SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8 - K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) July 30, 1996
MAXXIM MEDICAL, INC.
TEXAS 0-18208 76-0291634
(State or jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification)
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104 Industrial Boulevard , Sugar Land, Texas 77478
(Address of principal executive offices ) (Zip Code)
Registrant's telephone number, including area code (713) 240-5588
N/A
(Former name or former address, if changed since last report)
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Exhibit Index at Page 5
1
Item 2. Acquisition or Disposition of Assets
On July 30, 1996 Maxxim Medical, Inc ("Maxxim") successfully completed a
tender offer (the "Tender Offer") to the shareholders of Sterile Concepts
Holdings, Inc. ("Sterile Concepts") which commenced on June 14, 1996. 5,438,059
shares or 98.4018% of the outstanding shares of Sterile Concepts were purchased
pursuant to the Tender Offer for $20 per share for $108,800,000 in cash. Maxxim
expects to acquire the remaining 88,325 shares in a merger expected to be
completed not later than September 15, 1996, resulting in the payment of $20 per
share for any remaining outstanding shares of Sterile Concepts stock at a cost
of $1,800,000. Maxxim also refinanced existing Maxxim debt of approximately
$72,700,000 contemporaneously with and repaid approximately $34,200,000 of
Sterile Concepts debt shortly after the consummation of the Tender Offer. The
Tender Offer was conducted pursuant to the terms of an Agreement and Plan of
Merger dated June 10, 1996 (the "Merger Agreement") by and among Maxxim Medical,
Inc., a Delaware corporation ("Maxxim-Delaware"), Maxxim Acquisition Co., a
Virginia Corporation (the "Purchaser"), and Sterile Concepts which was
negotiated following the conduct by Sterile Concepts of a formal request for
bids from various different potential suitors designed to enable Sterile
Concepts to evaluate various alternatives for a potential change in control.
Sterile Concepts assembles, packages and sterilizes ready-to-use custom
procedure trays for hospitals, outpatient surgery centers and medical clinics.
The assets acquired pursuant to the Merger Agreement consist primarily of
accounts receivable, inventory, equipment and leased assembly and other
facilities in Richmond, Virginia, Temecula, California and Minnetonka, Minnesota
(which Maxxim expects to continue to operate for the foreseeable future).
Subsequent to the merger, Maxxim plans to integrate the assets of Sterile
Concepts into its already existing custom procedure tray assembly and packaging
operations.
Funding to complete the acquisition and debt repayment was derived from ( i )
approximately $121,000,000 of borrowings under a $165,000,000 credit facility
with NationsBank of Texas, N.A. ("NationsBank") and certain other lenders to be
determined, to Maxxim and ( ii ) the net proceeds of $97,000,000 from the
offering of $100,000,000 of 10 1/2% Senior Subordinated Notes with NationsBanc
Capital Markets Inc. ("NCMI") and Bear, Stearns, & Co. Inc. ("Bear Stearns"), as
the initial purchasers..
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of businesses acquired.
Financial Statements are not available as of the date of this report, but will
be filed by amendment as soon as practicable, but not later than 60 days after
the due date of this report.
(b) Pro forma financial information.
Pro forma Financial Statements are not available as of the date of this report,
but will be filed by amendment as soon as practicable, but not later than 60
days after the due date of this report
2
(c) Exhibits.
Documents filed as part of this report:
1. Agreement and Plan of Merger dated as of June 10, 1996 by and among
Maxxim, Maxxim-Delaware, Purchaser and Sterile Concepts (Filed as Exhibit (d) to
the Schedule 14D-1 of Maxxim, Maxxim-Delaware, and Purchaser with the Commission
on June 14, 1996 and incorporated herein by reference).
2. Second Amended and Restated Credit Agreement, dated July 30, 1996, by
and among NationsBank and the banks named therein.
3. Purchase Agreement dated July 18, 1996 between Maxxim, NCMI and Bear
Stearns.
4. Indenture dated July 30, 1996, by and among Maxxim, as Issuer,
Maxxim-Delaware, Purchaser, Fabritek La Romana, Inc., Maxxim Medical Canada
Limited, Medica B.V. and Medica Hospital Supplies, N.V., as Guarantors and First
Union National Bank of North Carolina, as Trustee.
3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MAXXIM MEDICAL, INC.
By: /S/ KENNETH W. DAVIDSON
Kenneth W. Davidson
Date: August 14, 1996
4
EXHIBIT INDEX
EXHIBIT NUMBER EXHIBIT DESCRIPTION PAGE
1. Agreement and Plan of Merger dated as of June 10, 1996 by
and among Maxxim, Maxxim-Delaware, Purchaser and Sterile
Concepts (Filed as Exhibit (d) to the Schedule 14D-1 of
Maxxim, Maxxim-Delaware, and Purchaser with the Commission
on June 14, 1996 and incorporated herein by reference). n/a
2. Second Amended and Restated Credit Agreement, dated July
30, 1996, by and among NationsBank and the banks named
therein. 6
3. Purchase Agreement dated July 18, 1996 between Maxxim, NCMI
and Bear Stearns. 98
4. Indenture dated July 30, 1996, by and among Maxxim, as
Issuer, Maxxim-Delaware, Purchaser, Fabritek La Romana,
Inc., Maxxim Medical Canada Limited, Medica B.V. and Medica
Hospital Supplies, N.V., as Guarantors and First Union
National Bank of North Carolina, as Trustee. 132
5
EXHIBIT 2
NOTE: Certain schedules and exhibits have been omitted due to their being
substantially described in the body of the Second Amended and Restated Credit
Agreement.
SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
DATED AS OF JULY 30, 1996
AMONG
MAXXIM MEDICAL, INC.
AS BORROWER
AND
NATIONSBANK OF TEXAS, N.A.
AS AGENT
AND
THE BANKS NAMED HEREIN
AS BANKS
$165,000,000.00
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND ACCOUNTING TERMS
Section 1.1 Certain Defined Terms ..................................... 1
Section 1.2 Computation of Time Periods ............................... 16
Section 1.3 Accounting Terms; Changes in GAAP ......................... 16
Section 1.4 Classes and Types of Advances ............................. 17
Section 1.5 Miscellaneous ............................................. 17
ARTICLE 2 CREDIT FACILITIES
Section 2.1 Commitments ............................................... 17
Section 2.2 Advancing ................................................. 18
Section 2.3 Prepayments ............................................... 21
Section 2.4 Repayment ................................................. 23
Section 2.5 Fees ...................................................... 23
Section 2.6 Interest .................................................. 24
Section 2.7 Illegality ................................................ 25
Section 2.8 Breakage Costs ............................................ 26
Section 2.9 Increased Costs ........................................... 26
Section 2.10 Paymemts and Computations ................................ 28
Section 2.11 Taxes .................................................... 29
Section 2.12 Letter of Credit ......................................... 31
ARTICLE 3CONDITIONS OF LENDING
Section 3.1 Conditions Precedent to Initial Borrowings ................ 34
Section 3.2 Conditions Precedent to Merger Borrowing .................. 37
Section 3.3 Conditions Precedent to Each Borrowing and
Letter of Credit .......................................... 38
ARTICLE 4 REPRESENTATIONS AND WARRANTIES
Section 4.1 Organization .............................................. 39
Section 4.2 Authorization ............................................. 39
Section 4.3 Enforceability ............................................ 39
Section 4.4 Financial Condition ....................................... 40
Section 4.5 Ownership and Liens ....................................... 40
Section 4.6 True and Complete Disclosure .............................. 40
Section 4.7 Litigation ................................................ 41
Section 4.8 Compliance with Agreements ................................ 41
Section 4.9 ERISA ..................................................... 41
Section 4.10 Environmental Condition .................................. 41
Section 4.11 Subsidiaries ............................................. 42
Section 4.12 Investment Company Act ................................... 42
Section 4.13 Public Utility Holding Company Act ....................... 42
Section 4.14 Taxes .................................................... 42
Section 4.15 Permits, Licenses, etc. .................................. 43
Section 4.16 Tender Offer and Merger .................................. 43
ARTICLE 5COVENANTS
Section 5.1 Organization .............................................. 43
Section 5.2 Reporting ................................................. 44
Section 5.3 Financial Covenants ....................................... 46
Section 5.4 Debt ...................................................... 47
Section 5.5 Liens ..................................................... 48
Section 5.6 Agreements Restricting Liens .............................. 48
Section 5.7 Use of Proceeds ........................................... 48
Section 5.8 Corporate Transactions .................................... 49
Section 5.9 Asset Sales ............................................... 49
Section 5.10 Distributions ............................................ 49
Section 5.11 Transactions with Affiliates ............................. 49
Section 5.12 Insurance ................................................ 50
Section 5.13 Investments .............................................. 50
Section 5.14 Lines of Business ........................................ 50
Section 5.15 Compliance with Laws ..................................... 50
Section 5.16 Taxes .................................................... 50
Section 5.17 Environmental Matters .................................... 50
Section 5.18 Additional Guaranties .................................... 51
Section 5.19 Subordinated Debt ........................................ 51
Section 5.20 Additional Legal Opinions ................................ 51
ARTICLE 6DEFAULT AND REMEDIES
Section 6.1 Events of Default ......................................... 51
Section 6.2 Optional Acceleration of Maturity ......................... 54
Section 6.3 Automatic Acceleration of Maturity ........................ 54
Section 6.4 Cash Collateral Account ................................... 55
Section 6.5 Setoff .................................................... 55
Section 6.6 Remedies Cumulative, No Waiver ............................ 56
Section 6.7 Application of Payments ................................... 56
ARTICLE 7THE AGENT AND THE ISSUING BANK
Section 7.1 Authorization and Action .................................. 56
Section 7.2 Agent Reliance, Etc ....................................... 57
Section 7.3 The Agent and Its Affiliates .............................. 57
Section 7.4 Bank Credit Decision ...................................... 57
Section 7.5 Indemnification and Expenses .............................. 58
Section 7.6 Successor Agent and Issuing Bank .......................... 58
ARTICLE 8MISCELLANEOUS
Section 8.1 Costs and Expenses ........................................ 59
Section 8.2 Indemnification ........................................... 59
Section 8.3 Waivers and Amendments. ................................... 60
Section 8.4 Severability .............................................. 60
Section 8.5 Survival of Representations, Etc .......................... 61
Section 8.6 Binding Effect ............................................ 61
Section 8.7 Bank Assignments and Participations ....................... 61
Section 8.8 Notices, Etc .............................................. 64
Section 8.9 Governing Law ............................................. 64
Section 8.10 Execution in Counterparts ................................ 64
Section 8.11 Waiver of Jury ........................................... 64
EXHIBITS:
Exhibit A - Assignment and Acceptance
Exhibit B - Compliance Certificate
Exhibit C - Form of Guaranty
Exhibit D - Letter of Credit Application
Exhibit E-1 - Notice of Borrowing
Exhibit E-2 - Notice of Continuation or Conversion
Exhibit F - Form of Pledge Agreement
Exhibit G-1 - Form of Revolving Credit Note
Exhibit G-2 - Form of Term Note
Exhibit H - Form of Opinion Letter
SCHEDULES:
Schedule I - Notice Information
Schedule II - Disclosures
Schedule III - Subsidiaries
Schedule IV - Insurance
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
This Second Amended and Restated Credit Agreement dated as of July 30,
1996, is among (a) Maxxim Medical, Inc., a Texas corporation ("Borrower"), (b)
the Banks (as defined below), and (c) NationsBank of Texas, N.A., as agent for
the Banks.
The Borrower, the Banks, and the Agent (as defined below) hereby agree as
follows:
INTRODUCTION
A. Maxxim Medical, Inc., a Delaware corporation ("Maxxim Delaware"), the
Agent, and the certain banks are parties to the Amended and Restated Credit
Agreement dated as of June 29, 1995 (as the same has been amended, modified and
supplemented since such date, the "Existing Credit Agreement").
B. The Borrower, the Agent, and the Banks have agreed, with Maxxim
Delaware's consent, to amend and restate the Existing Credit Agreement by
entering into this Agreement.
ARTICLE 1.
DEFINITIONS AND ACCOUNTING TERMS
Section 2. CERTAIN DEFINED TERMS. As used in this Agreement, the
terms "Borrower," "Maxxim Delaware," and "Existing Credit Agreement" shall have
the meanings set forth above and the following terms shall have the following
meanings (unless otherwise indicated, such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"ACQUISITION" means Maxxim Acquisition Co., a Virginia corporation.
"ADJUSTED BASE RATE" means, for any day, the fluctuating rate per annum of
interest equal to the greater of (a) the Base Rate in effect on such day and
(b) the Federal Funds Rate in effect on such day PLUS 0.5%.
"ADJUSTED CASH FLOW" means, for any period, (a) EBITDA during such period
MINUS (b) cash taxes paid by the Borrower and its Subsidiaries during such
period.
"ADVANCE" means any advance by a Bank to the Borrower as a part of a
Borrowing and refers to a Base Rate Advance or a Eurodollar Advance.
"AFFILIATE" means, as to any Person, any other Person that, directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such Person or any Subsidiary of such Person.
The term "control" (including the terms "controlled by" or "under common
control with") means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through ownership, by contract, or otherwise.
"AGENT" means NationsBank in its capacity as agent for the Banks pursuant
to Article 7 and any successor agent pursuant to Section 7.6.
"AGREEMENT" means this Second Amended and Restated Credit Agreement among
the Borrower, the Banks, and the Agent as it may be amended, supplemented, and
otherwise modified from time-to-time.
"APPLICABLE LENDING OFFICE" means, with respect to each Bank, such Bank's
Domestic Lending Office in the case of a Base Rate Advance and such Bank's
Eurodollar Lending Office in the case of a Eurodollar Advance.
"APPLICABLE MARGIN" means, at any time with respect to any Advance or the
commitment fee, the following percentages determined as a function of the Total
Debt Ratio as of the end of the Borrower's fiscal quarter ending immediately
preceding such time:
<TABLE>
<CAPTION>
LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V
Ratio LESS Ratio greater Ratio greater Ratio greater Ratio greater
than or than 3.00, than 3.50, than 4.00, than 4.50
equal to 3.00 but less but less but less
than or than or than or
equal to 3.50 equal to 4.00 equal to 4.50
<S> <C> <C> <C> <C> <C>
Eurodollar 1.00% 1.25% 1.50% 2.25% 2.50%
Advance
Base Rate 0.00% 0.00% 0.25% 0.75% 1.25%
Advance
Commitment 0.25% 0.30% 0.35% 0.45% 0.50%
Fee
</TABLE>
The foregoing ratio (a) shall be deemed to be Level IV from the Effective Date
until delivery of the financial statements for the fiscal quarter ending on or
about October 31, 1996, and (b) shall thereafter be determined from the
financial statements of the Borrower and its Subsidiaries most recently
delivered pursuant to Sections 5.2(a) and (b). Any change in the Applicable
Margin after delivery of the financial statements for the fiscal quarter ending
on or about October 31, 1996, shall be effective upon the date of delivery of
the financial statements pursuant to Sections 5.2(a) and (b). If the Borrower
fails to deliver such financial statements within the times specified in
Sections 5.2(a) or (b), such ratio shall be deemed to be Level V until the
Borrower delivers such financial statements to the Agent and the Banks.
Notwithstanding the above chart, upon the issuance of Subordinated Debt
(excluding Subordinated Debt evidenced by the Convertible Note Indenture) of
the Borrower in an outstanding principal amount of $100,000,000.00 or more, the
Applicable Margin for Eurodollar Advances for Level IV shall be 2.00%.
"ARRANGER" means NationsBanc Capital Markets, Inc.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance executed by
a Bank and an Eligible Assignee and accepted by the Agent, in substantially the
form of the attached EXHIBIT A.
"BANKS" means the lenders listed on the signature pages of this Agreement
and each Eligible Assignee that shall become a party to this agreement pursuant
to Section 8.7.
