its General Partner
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
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RURAL/METRO PROTECTION SERVICES, INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
RURAL/METRO TEXAS HOLDINGS, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
SW GENERAL, INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
SIOUX FALLS AMBULANCE, INC.
a South Dakota corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
SOUTH GEORGIA EMERGENCY
MEDICAL SERVICES, INC.
a Georgia corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
106
<PAGE> 112
SOUTHWEST AMBULANCE OF CASA
GRANDE, INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
SOUTHWEST AMBULANCE OF
SOUTHEASTERN ARIZONA, INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
SOUTHWEST AMBULANCE OF TUCSON, INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
SOUTHWEST GENERAL SERVICES, INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
107
<PAGE> 113
THE AID COMPANY, INC.
an Indiana corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
THE WESTERN NEW YORK EMERGENCY
MEDICAL SERVICES TRAINING INSTITUTE INC.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
TOWNS AMBULANCE SERVICE, INC.
a New York corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
UNITED MEDICAL SERVICES, INC.
a Washington corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
VALLEY FIRE SERVICE, INC.
a Delaware corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
W & W LEASING COMPANY, INC.
an Arizona corporation
By: /s/ Mark E. Liebner
-----------------------------------
Name: Mark E. Liebner
-----------------------------
Title: Vice President
----------------------------
108
<PAGE> 114
EXHIBIT A
FORM OF NOTE
(FACE OF NOTE)
[Delete this paragraph in the case of an Unrestricted Certificated Note or an
Unrestricted Global Note] THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS AND ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED 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 A
NON-U.S. PERSON THAT IS OUTSIDE THE UNITED STATES; (2) AGREES THAT IT WILL NOT
RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE COMPANY, (B) TO A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A IN A TRANSACTION IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT 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 CAN
BE OBTAINED FROM THE TRUSTEE), (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), (E) OUTSIDE THE
UNITED STATES TO A PERSON THAT IS NOT A "U.S. PERSON" AS DEFINED IN RULE 902
UNDER THE SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904
UNDER THE SECURITIES ACT OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY
REQUIREMENT OF LAW THAT THE DISPOSITION OF SUCH HOLDER'S PROPERTY OR THE
PROPERTY OF SUCH ACCOUNT AT ALL TIMES BE WITHIN ITS CONTROL AND TO COMPLIANCE
WITH APPLICABLE SECURITIES LAWS OF ANY JURISDICTION; AND (3) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THE TRANSFER RESTRICTIONS SET FORTH IN THIS
LEGEND. IN CONNECTION WITH ANY TRANSFER OF ANY CERTIFICATED SECURITY, THE HOLDER
MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE OF SUCH CERTIFICATED
SECURITY RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT SUCH CERTIFICATED
SECURITY TO THE TRUSTEE. IF ANY PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE
TRUSTEE AND THE COMPANY SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION
AS EITHER
A-1
<PAGE> 115
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 OR APPLICABLE SECURITIES LAWS OF
ANY JURISDICTION. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO
REFUSE TO REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE FOREGOING
RESTRICTIONS.
[Delete this paragraph in the case of a Certificated Note] THIS GLOBAL NOTE IS
HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS
NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS THEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE
MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF
THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART
PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE
DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.10 OF THE
INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY
WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
A-2
<PAGE> 116
CUSIP NUMBER __________
RURAL/METRO CORPORATION
7-7/8% SENIOR NOTE DUE 2008
RURAL/METRO CORPORATION, a Delaware corporation (the
"Company", which term includes any successor corporation), for value received
promises to pay to ___________________ or registered assigns the principal sum
of ___________________ Dollars, on March 15, 2008.
Interest Payment Dates: March 15 and September 15, commencing
September 15, 1998
Record Dates: March 1 and September 1
Reference is made to the further provisions of this Note
contained herein, which will for all purposes have the same effect as if set
forth at this place.
[Intentionally left blank]
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<PAGE> 117
IN WITNESS WHEREOF, the Company has caused this Note to be
signed manually or by facsimile by its duly authorized officers.
Dated: ____________ ____, 1998
RURAL/METRO CORPORATION,
a Delaware corporation
By: _________________________________
Name:
Title:
By: _________________________________
Name:
Title:
Certificate of Authentication:
This is one of the 7-7/8% Senior
Notes due 2008 referred to in
the within-mentioned Indenture
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By: ___________________________________
Authorized Signatory
A-4
<PAGE> 118
(REVERSE SIDE)
RURAL/METRO CORPORATION
7-7/8% SENIOR NOTE DUE 2008
1. INTEREST.
(a) Rural/Metro Corporation, a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note at a
rate of 7-7/8% per annum from the date of original issuance until maturity.
Interest is payable semi-annually in arrears on March 15 and September 15 of
each year, commencing on September 15, 1998, to Holders of record of the Notes
at the close of business on the immediately preceding March 1 and September 1,
respectively (whether or not a Business Day). Interest on the Notes will accrue
from the most recent date to which interest has been paid or, if no interest has
been paid, from the date of original issuance. Interest will be computed on the
basis of a 360-day year consisting of twelve 30-day months. The Notes will be
issued in denominations of $1,000 and any integral multiple of $1,000. The
Company shall pay interest on overdue principal at 9-7/8% per annum, and it
shall pay interest on overdue installments of interest at the same rate to the
extent lawful.
[Delete the following paragraph in the case of an Unrestricted
Certificated Note or an Unrestricted Global Note]
(b) If (i) the Company fails to file any of the Registration
Statements required by the Registration Rights Agreement on or before the date
specified for such filing, (ii) any of such Registration Statements is not
declared effective by the Commission on or prior to the date specified for such
effectiveness (the "Effectiveness Target Date"), (iii) the Company fails to
consummate the Exchange Offer within 30 business days of the Effectiveness
Target Date with respect to the Exchange Offer Registration Statement or (iv)
the Shelf Registration Statement or the Exchange Offer Registration Statement is
declared effective but thereafter ceases to be effective or useable in
connection with resales of Transfer Restricted Securities during the periods
specified in the Registration Rights Agreement (each such event referred to in
clauses (i) through (iv) above a "Registration Default"), then the Company will
pay Liquidated Damages to each holder of Notes, with respect to the first 90-day
period immediately following the occurrence of the first Registration Default,
in an amount equal to one-half of one percentage point (0.5%) per annum of the
principal amount of Notes held by such holder. The amount of the Liquidated
Damages will increase by an additional one-half of one percent (0.5%) per annum
for each subsequent 90-day period until all Registration Defaults have been
cured, up to a maximum amount of one and one-half percent (1.5%) per annum. All
accrued Liquidated Damages will be paid by the Company on each Interest Payment
Date to the holder of any Global Note by wire transfer of immediately available
funds or by federal funds check and to holders of Certificated Securities by
wire
A-5
<PAGE> 119
transfer to the accounts specified by them or by mailing checks to their
registered addresses if no such accounts have been specified.
2. METHOD OF PAYMENT.
The Company will pay interest on the Notes (except defaulted
interest) and Liquidated Damages to the Persons who are registered Holders of
Notes at the close of business on the March 1 and September 1 next preceding the
Interest Payment Date, even if such Notes are canceled after such record date
and on or before such Interest Payment Date, except as provided in Section 2.11
of the Indenture with respect to defaulted interest. If this Note is a Global
Note, payments in respect of this Note (including principal, premium, interest
and Liquidated Damages, if any) shall be made by wire transfer of immediately
available funds to the accounts specified by the Holder hereof. If this Note is
a Certificated Note, the Company will make all payments of principal, premium,
interest and Liquidated Damages, if any, by wire transfer of immediately
available funds to the accounts specified by the Holder hereof or, if no such
account is specified, by mailing a check to such Holder's registered address.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
3. PAYING AGENT AND REGISTRAR.
Initially, The First National Bank of Chicago, the Trustee
under the Indenture, will act as Paying Agent.
4. INDENTURE.
The Company issued this Note under an Indenture dated as of
March 16, 1998 (as such may be amended, supplemented or otherwise modified from
time to time, the "Indenture") among the Company, the Guarantors and the
Trustee. The terms of this Note 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. Code Sections 77aaa-77bbbb) as in effect on the date of the
Indenture. This Note is subject to all such terms, and the Holder of this Note
is referred to the Indenture and said Trust Indenture Act for a statement of
them. All capitalized terms in this Note, unless otherwise defined, have the
meanings assigned to them in the Indenture. The Notes will be limited to up to
$150,000,000 aggregate principal amount.
5. OPTIONAL REDEMPTION.
(a) Except as set forth below, the Notes will not be
redeemable at the option of the Company prior to March 15, 2003. Thereafter, the
Notes will be redeemable at any time, and from time to time, at the option of
the Company, in whole or in part, at the redemption prices set forth in Section
3.07 of the Indenture.
(b) Notwithstanding the foregoing, at any time prior to March
15, 2001, the Company may redeem up to an aggregate of $52,000,000 in principal
amount of Notes at a redemption price equal to 107.875% Redemption Date with the
net cash
A-6
<PAGE> 120
proceeds of one or more Public Equity Offerings, provided that at least
$98,000,000 million in principal amount of Notes remains outstanding immediately
following each such redemption and that any such redemption occurs within 90
days following the closing of any such Public Equity Offering.
6. MANDATORY REDEMPTION.
Except as set forth under Sections 4.19 and 4.20 of the
Indenture the Company is not obligated to make any mandatory redemption of or
sinking fund payments with respect to the Notes.
7. NOTICE OF REDEMPTION.
Notice of redemption will be mailed via first class mail at
least 30 days but not more than 60 days prior to the Redemption Date to each
Holder of Notes to be redeemed at its registered address as it shall appear on
the register of the Notes maintained by the Registrar. On and after any
Redemption Date, interest will cease to accrue on the Notes or portions thereof
called for redemption unless the Company shall fail to deposit the redemption
price of such Notes or portions thereof with the paying agent.
8. OFFERS TO PURCHASE.
The Indenture requires that certain proceeds from Asset Sales
be used, subject to further limitations contained therein, to make an offer to
purchase certain amounts of Notes in accordance with the procedures set forth in
the Indenture. The Company is also required to make an offer to purchase Notes
upon occurrence of a Change of Control in accordance with procedures set forth
in the Indenture.
9. DENOMINATIONS, TRANSFER, EXCHANGE.
The Notes are in registered form without coupons in
denominations of $1,000 and integral multiples thereof. A Holder may register
the transfer or exchange of Notes in accordance with the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
The Registrar need not register the transfer of or exchange any Note selected
for redemption or register the transfer of or exchange any Note for a period of
15 days before a selection of Notes to be redeemed or any Note after it is
called for redemption in whole or in part, except the unredeemed portion of any
Note being redeemed in part.
10. PERSONS DEEMED OWNERS.
The registered Holder of this Note may be treated as the owner
of it for all purposes.
A-7
<PAGE> 121
11. UNCLAIMED MONEY.
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its written request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must look
only to the Company and not to the Trustee for payment.
12. AMENDMENT, SUPPLEMENT AND WAIVER.
Subject to certain exceptions, the Indenture, the Notes and
the Guarantees thereof may be amended or supplemented with the consent of the
Holders of at least a majority in principal amount of the then outstanding
Notes, and any existing default or compliance with any provision of the
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes. Certain amendments
specified in the Indenture shall not be effective against a Holder without the
consent of such Holder (or a prior Holder). Without the consent of any Holder of
a Note, the Company and the Trustee may amend or supplement the Indenture, the
Notes or any Guarantee thereof to cure any ambiguity, defect or inconsistency,
to provide for uncertificated Notes in addition to or in place of certificated
Notes, to provide for the assumption of the Company's or any Guarantor's
obligations to Holders of the Notes in case of a merger or consolidation, to
make any change that does not adversely affect the legal rights under the
Indenture of any such Holder, to evidence and provide for the acceptance of
appointment under the Indenture by a successor Trustee with respect to the Notes
or to add additional guarantors with respect to the Notes.
13. TRUSTEE DEALINGS WITH THE COMPANY.
The Trustee under the Indenture, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company, any Guarantor or their Affiliates, and may otherwise deal with
the Company, any Guarantor or their Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS.
As more fully described in the Indenture, a stockholder,
incorporator, officer, director, member, partner, affiliate, beneficiary or
employee, as such, of the Company or any Guarantor shall not have any liability
for any obligations of the Company or any Guarantor under the Notes or the
Indenture or for any claim based on, in respect or by reason of, such
obligations or their creation. The Holder of this Note by accepting this Note
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of this Note.
15. DEFEASANCE AND COVENANT DEFEASANCE.
The Indenture contains provisions for defeasance of the entire
indebtedness on this Note and for defeasance of certain covenants in the
Indenture upon compliance by the Company with certain conditions set forth in
the Indenture.
A-8
<PAGE> 122
16. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder of
a Note 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).
17. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Notes and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to Holders of the Notes. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
18. GOVERNING LAW.
THE INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS
MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. 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 THE INDENTURE OR THE NOTES.
THE COMPANY WILL FURNISH TO ANY HOLDER OF A NOTE UPON WRITTEN
REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO:
Rural/Metro Corporation
8401 East Indian School Road
Scottsdale, Arizona 85251
Attention: Chief Financial Officer
19. AUTHENTICATION.
This Note shall not be valid until the Trustee or an
authenticating agent manually signs the Certificate of Authentication on the
other side of this Note.
20. INDEMNIFICATION.
The Holder of this Note, by acceptance hereof, agrees to
indemnify the Company and the Trustee against any liability that may result from
the transfer, exchange or assignment of this Note in violation of any provision
of the Indenture and/or applicable U.S. Federal or state securities law.
A-9
<PAGE> 123
ASSIGNMENT
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee)
and irrevocably appoint:
________________________________________________________________________________
________________________________________________________________________________
Agent to transfer this Note on the books of the Company. The Agent may
substitute another to act for him.
Check One
/ / (a) this Note is being transferred in compliance with the exemption
from registration under the Securities Act provided by Rule 144A
thereunder.
or
/ / (b) this Note is being transferred other than in accordance with (a)
above and documents are being furnished which comply with the
conditions of transfer set forth in this Note and the Indenture.
If none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Note in the name of any person other than the Holder
hereof unless and until the conditions to any such transfer of registration set
forth herein and in Section 2.06 (Transfer and Exchange) of the Indenture shall
have been satisfied.
Date: _______________________
Your Signature: _______________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee: _________________________________________________________
A-10
<PAGE> 124
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing
this Note for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: ____________________
_____________________________________
NOTICE: To be executed by an executive officer
A-11
<PAGE> 125
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note
purchased by the Company pursuant to Section 4.19 or Section 4.20 of the
Indenture, check the appropriate box:
/ / Section 4.19
/ / Section 4.20
If you want to have only part of the Note purchased by the
Company pursuant to Section 4.19 or Section 4.20 of the Indenture, state the
principal amount you elect to have purchased:
$____________________
(multiple of $1,000)
Date: _______________
Your Signature: ___________________________________________
(Sign exactly as your name appears on the face of this Note)
_________________________
Signature Guaranteed
A-12
<PAGE> 126
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note have been made:
<TABLE>
<CAPTION>
- ----------------------- -------------------- -------------------- -------------------- --------------------
Date of Exchange Amount of decrease Amount of increase Principal Amount Signature of
in Principal in Principal of this Global authorized officer
Amount of this Amount of this Note following of
Global Note Global Note such decrease (or Trustee or Note
increase) Custodian
<S> <C> <C> <C> <C>
</TABLE>
A-13
<PAGE> 127
FORM OF NOTATION ON NOTE RELATING TO GUARANTEE
Pursuant and subject to the terms of the Indenture, each Guarantor has
jointly and severally and unconditionally guaranteed to each Holder and to the
Trustee the full and punctual payment of the principal of, premium, if any,
interest and Liquidated Damages, if any, on the Notes.
Each Guarantor's liability shall be limited as set forth in Section
10.03 of the Indenture, and Guarantors may be released from the Guarantee as
provided in Sections 9.01, 9.02, 9.03 and 10.04 of the Indenture.
The provision of Article 10 of the Indenture are incorporated herein by
reference. Capitalized terms used herein have the same meanings given in the
Indenture unless otherwise indicated.