"BASE RATE" means a fluctuating interest rate per annum as shall be in
effect from time-to-time equal to the rate of interest publicly announced by
NationsBank as its prime rate, whether or not the Borrower has notice thereof.
"BASE RATE ADVANCE" means an Advance which bears interest based upon the
Adjusted Base Rate.
"BORROWING" means a Revolving Credit Borrowing or a Term Borrowing.
"BUSINESS DAY" means a day of the year during which commercial banks are
open for business in New York City and Dallas, Texas, and, if the applicable
Business Day relates to any Eurodollar Advances, on which dealings are carried
on by commercial banks in the London interbank market.
"CAPITAL EXPENDITURES" for any Person and period of its determination
means, without duplication, (a) the aggregate of all expenditures and costs
(whether paid in cash or accrued as liabilities during that period and
including that portion of Capital Leases which is capitalized on the balance
sheet of such Person) of such Person during such period that, in conformity
with GAAP, are required to be included in or reflected by the property, plant,
or equipment or similar fixed asset accounts reflected in the balance sheet of
such Person and (b) the amount paid (whether in cash, securities, or other
Property) for the purchase of any Subsidiary of such Person by such Person
during such period, excluding, however, any amounts paid in connection with the
Tender Offer and the Merger.
"CAPITAL LEASES" means, for any Person, any lease of any Property by such
Person as lessee which would, in accordance with GAAP, be required to be
classified and accounted for as a capital lease on the balance sheet of such
Person.
"CASH COLLATERAL ACCOUNT" means a special interest bearing cash collateral
account containing cash deposited pursuant to Section 6.4 to be maintained at
the Agent's office in accordance with Section 6.4.
"CHANGE IN CONTROL" means (a) the direct or indirect acquisition by any
person (as such term is used in Section 13(d) and Section 14(d)(2) of the
Exchange Act), or related persons constituting a group (as such term is used in
Rule 13d-5 under the Exchange Act), of (i) beneficial ownership of issued and
outstanding shares of voting stock of the Borrower, the result of which
acquisition is that such person or such group possesses in excess of 50 percent
of the combined voting power of all then-issued and outstanding voting stock of
the Borrower, or (ii) the power to elect, appoint, or cause the election or
appointment of at least a majority of the members of the board of directors of
the Borrower or (b) the sale or issuance of any capital stock of Maxxim
Delaware to a Person other than the Borrower.
"CLASS" has the meaning set forth in Section 1.4.
"CODE" means the Internal Revenue Code of 1986, as amended, and the
regulations and published interpretations thereof.
"COMMITMENTS" means, as to any Bank, its Revolving Credit Commitment and
its Term Commitment.
"COMPLIANCE CERTIFICATE" means a compliance certificate executed by an
authorized officer of the Borrower in substantially the form of the attached
EXHIBIT B.
"CONTROLLED GROUP" means all members of a controlled group of corporations
and all trades (whether or not incorporated) under common control which,
together with the Borrower, are treated as a single employer under Section 414
of the Code.
"CONVERT," "CONVERSION," and "CONVERTED" each refers to a conversion of
Advances of one Type into Advances of another Type pursuant to Section 2.2(b).
"CONVERTIBLE NOTE INDENTURE" means the Indenture dated as of March 18,
1993 between the Borrower and Chemical Bank, as trustee, as amended from time-
to-time.
"CREDIT DOCUMENTS" means this Agreement, the Notes, the Guaranties, the
Pledge Agreements, the Notices of Borrowing, the Notices of Conversion, the
Letters of Credit, the Letter of Credit Applications, Derivatives, and each
other agreement, instrument, or document executed at any time in connection
with this Agreement.
"CREDIT OBLIGATIONS" means all principal, interest, fees, reimbursements,
indemnifications, and other amounts now or hereafter owed by the Borrower to
the Banks under this Agreement and the Credit Documents and any increases,
extensions, and rearrangements of those obligations under any amendments,
supplements, and other modifications of the documents and agreements creating
those obligations.
"CREDIT PARTIES" shall mean the Borrower and each of its Subsidiaries.
"DEBT," for any Person, means without duplication: (a) indebtedness of
such Person for borrowed money, including, without limitation, the face amount
of any standby letters of credit supporting the repayment of indebtedness for
borrowed money issued for the account of such Person and obligations under
letters of credit and agreements relating to the issuance of letters of credit
or acceptance financing; (b) obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments; (c) obligations of such Person
to pay the deferred purchase price of property or services; (d) obligations of
such Person as lessee under Capital Leases; (e) obligations of such Person
under direct or indirect guaranties in respect of, and obligations (contingent
or otherwise) of such Person to purchase or otherwise acquire, or otherwise to
assure a creditor against loss in respect of, indebtedness or obligations of
others of the kinds referred to in clauses (a) through (d) above;
(f) indebtedness or obligations of others of the kinds referred to in
clauses (a) through (e) secured by any Lien on or in respect of any Property of
such Person; and (g) all liabilities of such Person in respect of unfunded
vested benefits under any Plan.
"DEFAULT" means (a) an Event of Default or (b) any event or condition
which with notice or lapse of time or both would, unless cured or waived,
become an Event of Default.
"DERIVATIVE" means any foreign exchange transaction between the Borrower
or any of its Subsidiaries and a Bank or any interest hedge, rate swap, or cap,
or similar arrangement between the Borrower or any of its Subsidiaries and a
Bank providing for the exchange of interest obligations or the cap of the
interest rate on the Advances made under this Agreement.
"DOLLARS" and "$" means lawful money of the United States of America.
"DOLLAR EQUIVALENT" means the equivalent in another currency of an amount
in Dollars to be determined by reference to the rate of exchange quoted by
NationsBank, N.A., at 10:00 a.m. (Charlotte, North Carolina time) on the date
of determination, for the spot purchase in the foreign exchange market of such
amount of Dollars with such other currency.
"DOMESTIC LENDING OFFICE" means, with respect to any Bank, the office of
such Bank specified as its "Domestic Lending Office" opposite its name on
SCHEDULE I or such other office of such Bank as such Bank may from time-to-time
specify to the Borrower and the Agent.
"EBIT" means, for any period, (a) Net Income for such period PLUS (b) to
the extent deducted in determining Net Income, Interest Expense, and taxes.
"EBITDA" means, for any period, (a) EBIT for such period PLUS (b) to the
extent deducted in determining EBIT, depreciation and amortization for such
period.
"EFFECTIVE DATE" has the meaning set forth in Section 3.1.
"ELIGIBLE ASSIGNEE" means (a) a commercial bank organized under the laws
of the United States, or any State thereof, and having primary capital of not
less than $250,000,000.00 and approved by the Agent and the Borrower which
approval by the Agent and the Borrower will not be unreasonably withheld, and
(b) a commercial bank organized under the laws of any other country which is a
member of the Organization for Economic Cooperation and Development and having
primary capital (or its equivalent) of not less than $250,000,000.00 (or its
Dollar Equivalent) and approved by the Agent and the Borrower which approval by
the Agent and the Borrower will not be unreasonably withheld.
"ENVIRONMENTAL LAW" means all federal, state, and local laws, rules,
regulations, ordinances, orders, decisions, agreements, and other requirements
now or hereafter in effect relating to the pollution, destruction, loss, or
injury of the environment, the presence of any contaminant in the environment,
the protection, cleanup, remediation, or restoration of the environment, the
creation, handling, transportation, use, or disposal of any waste product in
the environment, exposure of Persons to any contaminant, waste, or hazardous
substance in the environment, and the health and safety of employees in
relation to their environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time-to-time.
"EUROCURRENCY LIABILITIES" has the meaning assigned to that term in
Regulation D of the Federal Reserve Board (or any successor), as in effect from
time-to-time.
"EURODOLLAR ADVANCE" means an Advance which bears interest based upon the
Eurodollar Rate.
"EURODOLLAR LENDING OFFICE" means, with respect to any Bank, the office of
such Bank specified as its "Eurodollar Lending Office" opposite its name on
SCHEDULE I (or, if no such office is specified, its Domestic Lending Office) or
such other office of such Bank as such Bank may from time-to-time specify to
the Borrower and the Agent.
"EURODOLLAR RATE" means, for the Interest Period for each Eurodollar
Advance comprising part of the same Borrowing, an interest rate per annum
(rounded upward to the nearest whole multiple of 1/16 of 1% per annum) equal to
the rate per annum at which deposits in Dollars are offered by the principal
office of the Agent in London, England to prime banks in the London interbank
market at 11:00 a.m. (London time) two Business Days before the first day of
such Interest Period in an amount substantially equal to the Agent's Eurodollar
Advance comprising part of such Borrowing and for a period equal to such
Interest Period.
"EURODOLLAR RATE RESERVE PERCENTAGE" of any Bank for the Interest Period
for any Eurodollar Advance means the reserve percentage applicable during such
Interest Period (or if more than one such percentage shall be so applicable,
the daily average of such percentages for those days in such Interest Period
during which any such percentage shall be so applicable) under regulations
issued from time-to-time by the Federal Reserve Board for determining the
maximum reserve requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for such Bank with respect
to liabilities or assets consisting of or including Eurocurrency Liabilities
having a term equal to such Interest Period.
"EVENT OF DEFAULT" has the meaning specified in Section 6.1.
"EXPIRATION DATE" means, with respect to any Letter of Credit, the date on
which such Letter of Credit will expire or terminate in accordance with its
terms.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day
(or, if such day is not a Business Day, for the next preceding Business Day) by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day which is a Business Day, the average of the quotations for any such day
on such transactions received by Agent from three Federal funds brokers of
recognized standing selected by it.
"GAAP" means United States generally accepted accounting principles as in
effect from time-to-time, applied on a basis consistent with the requirements
of Section 1.3.
"GOVERNMENTAL AUTHORITY" means any foreign governmental authority, the
United States of America, any state of the United States of America, the
District of Columbia, and any subdivision of any of the foregoing, and any
agency, department, commission, board, authority or instrumentality, bureau or
court having jurisdiction over the Agent, the Issuing Bank, any Bank, the
Borrower, or any other Credit Party.
"GUARANTOR" means any Person that now or hereafter executes a Guaranty,
including Maxxim Delaware and all those Subsidiaries of the Borrower listed in
SCHEDULE III and all Subsidiaries of the Borrower required to execute a
guaranty under Section 5.18 in the future.
"GUARANTIES" means the Guaranties made by each of the Guarantors now or
hereafter executed in substantially the same form as the attached EXHIBIT C, as
the same may be amended, supplemented, and otherwise modified from time-to-
time.
"HAZARDOUS MATERIALS" means any substance or material identified as a
hazardous substance pursuant to the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended and as now or hereafter in
effect; any substance or material regulated as a hazardous waste pursuant to
the Resource Conservation and Recovery Act of 1976, as amended and as now or
hereafter in effect; and any substance or material designated as a hazardous
substance or hazardous waste pursuant to any Environmental Law. "Hazardous
Materials" shall include, without limitation, pollutants, contaminants,
flammable substances and materials, explosives, radioactive materials, oil,
petroleum and petroleum products, chemical liquids and solids, polychlorinated
biphenyls, asbestos, toxic substances, and similar substances and materials.
"HIGHEST LAWFUL RATE" means the maximum lawful interest rate, if any, that
at any time or from time-to-time may be contracted for, charged, or received
under the laws applicable to any Bank which are presently in effect or, to the
extent allowed by law, under such applicable laws which may hereafter be in
effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow. The maximum lawful rate under this Agreement shall
be the weekly indicated rate ceiling under Article 5069-1.04 of the Texas
Revised Civil Statutes, unless any other lawful rate ceiling exceeds the rate
ceiling so determined, and then the higher rate ceiling shall apply. Chapter
15 of the Texas Credit Code does not apply to this Agreement.
"INTEREST EXPENSE" means, for any period, total interest expense for the
Borrower and its Subsidiaries net of any interest income for such period,
whether paid or accrued (including that attributable to obligations which have
been or should be, in accordance with GAAP, recorded as Capital Leases),
including, without limitation, all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance
financing, all as determined in conformity with GAAP.
"INTEREST PERIOD" means for each Eurodollar Advance comprising part of the
same Borrowing, the period commencing on the date of such Eurodollar Advance is
made or deemed made and ending on the last day of the period selected by the
Borrower pursuant to the provisions below and Section 2.2, and thereafter, each
subsequent period commencing on the last day of the immediately preceding
Interest Period and ending on the last day of the period selected by the
Borrower pursuant to the provisions below and Section 2.2. The duration of
each such Interest Period shall be one, two, three, or six months, in each case
as the Borrower may select, PROVIDED that:
3. the Borrower may not select any Interest Period for any Term Advance
which ends after any principal repayment date unless, after giving effect to
such selection, the aggregate unpaid principal amount of Term Advances that are
Base Rate Advances and Term Advances having Interest Periods which end on or
before such principal repayment date shall be at least equal to the amount of
Term Advances due and payable on or before such date;
4. Interest Periods commencing on the same date for Advances comprising
part of the same Borrowing shall be of the same duration;
5. whenever the last day of any Interest Period would otherwise occur on
a day other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day, PROVIDED that if such
extension would cause the last day of such Interest Period to occur in the next
following calendar month, the last day of such Interest Period shall occur on
the next preceding Business Day; and
6. any Interest Period which begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on the last
Business Day of the calendar month in which it would have ended if there were a
numerically corresponding day in such calendar month.
"ISSUING BANK" means NationsBank and any successor Issuing Bank pursuant
to Section 7.6.
"LASERMEDICS CONVERTIBLE NOTE" means the $7,300,000.00 Convertible
Subordinated Promissory Note dated May 1, 1996 by Lasermedics, Inc., a Texas
corporation, payable to the order of Maxxim Delaware.
"LEGAL REQUIREMENT" means any law, statute, ordinance, decree,
requirement, order, judgment, rule, regulation (or official interpretation of
any of the foregoing) of, and the terms of any license or permit issued by, any
Governmental Authority, including, but not limited to, Regulations G, T, U and
X.
"LETTER OF CREDIT" means, individually, any letter of credit issued by the
Issuing Bank which is subject to this Agreement, and "LETTERS OF CREDIT" means
all such letters of credit collectively.
"LETTER OF CREDIT APPLICATION" means a letter of credit application in
substantially the form of the attached EXHIBIT D executed by the Borrower in
connection with the issuance of any Letter of Credit.
"LETTER OF CREDIT DOCUMENTS" means, with respect to any Letter of Credit,
such Letter of Credit and any agreements, documents, and instruments entered
into in connection with or relating to such Letter of Credit.
"LETTER OF CREDIT EXPOSURE" means, at any time, the sum of (a) the
aggregate undrawn maximum face amount of each Letter of Credit at such time
PLUS (b) the aggregate unpaid amount of all Reimbursement Obligations at such
time.
"LETTER OF CREDIT OBLIGATIONS" means any obligations of the Borrower under
this Agreement in connection with the Letters of Credit.
"LIEN" means any mortgage, lien, pledge, charge, deed of trust, security
interest, or encumbrance to secure or provide for the payment of any obligation
of any Person, whether arising by contract, operation of law, or otherwise
(including the interest of a vendor or lessor under any conditional sale
agreement, Capital Lease, or other title retention agreement).
"LIQUID INVESTMENTS" means (a) readily marketable direct full faith and
credit obligations of the United States of America or obligations
unconditionally guaranteed by the full faith and credit of the United States of
America, (b) commercial paper issued by any Bank or any Affiliate of any Bank
or any commercial banking institutions or corporations rated at least P-1 by
Moody's Investors Services, Inc. or A-1 by Standard & Poor's Rating Group,
(c) certificates of deposit and bankers' acceptances issued by any of the
Banks, or any other commercial banking institution which is a member of the
Federal Reserve System and has a combined capital and surplus and undivided
profits of not less than $250,000,000.00 and rated Aa by Moody's Investor
Service, Inc. or AA by Standard & Poor's Rating Group, (d) repurchase
agreements which are entered into with any of the Banks or any major money
center banks included in the commercial banking institutions described in
clause (c) and which are secured by readily marketable direct full faith and
credit obligations of the Government of the United States of America or any
agency thereof, and (e) investments in any money market fund which holds
investments solely of the type described in the foregoing clauses (a) through
(d). All such Permitted Investments described in clauses (a) through (e) above
shall have maturities of not more than 180 days from the date of issue.