AID AMBULANCE AT VIGO COUNTY, INC.
an Indiana corporation
By: __________________________________
Name: ______________________________
Title:______________________________
AMBULANCE TRANSPORT SYSTEMS, INC.
a New Jersey corporation
By: __________________________________
Name: ______________________________
Title:______________________________
AMERICAN LIMOUSINE SERVICE, INC.
an Ohio corporation
By: __________________________________
Name: ______________________________
Title:______________________________
ARROW AMBULANCE, INC.
an Idaho corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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<PAGE> 128
BEACON TRANSPORTATION, INC.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
CITY WIDE AMBULANCE SERVICE, INC.
an Ohio corporation
By: __________________________________
Name: ______________________________
Title:______________________________
CORNING AMBULANCE SERVICE INC.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
DONLOCK, LTD.
a Pennsylvania corporation
By: __________________________________
Name: ______________________________
Title:______________________________
E.M.S. VENTURES, INC.
a Georgia corporation
By: __________________________________
Name: ______________________________
Title:______________________________
EMS VENTURES OF SOUTH CAROLINA, INC.
a South Carolina corporation
By: __________________________________
Name: ______________________________
Title:______________________________
A-15
<PAGE> 129
EASTERN AMBULANCE SERVICE, INC.
a Nebraska corporation
By: __________________________________
Name: ______________________________
Title:______________________________
EASTERN PARAMEDICS, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
GOLD CROSS AMBULANCE SERVICES, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
GOLD CROSS AMBULANCE SERVICES OF PA., INC.
an Ohio corporation
By: __________________________________
Name: ______________________________
Title:______________________________
KEEFE & KEEFE, INC.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
KEEFE & KEEFE AMBULETTE, LTD.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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<PAGE> 130
LASALLE AMBULANCE INC.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MEDI-CAB OF GEORGIA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MEDICAL EMERGENCY DEVICES AND SERVICES (MEDS), INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MEDICAL TRANSPORTATION SERVICES, INC.
a South Dakota corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MEDSTAR EMERGENCY MEDICAL SERVICES, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
A-17
<PAGE> 131
MERCURY AMBULANCE SERVICE, INC.
a Kentucky corporation
By: __________________________________
Name: ______________________________
Title:______________________________
METRO CARE CORP.
an Ohio corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MO-RO-KO, INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MULTI CAB INC..
a New Jersey corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MULTI-CARE INTERNATIONAL, INC.
a New Jersey corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MULTI-CARE MEDICAL CAR SERVICE, INC.
a New Jersey corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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<PAGE> 132
MULTI-HEALTH CORP.
a Florida corporation
By: __________________________________
Name: ______________________________
Title:______________________________
MYERS AMBULANCE SERVICE, INC.
an Indiana corporation
By: __________________________________
Name: ______________________________
Title:______________________________
NATIONAL AMBULANCE & OXYGEN
SERVICE, INC.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
NORTH MISS. AMBULANCE SERVICE, INC.
a Mississippi corporation
By: __________________________________
Name: ______________________________
Title:______________________________
PHYSICIANS AMBULANCE SERVICE, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
PROFESSIONAL MEDICAL SERVICES, INC.
an Arkansas corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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RISC AMERICA ALABAMA
FIRE SAFETY SERVICES, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
R/M MANAGEMENT CO., INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
R/M OF MISSISSIPPI, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
R/M OF TENNESSEE G.P., INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
R/M OF TENNESSEE L.P., INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
R/M OF TEXAS G.P., INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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R/M PARTNERS, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RMC CORPORATE CENTER, L.L.C.
an Arizona limited liability company
By: RURAL/METRO CORPORATION,
an Arizona corporation
Its Member
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO ARGENTINA, L.L.C.
an Arizona limited liability company
By: RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
Its Member
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO BRASIL, L.L.C.
an Arizona corporation
By: RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
Its Member
By: __________________________________
Name: ______________________________
Title:______________________________
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RURAL/METRO CANADIAN HOLDINGS, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO COMMUNICATIONS
SERVICES, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO CORPORATION
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO CORPORATION OF FLORIDA
a Florida corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO CORPORATION OF TENNESSEE
a Tennessee corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO FIRE DEPT., INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO MID-ATLANTIC, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF ALABAMA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF ARGENTINA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF ARKANSAS, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF ARLINGTON, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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RURAL/METRO OF BRASIL, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF CALIFORNIA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF CENTRAL ALABAMA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF CENTRAL OHIO, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF GEORGIA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF INDIANA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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RURAL/METRO OF INDIANA, L.P.
a Delaware limited partnership
By: THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
Its General Partner
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF INDIANA II., L.P.
a Delaware corporation
By: THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
Its General Partner
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF KENTUCKY, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF MISSISSIPPI, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF NEBRASKA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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RURAL/METRO OF NEW YORK, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF NORTH FLORIDA, INC.
a Florida corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF OHIO, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF OREGON, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF ROCHESTER, INC.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF SAN DIEGO, INC.
a California corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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RURAL/METRO OF SOUTH CAROLINA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF SOUTH DAKOTA, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF TENNESSEE, L.P.
a Delaware limited partnership
By: R/M OF TENNESSEE, G.P., INC.,
a Delaware corporation
Its General Partner
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF TEXAS, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO OF TEXAS, L.P.
a Delaware limited partnership
By: R/M OF TEXAS G.P., INC.
a Delaware corporation
Its General Partner
By: __________________________________
Name: ______________________________
Title:______________________________
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RURAL/METRO PROTECTION SERVICES, INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
RURAL/METRO TEXAS HOLDINGS, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
SW GENERAL, INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
SIOUX FALLS AMBULANCE, INC.
a South Dakota corporation
By: __________________________________
Name: ______________________________
Title:______________________________
SOUTH GEORGIA EMERGENCY
MEDICAL SERVICES, INC.
a Georgia corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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SOUTHWEST AMBULANCE OF CASA
GRANDE, INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
SOUTHWEST AMBULANCE OF
SOUTHEASTERN ARIZONA, INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
SOUTHWEST AMBULANCE OF TUCSON, INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
SOUTHWEST GENERAL SERVICES, INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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THE AID COMPANY, INC.
an Indiana corporation
By: __________________________________
Name: ______________________________
Title:______________________________
THE WESTERN NEW YORK EMERGENCY
MEDICAL SERVICES TRAINING INSTITUTE INC.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
TOWNS AMBULANCE SERVICE, INC.
a New York corporation
By: __________________________________
Name: ______________________________
Title:______________________________
UNITED MEDICAL SERVICES, INC.
a Washington corporation
By: __________________________________
Name: ______________________________
Title:______________________________
VALLEY FIRE SERVICE, INC.
a Delaware corporation
By: __________________________________
Name: ______________________________
Title:______________________________
W & W LEASING COMPANY, INC.
an Arizona corporation
By: __________________________________
Name: ______________________________
Title:______________________________
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<PAGE> 144
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Rural/Metro Corporation
8401 East Indian School Road
Scottsdale, Arizona 85251
The First National Bank of Chicago
14 Wall Street, Eighth Floor
New York, New York 10005
Re: 7-7/8% Senior Notes due 2008
Reference is hereby made to the Indenture, dated as of March 16, 1998
(as such may have been amended, supplemented or otherwise modified to the date
hereof, the "Indenture"), among Rural/Metro Corporation, as issuer (the
"Company"), the Guarantors party thereto and The First National Bank of Chicago,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
_______________________ (the "Transferor") owns and proposes to
transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in
the principal amount of $___________ in such Note[s] or interests (the
"Transfer"), to ____________ (the "Transferee"), as further specified in Annex A
hereto. In connection the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. / / CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
144A GLOBAL NOTE OR A CERTIFICATED NOTE PURSUANT TO RULE 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Certificated Note is being transferred to a Person that the
Transferor reasonably believes is purchasing the beneficial interest or
Certificated Note for its own account or for one or more accounts with respect
to which such Person exercises sole investment discretion, and such Person and
each such account is a "qualified institutional buyer" within the meaning of
Rule 144A in a transaction meeting the requirements of Rule 144A and such
Transfer is in compliance with any applicable blue sky securities laws of states
of the United States. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Certificated Note will be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the 144A Global Note and/or the
Certificated Note and in the Indenture and the Securities Act.
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2. / / CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
REGULATION GLOBAL NOTE OR A CERTIFICATED NOTE PURSUANT TO REGULATION S. The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and, accordingly, the Transferor hereby, further
certifies that (i) the Transfer is not being made to a Person in the United
States, and (x) at the time the buy order was originated, the Transferee was
outside the United States or such Transferor and any Person acting on its behalf
reasonably believed and believes that the Transferee was outside the United
States or (y) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither such Transferor nor any Person
acting on its behalf knows that the transaction was prearranged with a buyer in
the United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S
under the Securities Act, (iii) the transaction is not part of a plan or scheme
to evade the registration requirements of the Securities Act and (iv) if the
proposed transfer is being made prior to the expiration of any restricted period
under applicable law, the Transfer is not being made to a U.S. Person or for the
account or benefit of a U.S. Person (other than an initial Purchaser). Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Certificated Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Regulation S Global Note and/or the Certificated Note and
in the Indenture and the Securities Act.
3. / / CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE IAI GLOBAL NOTE OR A CERTIFICATED NOTE PURSUANT TO ANY PROVISION
OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Certificated
Notes and pursuant to and in accordance with the Securities Act and any
applicable blue sky securities laws of states of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) / / such Transfer is being effected pursuant to and in accordance with Rule
144 under the Securities Act;
or
(b) / / such Transfer is being effected to the Company or a subsidiary thereof:
or
(c) / / such Transfer is being effected pursuant to an effective registration
statement under the Securities Act and in compliance with the prospectus
delivery requirements of the Securities Act;
or
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(d) / / such Transfer is being effected to an Institutional Accredited Investor
and pursuant to an exemption from the registration requirements of the
Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor
hereby further certifies that the Transfer complies with the transfer
restrictions applicable to beneficial interests in a Restricted Global Note or
Restricted Certificated Notes and the requirements of the exemption claimed,
which certification is supported by (1) a certificate executed by the Transferee
in the form of Exhibit D to the Indenture and (2) an Opinion of Counsel provided
by the Transferor or the Transferee (a copy of which the Transferor has attached
to this certification), to the effect that such Transfer is in compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Certificated Note will be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the IAI Global Note and/or the
Certificated Notes and in the Indenture and the Securities Act.
4. / / CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN AN
UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED CERTIFICATED NOTE.
(a) / / CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of states of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Certificated Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Certificated Notes and in the Indenture.
(b) / / CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of states
of the United States and (ii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Certificated Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Certificated Notes and in the Indenture.
(c) / / CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being, effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of states of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest
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or Certificated Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Certificated Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit, for the benefit of the Company, and for the benefit of your counsel and
the Company's counsel, who may rely hereon.
__________________________
[Insert Name of Transferor]
By: ______________________
Name:
Title:
Dated: _____________, ____
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<PAGE> 148
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) / / a beneficial interest in the:
(i) / / 144A Global Note (CUSIP _______), or
(ii) / / Regulation S Global Note (CUSIP ________), or
(iii) / / IAI Global Note (CUSIP ________): or
(b) / / a Restricted Certificated Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) / / a beneficial interest in the:
(i) / / 144A Global Note (CUSIP ________), or
(ii) / / Regulation S Global Note (CUSIP ________), or
(iii) / / IAI Global Note (CUSIP _______); or
(iv) / / Unrestricted Global Note (CUSIP____); or
(b) / / a Restricted Certificated Note: or
(c) / / an Unrestricted Certificated Note.
in accordance with the terms of the indenture.
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<PAGE> 149
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Rural/Metro Corporation
8401 East Indian School Road
Scottsdale, Arizona 85251
The First National Bank of Chicago
14 Wall Street, Eighth Floor
New York, New York 10005
Re: 7-7/8% Senior Notes due 2008
(CUSIP_________)
Reference is hereby made to the Indenture, dated as of March 16, 1998
(as such may have been amended, supplemented, or otherwise modified to the date
hereof, the "Indenture"), among Rural/Metro Corporation, as issuer (the
"Company"), the Guarantors party thereto and The First National Bank of Chicago,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
___________, (the "Owner") owns and proposes to exchange the Note[s] or
interest in such Note[s] specified herein, in the principal amount of
$___________ in such Note[s] or interest (the "Exchange"). In connection with
the Exchange, the Owner hereby certifies that:
EXCHANGE OF RESTRICTED CERTIFICATED NOTES OR BENEFICIAL INTERESTS IN A
RESTRICTED GLOBAL NOTE FOR UNRESTRICTED CERTIFICATED NOTES OR BENEFICIAL
INTERESTS IN AN UNRESTRICTED GLOBAL NOTE.
(a) / / CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO AN UNRESTRICTED GLOBAL NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Global Note in an equal principal amount, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to the Global Notes and pursuant to
and in accordance with the United States Securities Act of 1933, as amended (the
"Securities Act"), (iii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest in an
Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of states of the United States.
(b) / / CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO UNRESTRICTED CERTIFICATED NOTE. In connection with the
Exchange of the
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<PAGE> 150
Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Certificated Note, the Owner hereby certifies (i) the Certificated Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Certificated Note is being acquired in
compliance with any applicable blue sky securities laws of states of the United
States.
(c) / / CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Exchange of the Owner's Restricted Certificated Note for a beneficial interest
in an Unrestricted Global Note in an equal principal amount, the owner hereby
certifies (i) the beneficial interest is being acquired for the Owner's own
account without transfer and (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Certificated Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
beneficial interest is being acquired in compliance with any applicable blue
sky, securities laws of states of the United States.
(d) / / CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO AN
UNRESTRICTED CERTIFICATED NOTE. In connection with the Exchange of the Owner's
Restricted Certificated Note for an Unrestricted Certificated Note, the Owner
hereby certifies (i) the Certificated Note is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to the Restricted Certificated Notes
and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the Certificated Note is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.
This certificate and the statements contained herein are made for your benefit
and the benefit of the Company, and for the benefit of your counsel and the
Company's counsel, who may rely hereon.
________________________
[Insert Name of Owner]
By: ____________________
Name:
Title:
Dated: ___________, ____
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<PAGE> 151
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Rural/Metro Corporation
8401 East Indian School Road
Scottsdale, Arizona 85251
The First National Bank of Chicago
14 Wall Street, Eighth Floor
New York, New York 10005
Re: 7-7/8% Senior Notes due 2008
Reference is hereby made to the Indenture, dated as of March 16, 1998
(as such may have been amended, supplemented or otherwise modified to the date
hereof the "Indenture"), among Rural/Metro Corporation, as issuer (the
"Company"), the Guarantors party thereto and The First National Bank of Chicago,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
In connection with our proposed purchase of $__________
aggregate principal amount of:
(a) / / a beneficial interest in a Global Note, or
(b) / / a Certificated Note.
we confirm that:
1. We understand that any subsequent transfer of the Notes or
any interest therein is subject to certain restrictions and conditions set forth
in the Indenture and the undersigned agrees to be bound by and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its
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behalf by a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such transfer is in
compliance with the Securities Act, (D) outside the United States in accordance
with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the
provisions of Rule 144 under the Securities Act or (F) pursuant to an effective
registration statement under the Securities Act, and we further agree to provide
to any Person purchasing the Certificated Note or beneficial interest in a
Global Note from us in a transaction meeting the requirements of clauses (A)
through (E) of this paragraph a notice advising such purchaser that resales
thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (3) or (7) of Regulation D under the Securities Act) and have such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of our investment in the Notes. and we and any
accounts for which we are acting are each able to bear the economic risk of our
or its investment.
5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company (and your respective counsel) are entitled to rely
upon this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interest party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby.
------------------------------------
[Insert Name of Accredited Investor]
By:
--------------------------------
Name:
Title:
Dated: ,
---------- ----
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EXHIBIT E
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
_________ __, 19__, among [NEW GUARANTOR] (the "New Guarantor"), RURAL/METRO
CORPORATION, a Delaware corporation (the "Company") and the existing Guarantors
(the "Existing Guarantors") under this Indenture referred to below, and THE
FIRST NATIONAL BANK OF CHICAGO, as trustee under this Indenture referred to
below (the "Trustee").
W I T N E S S E T H:
WHEREAS the Company has heretofore executed and delivered to the
Trustee an Indenture (as such may have been amended, supplemented and modified
to the date hereof, the "Indenture"), dated as of March 16, 1998, providing for
the issuance of an aggregate principal amount of $150,000,000 of 7-7/8% Senior
Notes due 2008 (the "Notes");
WHEREAS this Indenture provides that under certain circumstances the
company is required to cause the New Guarantor to execute and deliver to the
Trustee a supplemental indenture pursuant to which the New Guarantor shall
unconditionally guarantee all of the Company" obligations under the Notes
pursuant to a Guarantee on the terms and conditions set forth herein; and
WHEREAS pursuant to Section 8.01 of this Indenture, the Trustee, the
Company and Existing Guarantors are authorized to execute and deliver this
Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the New
Guarantor, the Company, the Existing Guarantors and the Trustee mutually
covenant and agree for the equal and ratable benefit of the Holders of the Notes
as follows:
1. Definitions. (a) Capitalized terms used herein without definition
shall have the meanings assigned to them in this Indenture.
(b) For all purposes of this Supplement, except as otherwise herein
expressly provided or unless the context otherwise requires: (i) the terms and
expressions used herein shall have the same meanings as corresponding terms and
expressions used in this Indenture; and (ii) the words "herein," "hereof" and
"hereby" and other words of similar import used in this Supplemental Indenture
refer to this Supplemental Indenture as a whole and not to any particular
section hereof.
2. Agreement to Guarantee. The New Guarantor hereby agrees, jointly and
severally with all other Guarantors, to guarantee the Company's obligations
under the
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<PAGE> 154
Notes on the terms and subject to the conditions set forth in Article 10 of the
Indenture and to be bound by all other applicable provisions of the Indenture.
3. Ratification of Indenture; Supplemental Indentures Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every Holder of Notes heretofore or
hereafter authenticated and delivered shall be bound hereby.
4. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
5. Trustee Makes No Representation. The Trustee makes no representation
as to the validity or sufficiency of this Supplemental Indenture.
6. Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
7. Effect of Headings. The Section headings herein are for convenience
only and shall not effect the construction thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first above written.
[NEW GUARANTOR]
By: __________________________________
Name:______________________________
Title: ____________________________
RURAL/METRO CORPORATION
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 155
AID AMBULANCE AT VIGO COUNTY, INC.
an Indiana corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
AMBULANCE TRANSPORT SYSTEMS, INC.
a New Jersey corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
AMERICAN LIMOUSINE SERVICE, INC.
an Ohio corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
ARROW AMBULANCE, INC.
an Idaho corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
BEACON TRANSPORTATION, INC.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
CITY WIDE AMBULANCE SERVICE, INC.
an Ohio corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 156
CORNING AMBULANCE SERVICE INC.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
DONLOCK, LTD.
a Pennsylvania corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
E.M.S. VENTURES, INC.
a Georgia corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
EMS VENTURES OF SOUTH CAROLINA, INC.
a South Carolina corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
EASTERN AMBULANCE SERVICE, INC.
a Nebraska corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
EASTERN PARAMEDICS, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 157
GOLD CROSS AMBULANCE SERVICES, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
GOLD CROSS AMBULANCE SERVICES OF PA., INC.
an Ohio corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
KEEFE & KEEFE, INC.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
KEEFE & KEEFE AMBULETTE, LTD.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
LASALLE AMBULANCE INC.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MEDI-CAB OF GEORGIA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 158
MEDICAL EMERGENCY DEVICES AND SERVICES
(MEDS), INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MEDICAL TRANSPORTATION SERVICES, INC.
a South Dakota corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MEDSTAR EMERGENCY MEDICAL SERVICES, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MERCURY AMBULANCE SERVICE, INC.
a Kentucky corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
METRO CARE CORP.
an Ohio corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MO-RO-KO, INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 159
MULTI CAB INC..
a New Jersey corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MULTI-CARE INTERNATIONAL, INC.
a New Jersey corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MULTI-CARE MEDICAL CAR SERVICE, INC.
a New Jersey corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MULTI-HEALTH CORP.
a Florida corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
MYERS AMBULANCE SERVICE, INC.
an Indiana corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
NATIONAL AMBULANCE & OXYGEN
SERVICE, INC.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 160
NORTH MISS. AMBULANCE SERVICE, INC.
a Mississippi corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
PHYSICIANS AMBULANCE SERVICE, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
PROFESSIONAL MEDICAL SERVICES, INC.
an Arkansas corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RISC AMERICA ALABAMA
FIRE SAFETY SERVICES, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
R/M MANAGEMENT CO., INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
R/M OF MISSISSIPPI, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 161
R/M OF TENNESSEE G.P., INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
R/M OF TENNESSEE L.P., INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
R/M OF TEXAS G.P., INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
R/M PARTNERS, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RMC CORPORATE CENTER, L.L.C.
an Arizona limited liability company
By: RURAL/METRO CORPORATION,
an Arizona corporation
Its Member
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 162
RURAL/METRO ARGENTINA, L.L.C.