"MAJORITY BANKS" means, at any time, Banks holding at least 66-2/3% of the
then aggregate unpaid principal amount of the Notes held by the Banks and the
Letter of Credit Exposure of the Banks at such time, or, if no such principal
amount and Letter of Credit Exposure is then outstanding, Banks having at least
66-2/3% of the aggregate amount of the Commitments at such time.
"MERGER" means the merger of Acquisition with and into the Target
contemplated by the Merger Agreement.
"MERGER AGREEMENT" means the Agreement and Plan of Merger dated as of
June 10, 1996 among the Maxxim Delaware, Acquisition, and the Target.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA to which the Borrower or any member of the
Controlled Group is making or accruing an obligation to make contributions.
"NATIONSBANK" means NationsBank of Texas, N.A.
"NET INCOME" means, for any period, the Borrower's net income for such
period, as determined in accordance with GAAP, excluding, however,
extraordinary items, including (a) any net gain or loss during such period
arising from the sale, exchange, or other disposition of capital assets (such
term to include all fixed assets and all securities) other than in the ordinary
course of business and (b) any write-up or write-down of assets.
"NET WORTH" means, at any date for any Person that is a corporation, the
sum of (a) the par value (or value stated on the books of such Person) of the
capital stock of all classes of such Person, (b) the additional paid-in capital
of such Person, and (c) the amount of the retained earnings of such Person, all
determined in accordance with GAAP, excluding, however, the value of any
redeemable preferred stock or similar capital stock of such Person.
"NONORDINARY COURSE ASSET SALES" means, any sales, conveyances, or other
transfers made by the Borrower or any of its Subsidiaries (a) of any division
of the Borrower or any of its Subsidiaries, (b) of the capital stock of a
Subsidiary of the Borrower by the Borrower or any of its Subsidiaries, (c)
outside the ordinary course of business of assets in a transaction or related
series of transactions in which the aggregate consideration (whether cash,
securities, other Property or assumption of Debt) exceeds $3,000,000.00, or (d)
which constitutes an Asset Sale and is not an Exempt Asset Sale (as each such
term is defined in the Senior Subordinated Note Indenture).
"NOTE" means a Revolving Credit Note or a Term Note.
"NOTICE OF BORROWING" means a notice of borrowing signed by the Borrower
in substantially the form of the attached EXHIBIT E-1.
"NOTICE OF CONTINUATION OR CONVERSION" means a notice of continuation or
conversion signed by the Borrower in substantially the form of the attached
EXHIBIT E-2.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"PERMITTED DEBT" means all of the following Debt: (a) Debt of the Credit
Parties under the Credit Documents; (b) the Subordinated Debt and any
rearrangements, extensions, or refinancings thereof on terms and for amounts
substantially similar to the terms and amounts existing as of the date of this
Agreement; (c) Debt listed in SCHEDULE II (under Debt and Liens) and any
rearrangements, extensions, or refinancings thereof on terms and for amounts
substantially similar to the terms and amounts existing as of the date of this
Agreement; (d) intercompany Debt incurred in the ordinary course of business
owed (i) by any wholly-owned Subsidiary of the Borrower to the Borrower;
(ii) by the Borrower to any of its wholly-owned Subsidiaries; and (iii) by any
wholly-owned Subsidiary of the Borrower to another wholly-owned Subsidiary of
the Borrower; (e) Debt in the form of accounts payable to trade creditors for
goods or services and current operating liabilities (other than for borrowed
money) which in both cases are not more than 90 days past due, in each case
incurred in the ordinary course of business, as presently conducted, and paid
within the specified time, unless contested in good faith and by appropriate
proceedings; and (f) purchase money indebtedness and any obligations under
Capital Leases in a cumulative amount not to exceed 15% of the Borrower's Net
Worth at any time outstanding; PROVIDED that the Borrower may not enter into
additional indebtedness of the type described in clause (f) of this definition
if a Default is continuing or entering into the additional indebtedness would
reasonably be expected to cause a Default.
"PERMITTED INVESTMENTS" means (a) investments in the form of trade credit
to customers of the Borrower and its Subsidiaries arising in the ordinary
course of business and represented by accounts from such customers, (b) Liquid
Investments, (c) investments listed in SCHEDULE II, (d) other investments or
acquisitions of securities in Persons engaged in a line of business
substantially similar to the Borrower's line of business on the date of this
Agreement not to exceed an aggregate outstanding amount of $8,000,000.00 from
the date of this Agreement, (e) ordinary course of business contributions,
loans, or advances to, or investments in, (i) a Subsidiary of the Borrower or
(ii) the Borrower, (f) acquisition of the issued and outstanding common stock
of the Target in connection with the Tender Offer, (g) the Lasermedics
Convertible Note and any equity securities into which such promissory note may
be converted in accordance with its terms, and (h) such other investments as
the Agent may approve in writing.
"PERMITTED LIENS" means all of the following Liens: (a) Liens securing the
Credit Obligations; (b) Liens disclosed to the Banks in SCHEDULE II (under Debt
and Liens) securing the Debt described in part (c) of the definition of
Permitted Debt; (c) Liens imposed by law, such as materialmen's, mechanics',
carriers', workmen's and repairmen's liens, and other similar liens arising in
the ordinary course of business securing obligations which are not overdue for
a period of more than 30 days; (d) Liens arising in the ordinary course of
business out of pledges or deposits under workers compensation laws,
unemployment insurance, old age pensions, or other social security or
retirement benefits, or similar legislation to secure public or statutory
obligations; (e) Liens for taxes, assessment, or other governmental charges
which are being actively contested in good faith by appropriate proceedings;
(f) Liens securing purchase money debt or Capital Leases permitted under clause
(f) of the definition of Permitted Debt, PROVIDED that each such Lien encumbers
only the property purchased or leased in connection with the creation of any
such purchase money debt or Capital Lease; and (g) Liens encumbering the
capital stock of the Target.
"PERSON" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, limited liability company, limited
liability partnership, unincorporated association, joint venture, or other
entity, or a government or any political subdivision or agency thereof, or any
trustee, receiver, custodian, or similar official.
"PLAN" means an employee benefit plan (other than a Multiemployer Plan)
maintained for employees of the Borrower or any member of the Controlled Group
and covered by Title IV of ERISA or subject to the minimum funding standards
under Section 412 of the Code.
"PLEDGE AGREEMENTS" means the Pledge Agreements made by the Borrower and
each of its Subsidiaries (other than, prior to the Merger, Acquisition and its
Subsidiaries) now or hereafter existing which has a Subsidiary in substantially
the same form as the attached EXHIBIT F, as the same may be amended,
supplemented, and otherwise modified from time to time.
"PRO RATA SHARE" means, at any time with respect to any Bank, either
(a) the ratio (expressed as a percentage) of such Bank's Commitments at such
time to the aggregate Commitments at such time or (b) if all of the Commitments
have been terminated, the ratio (expressed as a percentage) of such Bank's
aggregate outstanding Advances and Letter of Credit Exposure at such time to
the aggregate outstanding Advances and Letter of Credit Exposure of all the
Banks at such time.
"PROHIBITED TRANSACTION" means any transaction set forth in Section 406 of
ERISA or Section 4975 of the Code.
"PROPERTY" of any Person means any property or assets (whether real,
personal, or mixed, tangible or intangible) of such Person.
"REGISTER" has the meaning set forth in Section 8.7(c).
"REIMBURSEMENT OBLIGATIONS" means all of the obligations of the Borrower
set forth in Section 2.12(c).
"RENTAL EXPENSE" means, for any period, all amounts payable by the
Borrower and its Subsidiaries during such period under any lease, sublease, or
other instrument (other than a Capital Lease) pursuant to which the Borrower or
any of its Subsidiaries is entitled to use any Property of another Person as
determined in accordance with GAAP.
"REPORTABLE EVENT" means any of the events set forth in Section 4043 of
ERISA.
"REVOLVING CREDIT ADVANCE" means any advance by a Bank to the Borrower as
part of a Revolving Credit Borrowing and refers to a Base Rate Advance or a
Eurodollar Advance.
"REVOLVING CREDIT BORROWING" means a Borrowing consisting of simultaneous
Revolving Credit Advances of the same Type made by the Banks pursuant to
Section 2.1(a) or Converted by each Bank to Revolving Credit Advances of a
different Type pursuant to Section 2.2(b).
"REVOLVING CREDIT COMMITMENT" means, for each Bank, the obligation of each
Bank to advance to Borrower the amount set opposite such Bank's name on the
signature pages of this Agreement as its Revolving Credit Commitment, or if
such Bank has entered into any Assignment and Acceptance, set forth for such
Bank as its Revolving Credit Commitment in the Register, as such amount may be
reduced pursuant to Section 2.1(c); PROVIDED that, after the Revolving Credit
Maturity Date, the Revolving Credit Commitment for such Bank shall be zero.
"REVOLVING CREDIT MATURITY DATE" means the earlier of (a) July 31, 2002,
as such date may be extended pursuant to Section 2.1(d) and (b) the earlier
termination in whole of the Revolving Credit Commitments pursuant to Section
2.1(c) or Article 7.
"REVOLVING CREDIT NOTE" means a promissory note of the Borrower payable to
the order of a Bank, in substantially the form of the attached EXHIBIT G-1,
evidencing indebtedness of the Borrower to such Bank resulting from Revolving
Credit Advances owing to such Bank.
"SENIOR SUBORDINATED NOTE INDENTURE" means the Indenture dated as of July
30, 1996 between the Borrower and First Union Bank of North Carolina, trustee,
under which the Senior Subordinated Notes are issued.
"SENIOR SUBORDINATED NOTES" means the 10-1/2% Senior Subordinated Notes
due 2006 issued by the Borrower under the Senior Subordinated Note Indenture.
"SUBORDINATED DEBT" means Debt of the Borrower or any of its Subsidiaries
(a) under the Convertible Note Indenture and (b) under the Senior Subordinated
Note Indenture.
"SUBSIDIARY" means, with respect to any Person, any other Person, a
majority of whose outstanding Voting Securities (other than directors'
qualifying shares) shall at any time be owned by such Person or one or more
Subsidiaries of such Person.
"TARGET" means Sterile Concepts Holdings, Inc., a Virginia corporation.
"TENDER OFFER" means the tender offer by Acquisition, Maxxim Delaware, or
the Borrower to purchase the outstanding common stock of the Target in
accordance with the terms of the Tender Offer Documents.
"TENDER OFFER DOCUMENTS" means the Merger Agreement, the Form 14d-1 filed
by the Borrower and Acquisition with the Securities and Exchange Commission
("SEC") on June 14, 1996 and all amendments thereto, the Form 14d-9 filed by
the Target with the SEC on June 14, 1996 and all amendments thereto, and all
other documents, instruments, or SEC filings executed, delivered or filed in
connection with the Tender Offer.
"TERM ADVANCE" means an advance by a Bank to the Borrower as part of a
Term Borrowing and refers to a Base Rate Advance or a Eurodollar Advance.
"TERM BORROWING" means the Borrowing consisting of simultaneous Term
Advances of the same Type made by each Bank pursuant to Section 2.1(b) or
Converted by each Bank to Term Advances of a different Type pursuant to
Section 2.2(b).
"TERM COMMITMENT" means, for each Bank, the amount set opposite such
Bank's name on the signature pages of this Agreement as its Term Commitment or,
if such Bank has entered into any Assignment and Acceptance, set forth for such
Bank as its Term Commitment in the Register; PROVIDED, however, that after the
earlier of (a) December 13, 1996 and (b) the date the second Term Borrowing, if
any, is made, the Term Commitment for such Bank shall be zero.
"TERM MATURITY DATE" means July 31, 2002.
"TERM NOTE" means a promissory note of the Borrower payable to the order
of any Bank in substantially the form of the attached EXHIBIT G-2, evidencing
indebtedness of the Borrower to such Bank resulting from any Term Advances
owing to such Bank.
"TERMINATION EVENT" means (a) the occurrence of a Reportable Event with
respect to a Plan, as described in Section 4043 of ERISA and the regulations
issued thereunder (other than a Reportable Event not subject to the provision
for 30-day notice to the PBGC under such regulations), (b) the withdrawal of
the Borrower or any of its Affiliates from a Plan during a plan year in which
it was a "substantial employer" as defined in Section 4001(a)(2) of ERISA,
(c) the giving of a notice of intent to terminate a Plan under Section 4041(c)
of ERISA, (d) the institution of proceedings to terminate a Plan by the PBGC,
or (e) any other event or condition which constitutes grounds under Section
4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan.
"TOTAL DEBT RATIO"means the ratio, determined as of the last day of each
of the Borrower's fiscal quarters, of (a) the Borrower's Debt as of such day;
PROVIDED that (i) on the last day of the fiscal quarter ending on or about
October 31, 1996, one-fourth, (ii) on the last day of the fiscal quarter ending
on or about January 31, 1997, one-half, and (iii) on the last day of the fiscal
quarter ending on or about April 30, 1997, three-fourths of the Borrower's Debt
as at each such day shall be used to calculate this ratio to (b) EBITDA (i) for
the fiscal quarter ending on or about October 31, 1996, (ii) for the two fiscal
quarters ending on or about January 31, 1997, (iii) for the three fiscal
quarters ending on or about April 30, 1997, and (iv) for the four fiscal
quarters ending on each such day thereafter PLUS, with respect to each
acquisition permitted by this Agreement, including the Tender Offer, and made
during such period, the aggregate amount of EBITDA attributable to the business
acquired for the period commencing of the first day of such period and ending
on the date of the closing of such acquisition MINUS, with respect any asset
sales permitted by this Agreement and made during such period, the aggregate
amount of EBITDA attributable to the assets sold during such period.
"TYPE" has the meaning set forth in Section 1.4.
"VOTING SECURITIES" means (a) with respect to any corporation, capital
stock of the corporation having general voting power under ordinary
circumstances to elect directors of such corporation (irrespective of whether
at the time stock of any other class or classes shall have or might have
special voting power or rights by reason of the happening of any contingency),
(b) with respect to any partnership, any partnership interest or other
ownership interest having general voting power to elect the general partner or
other management of the partnership or other Person, and (c) with respect to
any limited liability company, membership certificates or interests having
general voting power under ordinary circumstances to elect managers of such
limited liability company.
Section 7. COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".
Section 8. ACCOUNTING TERMS; CHANGES IN GAAP. 8. All accounting terms
not specifically defined in this Agreement shall be construed in accordance
with GAAP applied on a consistent basis with those applied in the preparation
of the financial statements referred to in Section 4.4 (except for changes
which the Borrower's independent public accountants make no exceptions), and
the Borrower shall not permit any change (except for changes with the
Borrower's independent public accountants make no exceptions) any method of
accounting employed in the preparation of the financial statements referred to
in Section 4.4 unless required to conform to GAAP or approved in writing by the
Agent.
9. Unless otherwise indicated, all financial statements of the Borrower,
all calculations for compliance with covenants in this Agreement, all
determinations of the Applicable Margin, and all calculations of any amounts to
be calculated under the definitions in Section 1.01 shall be based upon the
consolidated accounts of the Borrower and its Subsidiaries in accordance with
GAAP and consistent with the principles of consolidation applied in preparing
the Borrower's financial statements referred to in Section 4.4 (except for
changes in the principles of consolidation to which the Borrower's independent
public accountants take no exception).
Section 10. CLASSES AND TYPES OF ADVANCES. Advances are distinguished
by "Class" and "Type". The "Class" of an Advance refers to the determination
of whether such Advance is a Term Advance or a Revolving Credit Advance. The
"Type" of an Advance refers to the determination of whether such Advance is a
Base Rate Advance or a Eurodollar Advance.