an Arizona limited liability company
By: RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
Its Member
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO BRASIL, L.L.C.
an Arizona corporation
By: RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
Its Member
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO CANADIAN HOLDINGS, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO COMMUNICATIONS
SERVICES, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 163
RURAL/METRO CORPORATION
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO CORPORATION OF FLORIDA
a Florida corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO CORPORATION OF TENNESSEE
a Tennessee corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO FIRE DEPT., INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO MID-ATLANTIC, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 164
RURAL/METRO OF ALABAMA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF ARGENTINA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF ARKANSAS, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF ARLINGTON, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF BRASIL, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF CALIFORNIA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 165
RURAL/METRO OF CENTRAL ALABAMA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF CENTRAL OHIO, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF GEORGIA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF INDIANA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF INDIANA, L.P.
a Delaware limited partnership
By: THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
Its General Partner
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 166
RURAL/METRO OF INDIANA II., L.P.
a Delaware corporation
By: THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
Its General Partner
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF KENTUCKY, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF MISSISSIPPI, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF NEBRASKA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF NEW YORK, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 167
RURAL/METRO OF NORTH FLORIDA, INC.
a Florida corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF OHIO, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF OREGON, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF ROCHESTER, INC.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF SAN DIEGO, INC.
a California corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF SOUTH CAROLINA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 168
RURAL/METRO OF SOUTH DAKOTA, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF TENNESSEE, L.P.
a Delaware limited partnership
By: R/M OF TENNESSEE, G.P., INC.,
a Delaware corporation
Its General Partner
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF TEXAS, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO OF TEXAS, L.P.
a Delaware limited partnership
By: R/M OF TEXAS G.P., INC.
a Delaware corporation
Its General Partner
By: __________________________________
Name:_____________________________
Title: ___________________________
RURAL/METRO PROTECTION SERVICES, INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 169
RURAL/METRO TEXAS HOLDINGS, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
SW GENERAL, INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
SIOUX FALLS AMBULANCE, INC.
a South Dakota corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
SOUTH GEORGIA EMERGENCY
MEDICAL SERVICES, INC.
a Georgia corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
SOUTHWEST AMBULANCE OF CASA
GRANDE, INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 170
SOUTHWEST AMBULANCE OF
SOUTHEASTERN ARIZONA, INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
SOUTHWEST AMBULANCE OF TUCSON, INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
SOUTHWEST GENERAL SERVICES, INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
THE AID COMPANY, INC.
an Indiana corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
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<PAGE> 171
THE WESTERN NEW YORK EMERGENCY
MEDICAL SERVICES TRAINING INSTITUTE INC.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
TOWNS AMBULANCE SERVICE, INC.
a New York corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
UNITED MEDICAL SERVICES, INC.
a Washington corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
VALLEY FIRE SERVICE, INC.
a Delaware corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
W & W LEASING COMPANY, INC.
an Arizona corporation
By: __________________________________
Name:_____________________________
Title: ___________________________
THE FIRST NATIONAL BANK OF CHICAGO
as Trustee
By: __________________________________
Name:_____________________________
Title: ___________________________
E-19
<PAGE> 1
Exhibit 4.4
RURAL/METRO CORPORATION
$150,000,000
7 7/8% Senior Notes due 2008
Unconditionally Guaranteed by the Signatories Hereto
REGISTRATION RIGHTS AGREEMENT
March 11, 1998
BEAR, STEARNS & CO. INC.
SALOMON BROTHERS INC
SBC WARBURG DILLON READ INC.
FIRST UNION CAPITAL MARKETS
c/o Bear, Stearns & Co. Inc.
245 Park Avenue, 3rd Floor
New York, NY 10167
Ladies and Gentlemen:
Rural/Metro Corporation, a Delaware corporation (the "Issuer"),
proposes to issue and sell to Bear, Stearns & Co. Inc. ("Bear Stearns"), Salomon
Brothers Inc, SBC Warburg Dillon Read Inc. and First Union Capital Markets, a
division of Wheat First Securities, Inc., (collectively, the "Initial
Purchasers"), upon the terms set forth in a purchase agreement of even date
herewith (the "Purchase Agreement"), $150,000,000 aggregate principal amount of
its 7 7/8% Senior Notes Due 2008 (the "Initial Securities") to be
unconditionally guaranteed by the guarantor subsidiaries of the Issuer
signatories hereto (the "Guarantors" and together with the Issuer, the
"Company"). The Initial Securities will be issued pursuant to an Indenture,
dated as of March 16, 1998, (the "Indenture") among the Issuer, the Guarantors
named therein and The First National Bank of Chicago (the "Trustee"). As an
inducement to the Initial Purchasers, the Company agrees with the Initial
Purchasers, for the benefit of the holders of the Initial Securities (including,
without limitation, the Initial Purchasers), of the Exchange Securities (as
defined below in Section 1) and of the Private Exchange Securities (as defined
below in Section 1) (collectively the "Holders"), as follows:
1. Registered Exchange Offer. The Company shall, at its own cost,
prepare and, not later than 45 days after (or if the 45th day is not a business
day, the first business day thereafter) the date of original issue of the
Initial Securities (the "Issue Date"), file with the Securities and Exchange
Commission (the "Commission") a registration statement (the "Exchange Offer
Registration
<PAGE> 2
Statement") on an appropriate form under the Securities Act of 1933, as amended
(the "Securities Act"), with respect to a proposed offer (the "Registered
Exchange Offer") to the Holders of Transfer Restricted Securities (as defined in
Section 6(e) hereof), who are not prohibited by any law or policy of the
Commission from participating in the Registered Exchange Offer, to issue and
deliver to such Holders, in exchange for the Initial Securities, a like
aggregate principal amount of debt securities (the "Exchange Securities") of the
Company issued under the Indenture and identical in all material respects to the
Initial Securities (except for the transfer restrictions relating to the Initial
Securities and the provisions relating to the matters described in Section 6
hereof) that would be registered under the Securities Act. The Company shall use
its best efforts to cause such Exchange Offer Registration Statement to become
effective under the Securities Act within 90 days (or if the 90th day is not a
business day, the first business day thereafter) after the Issue Date of the
Initial Securities and shall keep the Exchange Offer Registration Statement
effective for not less than 30 business days (or longer, if required by
applicable law) after the date notice of the Registered Exchange Offer is mailed
to the Holders (such period being called the "Exchange Offer Registration
Period").
If the Company effects the Registered Exchange Offer, the Company will
be entitled to close the Registered Exchange Offer 30 business days after the
commencement thereof provided that the Company has accepted all the Initial
Securities theretofore validly tendered in accordance with the terms of the
Registered Exchange Offer.
Following the declaration of the effectiveness of the Exchange Offer
Registration Statement, the Company shall promptly commence the Registered
Exchange Offer, it being the objective of such Registered Exchange Offer to
enable each Holder of Transfer Restricted Securities electing to exchange the
Initial Securities for Exchange Securities (assuming that such Holder is not an
affiliate of the Company within the meaning of the Securities Act, acquires the
Exchange Securities in the ordinary course of such Holder's business and has no
arrangements with any person to participate in the distribution of the Exchange
Securities and is not prohibited by any law or policy of the Commission from
participating in the Registered Exchange Offer) to trade such Exchange
Securities, from and after their receipt, without any limitations or
restrictions under the Securities Act and without material restrictions under
the securities laws of the several states of the United States.
The Company acknowledges that, pursuant to current interpretations by
the Commission's staff of Section 5 of the Securities Act, in the absence of an
applicable exemption therefrom, (i) each Holder which is a broker-dealer
electing to exchange Securities, acquired for its own account as a result of
market making activities or other trading activities, for Exchange Securities
(an "Exchanging Dealer"), is required to deliver a prospectus containing the
information set forth in (a) Annex A hereto on the cover, (b) Annex B hereto in
the "Exchange Offer Procedures" section and the "Purpose of the Exchange Offer"
section, and (c) Annex C hereto in the "Plan of Distribution" section of such
prospectus in
2
<PAGE> 3
connection with a sale of any such Exchange Securities received by such
Exchanging Dealer pursuant to the Registered Exchange Offer and (ii) an Initial
Purchaser that elects to sell Exchange Securities acquired in exchange for
Initial Securities constituting any portion of an unsold allotment is required
to deliver a prospectus containing the information required by Items 507 or 508
of Regulation S-K under the Securities Act, as applicable, in connection with
such sale.
The Company shall use its best efforts to keep the Exchange Offer
Registration Statement effective and to amend and supplement the prospectus
contained therein, in order to permit such prospectus to be lawfully delivered
by all persons subject to the prospectus delivery requirements of the Securities
Act for such period of time as such persons must comply with such requirements
in order to resell the Exchange Securities; provided, however, that (i) in the
case where such prospectus and any amendment or supplement thereto must be
delivered by an Exchanging Dealer or an Initial Purchaser, such period shall be
the lesser of 180 days and the date on which all Exchanging Dealers and the
Initial Purchasers have sold all Exchange Securities held by them (unless such
period is extended pursuant to Section 3(j) below) and (ii) the Company shall
make such prospectus, and any amendment or supplement thereto, available to any
broker-dealer for use in connection with any resale of any Exchange Securities
for a period of not less than 90 days after the consummation of the Registered
Exchange Offer.
If, upon consummation of the Registered Exchange Offer, any Initial
Purchaser holds Initial Securities acquired by it as part of its initial
distribution, the Company, simultaneously with the delivery of the Exchange
Securities pursuant to the Registered Exchange Offer, shall issue and deliver to
such Initial Purchaser upon the written request of such Initial Purchaser, in
exchange (the "Private Exchange") for the Initial Securities held by such
Initial Purchaser, a like principal amount of debt securities of the Company
issued under the Indenture and identical in all material respects (including the
existence of restrictions on transfer under the Securities Act and the
securities laws of the several states of the United States, but excluding
provisions relating to the matters described in Section 6 hereof) to the Initial
Securities (the "Private Exchange Securities"). The Initial Securities, the
Exchange Securities and the Private Exchange Securities are herein collectively
called the "Securities."
In connection with the Registered Exchange Offer, the Company shall:
(a) mail to each Holder a copy of the prospectus forming part
of the Exchange Offer Registration Statement, together with an
appropriate letter of transmittal and related documents;
(b) keep the Registered Exchange Offer open for not less than
30 business days (or longer, if required by applicable law) after the
date notice thereof is mailed to the Holders;
(c) utilize the services of a depositary for the Registered
3
<PAGE> 4
Exchange Offer with an address in the Borough of Manhattan, The City of
New York, which may be the Trustee or an affiliate of the Trustee;
(d) permit Holders to withdraw tendered Securities at any time
prior to the close of business, New York time, on the last business day
on which the Registered Exchange Offer shall remain open; and
(e) otherwise comply with all applicable laws.
As soon as practicable after the close of the Registered Exchange Offer
or the Private Exchange, as the case may be, the Company shall:
(x) accept for exchange all the Securities validly tendered
and not withdrawn pursuant to the Registered Exchange Offer and the
Private Exchange;
(y) deliver to the Trustee for cancellation all the Initial
Securities so accepted for exchange; and
(z) cause the Trustee to authenticate and deliver promptly to
each Holder of the Initial Securities, Exchange Securities or Private
Exchange Securities, as the case may be, equal in principal amount to
the Initial Securities of such Holder so accepted for exchange.
The Indenture will provide that the Exchange Securities will not be
subject to the transfer restrictions set forth in the Indenture and that all the
Securities will vote and consent together on all matters as one class and that
none of the Securities will have the right to vote or consent as a class
separate from one another on any matter.
Interest on each Exchange Security and Private Exchange Security will
accrue from (A) the later of (i) the last interest payment date on which
interest was paid on the Initial Securities surrendered in exchange therefor or
(ii) if the Initial Securities are surrendered for exchange on a date in a
period which includes the record date for an interest payment date to occur on
or after the date of such exchange and as to which interest will be paid, the
date of such interest payment date or (B) if no interest has been paid on the
Initial Securities, from the Issue Date.
Each Holder participating in the Registered Exchange Offer shall be
required to represent to the Company that at the time of the consummation of the
Registered Exchange Offer (i) any Exchange Securities received by such Holder
will be acquired in the ordinary course of business, (ii) such Holder will have
no arrangements or understanding with any person to participate in the
distribution of the Securities or the Exchange Securities within the meaning of
the Securities Act, (iii) such Holder is not an "affiliate," as defined in Rule
405 of the Securities Act, of the Company or if it is an affiliate, such Holder
will comply with the registration and prospectus delivery requirements of the
Securities Act to the
4
<PAGE> 5
extent applicable, (iv) if such Holder is not a broker-dealer, that it is not
engaged in, and does not intend to engage in, the distribution of the Exchange
Securities and (v) if such Holder is a broker-dealer, that it will receive
Exchange Securities for its own account in exchange for Initial Securities that
were acquired as a result of market-making activities or other trading
activities and that it will be required to acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities.
Notwithstanding any other provisions hereof, the Company will ensure
that (i) any Exchange Offer Registration Statement and any amendment thereto and
any prospectus forming part thereof and any supplement thereto complies in all
material respects with the Securities Act and the rules and regulations
thereunder, (ii) any Exchange Offer Registration Statement and any amendment
thereto does not, when it becomes effective, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading and (iii) any prospectus forming part of
any Exchange Offer Registration Statement, together with any supplement to such
prospectus, does not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading.
2. Shelf Registration. If, (i) because of applicable law, Commission
policy, or applicable interpretations by the staff of the Commission, the
Company is not permitted to effect a Registered Exchange Offer, as contemplated
by Section 1 hereof, or (ii) any holder of Transfer Restricted Securities
notifies the Company prior to the 20th day following consummation of the
Registered Exchange Offer that (a) it is prohibited by law or Commission policy
from participating in the Registered Exchange Offer or (b) that it may not
resell the Exchange Securities acquired by it in the Registered Exchange Offer
to the public without delivering a prospectus and the prospectus contained in
the Exchange Offer Registration Statement is not appropriate or available for
such resales or (c) that it is a broker-dealer and owns Initial Securities
acquired directly from the Company or an affiliate of the Company, the Company
shall take the following actions:
(a) The Company shall, at its cost, use its best efforts to,
within 30 days after so required or requested pursuant to this Section
2, file with the Commission and thereafter shall use its best efforts
to cause to be declared effective a registration statement (the "Shelf
Registration Statement" and, together with the Exchange Offer
Registration Statement, a "Registration Statement") on an appropriate
form under the Securities Act relating to the offer and sale of the
Transfer Restricted Securities (as defined in Section 6(e) hereof) by
the Holders thereof from time to time in accordance with the methods of
distribution set forth in the Shelf Registration Statement and Rule 415
under the Securities Act (hereinafter, the "Shelf Registration");
provided, however, that no Holder (other than an
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<PAGE> 6
Initial Purchaser) shall be entitled to have the Securities held by it
covered by such Shelf Registration Statement unless such Holder agrees
in writing to be bound by all the provisions of this Agreement
applicable to such Holder.
(b) The Company shall use its best efforts to (i) cause the
Shelf Registration Statement to be declared effective under the
Securities Act within 90 days after the filing obligation with respect
thereto arises; and (ii) subject to Section 6(b) below, keep the Shelf
Registration Statement continuously effective in order to permit the
prospectus included therein to be lawfully delivered by the Holders of
the relevant Securities, for a period of two years (or for such longer
period if extended pursuant to Section 3(j) below) from the date of its
effectiveness or such shorter period that will terminate when all the
Securities covered by the Shelf Registration Statement (i) have been
sold pursuant thereto or (ii) are no longer restricted securities (as
defined in Rule 144 under the Securities Act, or any successor rule
thereof). Subject to Section 6(b), the Company shall be deemed not to
have used its best efforts to keep the Shelf Registration Statement
effective during the requisite period if it voluntarily takes any
action that would result in Holders of Securities covered thereby not
being able to offer and sell such Securities during that period, unless
the Company believes in good faith that such action is required by
applicable law.
(c) Notwithstanding any other provisions of this Agreement to
the contrary, the Company shall cause the Shelf Registration Statement
and the related prospectus and any amendment or supplement thereto, as
of the effective date of the Shelf Registration Statement, amendment or
supplement, (i) to comply in all material respects with the applicable
requirements of the Securities Act and the rules and regulations of the
Commission and (ii) not to contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
3. Registration Procedures. In connection with any Shelf Registration
contemplated by Section 2 hereof and, to the extent applicable, any Registered
Exchange Offer contemplated by Section 1 hereof, the following provisions shall
apply:
(a) The Company shall (i) furnish to each Initial Purchaser,
prior to the filing thereof with the Commission, a copy of the
Registration Statement and each amendment thereof and each supplement,
if any, to the prospectus included therein and, in the event that an
Initial Purchaser (with respect to any portion of an unsold allotment
from the original offering) is participating in the Registered Exchange
Offer or the Shelf Registration Statement, the Company shall use its
best efforts to reflect in each such document, when so filed with the
Commission, such comments as such
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<PAGE> 7
Initial Purchaser reasonably may propose; (ii) include the information
set forth in Annex A hereto on the cover, in Annex B hereto in the
"Exchange Offer Procedures" section and the "Purpose of the Exchange
Offer" section and in Annex C hereto in the "Plan of Distribution"
section of the prospectus forming a part of the Exchange Offer
Registration Statement and include the information set forth in Annex D
hereto in the Letter of Transmittal delivered pursuant to the
Registered Exchange Offer; (iii) if requested by an Initial Purchaser,
include the information required by Items 507 or 508 of Regulation S-K
under the Securities Act, as applicable, in the prospectus forming a
part of the Exchange Offer Registration Statement; (iv) include within
the prospectus contained in the Exchange Offer Registration Statement a
section entitled "Plan of Distribution," reasonably acceptable to the
Initial Purchasers, which shall contain a summary statement of the
positions taken or policies made by the staff of the Commission with
respect to the potential "underwriter" status of any broker-dealer that
is the beneficial owner (as defined in Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) of Exchange
Securities received by such broker-dealer in the Registered Exchange
Offer (a "Participating Broker-Dealer"), whether such positions or
policies have been publicly disseminated by the staff of the Commission
or such positions or policies, in the reasonable judgment of the
Initial Purchasers based upon advice of counsel (which may be in-house
counsel), represent the prevailing views of the staff of the
Commission; and (v) in the case of a Shelf Registration Statement,
include the names of the Holders, who propose to sell Securities
pursuant to the Shelf Registration Statement, as selling
securityholders.
(b) The Company shall give written notice to the Initial
Purchasers, the Holders of the Securities and any Participating
Broker-Dealer from whom the Company has received prior written notice
that it will be a Participating Broker-Dealer in the Registered
Exchange Offer (which notice pursuant to clauses (ii)-(v) hereof shall
be accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made):
(i) when the Registration Statement or any amendment
thereto has been filed with the Commission and when the
Registration Statement or any post-effective amendment thereto
has become effective;
(ii) of any request by the Commission for amendments
or supplements to the Registration Statement or the prospectus
included therein or for additional information;
(iii) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that
purpose;
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<PAGE> 8
(iv) of the receipt by the Company or its legal
counsel of any notification with respect to the suspension of
the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any
proceeding for such purpose; and
(v) of the happening of any event that requires the
Company to make changes in the Registration Statement or the
prospectus in order that the Registration Statement or the
prospectus do not contain an untrue statement of a material
fact nor omit to state a material fact required to be stated
therein or necessary to make the statements therein (in the
case of the prospectus, in light of the circumstances under
which they were made) not misleading.
(c) The Company shall make every reasonable effort to obtain
the withdrawal, at the earliest possible time, of any order suspending
the effectiveness of the Registration Statement.
(d) The Company shall furnish to each Holder of Securities
included within the coverage of the Shelf Registration, without charge,
at least one copy of the Shelf Registration Statement and any
post-effective amendment thereto, including financial statements and
schedules, and, if the Holder so requests in writing, all exhibits
thereto (including those, if any, incorporated by reference).
(e) The Company shall deliver to each Exchanging Dealer and
each Initial Purchaser, and to any other Holder who so requests,
without charge, at least one copy of the Exchange Offer Registration
Statement and any post-effective amendment thereto, including financial
statements and schedules, and, if any Initial Purchaser or any such
Holder requests, all exhibits thereto (including those incorporated by
reference).
(f) The Company shall, during the Shelf Registration Period,
deliver to each Holder of Securities included within the coverage of
the Shelf Registration, without charge, as many copies of the
prospectus (including each preliminary prospectus) included in the
Shelf Registration Statement and any amendment or supplement thereto as
such person may reasonably request. The Company consents, subject to
the provisions of this Agreement, to the use of the prospectus or any
amendment or supplement thereto by each of the selling Holders of the
Securities in connection with the offering and sale of the Securities
covered by the prospectus, or any amendment or supplement thereto,
included in the Shelf Registration Statement.
(g) The Company shall deliver to each Initial Purchaser, any
Exchanging Dealer, any Participating Broker-Dealer and such other
persons required to deliver a prospectus following the Registered
Exchange Offer, without charge, as many copies of the final prospectus
8
<PAGE> 9
included in the Exchange Offer Registration Statement and any amendment
or supplement thereto as such persons may reasonably request. The
Company consents, subject to the provisions of this Agreement, to the
use of the prospectus or any amendment or supplement thereto by any
Initial Purchaser, if necessary, any Participating Broker-Dealer and
such other persons required to deliver a prospectus following the
Registered Exchange Offer in connection with the offering and sale of
the Exchange Securities covered by the prospectus, or any amendment or
supplement thereto, included in such Exchange Offer Registration
Statement.
(h) Prior to any public offering of the Securities, pursuant
to any Registration Statement, the Company shall register or qualify or
cooperate with the Holders of the Securities included therein and their
respective counsel in connection with the registration or qualification
of the Securities for offer and sale under the securities or "blue sky"
laws of such states of the United States as any Holder of the
Securities reasonably requests in writing and do any and all other acts
or things necessary or advisable to enable the offer and sale in such
jurisdictions of the Securities covered by such Registration Statement;
provided, however, that the Company shall not be required to (i)
qualify generally to do business in any jurisdiction where it is not
then so qualified or (ii) take any action which would subject it to
general service of process or to taxation in any jurisdiction where it
is not then so subject.
(i) The Company shall cooperate with the Holders of the
Securities to facilitate the timely preparation and delivery of
certificates representing the Securities to be sold pursuant to any
Registration Statement free of any restrictive legends and in such
denominations and registered in such names as the Holders may request a
reasonable period of time prior to sales of the Securities pursuant to
such Registration Statement.
(j) Upon the occurrence of any event contemplated by
paragraphs (ii) through (v) of Section 3(b) above during the period for
which the Company is required to maintain an effective Registration
Statement, the Company shall promptly prepare and file a post-effective
amendment to the Registration Statement or a supplement to the related
prospectus and any other required document so that, as thereafter
delivered to Holders of the Securities or purchasers of Securities, the
prospectus will not contain an untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. If the Company notifies the
Initial Purchasers, the Holders of the Securities and any known
Participating Broker-Dealer in accordance with paragraphs (ii) through
(v) of Section 3(b) above to suspend the use of the prospectus until
the requisite changes to the prospectus have been made, then the
Initial Purchasers, the Holders of the Securities and any such
Participating Broker-Dealers shall suspend use of
9
<PAGE> 10
such prospectus, and the period of effectiveness of the Shelf
Registration Statement provided for in Section 2(b) above and the
Exchange Offer Registration Statement provided for in Section 1 above
shall each be extended by the number of days from and including the
date of the giving of such notice to and including the date when the
Initial Purchasers, the Holders of the Securities and any known
Participating Broker-Dealer shall have received such amended or
supplemented prospectus pursuant to this Section 3(j).
(k) Not later than the effective date of the applicable
Registration Statement, the Company will provide a CUSIP number for the
Initial Securities, the Exchange Securities or the Private Exchange
Securities, as the case may be, and provide the applicable trustee with
printed certificates for the Initial Securities, the Exchange
Securities or the Private Exchange Securities, as the case may be, in a
form eligible for deposit with The Depository Trust Company.
(l) The Company will comply with all rules and regulations of
the Commission to the extent and so long as they are applicable to the
Registered Exchange Offer or the Shelf Registration and will make
generally available to its security holders (or otherwise provide in
accordance with Section 11(a) of the Securities Act) an earnings
statement satisfying the provisions of Section 11(a) of the Securities
Act, no later than 45 days after the end of a 12-month period (or 90
days, if such period is a fiscal year) beginning with the first month
of the Company's first fiscal quarter commencing after the effective
date of the Registration Statement, which statement shall cover such
12-month period.
(m) The Company shall cause the Indenture to be qualified
under the Trust Indenture Act of 1939, as amended, in a timely manner
and containing such changes, if any, as shall be necessary for such
qualification. In the event that such qualification would require the
appointment of a new trustee under the Indenture, the Company shall
appoint a new trustee thereunder pursuant to the applicable provisions
of the Indenture.
(n) The Company may require each Holder of Securities to be
sold pursuant to the Shelf Registration Statement to furnish to the
Company such information regarding the Holder and the distribution of
the Securities as the Company may from time to time reasonably require
for inclusion in the Shelf Registration Statement, and the Company may
exclude from such registration the Securities of any Holder that
unreasonably fails to furnish such information within a reasonable time
after receiving such request.
(o) The Company shall enter into such customary agreements
(including, if requested, an underwriting agreement in customary form)
and take all such other action, if any, as any Holder of the Securities
shall
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<PAGE> 11
reasonably request in writing in order to facilitate the disposition of
the Securities pursuant to any Shelf Registration.
(p) In the case of any Shelf Registration, the Company shall
(i) make reasonably available for inspection by the Holders of the
Securities, any underwriter participating in any disposition pursuant
to the Shelf Registration Statement and any attorney, accountant or
other agent retained by the Holders of the Securities or any such
underwriter all relevant financial and other records, pertinent
corporate documents and properties of the Company and (ii) cause the
Company's officers, directors, employees, accountants and auditors to
supply all relevant information reasonably requested by the Holders of
the Securities or any such underwriter, attorney, accountant or agent
in connection with the Shelf Registration Statement, in each case, as
shall be reasonably necessary to enable such persons, to conduct a
reasonable investigation within the meaning of Section 11 of the
Securities Act; provided, however, that the foregoing inspection and
information gathering shall be coordinated on behalf of the Initial
Purchasers by you and on behalf of the other parties, by one counsel
designated by and on behalf of such other parties as described in
Section 4 hereof.
(q) In the case of any Shelf Registration, the Company, if
requested by any Holder of Securities covered thereby, shall cause (i)
its counsel to deliver an opinion and updates thereof relating to the
Securities in customary form addressed to such Holders and the managing
underwriters, if any, thereof and dated, in the case of the initial
opinion, the effective date of such Shelf Registration Statement (it
being agreed that the matters to be covered by such opinion shall
include, without limitation, the due incorporation and good standing of
the Company and its subsidiaries; the qualification of the Company and
its subsidiaries to transact business as foreign corporations; the due
authorization, execution and delivery of the relevant agreement of the
type referred to in Section 3(o) hereof; the due authorization,
execution, authentication and issuance, and the validity and
enforceability, of the applicable Securities; the absence of material
legal or governmental proceedings involving the Company and its
subsidiaries; the absence of governmental approvals required to be
obtained in connection with the Shelf Registration Statement, the
offering and sale of the applicable Securities, or any agreement of the
type referred to in Section 3(o) hereof; the compliance as to form of
such Shelf Registration Statement and any documents incorporated by
reference therein and of the Indenture with the requirements of the
Securities Act and the Trust Indenture Act, respectively; and, as of
the date of the opinion and as of the effective date of the Shelf
Registration Statement or most recent post-effective amendment thereto,
as the case may be, the absence from such Shelf Registration Statement
and the prospectus included therein, as then amended or supplemented,
and from any documents incorporated by reference therein of an untrue
statement of a material fact or the omission
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<PAGE> 12
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading (in the case of
any such documents, in the light of the circumstances existing at the
time that such documents were filed with the Commission under the
Exchange Act)); (ii) its officers to execute and deliver all customary
documents and certificates and updates thereof requested by any
underwriters of the applicable Securities and (iii) its independent
public accountants and the independent public accountants with respect
to any other entity for which financial information is provided in the
Shelf Registration Statement to provide to the selling Holders of the
applicable Securities and any underwriter therefor a comfort letter in
customary form and covering matters of the type customarily covered in
comfort letters in connection with primary underwritten offerings,
subject to receipt of appropriate documentation as contemplated, and
only if permitted, by Statement of Auditing Standards No. 72.
(r) In the case of the Registered Exchange Offer, if requested
by any Initial Purchaser or any known Participating Broker-Dealer, the
Company shall cause (i) its counsel to deliver to such Initial
Purchaser or such Participating Broker-Dealer a signed opinion
respecting the matters set forth in Exhibit A of the Purchase Agreement
with such changes as are customary in connection with the preparation
of a Registration Statement and (ii) its independent public accountants
and the independent public accountants with respect to any other entity
for which financial information is provided in the Registration
Statement to deliver to such Initial Purchaser or such Participating
Broker-Dealer a comfort letter in substantially the form delivered in
Section 8(g) of the Purchase Agreement, with appropriate date changes.
(s) If a Registered Exchange Offer or a Private Exchange is to
be consummated, upon delivery of the Initial Securities by Holders to
the Company (or to such other Person as directed by the Company) in
exchange for the Exchange Securities or the Private Exchange
Securities, as the case may be, the Company shall mark, or caused to be
marked, on the Initial Securities so exchanged that such Initial
Securities are being canceled in exchange for the Exchange Securities
or the Private Exchange Securities, as the case may be; in no event
shall the Initial Securities be marked as paid or otherwise satisfied.
(t) The Company will use its best efforts to (a) if the
Initial Securities have been rated prior to the initial sale of such
Initial Securities, confirm such ratings will apply to the Securities
covered by a Registration Statement, or (b) if the Initial Securities
were not previously rated, cause the Securities covered by a
Registration Statement to be rated with the appropriate rating
agencies, if so requested by Holders of a majority in aggregate
principal amount of Securities covered by such Registration Statement,
or by the managing underwriters, if any.
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<PAGE> 13
(u) In the event that any broker-dealer registered under the
Exchange Act shall underwrite any Securities or participate as a member
of an underwriting syndicate or selling group or "assist in the
distribution" (within the meaning of the Conduct Rules (the "Rules") of
the National Association of Securities Dealers, Inc. ("NASD")) thereof,
whether as a Holder of such Securities or as an underwriter, a
placement or sales agent or a broker or dealer in respect thereof, or
otherwise, the Company will assist such broker-dealer in complying with
the requirements of such Rules, including, without limitation, by (i)
if such Rules, including Rule 2720, shall so require, engaging a
"qualified independent underwriter" (as defined in Rule 2720) to
participate in the preparation of the Registration Statement relating
to such Securities, to exercise usual standards of due diligence in
respect thereto and, if any portion of the offering contemplated by
such Registration Statement is an underwritten offering or is made
through a placement or sales agent, to recommend the yield of such
Securities, (ii) indemnifying any such qualified independent
underwriter to the extent of the indemnification of underwriters
provided in Section 5 hereof and (iii) providing such information to
such broker-dealer as may be required in order for such broker-dealer
to comply with the requirements of the Rules.
(v) The Company shall cause all Securities covered by any
Registration Statement to be listed on each securities exchange on
which any Securities are listed.
(w) The Company shall use its best efforts to take all other
steps necessary to effect the registration of the Securities covered by
a Registration Statement contemplated hereby.
4. Registration Expenses.
(a) All expenses incident to the Company's performance of or
compliance with this Agreement will be borne by the Company regardless of
whether a Registration Statement is filed or becomes effective, including
without limitation: (i) all registration and filing fees and expenses (including
filings made by any Initial Purchasers or Holder with the NASD (and, if
applicable, the reasonable fees and expenses of any "qualified independent
underwriter" and its counsel that may be required by the rules and regulations
of the NASD)); (ii) all fees and expenses associated with compliance with
federal securities and state Blue Sky or securities laws; (iii) all expenses of
printing (including printing certificates for the Securities to be issued in the
Exchange Offer and printing of Prospectuses), messenger and delivery services
and telephone; (iv) all fees and disbursements of counsel for the Company and,
subject to Section 4(b) below, the Holders of Transfer Restricted Securities;
(v) all application and filing fees in connection with listing Securities on a
national securities exchange or automated quotation system pursuant to the
requirements hereof, if Securities are so listed; and (vi) all fees and
disbursements of independent certified public accountants of the Company
(including the expenses of any special audit and comfort letters
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<PAGE> 14
required by or incident to such performance).
The Company will, in any event, bear its internal expenses (including,
without limitation, all salaries and expenses of their officers and employees
performing legal or accounting duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by the
Company.
(b) In connection with any Registration Statement required by
this Agreement, the Company will reimburse the Initial Purchasers and the
Holders of Transfer Restricted Securities being tendered in the Exchange Offer
and/or resold pursuant to the "Plan of Distribution" contained in the Exchange
Offer Registration Statement or registered pursuant to the Shelf Registration
Statement, as applicable, for the reasonable fees and disbursements of not more
than one counsel, who shall be Morrison & Foerster LLP or such other counsel as
may be chosen by the Holders of a majority in aggregate principal amount of the
Transfer Restricted Securities for whose benefit such Registration Statement is
being prepared.
5. Indemnification.
(a) The Company agrees to indemnify and hold harmless the
Initial Purchasers, each Holder of the Securities, any Participating
Broker-Dealer and each person, if any, who controls such Holder or such
Participating Broker-Dealer within the meaning of the Securities Act or the
Exchange Act (each Holder, any Participating Broker-Dealer and such controlling
persons are referred to collectively as the "Indemnified Parties") from and
against any losses, claims, damages or liabilities, joint or several, or any
actions in respect thereof as incurred (including, but not limited to, any
losses, claims, damages, liabilities or actions relating to purchases and sales
of the Securities and including reasonable attorneys' fees and any and all
expenses whatsoever incurred in investigating, preparing or defending against
any investigation or litigation, commenced or threatened, or any claim
whatsoever, and in enforcing this indemnification, and any and all amounts paid
in settlement of any claim or litigation) to which each Indemnified Party may
become subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, claims, damages, liabilities or actions arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
contained in a Registration Statement or prospectus or in any amendment or
supplement thereto or in any preliminary prospectus, or arise out of, or are
based upon, the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and shall reimburse, as incurred, the Indemnified Parties for any
reasonable legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage, liability or
action in respect thereof; provided, however, that the Company shall not be
liable in any such case to the extent that such loss, claim, damage or liability
arises out of or is based upon any untrue statement or alleged untrue statement
or omission or alleged omission made in a Registration Statement or prospectus
or in any
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<PAGE> 15
amendment or supplement thereto or in any preliminary prospectus in reliance
upon and in conformity with written information pertaining to such Holder and
furnished to the Company by or on behalf of such Holder specifically for
inclusion therein; provided further, however, that this indemnity agreement will
be in addition to any liability which the Company may otherwise have to such
Indemnified Party under any other agreement or under applicable law. The Company
shall also indemnify underwriters, their officers and directors and each person
who controls such underwriters within the meaning of the Securities Act or the
Exchange Act to the same extent as provided above with respect to the
indemnification of the Holders of the Securities if requested by such Holders.
(b) Each Holder of the Securities, severally and not jointly,
will indemnify and hold harmless the Company and each person, if any, who
controls the Company within the meaning of the Securities Act or the Exchange
Act from and against any losses, claims, damages or liabilities or any actions
in respect thereof, to which the Company or any such controlling person may
become subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, claims, damages, liabilities or actions arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
contained in a Registration Statement or prospectus or in any amendment or
supplement thereto or in any preliminary prospectus, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
necessary to make the statements therein not misleading, but in each case only
to the extent that the untrue statement or omission or alleged untrue statement
or omission was made in reliance upon and in conformity with written information
pertaining to such Holder and furnished to the Company by or on behalf of such
Holder specifically for inclusion therein; provided, however, that in no case
shall any Holder be liable or responsible for any amount in excess of the dollar
amount of the proceeds received by such Holder upon the sale of the Securities
giving rise to such indemnification obligation. This indemnity agreement will be
in addition to any liability which such Holder may otherwise have to the Company
or any of its controlling persons under any other agreement or under applicable
law.
(c) Promptly after receipt by an indemnified party under this
Section 5(a) or (b) of notice of the commencement of any action or proceeding
(including a governmental investigation), such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 5, notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party. In case any
such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof except to the extent set forth below
the indemnifying party will not be liable to such indemnified party under this
Section 5 for any legal or other expenses, other
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<PAGE> 16
than reasonable costs of investigation, subsequently incurred by such
indemnified party in connection with the defense thereof. Notwithstanding the
foregoing, the indemnified party or parties shall have the right to employ its
or their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of such indemnified party or parties unless (i) the
employment of such counsel shall have been authorized in writing by the
indemnifying parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to take charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them which are different
from or additional to those available to one or all of the indemnifying parties
(in which case the indemnifying party or parties shall not have the right to
direct the defense of such action on behalf of the indemnified party or
parties), in any of which events such fees and expenses of counsel shall be
borne by the indemnifying parties; provided, however, that the indemnifying
party under subsection (a) or (b) above shall only be liable for the legal
expenses of one counsel (in addition to any local counsel) for all indemnified
parties in each jurisdiction in which any claim or action is brought. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened action in respect of
which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party unless such settlement
includes an unconditional release of such indemnified party from all liability
on any claims that are the subject matter of such action.