Section 11. MISCELLANEOUS. Article, Section, Schedule, and Exhibit
references are to this Agreement, unless otherwise specified.
ARTICLE 12.
CREDIT FACILITIES
Section 13. COMMITMENTS.
14. REVOLVING CREDIT COMMITMENT. Each Bank severally agrees, on the
terms and conditions set forth in this Agreement and for the purposes set forth
in Section 5.7, to make Revolving Credit Advances to the Borrower from time-to-
time on any Business Day during the period from the Effective Date until the
Revolving Credit Maturity Date in an aggregate amount not to exceed the amount
of (i) such Bank's Revolving Credit Commitment MINUS (ii) such Bank's Pro Rata
Share of the Letter of Credit Exposure. Each Revolving Credit Borrowing shall
(i) be in an aggregate amount not less than $400,000.00 and in integral
multiples of $100,000.00 in excess thereof and (ii) consist of Revolving Credit
Advances of the same Type made on the same day by the Banks ratably according
to their respective Revolving Credit Commitments. Within the limits of each
Bank's Revolving Credit Commitment, the Borrower may from time-to-time borrow,
prepay pursuant to Section 2.3, and reborrow under this Section 2.1(a).
15. TERM COMMITMENT. Each Bank severally agrees, on the terms and
conditions set forth in this Agreement, to make up to two Term Advances to the
Borrower on a Business Day during the period from the Effective Date until
December 13, 1996 in an aggregate amount not to exceed such Bank's Term
Commitment.
16. REDUCTION OF THE COMMITMENTS. The Borrower shall have the right,
upon at least three Business Days' irrevocable notice to the Agent, to
terminate in whole or reduce ratably in part the unused portion of the
Revolving Credit Commitments; PROVIDED that each partial reduction shall be in
the aggregate amount of $5,000,000.00 and an integral multiple of
$1,000,000.00. Any reduction or termination of the Commitments pursuant to
this Section 2.1(c) shall be permanent, with no obligation of the Banks to
reinstate such Commitments and the commitment fees provided for in
Section 2.5(a) shall thereafter be computed on the basis of the Commitments, as
so reduced.
17. EXTENSION OF REVOLVING CREDIT MATURITY DATE.
0.0.0.1. SO LONG AS NO DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING
AT SUCH TIME, AT LEAST 90 BUT NOT MORE THAN 120 DAYS BEFORE EACH JULY 31
BEGINNING JULY 31, 1998 THROUGH JULY 31, 2001, THE BORROWER MAY REQUEST IN
WRITING TO THE AGENT AND EACH BANK THAT THE BANKS EXTEND THE REVOLVING
CREDIT MATURITY DATE BY ONE YEAR. ON OR BEFORE THE IMMEDIATELY FOLLOWING
MAY 15 AFTER EACH SUCH REQUEST, EACH BANK SHALL NOTIFY THE AGENT AND THE
BORROWER IN WRITING WHETHER IT ELECTS TO SO EXTEND THE REVOLVING CREDIT
MATURITY DATE. ANY FAILURE BY A BANK TO SO NOTIFY THE AGENT AND THE
BORROWER SHALL BE DEEMED TO BE A DECISION BY SUCH BANK TO NOT EXTEND THE
REVOLVING CREDIT MATURITY DATE.
0.0.0.2. IF EACH BANK ELECTS TO EXTEND THE REVOLVING CREDIT MATURITY
DATE, THE REVOLVING CREDIT MATURITY DATE SHALL AUTOMATICALLY EXTEND FOR
ONE YEAR.
0.0.0.2.1. NOTES. The indebtedness of the Borrower to each Bank
resulting from Revolving Credit Advances owing to such Bank shall be evidenced
by a Revolving Credit Note. The indebtedness of the Borrower to each Bank
resulting from Term Advances owing to such Bank shall be evidenced by a Term
Note.
Section 0.0.0.2.2. ADVANCING.
0.0.0.2.3. NOTICE. Each Borrowing shall be made pursuant to a Notice
of Borrowing, given not later than (i) 10:00 a.m. (Dallas, Texas time) on the
third Business Day before the date of the proposed Borrowing, in the case of a
Eurodollar Advance or (ii) 10:00 a.m. (Dallas, Texas time) on the Business Day
of the proposed Borrowing, in the case of a Base Rate Advance, by the Borrower
to the Agent, which shall give to each Bank prompt notice of such proposed
Borrowing by telecopier or telex. Each Notice of Borrowing shall be by
telecopier or telex, confirmed immediately by the Borrower with a hard copy,
specifying the requested (i) date of such Borrowing, (ii) Type and Class of
Advances comprising such Borrowing, (iii) aggregate amount of such Borrowing,
and (iv) if such Borrowing is to be comprised of Eurodollar Advances, Interest
Period for each such Advance. In the case of a proposed Borrowing comprised of
Eurodollar Advances, the Agent shall promptly notify each Bank of the
applicable interest rate under Section 2.6(b). Each Bank shall (i) in the case
of all Borrowings other than Borrowings made on the same day as the day the
Notice of Borrowing is received, before 11:00 a.m. (Dallas, Texas time) on the
date of such Borrowing and (ii) in the case of Borrowings made on the same day
as the date of the Notice of Borrowing, before 1:00 p.m. (Dallas, Texas time),
make available for the account of its Applicable Lending Office to the Agent at
its address referred to in Section 8.8, or such other location as the Agent may
specify by notice to the Banks, in same day funds, such Bank's Pro Rata Share
of such Borrowing. After the Agent's receipt of such funds and upon
fulfillment of the applicable conditions set forth in Article 3, the Agent will
make such funds available to the Borrower at its account with the Agent.
0.0.0.2.4. CONVERSIONS AND CONTINUATIONS. In order to elect to
Convert or continue an Advance under this Section, the Borrower shall deliver
an irrevocable Notice of Conversion or Continuation to the Agent at the Agent's
office no later than 11:00 a.m. (Dallas, Texas time) (i) on the Business Day of
the proposed conversion date in the case of a Conversion to a Base Rate Advance
and (ii) at least three Business Days in advance of the proposed Conversion or
continuation date in the case of a Conversion to, or a continuation of, a
Eurodollar Advance. Each such Notice of Conversion or Continuation shall be in
writing or by telex or telecopier, confirmed immediately by the Borrower with a
hard copy, specifying (i) the requested Conversion or continuation date (which
shall be a Business Day), (ii) the amount, Type, and Class of the Advance to be
Converted or continued, (iii) whether a Conversion or continuation is
requested, and if a Conversion, into what Type of Advance, and (iv) in the case
of a Conversion to, or a continuation of, a Eurodollar Advance, the requested
Interest Period. Promptly after receipt of a Notice of Conversion or
Continuation under this paragraph, the Agent shall provide each Bank with a
copy thereof and, in the case of a Conversion to or a Continuation of a
Eurodollar Advance, notify each Bank of the applicable interest rate under
Section 2.6(b). The portion of Advances comprising part of the same Borrowing
that are converted to Advances of another Type shall constitute a new
Borrowing.
0.0.0.2.5. CERTAIN LIMITATIONS. Notwithstanding anything in
paragraphs (a) and (b) above:
0.0.0.3. AT NO TIME SHALL THERE BE MORE THAN FIVE INTEREST PERIODS
APPLICABLE TO OUTSTANDING EURODOLLAR ADVANCES;
0.0.0.4. THE BORROWER MAY NOT SELECT EURODOLLAR ADVANCES FOR ANY
BORROWING IF THE AGGREGATE AMOUNT OF SUCH BORROWING IS LESS THAN
$1,000,000.00 OR AT ANY TIME WHEN A DEFAULT HAS OCCURRED AND IS
CONTINUING;
0.0.0.5. (A) IF ANY BANK SHALL, AT LEAST ONE BUSINESS DAY BEFORE THE
DATE OF ANY REQUESTED BORROWING, NOTIFY THE AGENT THAT THE INTRODUCTION OF
OR ANY CHANGE IN OR IN THE INTERPRETATION OF ANY LAW OR REGULATION MAKES
IT UNLAWFUL, OR THAT ANY CENTRAL BANK OR OTHER GOVERNMENTAL AUTHORITY
ASSERTS THAT IT IS UNLAWFUL, FOR SUCH BANK OR ITS EURODOLLAR LENDING
OFFICE TO PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT TO MAKE EURODOLLAR
ADVANCES OR TO FUND OR MAINTAIN EURODOLLAR ADVANCES, THE RIGHT OF THE
BORROWER TO SELECT EURODOLLAR ADVANCES FOR SUCH BORROWING OR FOR ANY
SUBSEQUENT BORROWING SHALL BE SUSPENDED UNTIL SUCH BANK SHALL NOTIFY THE
AGENT THAT THE CIRCUMSTANCES CAUSING SUCH SUSPENSION NO LONGER EXIST, AND
EACH ADVANCE COMPRISING SUCH BORROWING SHALL BE A BASE RATE ADVANCE AND
(B) SUCH BANK AGREES TO USE COMMERCIALLY REASONABLE EFFORTS (CONSISTENT
WITH ITS INTERNAL POLICIES AND LEGAL AND REGULATORY RESTRICTIONS) TO
DESIGNATE A DIFFERENT EURODOLLAR LENDING OFFICE IF THE MAKING OF SUCH
DESIGNATION WOULD AVOID THE EFFECT OF THIS PARAGRAPH AND WOULD NOT, IN THE
REASONABLE JUDGMENT OF SUCH BANK, BE OTHERWISE DISADVANTAGEOUS TO SUCH
BANK;
0.0.0.6. IF THE AGENT IS UNABLE TO DETERMINE THE EURODOLLAR RATE FOR
EURODOLLAR ADVANCES COMPRISING ANY REQUESTED BORROWING, THE RIGHT OF THE
BORROWER TO SELECT EURODOLLAR ADVANCES FOR SUCH BORROWING OR FOR ANY
SUBSEQUENT BORROWING SHALL BE SUSPENDED UNTIL THE AGENT SHALL NOTIFY THE
BORROWER AND THE BANKS THAT THE CIRCUMSTANCES CAUSING SUCH SUSPENSION NO
LONGER EXIST, AND EACH ADVANCE COMPRISING SUCH BORROWING SHALL BE A BASE
RATE ADVANCE;
0.0.0.7. IF THE MAJORITY BANKS SHALL, AT LEAST ONE BUSINESS DAY
BEFORE THE DATE OF ANY REQUESTED BORROWING, NOTIFY THE AGENT THAT THE
EURODOLLAR RATE FOR EURODOLLAR ADVANCES COMPRISING SUCH BORROWING WILL NOT
ADEQUATELY REFLECT THE COST TO SUCH BANKS OF MAKING OR FUNDING THEIR
RESPECTIVE EURODOLLAR ADVANCES, AS THE CASE MAY BE, FOR SUCH BORROWING,
THE RIGHT OF THE BORROWER TO SELECT EURODOLLAR ADVANCES FOR SUCH BORROWING
OR FOR ANY SUBSEQUENT BORROWING SHALL BE SUSPENDED UNTIL THE AGENT SHALL
NOTIFY THE BORROWER AND THE BANKS THAT THE CIRCUMSTANCES CAUSING SUCH
SUSPENSION NO LONGER EXIST, AND EACH ADVANCE COMPRISING SUCH BORROWING
SHALL BE A BASE RATE ADVANCE; AND
0.0.0.8. IF THE BORROWER SHALL FAIL TO SELECT THE DURATION OR
CONTINUATION OF ANY INTEREST PERIOD FOR ANY EURODOLLAR ADVANCES IN
ACCORDANCE WITH THE PROVISIONS CONTAINED IN THE DEFINITION OF INTEREST
PERIOD IN SECTION 1.1 AND PARAGRAPH (B) ABOVE, THE AGENT WILL FORTHWITH SO
NOTIFY THE BORROWER AND THE BANKS AND SUCH ADVANCES WILL BE MADE AVAILABLE
TO THE BORROWER ON THE DATE OF SUCH BORROWING AS BASE RATE ADVANCES OR, IF
AN EXISTING ADVANCE, CONVERT INTO BASE RATE ADVANCES.
0.0.0.8.1. NOTICES IRREVOCABLE. Each Notice of Borrowing and Notice
of Conversion or Continuation shall be irrevocable and binding on the Borrower.
In the case of any Borrowing which the related Notice of Borrowing specifies is
to be comprised of Eurodollar Advances, the Borrower shall indemnify each Bank
against any loss, out-of-pocket cost or expense actually incurred by such Bank
as a result of any failure to fulfill on or before the date specified in such
Notice of Borrowing for such Borrowing the applicable conditions set forth in
Article 3, including, without limitation, any loss, cost or expense actually
incurred by such Bank by reason of the liquidation or reemployment of deposits
or other funds acquired by such Bank to fund the Advance to be made by such
Bank as part of such Borrowing when such Advance, as a result of such failure,
is not made on such date.
0.0.0.8.2. AGENT RELIANCE. Unless the Agent shall have received
notice from a Bank before the date of any Borrowing that such Bank will not
make available to the Agent such Bank's Pro Rata Share of any Borrowing, the
Agent may assume that such Bank has made its Pro Rata Share of such Borrowing
available to the Agent on the date of such Borrowing in accordance with Section
2.2(a), and the Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that
such Bank shall not have so made its Pro Rata Share of such Borrowing available
to the Agent, such Bank and the Borrower severally agree to immediately repay
to the Agent on demand such corresponding amount, together with interest on
such amount, for each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the Agent, at (i) in the case
of the Borrower, the interest rate applicable on such day to Advances
comprising such Borrowing and (ii) in the case of such Bank, the Federal Funds
Rate for such day. If such Bank shall repay to the Agent such corresponding
amount and interest as provided above, such corresponding amount so repaid
shall constitute such Bank's Advance as part of such Borrowing for purposes of
this Agreement even though not made on the same day as the other Advances
comprising such Borrowing.
Section 0.0.0.8.3. PREPAYMENTS.
0.0.0.8.4. RIGHT TO PREPAY. The Borrower shall have no right to
prepay any principal amount of any Advance except as provided in this Section
2.3.
0.0.0.8.5. OPTIONAL. The Borrower may elect to prepay any of the
Advances without penalty or premium except as set forth in Section 2.8 after
giving by 11:00 a.m. (Dallas, Texas time) (i) in the case of Eurodollar
Advances, at least three Business Days' or (ii) in case of Base Rate Advances,
same Business Day's prior written notice to the Agent stating the proposed date
and aggregate principal amount of such prepayment. If any such notice is
given, the Borrower shall prepay Advances comprising part of the same Borrowing
in whole or ratably in part in an aggregate principal amount equal to the
amount specified in such notice, together with accrued interest to the date of
such prepayment on the principal amount prepaid and amounts, if any, required
to be paid pursuant to Section 2.8 as a result of such prepayment being made on
such date; PROVIDED that each partial prepayment of a Borrowing comprised of
(i) Base Rate Advances shall be in a minimum amount not less than $400,000.00
and in multiple integrals of $100,000.00 in excess thereof and (ii) Eurodollar
Advances shall be in a minimum amount not less than $1,000,000.00 and in
multiple integrals of $100,000.00 in excess thereof.
0.0.0.8.6. MANDATORY.
0.0.0.9. ON THE DATE OF EACH REDUCTION OF THE AGGREGATE REVOLVING
CREDIT COMMITMENTS PURSUANT TO SECTION 2.1(C), THE BORROWER AGREES TO MAKE
A PREPAYMENT IN RESPECT OF THE OUTSTANDING AMOUNT OF REVOLVING CREDIT
ADVANCES TO THE EXTENT, IF ANY, THAT THE AGGREGATE UNPAID PRINCIPAL AMOUNT
OF ALL REVOLVING CREDIT ADVANCES EXCEEDS THE AGGREGATE REVOLVING CREDIT
COMMITMENTS, AS SO REDUCED.