(d) If the indemnification provided for in this Section 5 is
unavailable or insufficient to hold harmless an indemnified party under
subsections (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to in
subsection (a) or (b) above in such proportion as is appropriate to reflect the
relative fault of the indemnifying party or parties on the one hand and the
indemnified party on the other in connection with the statements or omissions
that resulted in such losses, claims, damages or liabilities (or actions in
respect thereof) as well as any other relevant equitable considerations. The
relative fault of the parties shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or such Holder or such other indemnified
party, as the case may be, on the other, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid by an indemnified party as a result of
the losses, claims, damages or liabilities referred to in the first sentence of
this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this subsection (d).
The Company and the Holders agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation which does not take into account
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<PAGE> 17
the equitable considerations referred to above. Notwithstanding any other
provision of this Section 5(d), no Holder shall be required to contribute any
amount in excess of the amount by which the net proceeds received by such Holder
from the sale of the Securities pursuant to a Registration Statement exceeds the
amount of damages which such Holder has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. For purposes of this
paragraph (d), each person, if any, who controls such indemnified party within
the meaning of the Securities Act or the Exchange Act shall have the same rights
to contribution as such indemnified party and each person, if any, who controls
the Company within the meaning of the Securities Act or the Exchange Act shall
have the same rights to contribution as the Company.
(e) The agreements contained in this Section 5 shall survive
the sale of the Securities pursuant to a Registration Statement and shall remain
in full force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any indemnified party.
6. Liquidated Damages.
(a) If (i) any of the Registration Statements required by this
Agreement is not filed with the Commission on or prior to the date specified for
such filing in this Agreement, (ii) any of such Registration Statements has not
been declared effective by the Commission on or prior to the date specified for
such effectiveness in this Agreement (the "Effectiveness Target Date"), (iii)
the Registered Exchange Offer has not been consummated within 30 business days
after the Effectiveness Target Date with respect to the Exchange Offer
Registration Statement or (iv) any Registration Statement required by this
Agreement is filed and declared effective but shall thereafter cease to be
effective or fail to be usable for its intended purpose without being succeeded
immediately by a post-effective amendment to such Registration Statement that
cures such failure and that is itself immediately declared effective, (each such
event referred to in clauses (ii) through (iv), a "Registration Default"), the
Company agrees to pay liquidated damages ("Liquidated Damages") to each Holder
of Transfer Restricted Securities with respect to the first 90-day period
immediately following the occurrence of the first Registration Default, in an
amount equal to one-half of one percentage point (0.5%) per annum of the
principal amount of Transfer Restricted Securities held by such Holder. The
amount of the Liquidated Damages shall increase by an additional one-half of one
percent (0.5%) per annum of the principal amount of Transfer Restricted
Securities with respect to each subsequent 90-day period until all Registration
Defaults have been cured, up to a maximum amount of Liquidated Damages of one
and one-half percent (1.5%) per annum of the principal amount of Transfer
Restricted Securities held by such Holder. All accrued Liquidated Damages shall
be paid by the Company on each Interest Payment Date (as defined in the
Indenture) to each Holder of a Global Note (as defined in the Indenture) by wire
transfer of immediately available funds
17
<PAGE> 18
or by federal funds check and to Holders of Certificated Securities by wire
transfers to the accounts specified by them or by mailing checks to their
registered addresses if no such accounts have been specified, on each Interest
Payment Date, as provided for in the Indenture. The filing of a Registration
Statement after the date specified for such filing, the declaration of
effectiveness of a Registration Statement after the Effectiveness Target Date or
the consummation of the Registered Exchange Offer at any time, as appropriate,
shall constitute a cure of the related Registration Default. Following the cure
of all Registration Defaults relating to any particular Transfer Restricted
Securities, the accrual of liquidated damages with respect to such Transfer
Restricted Securities will cease.
(b) All obligations of the Company set forth in the preceding
paragraph that are outstanding with respect to any Transfer Restricted Security
at the time such security ceases to be a Transfer Restricted Security shall
survive until such time as all such obligations with respect to such security
shall have been satisfied in full.
(c) For the purposes of this Agreement, a Registration
Statement or the related prospectus ceases to be usable when either (1) any
event occurs as a result of which the related prospectus forming part of such
Registration Statement would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, or (2) it
shall be necessary to amend such Registration Statement or supplement the
related prospectus, to comply with the Securities Act or the Exchange Act or the
respective rules thereunder.
(d) Any amounts of liquidated damages due pursuant to Section
6(a) above will be determined by multiplying the applicable rate by the
principal amount of the Securities, multiplied by a fraction, the numerator of
which is the number of days such liquidated damage rate was applicable during
such period (determined on the basis of a 360-day year comprised of twelve
30-day months), and the denominator of which is 360.
(e) "Transfer Restricted Securities" means each Security until
(i) the date on which such Transfer Restricted Security has been exchanged by a
person other than a broker-dealer for a freely transferable Exchange Security in
the Registered Exchange Offer, (ii) following the exchange by a broker-dealer in
the Registered Exchange Offer of an Initial Security for an Exchange Security,
the date on which such Exchange Security is sold to a purchaser who receives
from such broker-dealer on or prior to the date of such sale a copy of the
prospectus contained in the Exchange Offer Registration Statement, (iii) the
date on which such Initial Security has been effectively registered under the
Securities Act and disposed of in accordance with the Shelf Registration
Statement or (iv) the date on which such Initial Security is distributed to the
public pursuant to Rule 144 under the Securities Act.
7. Rules 144 and 144A. The Company shall use its best efforts to file
18
<PAGE> 19
the reports required to be filed by it under the Securities Act and the Exchange
Act in a timely manner and, if at any time the Company is not required to file
such reports, it will, upon the request of any Holder of Initial Securities,
make publicly available other information so long as necessary to permit sales
of their securities pursuant to Rules 144 and 144A. The Company covenants that
it will take such further action as any Holder of Initial Securities may
reasonably request, all to the extent required from time to time to enable such
Holder to sell Initial Securities without registration under the Securities Act
within the limitation of the exemptions provided by Rules 144 and 144A
(including the requirements of Rule 144A(d)(4)). The Company will provide a copy
of this Agreement to prospective purchasers of Initial Securities identified to
the Company by the Initial Purchasers upon request. Upon the request of any
Holder of Initial Securities, the Company shall deliver to such Holder a written
statement as to whether it has complied with such requirements. Notwithstanding
the foregoing, nothing in this Section 7 shall be deemed to require the Company
to register any of its securities pursuant to the Exchange Act.
8. Underwritten Registrations. If any of the Transfer Restricted
Securities covered by any Shelf Registration are to be sold in an underwritten
offering, the investment banker or investment bankers and manager or managers
that will administer the offering ("Managing Underwriters") will be selected by
the Holders of a majority in aggregate principal amount of such Transfer
Restricted Securities to be included in such offering; provided, however, that
such Managing Underwriters shall be reasonably satisfactory to the Company, it
being understood that Bear Stearns shall be deemed reasonably satisfactory to
the Company.
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted
Securities on the basis reasonably provided in any underwriting arrangements
approved by the persons entitled hereunder to approve such arrangements and (ii)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.
9. Miscellaneous.
(a) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents to
departures from the provisions hereof may not be given, except by the Company
and the written consent of the Holders of a majority in principal amount of the
Securities affected by such amendment, modification, supplement, waiver or
consents.
(b) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand delivery, first-class
mail, facsimile transmission, or air courier which guarantees overnight
delivery:
19
<PAGE> 20
(1) if to a Holder of the Securities, at the most current
address given by such Holder to the Company.
(2) if to the Initial Purchasers, at the following address:
Bear, Stearns & Co. Inc.
245 Park Avenue, 3rd Floor
New York, New York 10167
Telecopy No.: (212) 272-3092
Attention: Corporate Finance Group
with a copy to:
Morrison & Foerster LLP
19900 MacArthur Boulevard, 12th Floor
Irvine, California 92612
Telecopy No.: (714) 251-0900
Attention: Tamara Powell Tate, Esq.
(3) if to the Company, at its address as follows:
Rural/Metro Corporation
8401 East Indian School Road
Scottsdale, Arizona 85251
Telecopy No.: (602) 994-3886
Attention: Chief Financial Officer
with a copy to:
O'Connor, Cavanagh, Anderson,
Killingsworth & Beshears
One E. Camelback, Suite 1100
Phoenix, Arizona 85012
Telecopy No.: (602) 263-2900
Attention: Jean E. Harris
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; three
business days after being deposited in the mail, postage prepaid, if mailed;
when receipt is acknowledged by recipient's facsimile machine operator, if sent
by facsimile transmission; and on the day delivered, if sent by overnight air
courier guaranteeing next day delivery.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the Trustee at
the address specified in the Indenture.
(c) No Inconsistent Agreements. The Company has not, as of
20
<PAGE> 21
the date hereof, entered into, nor shall it, on or after the date hereof, enter
into, any agreement with respect to its securities that is inconsistent with the
rights granted to the Holders herein or otherwise conflicts with the provisions
hereof. The Company will take no action with respect to the Securities that
would materially and adversely affect the ability of the Holders to consummate
any Exchange Offer.
(d) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Securities.
(e) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(f) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
(h) Severability. If any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(i) Securities Held by the Company. Whenever the consent or
approval of Holders of a specified percentage of principal amount of Securities
is required hereunder, Securities held by the Company or its affiliates (other
than subsequent Holders of Securities if such subsequent Holders are deemed to
be affiliates solely by reason of their holdings of such Securities) shall not
be counted in determining whether such consent or approval was given by the
Holders of such required percentage.
(j) Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Company with
respect to the Transfer Restricted Securities. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
21
<PAGE> 22
(k) Remedies. The Company agrees that monetary damages
(including the Liquidated Damages contemplated hereby) would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.
[Intentionally left blank]
22
<PAGE> 23
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Issuer a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the several Initial Purchasers, the Issuer and the Guarantors in
accordance with its terms.
Very truly yours,
RURAL/METRO CORPORATION
By: /s/ Mark E. Liebner
-----------------------------------
Name:
Title:
23
<PAGE> 24
AID AMBULANCE AT VIGO COUNTY, INC.
an Indiana corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
AMBULANCE TRANSPORT SYSTEMS, INC.
a New Jersey corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
AMERICAN LIMOUSINE SERVICE, INC.
an Ohio corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
ARROW AMBULANCE, INC.
an Idaho corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
BEACON TRANSPORTATION, INC.
a New York corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
CITY WIDE AMBULANCE SERVICE, INC.
an Ohio corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 25
CORNING AMBULANCE SERVICE INC.
a New York corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
DONLOCK, LTD.
a Pennsylvania corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
E.M.S. VENTURES, INC.
a Georgia corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
EMS VENTURES OF SOUTH CAROLINA, INC.
a South Carolina corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
EASTERN AMBULANCE SERVICE, INC.
a Nebraska corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
EASTERN PARAMEDICS, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 26
GOLD CROSS AMBULANCE SERVICES, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
GOLD CROSS AMBULANCE SERVICES OF PA., INC.
an Ohio corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
KEEFE & KEEFE, INC.
a New York corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
KEEFE & KEEFE AMBULETTE, LTD.
a New York corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
LASALLE AMBULANCE INC.
a New York corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 27
MEDI-CAB OF GEORGIA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MEDICAL EMERGENCY DEVICES AND
SERVICES (MEDS), INC.
an Arizona corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MEDICAL TRANSPORTATION SERVICES, INC.
a South Dakota corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MEDSTAR EMERGENCY MEDICAL SERVICES, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MERCURY AMBULANCE SERVICE, INC.
a Kentucky corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 28
METRO CARE CORP.
an Ohio corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MO-RO-KO, INC.
an Arizona corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MULTI CAB INC..
a New Jersey corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MULTI-CARE INTERNATIONAL, INC.
a New Jersey corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MULTI-CARE MEDICAL CAR SERVICE, INC.
a New Jersey corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 29
MULTI-HEALTH CORP.
a Florida corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
MYERS AMBULANCE SERVICE, INC.
an Indiana corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
NATIONAL AMBULANCE & OXYGEN
SERVICE, INC.
a New York corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
NORTH MISS. AMBULANCE SERVICE, INC.
a Mississippi corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
PHYSICIANS AMBULANCE SERVICE, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 30
PROFESSIONAL MEDICAL SERVICES, INC.
an Arkansas corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RISC AMERICA ALABAMA
FIRE SAFETY SERVICES, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
R/M MANAGEMENT CO., INC.
an Arizona corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
R/M OF MISSISSIPPI, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
R/M OF TENNESSEE G.P., INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 31
R/M OF TENNESSEE L.P., INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
R/M OF TEXAS G.P., INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
R/M PARTNERS, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RMC CORPORATE CENTER, L.L.C.
an Arizona limited liability company
By: RURAL/METRO CORPORATION,
an Arizona corporation
Its Member
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 32
RURAL/METRO ARGENTINA, L.L.C.
an Arizona limited liability company
By: RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
Its Member
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO BRASIL, L.L.C.
an Arizona corporation
By: RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
Its Member
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO CANADIAN HOLDINGS, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO COMMUNICATIONS
SERVICES, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 33
RURAL/METRO CORPORATION
an Arizona corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO CORPORATION OF FLORIDA
a Florida corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO CORPORATION OF
TENNESSEE
a Tennessee corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO FIRE DEPT., INC.
an Arizona corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO INTERNATIONAL, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 34
RURAL/METRO MID-ATLANTIC, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF ALABAMA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF ARGENTINA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF ARKANSAS, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF ARLINGTON, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF BRASIL, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 35
RURAL/METRO OF CALIFORNIA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF CENTRAL ALABAMA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF CENTRAL OHIO, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF GEORGIA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF INDIANA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 36
RURAL/METRO OF INDIANA, L.P.
a Delaware limited partnership
By: THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
Its General Partner
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF INDIANA II., L.P.
a Delaware corporation
By: THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
Its General Partner
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF KENTUCKY, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF MISSISSIPPI, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF NEBRASKA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 37
RURAL/METRO OF NEW YORK, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF NORTH FLORIDA, INC.
a Florida corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF OHIO, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF OREGON, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF ROCHESTER, INC.
a New York corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 38
RURAL/METRO OF SAN DIEGO, INC.
a California corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF SOUTH CAROLINA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF SOUTH DAKOTA, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF TENNESSEE, L.P.
a Delaware limited partnership
By: R/M OF TENNESSEE, G.P., INC.,
a Delaware corporation
Its General Partner
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO OF TEXAS, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 39
RURAL/METRO OF TEXAS, L.P.
a Delaware limited partnership
By: R/M OF TEXAS G.P., INC.
a Delaware corporation
Its General Partner
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
RURAL/METRO PROTECTION SERVICES, INC.
an Arizona corporation
/s/ Mark E. Liebner
By:__________________________________
Name:______________________________
Title: ______________________________
RURAL/METRO TEXAS HOLDINGS, INC.
a Delaware corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
SW GENERAL, INC.
an Arizona corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
SIOUX FALLS AMBULANCE, INC.
a South Dakota corporation
/s/ Mark E. Liebner
By:__________________________________
Name:________________________________
Title:_______________________________
<PAGE> 40
SOUTH GEORGIA EMERGENCY
MEDICAL SERVICES, INC.
a Georgia corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
SOUTHWEST AMBULANCE OF CASA
GRANDE, INC.
an Arizona corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
SOUTHWEST AMBULANCE OF
SOUTHEASTERN ARIZONA, INC.
an Arizona corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
SOUTHWEST AMBULANCE OF TUCSON, INC.
an Arizona corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
SOUTHWEST GENERAL SERVICES, INC.
an Arizona corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
<PAGE> 41
THE AID AMBULANCE COMPANY, INC.
a Delaware corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
THE AID COMPANY, INC.
an Indiana corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
THE WESTERN NEW YORK EMERGENCY
MEDICAL SERVICES TRAINING INSTITUTE INC.
a New York corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
TOWNS AMBULANCE SERVICE, INC.
a New York corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
UNITED MEDICAL SERVICES, INC.
a Washington corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
<PAGE> 42
VALLEY FIRE SERVICE, INC.
a Delaware corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
W & W LEASING COMPANY, INC.
an Arizona corporation
/s/ Mark E. Liebner
By: _________________________________
Name:________________________________
Title:_______________________________
<PAGE> 43
The foregoing Registration Rights Agreement is hereby confirmed and accepted as
of the date first above written.
Acting on behalf of itself and as the Representative of the Initial Purchasers
BEAR, STEARNS & CO. INC.
By:____________________________________
Name:
Title:
<PAGE> 44
ANNEX A
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. The Letter
of Transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of Exchange Securities received in exchange for Initial Securities
where such Initial Securities were acquired by such broker-dealer as a result of
market-making activities or other trading activities. The Company has agreed
that, for a period of 180 days after the Expiration Date (as defined herein), it
will make this Prospectus available to any broker-dealer for use in connection
with any such resale. See "Plan of Distribution."
<PAGE> 45
ANNEX B
Each broker-dealer that receives Exchange Securities for its own
account in exchange for Securities, where such Initial Securities were acquired
by such broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Securities. See "Plan of Distribution."
<PAGE> 46
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Securities for its own account
pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of Exchange Securities received in
exchange for Initial Securities where such Initial Securities were acquired as a
result of market-making activities or other trading activities. The Company has
agreed that, for a period of 180 days after the Expiration Date, it will make
this prospectus, as amended or supplemented, available to any broker-dealer for
use in connection with any such resale. In addition, until , 1998,
all dealers effecting transactions in the Exchange Securities may be required to
deliver a prospectus.(1)
The Company will not receive any proceeds from any sale of Exchange
Securities by broker-dealers. Exchange Securities received by broker-dealers for
their own account pursuant to the Exchange Offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the Exchange Securities or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any such Exchange
Securities. Any broker-dealer that resells Exchange Securities that were
received by it for its own account pursuant to the Exchange Offer and any broker
or dealer that participates in a distribution of such Exchange Securities may be
deemed to be an "underwriter" within the meaning of the Securities Act and any
profit on any such resale of Exchange Securities and any commission or
concessions received by any such persons may be deemed to be underwriting
compensation under the Securities Act. The Letter of Transmittal states that, by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
For a period of 180 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Exchange Offer (including the expenses of one counsel for the
Holders of the Securities) other than commissions or concessions of any brokers
or dealers and will indemnify the Holders of the Securities (including any
broker-dealers) against certain liabilities, including liabilities under the
Securities Act.
- -----------
(1) In addition, the legend required by Item 502(e) of Regulation S-K will
appear on the back cover page of the Exchange Offer prospectus.
<PAGE> 47
ANNEX D
CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL
COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name: _____________________________________________
Address: ___________________________________________
____________________________________________________
If the undersigned is not a broker-dealer, the undersigned represents
that it is not engaged in, and does not intend to engage in, a distribution of
Exchange Securities. If the undersigned is a broker-dealer that will receive
Exchange Securities for its own account in exchange for Initial Securities that
were acquired as a result of market-making activities or other trading
activities, it acknowledges that it will deliver a prospectus in connection with
any resale of such Exchange Securities; however, by so acknowledging and by
delivering a prospectus, the undersigned will not be deemed to admit that it is
an "underwriter" within the meaning of the Securities Act.
<PAGE> 1
EXHIBIT 12
RURAL/METRO CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Six months ended
Year ended June 30, December 31,
-------------------------------------------------- -----------------
1993 1994 1995 1996 1997 1996 1997
-------------------------------------------------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Income from continuing operations
before Income taxes and
extraordinary item $4,156 $ 7,610 $12,881 $19,556 $22,084 $11,984 $17,006
ADD
Portion of rents representative
of the interest factor 818 841 1,334 1,782 2,208 1,120 1,627
Interest on indebtedness 2,896 1,780 3,059 5,108 5,720 2,430 5,409
Amortization of debt expenses
and premium 55 141 259 332 162 188
Income as adjusted 7,870 10,286 17,415 26,705 30,344 15,696 24,230
FIXED CHARGES
Interest on indebtedness 2,896 1,780 3,059 5,108 6,097 2,489 5,849
Amortization of debt expense
and premium 55 141 259 332 162 188
Portion of rents representative
of the interest factor 818 841 1,334 1,782 2,208 1,120 1,627
Fixed charges 3,714 2,676 4,534 7,149 8,637 3,771 7,664
Ratio of earnings to fixed charges 2.1 3.8 3.8 3.7 3.5 4.2 3.2
</TABLE>
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our
report (and to all references to our Firm) included in or made a part of this
registration statement.
ARTHUR ANDERSEN LLP
Phoenix, Arizona
April 27, 1998
<PAGE> 1
EXHIBIT 24.2
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that Warren S. Rustand hereby
constitutes and appoints Mark E. Liebner as his true and lawful attorney-in-fact
and agent, with full power of substitution and resubstitution, for him and in
his name, place and stead, in any and all capacities, to sign the Form S-4
Resignation Statement regarding the offer of $150,000,000 7/8% Senior Notes due
2008 of Rural/Metro Corporation in exchange for its outstanding $150,000,000
7/8% Senior Notes Due 2008 and any or all amendments (including post-effective
amendments) thereto, and to file the same, with all exhibits thereto, and all
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorney-in-fact and agent, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the foregoing, as fully as to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Power of Attorney has been signed on April 30, 1998 by Warren S. Rustand in
the capacities and for the entities indicated.
--------------------------------------
Warren S. Rustand
PRESIDENT and DIRECTOR
of the corporations and of the general
partners and members of the limited
partnerships and limited liability
companies, respectively, set forth on
the attached Schedule
<PAGE> 2
SCHEDULE 1
Aid Ambulance at Vigo County, Inc.
Ambulance Transport Systems, Inc.
American Limousine Service, Inc.
Arrow Ambulance, Inc.
Beacon Transportation, Inc.
City Wide Ambulance Service, Inc.
Corning Ambulance Service Inc.
Donlock, Ltd.
E.M.S. Ventures, Inc.
EMS Ventures of South Carolina, Inc.
Eastern Ambulance Service, Inc.
Eastern Paramedics, Inc.
Gold Cross Ambulance Services, Inc.
Gold Cross Ambulance Service of Pa., Inc.
Keefe & Keefe, Inc.
Keefe & Keefe Ambulette, Ltd.
LaSalle Ambulance Inc.
Medi-Cab of Georgia, Inc.
Medical Emergency Devices and Services, Inc.
Medical Transportation Services, Inc.
Medstar Emergency Medical Services, Inc.
Mercury Ambulance Service, Inc.
Metro Care Corp.
MO-RO-KO, Inc.
Multi Cab Inc.
Multi-Care International, Inc.
Multi-Care Medical Car Service, Inc.
Multi-Health Corp.
Myers Ambulance Service, Inc.
National Ambulance & Oxygen Service, Inc.
North Miss. Ambulance Service, Inc.
Physicians Ambulance Service, Inc.
Professional Medical Services, Inc.
RISC America Alabama Fire Safety Services, Inc.
R/M Management Co., Inc.
R/M of Mississippi, Inc.
R/M of Tennessee G.P., Inc.
R/M of Tennessee L.P., Inc.
R/M of Texas G.P., Inc.
R/M Partners, Inc.
RMC Corporate Center, L.L.C.
Rural/Metro Argentina, L.L.C.
<PAGE> 3
Rural/Metro Brasil, L.L.C.
Rural/Metro Canadian Holdings, Inc.
Rural/Metro Communications Services, Inc.
Rural/Metro Corporation, an Arizona corporation
Rural/Metro Corporation of Florida
Rural/Metro Corporation of Tennessee
Rural/Metro Fire Dept., Inc.
Rural/Metro International, Inc.
Rural/Metro Mid-Atlantic, Inc.
Rural/Metro of Alabama, Inc.
Rural/Metro of Argentina, Inc.
Rural/Metro of Arkansas, Inc.
Rural/Metro of Arlington, Inc.
Rural/Metro of Brasil, Inc.
Rural/Metro of California, Inc.
Rural/Metro of Central Alabama, Inc.
Rural/Metro of Central Ohio, Inc.
Rural/Metro of Georgia, Inc.
Rural/Metro of Indiana, Inc.
Rural/Metro of Indiana, L.P.
Rural/Metro of Indiana II, L.P.
Rural/Metro of Kentucky, Inc.
Rural/Metro of Mississippi, Inc.
Rural/Metro of Nebraska, Inc.
Rural/Metro of New York, Inc.
Rural/Metro of North Florida, Inc.
Rural/Metro of Ohio, Inc.
Rural/Metro of Oregon, Inc.
Rural/Metro of Rochester, Inc.
Rural/Metro of San Diego, Inc.
Rural/Metro of South Carolina, Inc.
Rural/Metro of South Dakota, Inc.
Rural/Metro of Tennessee, L.P.
Rural/Metro of Texas, Inc.
Rural/Metro of Texas, L.P.
Rural/Metro Protection Services, Inc.
Rural/Metro Texas Holdings, Inc.
SW General, Inc.
Sioux Falls Ambulance, Inc.
South Georgia Emergency Medical Services, Inc.
Southwest Ambulance of Casa Grande, Inc.
Southwest Ambulance of Southeastern Arizona, Inc.
Southwest Ambulance of Tucson, Inc.
Southwest General Services, Inc.
The Aid Ambulance Company, Inc.
The Aid Company, Inc.
The Western New York Emergency Medical Services Training Institute Inc.
Towns Ambulance Service, Inc.
United Medical Services, Inc.
Valley Fire Service, Inc.
W & W Leasing Company, Inc.
<PAGE> 1
EXHIBIT 25
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
RURAL/METRO CORPORATION
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE 86-0746929
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
8401 EAST INDIAN SCHOOL ROAD
SCOTTSDALE, ARIZONA 85251
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
DEBT SECURITIES
(TITLE OF INDENTURE SECURITIES)
<PAGE> 2
ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO
THE TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING
AUTHORITY TO WHICH IT IS SUBJECT.
Comptroller of the Currency, Washington, D.C.; Federal Deposit
Insurance Corporation, Washington, D.C.; and The Board of
Governors of the Federal Reserve System, Washington D.C.
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST
POWERS.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE
OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A PART OF
THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the trustee now
in effect.*
2. A copy of the certificates of authority of the trustee to
commence business.*
3. A copy of the authorization of the trustee to exercise
corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by Section 321(b) of
the Act.
2
<PAGE> 3
7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all
in the City of Chicago and State of Illinois, on the 29th day of April,
1998.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
BY /s/ Sandra L. Caruba
---------------------------------
SANDRA L. CARUBA
VICE PRESIDENT
* EXHIBIT 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS BEARING
IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK OF
CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA INC., FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 2,
1996 (REGISTRATION NO. 333-14201).
3
<PAGE> 4
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
April 29, 1998
Securities and Exchange Commission
Washington, D.C. 20549
Ladies and Gentlemen:
In connection with the qualification of the indenture between Rural/Metro
Corporation and The First National Bank of Chicago, as Trustee, the undersigned,
in accordance with Section 321(b) of the Trust Indenture Act of 1939, as
amended, hereby consents that the reports of examinations of the undersigned,
made by Federal or State authorities authorized to make such examinations, may
be furnished by such authorities to the Securities and Exchange Commission upon
its request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
BY: /s/ Sandra L. Caruba
--------------------------------
SANDRA L. CARUBA
VICE PRESIDENT
4
<PAGE> 5
EXHIBIT 7
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for December 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
C400
Dollar Amounts in ------------
Thousands RCFD BIL MIL THOU
--------- ---- ------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule RC-A):
a. Noninterest-bearing balances and currency and coin(1)................ 0081 4,267,336 1.a.
b. Interest-bearing balances(2)......................................... 0071 6,893,837 1.b.
2. Securities
a. Held-to-maturity securities (from Schedule RC-B, column A)........... 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)......... 1773 5,691,722 2.b.
3. Federal funds sold and securities purchased under agreements to
resell 1350 6,339,940 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)................................................................... RCFD 2122 25,202,984 4.a.
b. LESS: Allowance for loan and lease losses............................ RCFD 3123 419,121 4.b.
c. LESS: Allocated transfer risk reserve................................ RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)................................. 2125 24,783,863 4.d.
5. Trading assets (from Schedule RD-D)..................................... 3545 6,703,332 5.
6. Premises and fixed assets (including capitalized leases)................ 2145 743,426 6.
7. Other real estate owned (from Schedule RC-M)............................ 2150 7,727 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M).......................................... 2130 134,959 8.
9. Customers' liability to this bank on acceptances outstanding............ 2155 644,340 9.
10. Intangible assets (from Schedule RC-M).................................. 2143 268,501 10.
11. Other assets (from Schedule RC-F)....................................... 2160 2,004,432 11.
12. Total assets (sum of items 1 through 11)................................ 2170 58,483,415 12.
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
5
<PAGE> 6
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands Bil Mil Thou
--------- ------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)...................................... RCON 2200 21,756,846 13.a
(1) Noninterest-bearing(1)....................................... RCON 6631 9,197,227 13.a.1
(2) Interest-bearing............................................. RCON 6636 559,619 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)............................... RCFN 2200 14,811,410 13.b.
(1) Noninterest bearing.......................................... RCFN 6631 332,801 13.b.1
(2) Interest-bearing............................................. RCFN 6636 14,478,609 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 4,535,422 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 43,763 15.a
b. Trading Liabilities (from Schedule RC-D)......................... RCFD 3548 6,523,239 15.b
16. Other borrowed money:
a. With a remaining maturity of one year or less.................... RCFD 2332 1,360,165 16.a
b. With a remaining maturity of more than one year through
three years...................................................... A547 576,492 16.b
. c. With a remaining maturity of more than three years .............. A548 703,981 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding............. RCFD 2920 644,341 18
19. Subordinated notes and debentures (2)............................... RCFD 3200 1,700,000 19
20. Other liabilities (from Schedule RC-G).............................. RCFD 2930 1,322,077 20
21. Total liabilities (sum of items 13 through 20)...................... RCFD 2948 53,987,736 21
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus....................... RCFD 3838 0 23
24. Common stock........................................................ RCFD 3230 200,858 24
25. Surplus (exclude all surplus related to preferred stock)............ RCFD 3839 2,999,001 25
26. a. Undivided profits and capital reserves........................... RCFD 3632 1,273,239 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities....................................................... RCFD 8434 24,096 26.b.
27. Cumulative foreign currency translation adjustments................. RCFD 3284 (1,515) 27
28. Total equity capital (sum of items 23 through 27)................... RCFD 3210 4,495,679 28
29. Total liabilities and equity capital (sum of items 21 and 28)....... RCFD 3300 58,483,415 29
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<CAPTION>
Number
<S> <C> <C> <C>
1. Indicate in the box at the right the number of the statement below
that best describes the most comprehensive level of auditing work
performed for the bank by independent external auditors as of any
date during 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 6724 N/A. M.1
</TABLE>
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified
public accounting firm which submits a report on the consolidated holding
company (but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors
(may be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
6
<PAGE> 1
Exhibit 99
LETTER OF TRANSMITTAL
RURAL/METRO CORPORATION
OFFER TO EXCHANGE 7 7/8% SENIOR NOTES DUE 2008,
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT")
FOR
7 7/8% SENIOR NOTES DUE 2008
PURSUANT TO THE PROSPECTUS DATED
, 1998
---------------------
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT
5:00 P.M., E.D.T., ON , 1998, UNLESS THE EXCHANGE OFFER IS EXTENDED
---------------------
DELIVER TO THE FIRST NATIONAL BANK OF CHICAGO
(THE "EXCHANGE AGENT")
<TABLE>
<S> <C>
The First National Bank of Chicago BY FACSIMILE TRANSMISSION
One North State Street (FOR ELIGIBLE INSTITUTIONS ONLY):
Ninth Floor, Suite 0126 (312) 407-1708
Chicago, Illinois 60670-0126 Confirm by Telephone:
Attention: Corporate Trust Administration (312) 732-4000
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE OTHER THAN AS SET FORTH ABOVE WILL
NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
The undersigned hereby acknowledges receipt of the Prospectus dated ,
1998 (the "Prospectus") of Rural/Metro Corporation, a Delaware corporation (the
"Company"), and this Letter of Transmittal, which together constitute the
Company's offer (the "Exchange Offer") to exchange up to an aggregate principal
amount of $150,000,000 of its 7 7/8% Senior Notes due 2008 (the "Exchange
Notes," which have been registered under the Securities Act, pursuant to a
Registration Statement of which the Prospectus is a part), for a like principal
amount of its outstanding 7 7/8% Senior Notes due 2008 (the "Outstanding Notes"
and together with the Exchange Notes, the "Notes"). Capitalized terms used but
not defined herein have the meanings given to them in the Prospectus.
YOUR BANK OR BROKER CAN ASSIST YOU IN COMPLETING THIS FORM. THE
INSTRUCTIONS INCLUDED WITH THIS LETTER OF TRANSMITTAL MUST BE FOLLOWED.
QUESTIONS RELATING TO THE PROCEDURE FOR TENDERING AND REQUESTS FOR ADDITIONAL
COPIES OF THE PROSPECTUS AND THIS LETTER OF TRANSMITTAL MAY BE DIRECTED TO THE
EXCHANGE AGENT. QUESTIONS RELATING TO THE EXCHANGE OFFER AND REQUESTS FOR
ASSISTANCE OR FOR ADDITIONAL COPIES OF THE PROSPECTUS AND THIS LETTER OF
TRANSMITTAL MAY BE DIRECTED TO THE COMPANY.
<PAGE> 2
This Letter of Transmittal is to be completed by a holder of Outstanding
Notes if (i) certificates are to be forwarded herewith, (ii) delivery of
Outstanding Notes is to be made by book-entry transfer to an account maintained
by the Exchange Agent at The Depository Trust Company (the "Book-Entry Transfer
Facility"), pursuant to the procedures set forth in "The Exchange Offer --
Procedures for Tendering" in the Prospectus or (iii) tender of the Outstanding
Notes is to be made according to the guaranteed delivery procedures described in
the Prospectus under the caption "The Exchange Offer -- Guaranteed Delivery
Procedures." See Instruction 2. Delivery of documents to a book-entry transfer
facility does not constitute delivery to the Exchange Agent. It is understood
that participants in the Book-Entry Transfer Facility's book-entry system will,
in accordance with the Book-Entry Transfer Facility's Automated Tender Offer
Program procedures and in lieu of physical delivery to the Exchange Agent of a
Letter of Transmittal, electronically acknowledge receipt of, and agreement to
be bound by, the terms of this Letter of Transmittal.
Unless the context otherwise requires, the term "Holder" as used herein
with respect to the Exchange Offer means any person in whose name Outstanding
Notes are registered on the books of the Company or any other person who has
obtained a properly completed bond power from the registered holder. The
undersigned has completed, executed and delivered this Letter of Transmittal to
indicate the action the undersigned desires to take with respect to the Exchange
Offer. Holders who wish to tender their Outstanding Notes must complete this
Letter of Transmittal in its entirety.
Listed below are the Outstanding Notes to which this Letter of Transmittal
relates. If the space provided below is inadequate, the certificate numbers and
principal amounts should be listed on a separate signed schedule affixed hereto.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OUTSTANDING NOTES TENDERED HEREBY
- ------------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) PRINCIPAL AMOUNT PRINCIPAL
EXACTLY AS NAME(S) APPEAR(S) ON NOTES CERTIFICATE REPRESENTED BY AMOUNT
(PLEASE FILL IN) NUMBERS* OUTSTANDING NOTES TENDERED**
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
Total
- ------------------------------------------------------------------------------------------------------------------------
* Need not be completed if Outstanding Notes are being tendered by book-entry transfer.
** Unless otherwise indicated, the Holder will be deemed to have tendered the
full aggregate principal amount represented by such Outstanding Notes. All
tenders must be in integral multiples of $1,000.
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
[ ]CHECK HERE IF TENDERED OUTSTANDING NOTES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH A
BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING:
Name of Tendering Institution
-----------------------------------------------------------------------------
Account Number
-----------------------------------------------------------------------------
Transaction Code Number
-----------------------------------------------------------------------------
Holders whose Notes are not immediately available or who cannot deliver
their Notes and all other documents required hereby to the Exchange Agent on or
prior to the Expiration Date must tender their Notes according to the guaranteed
delivery procedure set forth in the Prospectus under the caption "The Exchange
Offer -- Guaranteed Delivery Procedures." See Instruction 2.