0.0.0.10. THE BORROWER SHALL REPAY THE TERM ADVANCES:
0.0.0.10.1. PROMPTLY AFTER THE RECEIPT OF THE CASH
PROCEEDS FROM A NONORDINARY COURSE ASSET SALE, BY AN AMOUNT EQUAL TO
100% OF THE NET CASH PROCEEDS ANY CREDIT PARTY RECEIVES FROM SUCH
NONORDINARY COURSE ASSET SALE AND
0.0.0.10.2. PROMPTLY AFTER THE RECEIPT OF THE CASH
PROCEEDS FROM THE SALE OF ANY CAPITAL STOCK, BY AN AMOUNT EQUAL TO
50% OF THE NET CASH PROCEEDS ANY CREDIT PARTY RECEIVES FROM THE SALE
OF ITS CAPITAL STOCK.
0.0.0.11. EACH PREPAYMENT PURSUANT TO THIS SECTION 2.3 SHALL BE
ACCOMPANIED BY ACCRUED INTEREST ON THE AMOUNT PREPAID TO THE DATE OF SUCH
PREPAYMENT AND AMOUNTS, IF ANY, REQUIRED TO BE PAID PURSUANT TO
SECTION 2.8 AS A RESULT OF SUCH PREPAYMENT BEING MADE ON SUCH DATE.
0.0.0.11.1. APPLICATION OF TERM ADVANCE PREPAYMENTS. Each prepayment
of Term Advances shall be applied, at the Borrower's option, (i) to the
scheduled principal installments in the inverse order of their maturity or
(ii) to the scheduled principal installments pro rata.
Section 0.0.0.11.2. REPAYMENT.
0.0.0.11.3. REVOLVING CREDIT ADVANCES. The Borrower shall pay to each
Bank the aggregate amount of the Revolving Credit Advances owed to such Bank on
the Revolving Credit Maturity Date.
0.0.0.11.4. TERM ADVANCES. The Borrower shall repay the Term Advances
ratably to the Banks in 24 installments on each October 31, January 31, April
30, and July 31 beginning October 31, 1996 in the following amounts on the
following dates:
From October 31, 1996
through July 31, 1997 $1,500,000.00
From October 31, 1997
through July 31, 1998 $3,000,000.00
From October 31, 1998
through July 31, 1999 $3,750,000.00
From October 31, 1999
through July 31, 2001 $4,375,000.00
From October 31, 2001
through July 31, 2002 $5,500,000.00
The Borrower shall pay to each Bank the aggregate amount of the Term Advance
owed to such Bank on the Term Maturity Date.
Section 0.0.0.11.5. FEES.
0.0.0.11.6. COMMITMENT FEES. The Borrower agrees to pay to the Agent
for the account of each Bank a commitment fee on the average daily amount by
which such Bank's Commitments exceeds the sum of such Bank's outstanding
Advances and Pro Rata Share of the Letter of Credit Exposure from the date of
this Agreement until the Revolving Credit Maturity Date at the rate equal to
the Applicable Margin for commitment fees during such period. The fee payable
pursuant to this clause (a) is due quarterly in arrears on October 31, January
31, April 30, and July 31 of each year commencing October 31, 1996, and on the
Revolving Credit Maturity Date.
0.0.0.11.7. AGENT'S AND ARRANGER'S FEES. The Borrower agrees to pay to
the Agent and the Arranger the agent's and arranger's fees described in the
letter dated June 8, 1996, from the Agent to the Borrower.
0.0.0.11.8. LETTER OF CREDIT FEES. The Borrower agrees to pay (i) to
the Agent for the pro rata benefit of the Banks, a fee per annum for each
Letter of Credit equal to the Applicable Margin for Eurodollar Advances of the
face amount of such Letter of Credit and (ii) to the Issuing Bank, a fee for
each Letter of Credit of 0.125% per annum of the face amount of such Letter of
Credit. Each such fee shall be based on the maximum amount available to be
drawn under such Letter of Credit from the date of issuance of the Letter of
Credit until its Expiration Date and be payable in advance (A) on the date of
the issuance of the Letter of Credit for the period from such date until the
first to occur of October 31, January 31, April 30, or July 31 after such date
and (B) on each October 31, January 31, April 30, and July 31 thereafter until
its expiration date for the period from such date to the earlier of the end of
the three month period following such date and its expiration date.
Section 0.0.0.11.9. INTEREST.
0.0.0.11.10. BASE RATE ADVANCES. Each Base Rate Advance shall bear
interest at the Adjusted Base Rate in effect from time-to-time PLUS the
Applicable Margin, PROVIDED that (i) while an Event of Default pursuant to
Section 6.1(a) is continuing or (ii) (A) while any Event of Default other than
pursuant to Section 6.1(a) is continuing and (B) the Agent has given the
Borrower notice that the Majority Banks have exercised their right to increase
the rate of interest, the Base Rate Advances shall bear interest at the
Adjusted Base Rate in effect from time-to-time PLUS the Applicable Margin PLUS
2%. The Borrower shall pay to each Bank all accrued but unpaid interest on
such Bank's Base Rate Advances on each October 31, January 31, April 30, and
July 31 beginning with October 31, 1996, on the date such Base Rate Advances
are repaid in full, and on the Revolving Credit Maturity Date.
0.0.0.11.11. EURODOLLAR ADVANCES. Each Eurodollar Advance shall bear
interest during its Interest Period equal to at all times the Eurodollar Rate
for such Interest Period PLUS the Applicable Margin in effect from time-to-
time, PROVIDED that (i) while an Event of Default pursuant to Section 6.1(a) is
continuing or (ii) (A) while any Event of Default other than pursuant to
Section 6.1(a) is continuing and (B) the Agent has given the Borrower notice
that the Majority Banks have exercised their right to increase the rate of
interest, the Eurodollar Advances shall bear interest at the Eurodollar Rate in
effect from time-to-time PLUS the Applicable Margin PLUS 2%. The Borrower
shall pay to each Bank all accrued but unpaid interest on each of such Bank's
Eurodollar Advances on the last day of the Interest Period therefor (provided
that for Eurodollar Advances with six month Interest Periods, accrued but
unpaid interest shall also be due on the day three months from the first day of
such Interest Period), on the date any Eurodollar Advance is repaid in full,
and on the Revolving Credit Maturity Date.
0.0.0.11.12. ADDITIONAL INTEREST ON EURODOLLAR ADVANCES. The Borrower
shall pay to each Bank so long as such Bank shall be required under regulations
of the Federal Reserve Board to maintain reserves with respect to liabilities
or assets consisting of or including Eurocurrency Liabilities, additional
interest on the unpaid principal amount of each Eurodollar Advance of such
Bank, from the effective date of such Eurodollar Advance until such principal
amount is paid in full, at an interest rate per annum equal at all times to the
remainder obtained by subtracting (A) the Eurodollar Rate for the Interest
Period for such Eurodollar Advance from (B) the rate obtained by dividing such
Eurodollar Rate by a percentage equal to 100% MINUS the Eurodollar Reserve
Percentage of such Bank for such Interest Period, payable on each date on which
interest is payable on such Advance. Such additional interest payable to any
Bank shall be determined by such Bank and notified to the Borrower (such notice
to include the calculation of such additional interest, which calculation shall
be conclusive in the absence of manifest error).
0.0.0.11.13. RECAPTURE. If the stated rates of interest under this
Agreement ever exceed the Highest Lawful Rate, then the outstanding principal
amount of the loans made hereunder shall bear interest at the Highest Lawful
Rate until the difference between the interest which would have been due at the
stated rates of interest and the amount due at the Highest Lawful Rate (the
"Lost Interest") has been recaptured by the Bank. If when the loans made
hereunder are repaid in full the Lost Interest has not been fully recaptured by
the Banks pursuant to the preceding sentence, then the loans made hereunder
shall be deemed to have accrued interest at the Highest Lawful Rate since the
effectiveness of this Agreement to the extent necessary to recapture the Lost
Interest not recaptured pursuant to the preceding sentence and, to the extent
allowed by law, the Borrower shall pay to the Banks the amount of the Lost
Interest remaining to be recaptured by the Bank. Notwithstanding the foregoing
or any other term in this Agreement and the Credit Documents to the contrary,
it is the intention of the Banks and the Borrower to conform strictly to any
applicable usury laws. Accordingly, if the Banks contract for, charge, or
receive any consideration which constitutes interest in excess of the Highest
Lawful Rate, then any such excess shall be canceled automatically and, if
previously paid, shall at the Bank's option be applied to the outstanding
amount of the loans made hereunder or be refunded to the Borrower.
Section 0.0.0.11.14. ILLEGALITY. If any Bank shall notify the
Borrower that the introduction of or any change in or in the interpretation of
any law or regulation makes it unlawful, or that any central bank or other
governmental authority asserts that it is unlawful, for such Bank or its
Alternate Lending Office to perform its obligations under this Agreement to
maintain any Eurodollar Advances of such Bank then outstanding hereunder,
(a) the Borrower shall, no later than 10:00 a.m. (Dallas, Texas, time) (i) if
not prohibited by law, on the last day of the Interest Period for each
outstanding Eurodollar Advance or (ii) if required by such notice, on the
second Business Day following its receipt of such notice, prepay all of the
Eurodollar Advances of such Bank then outstanding, together with accrued
interest on the principal amount prepaid to the date of such prepayment and
amounts, if any, required to be paid pursuant to Section 2.8(b) as a result of
such prepayment being made on such date, (b) such Bank shall simultaneously
make a Base Rate Advance to the Borrower on such date in an amount equal to the
aggregate principal amount of the Eurodollar Advances prepaid to such Bank, and
(c) the right of the Borrower to select Eurodollar Advances from such Bank for
any subsequent Borrowing shall be suspended until such Bank shall notify the
Borrower that the circumstances causing such suspension no longer exist. Each
Bank agrees to use commercially reasonable efforts (consistent with its
internal policies and legal and regulatory restrictions) to designate a
different Applicable Lending Office if the making of such designation would
avoid the effect of this paragraph and would not, in the reasonable judgment of
such Bank, be otherwise disadvantageous to such Bank.
Section 0.0.0.11.15. BREAKAGE COSTS.
0.0.0.11.16. FUNDING LOSSES. In the case of any Borrowing which the
related Notice of Borrowing specifies is to be comprised of Eurodollar
Advances, the Borrower shall indemnify each Bank against any loss, out-of-
pocket cost, or expense incurred by such Bank as a result of any failure to
fulfill on or before the date specified in such Notice of Borrowing for such
Borrowing the applicable conditions set forth in Article 3, including, without
limitation, any loss (including any loss of anticipated profits), cost, or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Bank to fund the Eurodollar Advance to be made by
such Bank as part of such Borrowing when such Eurodollar Advance, as a result
of such failure, is not made on such date.
0.0.0.11.17. PREPAYMENT LOSSES. If (i) any payment of principal of any
Eurodollar Advance is made other than on the last day of the Interest Period
for such Advance as a result of any voluntary prepayment, payment pursuant to
Section 2.9, the acceleration of the maturity of the Notes, or for any other
reason or (ii) the Borrower fails to make a principal or interest payment with
respect to any Eurodollar Advance on the date such payment is due and payable,
the Borrower shall, within 10 days of any written demand sent by any Bank to
the Borrower, pay to such Bank any amounts required to compensate such Bank for
any additional losses, out-of-pocket costs, or expenses which it may reasonably
incur as a result of such payment or nonpayment, including, without limitation,
any loss (including loss of anticipated profits), cost, or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired
by any Bank to fund or maintain such Advance.
Section 0.0.0.11.18. INCREASED COSTS.
0.0.0.11.19. EURODOLLAR ADVANCES. If, due to either (i) the
introduction of or any change (other than any change by way of imposition or
increase of reserve requirements included in the Eurodollar Reserve Percentage)
in or change in the interpretation of any law or regulation or (ii) the
compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall be
any increase in the cost to any Bank of agreeing to make, making, funding, or
maintaining Eurodollar Advances, then the Borrower shall, from time-to-time,
upon demand by such Bank, immediately pay to such Bank additional amounts
sufficient to compensate such Bank for such increased cost; PROVIDED that
before making any such demand, each Bank agrees to use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to
designate a different Applicable Lending Office if the making of such a
designation would avoid or decrease such increased cost and would not, in the
reasonable judgment of such Bank, be otherwise disadvantageous to such Bank. A
certificate as to the amount of such increased cost submitted to the Borrower
by such Bank shall be conclusive and binding for all purposes, absent manifest
error.
0.0.0.11.20. CAPITAL ADEQUACY. If any Bank determines that compliance
with any law or regulation or any guideline or request from any central bank or
other governmental authority (whether or not having the force of law) affects
or would affect the amount of capital required or expected to be maintained by
such Bank or any corporation controlling such Bank and that the amount of such
capital is increased by or based upon the existence of such Bank's commitment
to lend hereunder and other commitments of this type, then, upon 30 days prior
written notice by such Bank, the Borrower shall immediately pay to such Bank
from time-to-time as specified by such Bank, additional amounts sufficient to
compensate such Bank in light of such circumstances to the extent that such
Bank reasonably determines such increase in required capital to be allocable to
the existence of such Bank's commitment to lend under this Agreement. A
certificate as to such amounts submitted to the Borrower by such Bank shall be
conclusive and binding for all purposes, absent manifest error.
0.0.0.11.21. LETTERS OF CREDIT. If any change in any law or regulation
or in the interpretation thereof by any court or administrative or governmental
authority charged with the administration thereof shall either (i) impose,
modify, or deem applicable any reserve, special deposit, or similar requirement
against letters of credit issued by, or assets held by, or deposits in or for
the account of, the Issuing Bank or (ii) impose on the Issuing Bank any other
condition regarding the provisions of this Agreement relating to the Letters of
Credit or any Letter of Credit Obligations, and the result of any event
referred to in the preceding clause (i) or (ii) shall be to increase the cost
to the Issuing Bank of issuing or maintaining any Letter of Credit (which
increase in cost shall be determined by the Issuing Bank's reasonable
allocation of the aggregate of such cost increases resulting from such event),
then, upon demand by the Issuing Bank, the Borrower shall pay to the Issuing
Bank, from time-to-time as specified by the Issuing Bank, additional amounts
which shall be sufficient to compensate the Issuing Bank for such increased
cost. The Issuing Bank agrees to use commercially reasonable efforts
(consistent with internal policy and legal and regulatory restrictions) to
designate a different Applicable Lending Office for the booking of its Letters
of Credit if the making of such designation would avoid the effect of this
paragraph and would not, in the reasonable judgment of the Issuing Bank, be
otherwise disadvantageous to the Issuing Bank. A certificate as to such
increased cost incurred by the Issuing Bank, as a result of any event mentioned
in clause (i) or (ii) above, and detailing the calculation of such increased
costs submitted by the Issuing Bank to the Borrower, shall be conclusive and
binding for all purposes, absent manifest error.
Section 0.0.0.11.22. PAYMENTS AND COMPUTATIONS.
0.0.0.11.23. PAYMENT PROCEDURES. The Borrower shall make each payment
under this Agreement and under the Notes not later than 11:00 a.m. (Dallas,
Texas time) on the day when due in Dollars to the Agent at the location
referred to in the Notes (or such other location as the Agent shall designate
in writing to the Borrower) in same day funds. The Agent will promptly
thereafter, and in any event prior to the close of business on the day any
timely payment is made, cause to be distributed like funds relating to the
payment of principal, interest or fees ratably (other than amounts payable
solely to the Agent, the Issuing Bank, or a specific Bank pursuant to
Sections 2.5(b), 2.5(c), 2.6(c), 2.8, 2.9, 2.11, and 8.2 but after taking into
account payments effected pursuant to Section 8.1) in accordance with each
Bank's Pro Rata Share to the Banks for the account of their respective
Applicable Lending Offices, and like funds relating to the payment of any other
amount payable to any Bank or the Issuing Bank to such Bank for the account of
its Applicable Lending Office, in each case to be applied in accordance with
the terms of this Agreement.
0.0.0.11.24. AUTHORITY TO CHARGE ACCOUNTS. The Borrower hereby
authorizes each Bank, if and to the extent payment owed to such Bank is not
made when due, taking into consideration any applicable grace period, to charge
from time-to-time against any account of the Borrower with such Bank any amount
so due.