2
<PAGE> 3
[ ]CHECK HERE IF TENDERED OUTSTANDING NOTES ARE BEING DELIVERED PURSUANT TO A
NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND
COMPLETE THE FOLLOWING:
Name(s) of Registered Holder(s)
----------------------------------------------------------------------------
Date of Execution of Notice of Guaranteed Delivery
-----------------------------------------------------------------
Name of Eligible Institution that Guaranteed Delivery
-----------------------------------------------------------------
IF DELIVERED BY BOOK-ENTRY TRANSFER, COMPLETE THE FOLLOWING:
Account Number
-----------------------------------------------------------------------------
Transaction Code Number
-----------------------------------------------------------------------------
[ ]CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL
COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS
THERETO.
Name
-----------------------------------------------------------------------------
Address
-----------------------------------------------------------------------------
3
<PAGE> 4
SPECIAL ISSUANCE INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 5)
To be completed ONLY if the Exchange Notes and/or Outstanding Notes not
exchanged are to be issued in the name of and sent to someone other than the
undersigned, or if Outstanding Notes delivered by book-entry transfer which are
not accepted for exchange or Exchange Notes are to be returned by credit to an
account maintained at the Book-Entry Transfer Facility other than the account
indicated above.
Issue Exchange Notes and/or Outstanding Notes to:
Name(s):
- --------------------------------------------
(Please Type or Print)
- --------------------------------------------------------
(Please Type or Print)
Address:
- ----------------------------------------------
- --------------------------------------------------------
(Including Zip Code)
- --------------------------------------------------------
(Tax Identification or Social Security No.)
[ ] Credit unexchanged Outstanding Notes
and/or Exchange Notes delivered by
book-entry transfer to the Book-Entry
Transfer Facility account set forth below.
- --------------------------------------------------------
(Book-Entry Transfer Facility
Account Number, if applicable)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 5)
To be completed ONLY if the Exchange Notes and/or Outstanding Notes not
exchanged are to be sent to someone other than the undersigned, or to the
undersigned at an address other than that shown under "Description of
Outstanding Notes Tendered Hereby." Mail Exchange Notes and/or Outstanding Notes
to:
Name(s): --------------------------------------------
(Please Type or Print)
- --------------------------------------------------------
(Please Type or Print)
Address:
- ----------------------------------------------
- -------------------------------------------------------
(Including Zip Code)
IMPORTANT: THIS LETTER OR A FACSIMILE HEREOF (TOGETHER WITH THE CERTIFICATES FOR
OUTSTANDING NOTES OR A BOOK-ENTRY CONFIRMATION AND ALL OTHER REQUIRED DOCUMENTS
OR THE NOTICE OF GUARANTEED DELIVERY) MUST BE RECEIVED BY THE EXCHANGE AGENT
PRIOR TO 5:00 P.M., E.D.T., ON THE EXPIRATION DATE.
PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL
CAREFULLY BEFORE COMPLETING ANY BOX ABOVE.
4
<PAGE> 5
SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
Upon the terms and subject to the conditions of the Exchange Offer, the
undersigned hereby tenders to the Company the principal amount of the
Outstanding Notes indicated above. Subject to, and effective upon, the
acceptance for exchange of such Outstanding Notes tendered hereby, the
undersigned hereby exchanges, sells, assigns and transfers to, or upon the order
of, the Company all right, title and interest in and to such Outstanding Notes
as are being tendered hereby, including all rights to accrued and unpaid
interest thereon. The undersigned hereby irrevocably constitutes and appoints
the Exchange Agent its true and lawful agent and attorney-in-fact with full
power of substitution (with full knowledge that said Exchange Agent acts as the
agent of the Company in connection with the Exchange Offer) to cause the
Outstanding Notes to be assigned, sold, transferred and exchanged. The Power of
Attorney granted in this paragraph shall be deemed irrevocable from and after
the Expiration Date and coupled with an interest.
The undersigned represents and warrants that it has full power and
authority to tender, sell, exchange, assign and transfer the Outstanding Notes
and to acquire Exchange Notes issuable upon the exchange of such tendered
Outstanding Notes, and that when the same are accepted for exchange, the Company
will acquire good and unencumbered title to the tendered Outstanding Notes, free
and clear of all liens, restrictions, charges and encumbrances and not subject
to any adverse claim.
The undersigned represents to the Company that (i) the Exchange Notes
acquired pursuant to the Exchange Offer are being obtained in the ordinary
course of business of the person receiving such Exchange Notes, whether or not
such person is the undersigned, and (ii) neither the undersigned nor any such
other person is engaged in, or intends to engage in, or has an arrangement or
understanding with any person to participate in the distribution (within the
meaning of the Securities Act) of such Exchange Notes. If the undersigned or the
person receiving the Exchange Notes covered hereby is a broker-dealer that is
receiving the Exchange Notes for its own account in exchange for Outstanding
Notes that were acquired as a result of market-making activities or other
trading activities, the undersigned acknowledges that it or such other person
will deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Notes. The undersigned and any such
other person acknowledge that, if they are participating in the Exchange Offer
for the purpose of distributing the Exchange Notes, (i) they cannot rely on the
position of the staff of the Securities and Exchange Commission enunciated in
Exxon Capital Holdings Corporation (available April 13, 1989) or similar
no-action letters and, in the absence of an exemption therefrom, must comply
with the registration and prospectus delivery requirements of the Securities Act
in connection with the resale transaction and (ii) failure to comply with such
requirements in such instance could result in the undersigned or any such other
person incurring liability under the Securities Act for which such persons are
not indemnified by the Company. If the undersigned or the person receiving the
Exchange Notes covered by this letter is an affiliate (as defined under Rule 405
of the Securities Act) of the Company, the undersigned represents to the Company
that the undersigned understands and acknowledges that such Exchange Notes may
not be offered for resale, resold or otherwise transferred by the undersigned or
such other person without registration under the Securities Act or an exemption
therefrom.
The undersigned also warrants that it will, upon request, execute and
deliver any additional documents deemed by the Exchange Agent or the Company to
be necessary or desirable to complete the exchange, sale, assignment and
transfer of tendered Outstanding Notes or transfer ownership of such Outstanding
Notes on the account books maintained by a Book-Entry Transfer Facility. The
undersigned further agrees that acceptance of any tendered Outstanding Notes by
the Company and the issuance of Exchange Notes in exchange therefor shall
constitute performance in full by the Company of its obligations under the
Registration Rights Agreement and that the Company shall have no further
obligations or liabilities thereunder for the registration of the Outstanding
Notes or the Exchange Notes.
The Exchange Offer is subject to certain conditions, including those set
forth in the Prospectus under the caption "The Exchange Offer." The undersigned
recognizes that as a result of these conditions (which may be waived, in whole
or in part, by the Company), as more particularly set forth in the Prospectus,
the Company may not be required to exchange any of the Outstanding Notes
tendered hereby and, in such event, the Outstanding Notes not exchanged will be
returned to the undersigned at the address shown below the signature of the
undersigned.
5
<PAGE> 6
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity of the undersigned and every obligation of the undersigned
hereunder shall be binding upon the heirs, personal representatives, successors,
assigns, executors, administrators, trustees in bankruptcy and legal
representatives of the undersigned. Tendered Outstanding Notes may be withdrawn
at any time prior to the Expiration Date only in accordance with the terms set
forth in the Prospectus under the caption "The Exchange Offer -- Withdrawal of
Tenders."
Unless otherwise indicated herein in the box entitled "Special Issuance
Instructions" above, please deliver the Exchange Notes (and, if applicable,
substitute certificates representing Outstanding Notes for any Outstanding Notes
not exchanged) in the name of the undersigned or, in the case of a book-entry
delivery of Outstanding Notes, please credit the account indicated above
maintained at the Book-Entry Transfer Facility. Similarly, unless otherwise
indicated under the box entitled "Special Delivery Instructions" above, please
send the Exchange Notes (and, if applicable, substitute certificates
representing Outstanding Notes for any Outstanding Notes not exchanged) to the
undersigned at the address shown above in the box entitled "Description of
Outstanding Notes Tendered Hereby."
IF OUTSTANDING NOTES ARE SURRENDERED BY HOLDER(S) THAT HAVE COMPLETED
EITHER THE BOX ENTITLED "SPECIAL ISSUANCE INSTRUCTIONS" OR THE BOX ENTITLED
"SPECIAL DELIVERY INSTRUCTIONS" IN THIS LETTER OF TRANSMITTAL, SIGNATURE(S) ON
THIS LETTER OF TRANSMITTAL MUST BE GUARANTEED BY AN ELIGIBLE INSTITUTION (SEE
INSTRUCTION 4).
6
<PAGE> 7
REGISTERED HOLDER(S) OF NOTES SIGN HERE (In addition
complete Substitute Form W-9 Below)
X
- -------------------------------------------------------------------------------
X
- -------------------------------------------------------------------------------
(Signature(s) of Registered Holder(s))
Must be signed by registered holder(s) exactly as name(s) appear(s) on the
Notes or on a security position listing as the owner of the Notes or by
person(s) authorized to become registered holder(s) by properly completed bond
powers transmitted herewith. If signature is by attorney-in-fact, trustee,
executor, administrator, guardian, officer of a corporation or other person
acting in a fiduciary capacity, please provide the following information (please
print or type):
Name and Capacity (full title):
- -------------------------------------------------------------------------------
Address (including zip):
- -------------------------------------------------------------------------------
Area Code and Telephone Number:
- -------------------------------------------------------------------------------
Dated:
- --------------------
SIGNATURE GUARANTEE
(If required -- See Instruction 4)
Authorized Signature:
- -------------------------------------------------------------------------------
(Signature of Representative of Signature Guarantor)
Name and Title:
- -------------------------------------------------------------------------------
Name of Firm:
- -------------------------------------------------------------------------------
Area Code and Telephone Number:
- -------------------------------------------------------------------------------
(Please print or type)
Dated:
- ---------------------
7
<PAGE> 8
INSTRUCTIONS
FORMING PART OF THE TERMS AND
CONDITIONS OF THE EXCHANGE OFFER
1. DELIVERY OF THIS LETTER OF TRANSMITTAL AND CERTIFICATES.
All physically delivered Outstanding Notes or any confirmation of a
book-entry transfer to the Exchange Agent's account at a Book-Entry Transfer
Facility of Outstanding Notes tendered by book-entry transfer, as well as a
properly completed and duly executed copy of this Letter of Transmittal or
facsimile thereof, and any other documents required by this Letter of
Transmittal, must be received by the Exchange Agent at any of its addresses set
forth herein on or prior to the Expiration Date (as defined in the Prospectus).
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, THE OUTSTANDING NOTES AND
ANY OTHER REQUIRED DOCUMENTS IS AT THE ELECTION AND RISK OF THE HOLDER, AND
EXCEPT AS OTHERWISE PROVIDED BELOW, THE DELIVERY WILL BE DEEMED MADE ONLY WHEN
ACTUALLY RECEIVED BY THE EXCHANGE AGENT. IF SUCH DELIVERY IS BY MAIL, IT IS
SUGGESTED THAT REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED,
BE USED.
No alternative, conditional, irregular or contingent tenders will be
accepted. All tendering Holders, by execution of this Letter of Transmittal (or
facsimile thereof), shall waive any right to receive notice of the acceptance of
the Outstanding Notes for exchange.
DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH HEREIN, OR INSTRUCTIONS VIA
FACSIMILE OTHER THAN AS SET FORTH HEREIN, WILL NOT CONSTITUTE A VALID DELIVERY.
2. GUARANTEED DELIVERY PROCEDURES.
Holders who wish to tender their Outstanding Notes, but whose Outstanding
Notes are not immediately available and thus cannot deliver their Outstanding
Notes, the Letter of Transmittal or any other required documents to the Exchange
Agent (or comply with the procedures for book-entry transfer) prior to the
Expiration Date, may effect a tender if:
(a) the tender is made through a member firm of a registered national
securities exchange or of the National Association of Securities Dealers,
Inc., a commercial bank or trust company having an office or correspondent
in the United States or an "eligible guarantor institution" within the
meaning of Rule 17Ad-15 under the Exchange Act (an "Eligible Institution");
(b) prior to the Expiration Date, the Exchange Agent receives from
such Eligible Institution a properly completed and duly executed Notice of
Guaranteed Delivery (by facsimile transmission, mail or hand delivery)
setting forth the name and address of the Holder, the registration
number(s) of such Outstanding Notes and the principal amount of Outstanding
Notes tendered, stating that the tender is being made thereby and
guaranteeing that, within five Nasdaq Stock Market trading days after the
Expiration Date, the Letter of Transmittal (or facsimile thereof), together
with the Outstanding Notes (or a confirmation of book-entry transfer of
such Outstanding Notes into the Exchange Agent's account at the Book-Entry
Transfer Facility) and any other documents required by the Letter of
Transmittal, will be deposited by the Eligible Institution with the
Exchange Agent; and
(c) such properly completed and executed Letter of Transmittal (or
facsimile thereof), as well as all tendered Outstanding Notes in proper
form for transfer (or a confirmation of book-entry transfer of such
Outstanding Notes into the Exchange Agent's account at the Book-Entry
Transfer Facility) and all other documents required by the Letter of
Transmittal, are received by the Exchange Agent within five Nasdaq Stock
Market trading days after the Expiration Date.
Upon request to the Exchange Agent, a Notice of Guaranteed Delivery will be
sent to Holders who wish to tender their Outstanding Notes according to the
guaranteed delivery procedures set forth above. Any holder who wishes to tender
Outstanding Notes pursuant to the guaranteed delivery procedures described above
must ensure that the Exchange Agent receives the Notice of Guaranteed Delivery
relating to such Outstanding Notes prior to the Expiration Date. Failure to
complete the guaranteed delivery procedures outlined above will not, of itself,
affect the validity or effect a revocation of any Letter of Transmittal form
properly completed and executed by a Holder who attempted to use the guaranteed
delivery procedures.
8
<PAGE> 9
3. PARTIAL TENDERS (NOT APPLICABLE TO HOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER); WITHDRAWALS.
If less than the entire principal amount of Outstanding Notes evidenced by
a submitted certificate is tendered, the tendering holder should fill in the
principal amount tendered in the column entitled "Principal Amount Tendered" of
the box entitled "Description of Outstanding Notes Tendered Hereby." A newly
issued Outstanding Note for the principal amount of Outstanding Notes submitted
but not tendered will be sent to such holder as soon as practicable after the
Expiration Date. All Outstanding Notes delivered to the Exchange Agent will be
deemed to have been tendered in full unless otherwise indicated. Tenders of
Outstanding Notes will be accepted only in integral multiples of $1,000.
Outstanding Notes tendered pursuant to the Exchange Offer may be withdrawn
at any time prior to the Expiration Date, after which tenders of Outstanding
Notes are irrevocable. To be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Exchange Agent.
Any such notice of withdrawal must (i) specify the name of the person having
deposited the Outstanding Notes to be withdrawn (the "Depositor"), (ii) identify
the Outstanding Notes to be withdrawn (including the registration number(s) and
principal amount of such Outstanding Notes, or, in the case of Outstanding Notes
transferred by book-entry transfer, the name and number of the account at the
Book-Entry Transfer Facility to be credited), (iii) be signed by the Holder in
the same manner as the original signature on this Letter of Transmittal
(including any required signature guarantees) or be accompanied by documents of
transfer sufficient to have the Trustee with respect to the Outstanding Notes
register the transfer of such Outstanding Notes into the name of the person
withdrawing the tender and (iv) specify the name in which any such Outstanding
Notes are to be registered, if different from that of the Depositor. All
questions as to the validity, form and eligibility (including time of receipt)
of such notices will be determined by the Company, whose determination shall be
final and binding on all parties. Any Outstanding Notes so withdrawn will be
deemed not to have been validly tendered for purposes of the Exchange Offer and
no Exchange Notes will be issued with respect thereto unless the Outstanding
Notes so withdrawn are validly retendered. Any Outstanding Notes that have been
tendered but not accepted for exchange will be returned to the Holder thereof
without cost to such Holder as soon as practicable after withdrawal, rejection
of tender or termination of the Exchange Offer.
4. SIGNATURE ON THIS LETTER OF TRANSMITTAL; WRITTEN INSTRUMENTS AND
ENDORSEMENTS; GUARANTEE OF SIGNATURES.
If this Letter of Transmittal (or facsimile hereof) is signed by the
registered holder(s) of the Outstanding Notes tendered hereby, the signature
must correspond with the name(s) as written on the face of the certificates
without alteration or enlargement or any change whatsoever. If this Letter of
Transmittal is signed by a participant in the Book-Entry Transfer Facility, the
signature must correspond with the name as it appears on the security position
listing as the Holder of the Outstanding Notes.
If any of the Outstanding Notes tendered hereby are owned of record by two
or more joint owners, all such owners must sign this Letter of Transmittal.
If a number of Outstanding Notes registered in different names are
tendered, it will be necessary to complete, sign and submit as many separate
copies of this Letter of Transmittal as there are different registrations of
Outstanding Notes.
Signatures on this Letter of Transmittal or a notice of withdrawal, as the
case may be, must be guaranteed by an Eligible Institution unless the
Outstanding Notes tendered hereby are tendered (i) by a registered holder who
has not completed the box entitled "Special Registration Instructions" or
"Special Delivery Instructions" on the Letter of Transmittal or (ii) for the
account of an Eligible Institution.
If this Letter of Transmittal is signed by the registered holder or holders
of Outstanding Notes (which term, for the purposes described herein, shall
include a participant in the Book-Entry Transfer Facility whose name appears on
a security listing as the holder of the Outstanding Notes) listed and tendered
hereby, no endorsements of the tendered Outstanding Notes or separate written
instruments of transfer or exchange are required. In any other case, the
registered holder (or acting Holder) must either properly endorse the
Outstanding Notes or transmit properly completed bond powers with this Letter of
Transmittal (in either case, executed exactly as the name(s) of the registered
holder(s) appear(s) on the Outstanding Notes, and, with respect to a participant
in the Book-Entry Transfer Facility whose name appears on a security position
listing as the owner of Outstanding Notes, exactly as the name of the
participant appears on such security position listing), with the signature on
the Outstanding Notes or bond power guaranteed by an Eligible Institution
(except where the Outstanding Notes are tendered for the account of an Eligible
Institution).
9
<PAGE> 10
If this Letter of Transmittal, any certificates or separate written
instruments of transfer or exchange are signed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or others
acting in a fiduciary or representative capacity, such persons should so
indicate when signing, and, unless waived by the Company, proper evidence
satisfactory to the Company of their authority so to act must be submitted.
5. SPECIAL REGISTRATION AND DELIVERY INSTRUCTIONS.
Tendering Holders should indicate, in the applicable box, the name and
address (or account at the Book-Entry Transfer Facility) in which the Exchange
Notes or substitute Outstanding Notes for principal amounts not tendered or not
accepted for exchange are to be issued (or deposited), if different from the
names and addresses or accounts of the person signing this Letter of
Transmittal. In the case of issuance in a different name, the employer
identification number or social security number of the person named must also be
indicated and the tendering Holder should complete the applicable box.