0.0.0-11.25. NON-BUSINESS DAY PAYMENTS. Whenever any payment shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or fees, as the case
may be; PROVIDED that if such extension would cause payment of interest on or
principal of Eurodollar Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.
0.0.0.11.26. COMPUTATIONS. All computations of interest based on the
Base Rate shall be made by the Agent on the basis of a year of 365 or 366 days,
as the case may be, and all computations of interest based on the Eurodollar
Rate, the Federal Funds Rate, and of fees shall be made by the Agent, on the
basis of a year of 360 days, in each case for the actual number of days
(including the first day, but excluding the last day) occurring in the period
for which such interest or fees are payable. Each determination by the Agent
of an interest rate shall be conclusive and binding for all purposes, absent
manifest error.
0.0.0.11.27. SHARING OF PAYMENTS, ETC. If any Bank shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Advances made by it in excess of its
ratable share of payments on account of the Advances obtained by the Banks,
such Bank shall notify the other Bank and forthwith purchase from the other
Bank such participations in the Advances made by it as shall be necessary to
cause such purchasing Bank to share the excess payment ratably with the other
Bank; PROVIDED that if all or any portion of such excess payment is thereafter
recovered from such purchasing Bank, such purchase from the other Bank shall be
rescinded and such Bank shall repay to the purchasing Bank the purchase price
to the extent of such Bank's ratable share, but without interest. The Borrower
agrees that any Bank so purchasing a participation from another Bank pursuant
to this Section 2.10(e) may, to the fullest extent permitted by law, exercise
all its rights of payment (including the right of set-off) with respect to such
participation as fully as if such Bank were the direct creditor of the Borrower
in the amount of such participation.
Section 0.0.0.11.28. TAXES.
0.0.0.11.29. NO DEDUCTION FOR CERTAIN TAXES. Any and all payments by
the Borrower shall be made, in accordance with Section 2.10, free and clear of
and without deduction for any and all present or future taxes, levies, imposts,
deductions, charges, or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Bank, taxes imposed on its income and franchise
taxes imposed on it by the jurisdiction under the laws of which such Bank is
organized or any political subdivision of such jurisdiction (all such
nonexcluded taxes, levies, imposts, deductions, charges, withholdings, and
liabilities being hereinafter referred to as "Taxes") and, in the case of each
Bank, Taxes by the jurisdiction of such Bank's Applicable Lending Office or any
political subdivision of such jurisdiction. Unless the Bank can prevent
withholding by complying with Section 2.11(e), if the Borrower shall be
required by law to deduct any Taxes from or in respect of any sum payable to
any Bank, (i) the sum payable shall be increased as may be necessary so that,
after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.11), such Bank receives an amount
equal to the sum it would have received had no such deductions been made;
(ii) the Borrower shall make such deductions; and (iii) the Borrower shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law.
0.0.0.11.30. OTHER TAXES. In addition, the Borrower agrees to pay any
present or future stamp or documentary taxes or any other excise or property
taxes, charges, or similar levies which arise from any payment made or from the
execution, delivery, or registration of, or otherwise with respect to, this
Agreement, the Notes, or the other Credit Documents (hereinafter referred to as
"Other Taxes").
0.0.0.11.31. INDEMNIFICATION. The Borrower indemnifies each Bank for
the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this
Section 2.11) paid by such Bank and any liability (including penalties,
interest, and expenses) arising therefrom or with respect thereto, whether or
not such Taxes or Other Taxes were correctly or legally asserted. Each payment
required to be made by the Borrower in respect of this indemnification shall be
made to the party claiming such indemnification within 30 days from the date
the Borrower receives written demand therefor.
0.0.0.11.32. EVIDENCE OF TAX PAYMENTS. The Borrower shall pay when due
all Taxes payable in respect of any payment. Within 30 days after the date of
any payment of Taxes, the Borrower shall provide to the Agent an original or a
certified copy of a receipt evidencing payment of such Taxes.
0.0.0.11.33. FOREIGN BANK WITHHOLDING EXEMPTION. Each Bank and Issuing
Bank that is not incorporated under the laws of the United States of America or
a state thereof agrees that it will deliver to the Borrower and the Agent on
the date of this Agreement or upon the effectiveness of any Assignment and
Acceptance (i) two duly completed copies of United States Internal Revenue
Service Form 1001 or 4224 or successor applicable form, as the case may be,
certifying in each case that such Bank is entitled to receive payments under
this Agreement and the Notes payable to it, without deduction or withholding of
any United States federal income taxes, (ii) if applicable, an Internal Revenue
Service Form W-8 or W-9 or successor applicable form, as the case may be, to
establish an exemption from United States backup withholding tax, and (iii) any
other governmental forms which are necessary or required under an applicable
tax treaty or otherwise by law to reduce or eliminate any withholding tax,
which have been reasonably requested by the Borrower. Each Bank which delivers
to the Borrower and the Agent a Form 1001 or 4224 and Form W-8 or W-9 pursuant
to the next preceding sentence further undertakes to deliver to the Borrower
and the Agent two further copies of the said letter and Form 1001 or 4224 and
Form W-8 or W-9, or successor applicable forms, or other manner of
certification, as the case may be, on or before the date that any such letter
or form expires or becomes obsolete or after the occurrence of any event
requiring a change in the most recent letter and form previously delivered by
it to the Borrower and the Agent, and such extensions or renewals thereof as
may reasonably be requested by the Borrower and the Agent certifying in the
case of a Form 1001 or 4224 that such Bank is entitled to receive payments
under this Agreement without deduction or withholding of any United States
federal income taxes. If an event (including without limitation any change in
treaty, law or regulation) has occurred prior to the date on which any delivery
required by the preceding sentence would otherwise be required which renders
all such forms inapplicable or which would prevent any Bank from duly
completing and delivering any such letter or form with respect to it and such
Bank advises the Borrower and the Agent that it is not capable of receiving
payments without any deduction or withholding of United States federal income
tax, and in the case of a Form W-8 or W-9, establishing an exemption from
United States backup withholding tax, such Bank shall not be required to
deliver such letter or forms. The Borrower shall withhold tax at the rate and
in the manner required by the laws of the United States with respect to
payments made to a Bank failing to timely provide the requisite Internal
Revenue Service forms.
Section 0.0.0.11.34. LETTERS OF CREDIT.
0.0.0.11.35. ISSUANCE. From time-to-time from the Effective Date until
the Revolving Credit Maturity Date, at the request of the Borrower, the Issuing
Bank shall, on the terms and conditions hereinafter set forth, issue, increase,
or extend the Expiration Date of Letters of Credit for the account of the
Borrower on any Business Day. No Letter of Credit shall be issued, increased,
or extended:
0.0.0.12. UNLESS SUCH ISSUANCE, INCREASE, EXTENSION OR CONVERSION
WOULD NOT CAUSE THE LETTER OF CREDIT EXPOSURE TO EXCEED THE LESSER OF
(A) $15,000,000.00 OR (B) THE AGGREGATE REVOLVING CREDIT COMMITMENTS MINUS
THE AGGREGATE OUTSTANDING PRINCIPAL AMOUNT OF ALL REVOLVING CREDIT
ADVANCES;
0.0.0.13. UNLESS SUCH LETTER OF CREDIT HAS AN EXPIRATION DATE NOT
LATER THAN THE EARLIER OF (A) TWELVE MONTHS AFTER THE DATE OF ISSUANCE
THEREOF OR (B) THE REVOLVING CREDIT MATURITY DATE;
0.0.0.14. UNLESS THE LETTER OF CREDIT DOCUMENTS EXECUTED IN
CONNECTION WITH LETTERS OF CREDIT ARE IN FORM AND SUBSTANCE ACCEPTABLE TO
THE ISSUING BANK IN ITS SOLE DISCRETION;
0.0.0.15. UNLESS SUCH LETTER OF CREDIT IS A STANDBY LETTER OF CREDIT
NOT SUPPORTING THE REPAYMENT OF INDEBTEDNESS FOR BORROWED MONEY OF ANY
PERSON;
0.0.0.16. UNLESS THE BORROWER HAS DELIVERED TO THE ISSUING BANK A
COMPLETED AND EXECUTED LETTER OF CREDIT APPLICATION; AND
0.0.0.17. UNLESS SUCH LETTER OF CREDIT IS GOVERNED BY THE UNIFORM
CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION),
INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 500 OR ANY SUCCESSOR TO
SUCH PUBLICATION.
If the terms of any Letter of Credit Application referred to in the foregoing
clause (v) conflicts with the terms of this Agreement, the terms of this
Agreement shall control.
0.0.0.17.1. PARTICIPATIONS. (i) On the Effective Date, the Issuing
Bank shall be deemed to have sold to each Bank and each other Bank shall be
deemed to have purchased from the Issuing Bank a participation equal to such
Bank's Pro Rata Share at such date in the Letter of Credit Obligations related
to each Letter of Credit issued under the Existing Credit Agreement and
outstanding on the Effective Date and (ii) upon the date of the issuance or
increase of a Letter of Credit, the Issuing Bank shall be deemed to have sold
to each other Bank and each other Bank shall have been deemed to have purchased
from the Issuing Bank a participation in the related Letter of Credit
Obligations equal to such Bank's Pro Rata Share at such date and such sale and
purchase shall otherwise be in accordance with the terms of this Agreement.
The Issuing Bank shall promptly notify each such participant Bank by telex,
telephone, or telecopy of each Letter of Credit issued, increased, or extended
and the actual dollar amount of such Bank's participation in such Letter of
Credit.
0.0.0.17.2. REIMBURSEMENT. The Borrower hereby agrees to pay on demand
to the Issuing Bank an amount equal to any amount paid by the Issuing Bank
under any Letter of Credit. In the event the Issuing Bank makes a payment
pursuant to a request for draw presented under a Letter of Credit and such
payment is not promptly reimbursed by the Borrower upon demand, the Issuing
Bank shall give the Agent notice of the Borrower's failure to make such
reimbursement and the Agent shall promptly notify each Bank of the amount
necessary to reimburse the Issuing Bank. Upon such notice from the Agent, each
Bank shall promptly reimburse the Issuing Bank for such Bank's Pro Rata Share
of such amount, and such reimbursement shall be deemed for all purposes of this
Agreement to be a Base Rate Revolving Credit Advance to the Borrower
transferred at the Borrower's request to the Issuing Bank. If such
reimbursement is not made by any Bank to the Issuing Bank on the same day on
which the Agent notifies such Bank to make reimbursement to the Issuing Bank
hereunder, such Bank shall pay interest on its Pro Rata thereof to the Issuing
Bank at a rate per annum equal to the Federal Funds Rate. The Borrower hereby
unconditionally and irrevocably authorizes, empowers, and directs the Agent and
the Banks to record and otherwise treat such reimbursements to the Issuing Bank
as a Revolving Credit Borrowing comprised of Base Rate Advances requested by
the Borrower to reimburse the Issuing Bank which have been transferred to the
Issuing Bank at the Borrower's request.
0.0.0.17.3. OBLIGATIONS UNCONDITIONAL. The obligations of the Borrower
under this Agreement in respect of each Letter of Credit shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of
this Agreement under all circumstances, including, without limitation, the
following circumstances:
0.0.0.18. ANY LACK OF VALIDITY OR ENFORCEABILITY OF ANY LETTER OF
CREDIT DOCUMENTS;
0.0.0.19. ANY AMENDMENT OR WAIVER OF, OR ANY CONSENT TO, DEPARTURE
FROM ANY LETTER OF CREDIT DOCUMENTS;
0.0.0.20. THE EXISTENCE OF ANY CL-IM, SET-OFF, DEFENSE, OR OTHER
RIGHT WHICH THE BORROWER MAY HAVE AT ANY TIME AGAINST ANY BENEFICIARY OR
TRANSFEREE OF SUCH LETTER OF CREDIT (OR ANY PERSONS FOR WHOM ANY SUCH
BENEFICIARY OR ANY SUCH TRANSFEREE MAY BE ACTING), THE ISSUING BANK, OR
ANY OTHER PERSON OR ENTITY, WHETHER IN CONNECTION WITH THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED IN THIS AGREEMENT OR IN ANY LETTER OF CREDIT
DOCUMENTS, OR ANY UNRELATED TRANSACTION;
0.0.0.21. ANY STATEMENT OR ANY OTHER DOCUMENT PRESENTED UNDER SUCH
LETTER OF CREDIT PROVING TO BE FORGED, FRAUDULENT, INVALID, OR
INSUFFICIENT IN ANY RESPECT OR ANY STATEMENT THEREIN BEING UNTRUE OR
INACCURATE IN ANY RESPECT TO THE EXTENT THE ISSUING BANK WOULD NOT BE
LIABLE THEREFOR PURSUANT TO THE FOLLOWING PARAGRAPH (E);
0.0.0.22. PAYMENT BY THE ISSUING BANK UNDER SUCH LETTER OF CREDIT
AGAINST PRESENTATION OF A DRAFT OR CERTIFICATE WHICH DOES NOT COMPLY WITH
THE TERMS OF SUCH LETTER OF CREDIT; OR
0.0.0.23. ANY OTHER CIRCUMSTANCE OR HAPPENING WHATSOEVER, WHETHER OR
NOT SIMILAR TO ANY OF THE FOREGOING;
PROVIDED that nothing contained in this paragraph (d) shall be deemed to
constitute a waiver of any remedies of the Borrower in connection with the
Letters of Credit.
0.0.0.23.1. LIABILITY OF ISSUING BANK. The Borrower assumes all risks
of the acts or omissions of any beneficiary or transferee of any Letter of
Credit with respect to its use of such Letter of Credit. Neither the Issuing
Bank nor any of its officers or directors shall be liable or responsible for:
0.0.0.24. THE USE WHICH MAY BE MADE OF ANY LETTER OF CREDIT OR ANY
ACTS OR OMISSIONS OF ANY BENEFICIARY OR TRANSFEREE IN CONNECTION
THEREWITH;
0.0.0.25. THE VALIDITY, SUFFICIENCY, OR GENUINENESS OF DOCUMENTS, OR
OF ANY ENDORSEMENT THEREON, EVEN IF SUCH DOCUMENTS SHOULD PROVE TO BE IN
ANY OR ALL RESPECTS INVALID, INSUFFICIENT, FRAUDULENT, OR FORGED;
0.0.0.26. PAYMENT BY THE ISSUING BANK AGAINST PRESENTATION OF
DOCUMENTS WHICH DO NOT COMPLY WITH THE TERMS OF A LETTER OF CREDIT,
INCLUDING FAILURE OF ANY DOCUMENTS TO BEAR ANY REFERENCE OR ADEQUATE
REFERENCE TO THE RELEVANT LETTER OF CREDIT; OR
0.0.0.27. ANY OTHER CIRCUMSTANCES WHATSOEVER IN MAKING OR FAILING TO
MAKE PAYMENT UNDER ANY LETTER OF CREDIT (INCLUDING THE ISSUING BANK'S OWN
NEGLIGENCE),
EXCEPT that the Borrower shall have a claim against the Issuing Bank, and the
Issuing Bank shall be liable to the Borrower, to the extent of any direct, as
opposed to consequential, damages suffered by the Borrower which the Borrower
proves were caused by (A) the Issuing Bank's willful misconduct or gross
negligence in determining whether documents presented under a Letter of Credit
comply with the terms of such Letter of Credit or (B) the Issuing Bank's
willful failure to make lawful payment under any Letter of Credit after the
presentation to it of a draft and certificate strictly complying with the terms
and conditions of such Letter of Credit. In furtherance and not in limitation
of the foregoing, the Issuing Bank may accept documents that appear on their
face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary.
ARTICLE 0.0.0.27.1.