If no instructions are given, the Exchange Notes (and any Outstanding Notes
not tendered or not accepted) will be issued in the name of and sent to the
acting Holder of the Outstanding Notes or deposited at such Holder's account at
the Book-Entry Transfer Facility.
6. TRANSFER TAXES.
The Company shall pay all transfer taxes, if any, applicable to the
transfer and exchange of Outstanding Notes to it or its order pursuant to the
Exchange Offer. If a transfer tax is imposed for any other reason other than the
transfer and exchange of Outstanding Notes to the Company or its order pursuant
to the Exchange Offer, the amount of any such transfer taxes (whether imposed on
the registered Holder or any other person) will be payable by the tendering
Holder. If satisfactory evidence of payment of such taxes or exception therefrom
is not submitted herewith, the amount of such transfer taxes will be billed
directly to such tendering Holder.
Except as provided in this Instruction 6, it will not be necessary for
transfer stamps to be affixed to the Outstanding Notes listed in this Letter of
Transmittal.
7. WAIVER OF CONDITIONS.
The Company reserves the absolute right to waive, in whole or in part, any
of the conditions to the Exchange Offer set forth in the Prospectus.
8. MUTILATED, LOST, STOLEN OR DESTROYED NOTES.
Any Holder whose Outstanding Notes have been mutilated, lost, stolen or
destroyed should contact the Exchange Agent at the address indicated above for
further instructions.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES.
Questions relating to the procedure for tendering as well as requests for
additional copies of the Prospectus and this Letter of Transmittal may be
directed to the Exchange Agent at the address and telephone number(s) set forth
above. In addition, all questions relating to the Exchange Offer, as well as
requests for assistance or additional copies of the Prospectus and this Letter
of Transmittal, may be directed to the Company at 8401 East Indian School Road,
Scottsdale, Arizona 85251, Attention: Dean P. Hoffman (telephone: (602)
994-3886).
10. VALIDITY AND FORM.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance of tendered Outstanding Notes and withdrawal of tendered
Outstanding Notes will be determined by the Company in its sole discretion,
which determination will be final and binding. The Company reserves the absolute
right to reject any and all Outstanding Notes not properly tendered or any
Outstanding Notes the Company's acceptance of which would, in the opinion of
counsel for the Company, be unlawful. The Company also reserves the right to
waive any defects, irregularities or conditions of tender as to particular
Outstanding Notes. The Company's interpretation of the terms and conditions of
the Exchange Offer (including the instructions in this Letter of Transmittal)
will be final and binding on all parties. Unless waived, any
10
<PAGE> 11
defects or irregularities in connection with tenders of Outstanding Notes must
be cured within such time as the Company shall determine. Although the Company
intends to notify Holders of defects or irregularities with respect to tenders
of Outstanding Notes, neither the Company, the Exchange Agent nor any other
person shall incur any liability for failure to give such notification. Tenders
of Outstanding Notes will not be deemed to have been made until such defects or
irregularities have been cured or waived. Any Outstanding Notes received by the
Exchange Agent that are not properly tendered and as to which the defects or
irregularities have not been cured or waived will be returned by the Exchange
Agent to the tendering Holders as soon as practicable following the Expiration
Date.
IMPORTANT TAX INFORMATION
Under federal income tax law, a Holder tendering Outstanding Notes is
required to provide the Exchange Agent with such Holder's correct TIN on
Substitute Form W-9 below. If such Holder is an individual, the TIN is the
Holder's social security number. The Certificate of Awaiting Taxpayer
Identification Number should be completed if the tendering Holder has not been
issued a TIN and has applied for a number or intends to apply for a number in
the near future. If the Exchange Agent is not provided with the correct TIN, the
Holder may be subject to a $50 penalty imposed by the Internal Revenue Service.
In addition, payments that are made to such Holder with respect to tendered
Outstanding Notes may be subject to backup withholding.
Certain Holders (including, among others, all corporations and certain
foreign individuals and foreign entities) are not subject to these backup
withholding and reporting requirements. In order for such a Holder to qualify as
an exempt recipient, that holder must submit to the Exchange Agent a properly
completed Internal Revenue Service Form W-8, signed under penalties of perjury,
attesting to that Holder's exempt status. Such forms can be obtained from the
Exchange Agent.
If backup withholding applies, the Exchange Agent is required to withhold
31% of any amounts otherwise payable to the Holder. Backup withholding is not an
additional tax. Rather, the tax liability of persons subject to backup
withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained from the Internal
Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments that are made to a Holder with
respect to Outstanding Notes tendered for exchange, the Holder is required to
notify the Exchange Agent of his or her correct TIN by completing the form
herein certifying that the TIN provided on Substitute Form W-9 is correct (or
that such Holder is awaiting a TIN) and that (i) such Holder has not been
notified by the Internal Revenue Service that he or she is subject to backup
withholding as a result of failure to report all interest or dividends or (ii)
the Internal Revenue Service has notified such Holder that he or she is no
longer subject to backup withholding.
WHAT NUMBER TO GIVE THE EXCHANGE AGENT
Each Holder is required to give the Exchange Agent the social security
number or employer identification number of the record Holder(s) of the
Outstanding Notes. If Outstanding Notes are in more than one name or are not in
the name of the actual Holder, consult the Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 included herewith for
additional guidance on which number to report.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
If the tendering holder has not been issued a TIN and has applied for a
number or intends to apply for a number in the near future, write "Applied For"
in the space for the TIN on Substitute Form W-9, sign and date the form and the
Certificate of Awaiting Taxpayer Identification Number and return them to the
Exchange Agent. If such certificate is completed and the Exchange Agent is not
provided with the TIN within 60 days, the Exchange Agent will withhold 31% of
all payments made thereafter until a TIN is provided to the Exchange Agent.
11
<PAGE> 12
IMPORTANT: THIS LETTER OF TRANSMITTAL OR A MANUALLY SIGNED FACSIMILE THEREOF
(TOGETHER WITH OUTSTANDING NOTES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL
OTHER REQUIRED DOCUMENTS) OR A NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY
THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE.
12
<PAGE> 13
<TABLE>
<S> <C>
- -------------------------------------------------------------------------------------------------
Name (if joint names, list first and circle the name of the
person or entity whose number you enter in Part 1 below. See
SUBSTITUTE instructions if your name has changed.)
FORM W-9 --------------------------------------------------------------
Address
--------------------------------------------------------------
City, State and Zip Code
--------------------------------------------------------------
List account number(s) here (optional)
--------------------------------------------------------------
Department of the Treasury PART 1 -- PLEASE PROVIDE YOUR TAXPAYER IDENTIFICATION NUMBER
Internal Revenue Service ("TIN") IN THE BOX AT RIGHT AND CERTIFY BY SIGNING AND DATING
BELOW
--------------------------------------------------------------
PART 2 -- Check the box if you are NOT subject to backup
withholding under the provisions of section 3408(a)(1)(C) of
the Internal Revenue Code because (1) you have not been
notified that you are subject to backup withholding as a result
PAYER'S REQUEST FOR of failure to report all interest of dividends or (2) the
TAXPAYER IDENTIFICATION Internal Revenue Service has notified you that you are no longer
NUMBER (TIN) subject to backup withholding. [ ]
--------------------------------------------------------------
CERTIFICATION -- UNDER THE PENALTIES OF PERJURY, I CERTIFY
THAT THE INFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT
AND COMPLETE.
SIGNATURE --------------------------- Date------------
- ------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
Name (if joint names, list first an
person or entity whose number you enter in Part 1 below. See
SUBSTITUTE instructions if your name has changed.)
FORM W-9 --------------------------------------------------------------
Address
--------------------------------------------------------------
City, State and Zip Code
--------------------------------------------------------------
List account number(s) here (optional)
--------------------------------------------------------------
Department of the Treasury Social Security Number
Internal Revenue Service or TIN
--------------------------------------------------------------
PART 2 -- Check the box if you are NOT subject to backup
withholding under the provisions of section 3408(a)(1)(C) of
the Internal Revenue Code because (1) you have not been
notified that you are subject to backup withholding as a result
PAYER'S REQUEST FOR of failure to report all interest of dividends or (2) the
TAXPAYER IDENTIFICATION Internal Revenue Service has notified you that you are no longer
NUMBER (TIN) subject to backup withholding. [ ]
--------------------------------------------------------------
PART 3 --
Awaiting TIN [ ]
- -------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE EXCHANGE OFFER. PLEASE
REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART
3 OF SUBSTITUTE FORM W-9:
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and either (a) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office, or (b)
I intend to mail or deliver an application in the near future. I understand that
if I do not provide a taxpayer identification number to the Exchange Agent
within 60 days, 31% of all reportable payments made to me thereafter will be
withheld until I provide a number to the Exchange Agent.
Signature
- -------------------------------------------------
Date
- ------------------------------------------------------
13
<PAGE> 14
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER. -- Social Security numbers have nine digits separated by two hyphens:
i.e. 000-00-0000. Employer identification numbers have nine digits separated by
only one hyphen: i.e. 00-0000000. The table below will help determine the number
to give the payer.
- ---------------------------------------------------------
---------------------------------------------------------
<TABLE>
<CAPTION>
FOR THIS TYPE OF ACCOUNT: GIVE THE SOCIAL SECURITY
NUMBER OF --
- --------------------------------------------------------------------------------
FOR THIS TYPE OF ACCOUNT: GIVE THE EMPLOYER IDENTIFICATION
NUMBER OF --
- --------------------------------------------------------------------------------
<C> <S> <C>
1. An individual's account. The individual
2. Two or more individuals The actual owner of the account or,
(joint account) if combined funds, any one of the
Individuals(1)
3. Husband and wife (joint The actual owner of the account or,
(joint account) if joint funds, either person(1)
4. Custodian account of a minor The minor(2)
(Uniform Gift to Minors Act)
5. Adult and minor The adult or, if the minor is the
(joint account) only contributor, the minor(1)
6. Account in the name of The ward, minor, incompetent person(3)
or guardian or committee
designated ward, minor, or
incompetent person
7. a The usual revocable The grantor- trustee(1)
savings trust account
(grantor is also trustee)
b So-called trust account The actual owner(1)
that is not a legal or
valid trust under
State law
8. Sole proprietorship account The owner(4)
9. A valid trust, estate, or The legal entity (Do not furnish the
pension trust identifying number of the personal
representative or trustee unless the legal
entity itself is not designated in the
account title.)(5)
10. Corporate account The corporation
11. Religious, charitable, or The organization
educational organization
account
12. Partnership account held in The partnership
the name of the business
13. Association, club, or other The organization
tax-exempt organization
14. A broker or registered The broker or nominee
nominee
15. Account with the Department The public entity
of Agriculture in the name of
a public entity (such as a
State or local government,
school district, or prison)
that receives agricultural
program payments
</TABLE>
- -----------------------------------------------------------
---------------------------------------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
NOTE:If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE> 15
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include the
following:
- A corporation.
- A financial institution.
- An organization exempt from tax under section 510(a), or an individual
retirement plan, or a custodial account under section 403(6)(7).
- The United States or any agency or instrumentality thereof.
- A State, the District of Columbia, a possession of the United States, or any
subdivision or instrumentality thereof.
- A foreign government, a political subdivision of a foreign government, or any
agency or instrumentality thereof.
- An international organization or any agency, or instrumentality thereof.
- A registered dealer in securities or commodities registered in the U.S. or a
possession of the U.S.
- A real estate investment trust.
- A common trust fund operated by a bank under section 584(a)
- An exempt charitable remainder trust under section 664, or a non-exempt trust
described in section 4947.
- An entity registered at all times under the Investment Company Act of 1940.
- A foreign central bank of issue.
- A future commission merchant registered with the Commodity Futures Trading
Commission.
- A middleman known in the investment community as a nominee or listed in the
most recent publication of the American Society of Corporate Secretaries,
Inc. Nominee List.
Payments of dividends and patronage dividends not generally subject to backup
withholding include the following:
- Payments to nonresident aliens subject to withholding under section 1441.
- Payments to partnerships not engaged in a trade or business in the U.S. and
which have at least one nonresident partner.
- Payments of patronage dividends where the amount received is not paid in
money.
- Payments made by certain foreign organizations.
Payments of interest not generally subject to backup withholding include the
following:
- Payments of interest on obligations issued by individuals.
Note: You may be subject to backup withholding if this interest is $600 or more
and is paid in the course of the payer's trade or business and you have not
provided your correct taxpayer identification number to the payer.
- Payments of tax-exempt interest (including exempt-interest dividends under
section 852).
- Payments described in section 6049(b)(5) to non-resident aliens.
- Payments on tax-free covenant bonds under section 1451.
- Payments made by certain foreign organizations.
- Mortgage interest paid to the payer.
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
Certain payments other than interest, dividends, and patronage dividends, that
are not subject to information reporting are also not subject to backup
withholding. For details, see section 6041, 6041A(a), 6042, 6044, 6045, 6049,
6050A, and 6050N and their regulations.
PRIVACY ACT NOTICE. -- Section 6109 requires most recipients of dividend,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to the IRS. IRS uses the numbers for identification
purposes and to help verify the accuracy of your return. Payers must be given
the numbers whether or not recipients are required to file tax returns. Payers
must generally withhold 31% of taxable interest, dividend, and certain other
payments to a payee who does not furnish a taxpayer identification number to a
payer. Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. -- If you
fail to furnish your taxpayer identification number to a payer, you are subject
to a penalty of $50 for each such failure unless your failure is due to
reasonable cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. -- If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION. -- Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX
CONSULTANT OR THE INTERNAL REVENUE SERVICE
<PAGE> 16
FORM OF GUARANTEED DELIVERY
NOTICE OF GUARANTEED DELIVERY FOR
RURAL/METRO CORPORATION
This form or one substantially equivalent hereto must be used to accept the
Exchange Offer of Rural/Metro Corporation, a Delaware corporation (the
"Company"), made pursuant to the Prospectus, dated , 1998 (the
"Prospectus"), if certificates for Outstanding Notes of the Company are not
immediately available or if the procedure for book-entry transfer cannot be
completed on a timely basis or time will not permit all required documents to
reach the Company prior to 5:00 p.m., E.D.T., on the Expiration Date of the
Exchange Offer. Such form may be delivered or transmitted by facsimile
transmission, mail or hand delivery to The First National Bank of Chicago (the
"Exchange Agent") as set forth below. Capitalized terms used but not defined
herein have the meanings given to them in the Prospectus.
Deliver To: The First National Bank of Chicago, Exchange Agent
The First National Bank of Chicago
One North State Street
Ninth Floor, Suite 0126
Chicago, Illinois 60670-0126
Attention: Corporate Trust Administration
By Facsimile:
(312) 407-1708
Confirm by Telephone:
(312) 732-4000
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE, OR
TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE OTHER THAN AS SET FORTH ABOVE, WILL
NOT CONSTITUTE A VALID DELIVERY.
<PAGE> 17
Ladies and Gentlemen:
Upon the terms and conditions set forth in the Prospectus and the
accompanying Letter of Transmittal, the undersigned hereby tenders to the
Company the principal amount of Outstanding Notes set forth below, pursuant to
the guaranteed delivery procedure described in "The Exchange Offer -- Guaranteed
Delivery Procedures" section of the Prospectus.
Principal Amount of Outstanding Notes Tendered:*
<TABLE>
<S> <C>
$ If the Outstanding Notes will be delivered by book-
entry
- ------------------------------------------------------- transfer to the Depository Trust Company, provide
Certificate Nos. (if available): account number.
- -------------------------------------------------------
Total Principal Amount Represented by Outstanding Notes:
$ Account Number -------------------------------------
- -------------------------------------------------------
</TABLE>
- ---------------
* Must be in denominations of principal amount of $1,000 and any integral
multiple thereof.
ALL AUTHORITY HEREIN CONFERRED OR AGREED TO BE CONFERRED SHALL SURVIVE THE
DEATH OR INCAPACITY OF THE UNDERSIGNED AND EVERY OBLIGATION OF THE UNDERSIGNED
HEREUNDER SHALL BE BINDING UPON THE HEIRS, PERSONAL REPRESENTATIVES, SUCCESSORS
AND ASSIGNS OF THE UNDERSIGNED.
PLEASE SIGN HERE
<TABLE>
<S> <C>
X
- ------------------------------------------------------------ ------------------------------------
X
- ------------------------------------------------------------ ------------------------------------
Signature(s) of Owner(s) Date
or Authorized Signatory
</TABLE>
Area Code and Telephone Number:
- ------------------------------------------------------
Must be signed by the holder(s) of Outstanding Notes as their name(s)
appear(s) on certificates for Outstanding Notes or on a security position
listing, or by person(s) authorized to become registered holder(s) by
endorsement and documents transmitted with this Notice of Guaranteed Delivery.
If signature is by a trustee, executor, administrator, guardian,
attorney-in-fact, officer or the person acting in a fiduciary or representative
capacity, such person must set forth his or her full title below.
PLEASE PRINT NAME(S) AND ADDRESS(ES)
Name(s):
- --------------------------------------------------------------------------------
Capacity:
- --------------------------------------------------------------------------------
Address(es):
- --------------------------------------------------------------------------------
<PAGE> 18
GUARANTEE
The undersigned, a member of a registered national securities exchange, or
a member of the National Association of Securities Dealers, Inc., or a
commercial bank or trust company having an office or correspondent in the United
States, hereby guarantees that the certificates representing the principal
amount of Outstanding Notes tendered hereby in proper form for transfer, or
timely confirmation of the book-entry transfer of such Outstanding Notes into
the Exchange Agent's account at the Depository Trust Company pursuant to the
procedures set forth in the "The Exchange Offer -- Guaranteed Delivery
Procedures" section of the Prospectus, together with a properly completed and
duly executed Letter of Transmittal (or a manually signed facsimile thereof)
with any required signature guarantee and any other documents required by the
Letter of Transmittal, will be received by the Exchange Agent at the address set
forth above, no later than five Nasdaq Stock Market trading days after the
Expiration Date.
<TABLE>
<S> <C>
- ----------------------------------------------------- -------------------------------------------------------
Name of Firm Authorized Signature
- -------------------------------------------------------- -------------------------------------------------------
Address Title
- -------------------------------------------------------- Name: -------------------------------------------------
(Please Type or Print)
Area Code and Tel. No.: ------------------------------ Dated: ------------------------------------------------
</TABLE>
NOTE: DO NOT SEND CERTIFICATES FOR OUTSTANDING NOTES WITH THIS FORM.
CERTIFICATES FOR OUTSTANDING NOTES SHOULD ONLY BE SENT WITH YOUR LETTER OF
TRANSMITTAL.