CONDITIONS OF LENDING
Section 0.0.0.27.2. CONDITIONS PRECEDENT TO INITIAL BORROWINGS. This
Agreement shall become effective and the Existing Credit Agreement shall be
amended and restated as provided in this Agreement on the date the following
conditions precedent are met ("Effective Date") and the obligations of each
Bank to make the initial Term Advance and Revolving Credit Advance shall be
subject to the conditions precedent that:
0.0.0.27.3. DOCUMENTATION. The Banks shall have received the
following, duly executed by all the parties thereto, in form and substance
satisfactory to the Agent and (except for the Notes) in sufficient copies for
each Bank:
0.0.0.28. THIS AGREEMENT AND ALL ATTACHED EXHIBITS AND SCHEDULES AND
THE NOTES PAYABLE TO THE ORDER OF EACH OF THE BANKS, RESPECTIVELY;
0.0.0.29. A GUARANTY BY EACH OF THE BORROWER'S SUBSIDIARIES,
INCLUDING MAXXIM DELAWARE (OTHER THAN THE TARGET AND ITS SUBSIDIARIES);
0.0.0.30. A PLEDGE AGREEMENT EXECUTED (A) BY THE BORROWER PLEDGING
100% OF THE CAPITAL STOCK OF MAXXIM DELAWARE AND (B) BY MAXXIM DELAWARE
PLEDGING 100% OF THE CAPITAL STOCK OF ITS U.S. SUBSIDIARIES (OTHER THAN
THE TARGET) AND 65% OF THE CAPITAL STOCK OF ITS FOREIGN SUBSIDIARIES AND
THE STOCK CERTIFICATES PLEDGED IN ACCORDANCE WITH EACH SUCH PLEDGE
AGREEMENT;
0.0.0.31. A CERTIFICATE FROM THE CHIEF EXECUTIVE OFFICER, PRESIDENT
OR CHIEF OPERATING OFFICER OF THE BORROWER DATED AS OF THE EFFECTIVE DATE
STATING THAT AS OF SUCH DATE (A) ALL REPRESENTATIONS AND WARRANTIES OF THE
BORROWER SET FORTH IN THIS AGREEMENT ARE TRUE AND CORRECT IN ALL MATERIAL
RESPECTS AND (B) NO DEFAULT HAS OCCURRED AND IS CONTINUING;
0.0.0.32. COPIES, EACH CERTIFIED BY A SECRETARY OR ASSISTANT
SECRETARY OF THE APPROPRIATE PERSON, (A) OF THE RESOLUTIONS OF THE BOARD
OF DIRECTORS OF EACH CREDIT PARTY APPROVING THE CREDIT DOCUMENTS TO WHICH
IT IS A PARTY, (B) OF THE ARTICLES OR CERTIFICATE OF INCORPORATION AND
BYLAWS OF EACH CREDIT PARTY AND ALL DOCUMENTS EVIDENCING OTHER NECESSARY
CORPORATE ACTION AND GOVERNMENTAL APPROVALS, IF ANY, WITH RESPECT TO THE
CREDIT DOCUMENTS TO WHICH IT IS A PARTY, (C) OF THE CONVERTIBLE NOTE
INDENTURE, AND (D) THE SENIOR SUBORDINATED NOTE INDENTURE;
0.0.0.33. A CERTIFICATE OF THE SECRETARY OR AN ASSISTANT SECRETARY OF
EACH CREDIT PARTY DATED AS OF THE DATE OF THIS AGREEMENT CERTIFYING AS OF
THE DATE OF THIS AGREEMENT THE NAMES AND TRUE SIGNATURES OF OFFICERS OF
EACH CREDIT PARTY AUTHORIZED TO SIGN THE CREDIT DOCUMENTS TO WHICH IT IS A
PARTY;
0.0.0.34. AN OPINION OF BOYER, EWING AND HARRIS INCORPORATED, AS
COUNSEL FOR THE BORROWER, SUBSTANTIALLY IN THE FORM OF THE ATTACHED
EXHIBIT H AND COVERING OTHER MATTERS AS THE AGENT, ON BEHALF OF THE BANKS,
MAY REASONABLY REQUEST; AND
0.0.0.35. SUCH OTHER DOCUMENTS, GOVERNMENTAL CERTIFICATES,
AGREEMENTS, AND LIEN SEARCHES AS THE AGENT OR ANY BANK MAY REASONABLY
REQUEST.
0.0.0.35.1. TENDER OFFER.
0.0.0.36. THE BORROWER SHALL HAVE RECEIVED AT LEAST $97,000,000.00 IN
NET PROCEEDS FROM THE ISSUANCE OF THE SENIOR SUBORDINATED NOTES;
0.0.0.37. THE AGENT SHALL HAVE RECEIVED TRUE COPIES OF THE TENDER
OFFER DOCUMENTS AND THE MERGER AGREEMENT (WHICH SHALL BE IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO THE AGENT), CERTIFIED BY THE
SECRETARY OR AN ASSISTANT SECRETARY OF THE BORROWER (A) AS BEING TRUE AND
CORRECT COPIES OF SUCH DOCUMENTS, (B) AS HAVING BEEN DULY AUTHORIZED BY
THE BOARD OF DIRECTORS OF THE CREDIT PARTIES PARTY THERETO, AND (C) AS
HAVING BEEN DULY EXECUTED AND DELIVERED BY THE CREDIT PARTIES PARTY
THERETO;
0.0.0.38. THE TENDER OFFER SHALL HAVE BEEN CONSUMMATED CONCURRENTLY
WITH THE MAKING OF THE FIRST TERM BORROWING IN ACCORDANCE WITH THE TENDER
OFFER DOCUMENTS AND THE MERGER AGREEMENT AND WITHOUT ANY MODIFICATION
THERETO OR WAIVER OF ANY TERM OR CONDITION THEREOF;
0.0.0.39. ACQUISITION SHALL HAVE ACQUIRED MORE THAN 66 2/3% (ON A
FULLY DILUTED BASIS) OF THE COMMON STOCK OF THE TARGET IN ACCORDANCE WITH
THE TERMS OF THE TENDER OFFER AND IN ACCORDANCE WITH ALL APPLICABLE LEGAL
REQUIREMENTS;
0.0.0.40. THE AGENT SHALL BE SATISFIED THAT THE SOLE RIGHT OF THE
SHAREHOLDERS OF TARGET WHO DO NOT TENDER THEIR SHARES PURSUANT TO THE
TENDER OFFER SHALL BE TO RECEIVE A CASH PAYMENT OF $20.00 PER SHARE
PURSUANT TO THE MERGER;
0.0.0.41. THE CONSUMMATION OF THE TENDER OFFER AND THE MERGER SHALL
NOT VIOLATE OR CAUSE A DEFAULT UNDER ANY APPLICABLE LAW, STATUTE, RULE, OR
REGULATION OR ANY MATERIAL AGREEMENT OR RIGHT OF THE BORROWER, THE TARGET,
OR ANY OF THEIR SUBSIDIARIES;
0.0.0.42. THE RESPECTIVE BOARDS OF DIRECTORS OF THE TARGET AND THE
BORROWER AND ITS SUBSIDIARIES SHALL NOT HAVE WITHDRAWN, MODIFIED OR
TERMINATED THEIR APPROVAL OF THE TENDER OFFER, THE MERGER AGREEMENT OR ANY
OF THE TRANSACTIONS CONTEMPLATED THEREBY;
0.0.0.43. THERE SHALL NOT HAVE OCCURRED A MATERIAL ADVERSE CHANGE IN
THE BUSINESS, ASSETS, REVENUES, OPERATIONS, CONDITIONS (FINANCIAL OR
OTHERWISE), OR PROSPECTS OF ANY OF THE TARGET, THE BORROWER, OR OF ANY
THEIR SUBSIDIARIES, TAKEN AS A WHOLE, SINCE THE DATE OF THE MOST RECENT
FINANCIAL STATEMENTS FURNISHED TO THE AGENT FOR SUCH ENTITIES;
0.0.0.44. THE AGENT AND THE LENDERS SHALL HAVE RECEIVED A COPY OF THE
"FAIRNESS" OPINION DELIVERED BY WHEAT FIRST BUTCHER SINGER TO THE BOARD OF
DIRECTORS OF THE TARGET AND SUCH LETTER SHALL REMAIN IN FULL FORCE AND
EFFECT WITHOUT MODIFICATION OR WITHDRAWAL;
0.0.0.45. THE AGENT'S AND THE LENDERS' FINANCING OF THE TENDER OFFER
AND THE SECURITY ARRANGEMENTS IN CONNECTION THEREWITH SHALL NOT RESULT IN
ANY VIOLATION OF REGULATIONS G, U, OR X AS IN EFFECT ON THE DATE OF SUCH
FINANCING;
0.0.0.46. ANY AND ALL CONSENTS REQUIRED BY REASON OF THE TENDER OFFER
SHALL HAVE BEEN DULY OBTAINED AND ALL MATERIAL LICENSES, PERMITS, AND THE
LIKE SHALL REMAIN IN FULL FORCE AND EFFECT AFTER GIVING EFFECT TO THE
TENDER OFFER AND THE MERGER;
0.0.0.47. THE AGENT SHALL BE SATISFIED THAT THE TENDER OFFER AND THE
MERGER CAN BE CONSUMMATED WITHOUT TRIGGERING ANY "POISON PILL," "SHARK
REPELLANT," OR SIMILAR ANT-TAKEOVER DEVICE AND WITHOUT ANY ADVERSE EFFECT
FROM ANY APPLICABLE ANTI-TAKEOVER STATUTES;
0.0.0.48. NO MATERIAL ADVERSE CHANGE IN THE BUSINESS, FINANCIAL
CONDITION, OR RESULTS OF OPERATIONS OF THE TARGET, TAKEN AS A WHOLE, SINCE
MARCH 31, 1996 SHALL HAVE OCCURRED;
0.0.0.49. THE AGENT SHALL HAVE RECEIVED CERTIFIED COPIES OF THE PRO
FORMA FINANCIAL STATEMENTS OF THE BORROWER SHOWING THE EFFECT OF THE
TENDER OFFER AND THE MERGER, AND THE BORROWER'S PRO FORMA CAPITAL
STRUCTURE AFTER GIVING EFFECT TO THE TENDER OFFER AND THE MERGER SHALL BE
SATISFACTORY TO THE AGENT AND THE LENDERS; AND
0.0.0.50. THE AGENT AND THE LENDERS SHALL HAVE RECEIVED LEGAL
OPINIONS IN RESPECT TO THE TRANSACTIONS CONTEMPLATED HEREBY IN FORM AND
SUBSTANCE SATISFACTORY TO THE AGENT RELEVANT TO THE TENDER OFFER.
0.0.0.50.1. REPRESENTATIONS AND WARRANTIES. The representations and
warranties contained in Article 4, Section 5 of the Guaranties, and Section 3
of the Pledge Agreements shall be true and correct in all material respects on
and as of the Effective Date before and after giving effect to the initial
Borrowing and to the application of the proceeds from such Borrowing, as though
made on and as of such date.
0.0.0.50.2. PAYMENT OF FEES. The Borrower shall have paid the fees
required to be paid as of the closing date by Section 2.5(b).
Section 0.0.0.50.3. CONDITIONS PRECEDENT TO MERGER BORROWING. The
obligation of each Bank to make a second Term Advance on the occasion of the
second Term Borrowing, if any, or to make Revolving Credit Advances to be used
to finance the Merger shall be subject to the further conditions precedent that
on the date of such Borrowing:
0.0.0.50.4. MERGER.
0.0.0.51. THE MERGER SHALL BE CONSUMMATED CONCURRENTLY WITH THE
MAKING OF SUCH BORROWING IN ACCORDANCE WITH THE MERGER AGREEMENT AND
WITHOUT ANY MODIFICATION THERETO OR WAIVER OF ANY TERM OR CONDITION
THEREOF.
0.0.0.52. THE CONSUMMATION OF THE MERGER SHALL NOT VIOLATE OR CAUSE A
DEFAULT UNDER ANY APPLICABLE LAW, STATUTE, RULE, OR REGULATION OR ANY
MATERIAL AGREEMENT OR RIGHT OF THE BORROWER, THE TARGET, OR ANY OF THEIR
SUBSIDIARIES;
0.0.0.53. ANY AND ALL CONSENTS REQUIRED BY REASON OF THE MERGER SHALL
HAVE BEEN DULY OBTAINED AND ALL MATERIAL LICENSES, PERMITS, AND THE LIKE
SHALL REMAIN IN FULL FORCE AND EFFECT AFTER GIVING EFFECT TO THE MERGER;
0.0.0.54. THE AGENT SHALL BE SATISFIED THAT THE MERGER CAN BE
CONSUMMATED WITHOUT TRIGGERING ANY "POISON PILL," "SHARK REPELLANT," OR
SIMILAR ANT-TAKEOVER DEVICE AND WITHOUT ANY ADVERSE EFFECT FROM ANY
APPLICABLE ANTI-TAKEOVER STATUTES;
0.0.0.55. THE RESPECTIVE BOARDS OF DIRECTORS OF THE TARGET AND THE
BORROWER AND ITS SUBSIDIARIES SHALL NOT HAVE WITHDRAWN, MODIFIED, OR
TERMINATED THEIR APPROVAL OF THE MERGER AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED THEREBY; AND
0.0.0.56. THE AGENT AND THE LENDERS SHALL HAVE RECEIVED LEGAL
OPINIONS IN RESPECT TO THE TRANSACTIONS CONTEMPLATED HEREBY IN FORM AND
SUBSTANCE SATISFACTORY TO THE AGENT INCLUDING OPINIONS AS TO MATTERS OF
VIRGINIA LAW RELEVANT TO THE MERGER.
0.0.0.56.1. DOCUMENTATION. The Agent shall have received the
following, duly executed by all parties thereto, in form and substance
satisfactory to the Agent and in sufficient copies for each Bank:
0.0.0.57. A GUARANTY BY THE TARGET AND EACH OF ITS SUBSIDIARIES;
0.0.0.58. A PLEDGE AGREEMENT EXECUTED (A) BY THE TARGET PLEDGING 100%
OF THE CAPITAL STOCK OF ITS SUBSIDIARIES AND (B) IF ANY SUBSIDIARY OF THE
TARGET HAS A SUBSIDIARY, EACH SUCH SUBSIDIARY, IN EACH SUCH CASE PLEDGING
100% OF THE CAPITAL STOCK OF ITS SUBSIDIARIES AND THE STOCK CERTIFICATES
PLEDGED IN ACCORDANCE WITH EACH SUCH PLEDGE AGREEMENT;
0.0.0.59. THE SHARE CERTIFICATE EVIDENCING ALL OF THE OUTSTANDING
CAPITAL STOCK OF THE TARGET;
0.0.0.60. A CERTIFICATE FROM THE CHIEF EXECUTIVE OFFICER, PRESIDENT
OR CHIEF OPERATING OFFICER OF THE BORROWER DATED AS OF THE EFFECTIVE DATE
STATING THAT AS OF SUCH DATE (A) ALL REPRESENTATIONS AND WARRANTIES OF THE
BORROWER SET FORTH IN THIS AGREEMENT ARE TRUE AND CORRECT IN ALL MATERIAL
RESPECTS AND (B) NO DEFAULT HAS OCCURRED AND IS CONTINUING;
0.0.0.61. COPIES, EACH CERTIFIED BY A SECRETARY OR ASSISTANT
SECRETARY OF THE APPROPRIATE PERSON, (A) OF THE RESOLUTIONS OF THE BOARD
OF DIRECTORS OF THE TARGET AND EACH OF ITS SUBSIDIARIES APPROVING THE
CREDIT DOCUMENTS TO WHICH IT IS A PARTY AND (B) OF THE ARTICLES OR
CERTIFICATE OF INCORPORATION AND BYLAWS OF EACH SUCH CREDIT PARTY AND ALL
DOCUMENTS EVIDENCING OTHER NECESSARY CORPORATE ACTION AND GOVERNMENTAL
APPROVALS, IF ANY, WITH RESPECT TO THE CREDIT DOCUMENTS TO WHICH IT IS A
PARTY;
0.0.0.62. A CERTIFICATE OF THE SECRETARY OR AN ASSISTANT SECRETARY OF
THE TARGET AND EACH OF ITS SUBSIDIARIES DATED AS OF THE DATE OF THE MERGER
CERTIFYING THE NAMES AND TRUE SIGNATURES OF OFFICERS OF EACH SUCH CREDIT
PARTY AUTHORIZED TO SIGN THE CREDIT DOCUMENTS TO WHICH IT IS A PARTY; AND
0.0.0.63. SUCH OTHER DOCUMENTS, GOVERNMENTAL CERTIFICATES,
CERTIFICATES, AND AGREEMENTS, AS THE AGENT OR ANY BANK MAY REASONABLY
REQUEST.
Section 0.0.0.63.1. CONDITIONS PRECEDENT TO EACH BORROWING AND LETTER OF
CREDIT. The obligation of each Bank to make an Advance on the occasion of each
Borrowing (including the initial Borrowing) and the Issuing Bank to issue,
extend, or increase any Letter of Credit shall be subject to the further
conditions precedent that on the date of such Borrowing or the issuance,
extension, or increase of such Letter of Credit:
0.0.0.63.2. REPRESENTATIONS AND WARRANTIES. As of the date of the
making of any Advance hereunder the representations and warranties made by the
Credit Parties or any officer contained in the Credit Documents shall have been
and shall be true and correct. The Borrower agrees that each request for the
making of any Advance hereunder shall be deemed to be a reaffirmation of the
representations and warranties contained in each Credit Document, and those
representations and warranties as reaffirmed are subject to the terms of this
Agreement, including Section 6.1(b).
0.0.0.63.3. COVENANTS. As of the date of making any Advance hereunder,
the Borrower will provide the Banks, if requested by the Agent, a Compliance
Certificate by an officer of the Borrower that the Borrower is in compliance
with the covenants set out in Article 5.
0.0.0.63.4. EVENT OF DEFAULT. As of the date of the making of any
Advance hereunder there shall exist no Default or Event of Default, and the
making of the Advance would not cause or be reasonably expected to cause a
Default or Event of Default.
ARTICLE 0.0.0.63.5.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants as follows:
Section 0.0.0.63.6. ORGANIZATION. Each Credit Party is duly and validly
organized and existing and in good standing under the laws of its jurisdictions
of incorporation, and are authorized to do business and is in good standing in
all jurisdictions in which such qualifications or authorizations are necessary.
Section 0.0.0.63.7. AUTHORIZATION. The execution, delivery, and
performance by the Credit Parties of each Credit Document to which such Credit
Party is a party and the consummation of the transactions contemplated thereby
(a) are within each Credit Parties corporate powers, (b) have been duly
authorized by all necessary corporate action, (c) do not contravene any
articles or certificate of incorporation or bylaws or any law or any
contractual restriction binding on or affecting any Credit Party or (d) shall
not result in or require the creation or imposition of any Lien prohibited by
this Agreement.
Section 0.0.0.63.8. ENFORCEABILITY. The Credit Documents to which any
Credit Party is a party have each been duly executed and delivered and
constitute the legal, valid, and binding obligation of such Credit Party, as
applicable, enforceable in accordance with their respective terms, except as
limited by applicable bankruptcy, insolvency, reorganization, moratorium, or
similar laws at the time in effect affecting the rights of creditors generally
and to the effect of general principles of equity whether applied by a court of
law or equity.
Section 0.0.0.63.9. FINANCIAL CONDITION. 0.0.0.63.9. The Borrower has
delivered to the Banks the consolidated financial statements of the Borrower
dated as of October 29, 1995 and May 5, 1996. These financial statements are
true and correct in all material respects and present fairly the consolidated
financial condition of the Borrower as of the respective dates thereof, except
as set forth in the financial statements. As of those dates, there are no
contingent obligations, liabilities for taxes, unusual forward or long-term
commitments, or material unrealized or anticipated losses of the Credit
Parties, except as disclosed in the financial statements or notes thereto which
are not reserved against. Since the dates of the financial statements, no
event has occurred that could reasonably be expected to have a material adverse
effect on the Borrower's and any of its Subsidiaries' ability to perform their
respective obligations under any Credit Document.
0.0.0.63.10. The Borrower has delivered to the Banks the consolidated
financial statements of the Target dated as of September 30, 1995 and March 31,
1996. To the Borrower's knowledge, these financial statements are true and
correct in all material respects and present fairly the consolidated financial
condition of the Target as of the respective dates thereof, except as set forth
in the financial statements. To the Borrower's knowledge, as of those dates,
there are no contingent obligations, liabilities for taxes, unusual forward or
long-term commitments, or material unrealized or anticipated losses of the
Target and its Subsidiaries, except as disclosed in the financial statements or
notes thereto which are not reserved against. Since the dates of the financial
statements, no event has occurred that could reasonably be expected to have a
material adverse effect on the Target's and any of its Subsidiaries' ability to
perform their respective obligations under any Credit Document.
0.0.0.63.11. The pro forma financial statements of the Borrower
delivered pursuant to Section 3.1(b)(xiv) present fairly the financial
condition of the Borrower as of the date thereof and the results of operations
for the period then ended.
Section 0.0.0.63.12. OWNERSHIP AND LIENS. Each Credit Party has title
to, or a valid leasehold interest in, all of the real and personal property
used in its business, including as of the date hereof the property reflected in
the financial statements referred to in Section 4.4, and none of the property
owned and leased by any Credit Party is subject to any Lien except Permitted
Liens.
Section 0.0.0.63.13. TRUE AND COMPLETE DISCLOSURE. No representation,
warranty, or other statement made by the Borrower (or on behalf of the
Borrower) in this Agreement or any other Credit Document contains any untrue
statement of a material fact or omits to state any material fact necessary to
make the statements contained therein not misleading in light of the
circumstances in which they were made. There is no fact known to any officer
of the Borrower or Maxxim Delaware on the date of this Agreement that has not
been disclosed to the Agent which would reasonably be expected to have a
material adverse effect on the ability of any Credit Party to perform its
obligations under any Credit Document. All projections, estimates, and pro
forma financial information furnished by the Borrower or on behalf of the
Borrower were prepared on the basis of assumptions, data, information, tests,
or conditions believed to be reasonable at the time such projections,
estimates, and pro forma financial information were furnished.
Section 0.0.0.63.14. LITIGATION. There are no actions, suits, or
proceedings pending or, to the knowledge of any Credit Party, threatened
against any Credit Party at law, in equity, or in admiralty, or by or before
any governmental department, commission, board, bureau, agency, or
instrumentality, domestic or foreign, or any arbitrator, which could reasonably
be expected to have a material adverse effect on the ability of any Credit
Party to perform their respective obligations under any Credit Document.
Section 0.0.0.63.15. COMPLIANCE WITH AGREEMENTS. No Default or Event
of Default exists. None of the Credit Parties are in violation of any
provision of any other indenture, loan, or credit agreement to which it is a
party, and the execution and delivery of this Agreement and the Credit
Documents and the consummation of the transactions contemplated thereunder
shall not result in any breach of any provisions of, or constitute a default
under, any other indenture, loan, or credit agreement to which any Credit Party
are a party. None of the Credit Parties are a party to or bound by any
contract which materially and adversely affects the assets, business,
operations, or condition of any Credit Party.
Section 0.0.0.63.16. ERISA. Neither the Borrower nor any member of
the Controlled Group is in violation of any material provision of ERISA.
Section 0.0.0.63.17. ENVIRONMENTAL CONDITION. Except as disclosed in
SCHEDULE II (under Environmental) each Credit Party: (a) has been and is in
full compliance with all Environmental Laws and has obtained and is in full
compliance with all related permits necessary for the ownership and operation
of such Credit Party's property and business; (b) does not and has not created,
handled, transported, used, or disposed of any Hazardous Materials, nor has any
Credit Party's currently or previously owned property been used for those
purposes; (c) has never been responsible for the release of any Hazardous
Materials into the environment and none of the Credit Parties' currently or
previously owned property has been subjected to any release of or is
contaminated by any Hazardous Materials; and (d) has never received notice of
and has never been investigated for any violation or alleged violation of any
Environmental Law.
Section 0.0.0.63.18. SUBSIDIARIES. The Borrower has no Subsidiaries
other than Maxxim Delaware and its Subsidiaries, and Maxxim Delaware has no
Subsidiaries other than those listed in SCHEDULE III or which have, after the
Effective Date, complied with the requirements of Section 5.18.
Section 0.0.0.63.19. INVESTMENT COMPANY ACT. Neither the Borrower nor
any of its Subsidiaries is an "investment company" or a company "controlled" by
an "investment company" within the meaning of the Investment Company Act of
1940, as amended.
Section 0.0.0.63.20. PUBLIC UTILITY HOLDING COMPANY ACT. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or a "Subsidiary
company" of a "holding company", or an "affiliate" of a "holding company" or of
a "Subsidiary company" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
Section 0.0.0.63.21. TAXES. Proper and accurate (in all material
respects), federal, state, local and foreign tax returns, reports and
statements required to be filed (after giving effect to any extension granted
in the time for filing) by the Borrower, its Subsidiaries or any member of the
Controlled Group (hereafter collectively called the "Tax Group") have been
filed with the appropriate governmental agencies in all jurisdictions in which
such returns, reports and statements are required to be filed and where the
failure to file would cause a material adverse effect on the ability of the
Borrower or any of its Subsidiaries to perform their obligations under any
Credit Document, and all taxes (which are material in amount) and other
impositions due and payable have been timely paid prior to the date on which
any fine, penalty, interest, late charge or loss may be added thereto for non-
payment thereof except where contested in good faith and by appropriate
proceeding. Neither the Borrower nor any member of the Tax Group has given, or
been requested to give, a waiver of the statute of limitations relating to the
payment of any federal, state, local or foreign taxes or other impositions.
None of the property owned by the Borrower or any other member of the Tax Group
is property which the Borrower or any member of the Tax Group is required to
treat as being owned by any other Person pursuant to the provisions of Section
168(f)(8) of the Code. Proper and accurate amounts have been withheld by the
Borrower and all other members of the Tax Group from their employees for all
periods to comply in all material respects with the tax, social security and
unemployment withholding provisions of applicable federal, state, local and
foreign law. Timely payment of all material sales and use taxes required by
applicable law have been made by the Borrower and all other members of the Tax
Group, the failure to timely pay of which would reasonably be expected to cause
a material adverse effect on the ability of the Borrower or any of its
Subsidiaries to perform their obligations under any Credit Document. The
amounts shown on all tax returns to be due and payable have been paid in full
or adequate provision therefor is included on the books of the appropriate
member of the Tax Group.
Section 0.0.0.63.22. PERMITS, LICENSES, ETC. Each Credit Party
possesses all permits, licenses, patents, patent rights or licenses,
trademarks, trademark rights, trade names rights and copyrights which are
material to the conduct of its business. Each Credit Party manages and
operates its business in accordance with all applicable Legal Requirements
which the failure to so manage or operate would reasonably be expected to cause
a material adverse effect on the ability of any Credit Party to perform their
obligations under any Credit Document.
Section 0.0.0.63.23. TENDER OFFER AND MERGER.
0.0.0.63.24. Contemporaneously with the Effective Date and the funding
of the initial Term Borrowing to the Borrower, (i) more than 66-2/3% (on a
fully diluted basis) of the common stock of the Target shall have been acquired
by Acquisition in accordance with the Tender Offer Documents and the Merger
Agreement for a price not to exceed $20.00 per share net to the sellers and for
an aggregate consideration not to exceed $115,000,000.00 net to the sellers and
(ii) Acquisition's acquisition of the common stock of the Target pursuant to
the Tender Offer Documents shall have been made in accordance with all
applicable Legal Requirements. The Borrower has delivered to the Agent true,
correct and complete copies of the Tender Offer Documents as in effect as of
the date of this Agreement. Since such date there has been no amendment,
modification, waiver, or termination of, or supplement to, the Tender Offer
Documents, except for immaterial amendments, modifications, and supplements or
as disclosed to and approved by the Agent.
0.0.0.63.25. On the date of the Merger, the Merger shall be consummated
in accordance with the terms of the Merger Agreement, and after giving effect
to the Merger, no shares of Target stock which are not owned by Maxxim
Delaware shall remain outstanding. The Borrower has delivered to the Agent
true, correct and complete copies of the Merger Agreement as in effect of the
date of this Agreement. Since such date there has been no amendment,
modification, waiver, or termination of, or supplement to, the Merger
Agreement, except for immaterial amendments, modifications, and supplements or
as disclosed to and approved by the Agent.
ARTICLE 0.0.0.63.26.
COVENANTS
So long as any Credit Obligation shall remain unpaid or any Bank shall
have any Commitment hereunder, the Borrower agrees to comply with the following
covenants.
Section 0.0.0.63.27. ORGANIZATION. Except as contemplated with
respect to the Merger and as permitted by Section 5.8, the Borrower shall and
shall cause each Credit Party to maintain its organization and good standing
under the laws of its jurisdiction of incorporation, and the authorization to
do business and good standing in all jurisdictions in which such qualification
or authorization is necessary.
Section 0.0.0.63.28. REPORTING.
0.0.0.63.29. ANNUAL FINANCIAL REPORTS. The Borrower shall provide to
the Banks, as soon as available, but in any event within 90 days after the end
of each fiscal year of the Borrower, the audited consolidated annual financial
statements of the Borrower, including an audited balance sheet as of the end of
such year and the related audited combined statements of income, retained
earnings, and cash flow, all prepared in conformity with GAAP consistently
applied, and all as audited by certified public accountants of national
standing and including any management letters delivered by such accountants to
the Borrower in connection with such audit together with (i) a certificate of
such accounting firm to the Banks stating that, in the course of the regular
audit of the business of the Borrower and its Subsidiaries, which audit was
conducted by such accounting firm in accordance with generally accepted
auditing standards, such accounting firm has obtained no knowledge that a
Default has occurred and is continuing, or if, in the opinion of such
accounting firm, a Default has occurred and is continuing, a statement as to
the nature thereof and (ii) a duly completed Compliance Certificate.
0.0.0.63.30. QUARTERLY FINANCIAL REPORTS. The Borrower shall provide to
the Banks, as soon as available, but in any event within 45 days after the end
of each fiscal quarter of the Borrower: (i) an internally prepared
consolidated balance sheet of the Borrower as of the close of such fiscal
quarter and the related combined statements of income, retained earnings, and
cash flow for the fiscal year-to-date, all of which shall be certified as
accurate by an officer of the Borrower and (ii) a duly completed Compliance
Certificate.
0.0.0.63.31. REQUIRED SECURITIES FILING. The Borrower shall provide
promptly, and in any event within 15 days after the sending or filing thereof,
copies of all proxy material, reports, and other information which the Borrower
or any of its Subsidiaries sends to or files with the United States Securities
and Exchange Commission or sends to the shareholders of the Borrower or any of
its Subsidiaries.
0.0.0.63.32. DEFAULTS. The Borrower shall provide to the Banks
promptly, but in any event within five days after the occurrence thereof, a
notice of each Default or Event of Default known to any Credit Party, together
with a statement of an officer of the Borrower setting forth the details of
such Default or Event of Default and the actions which the Borrower has taken
and proposes to take with respect thereto.
0.0.0.63.33. OTHER CREDITORS. The Borrower shall provide to the Banks
promptly after the giving or receipt thereof, copies of any material notices,
information, and documents given or received by any Credit Party pursuant to
the terms of any indenture, loan agreement, credit agreement, or similar
agreement.
0.0.0.63.34. LITIGATION. The Borrower shall provide to the Banks
promptly after the commencement thereof, notice of all actions, suits, and
proceedings before any court or governmental department, commission, board,
bureau, agency, or instrumentality, domestic or foreign, affecting any Credit
Party which, if determined adversely, could reasonably be expected to have a
material adverse effect on the ability of any Credit Party to perform its
obligations under any Credit Document.
0.0.0.63.35. ENVIRONMENTAL NOTICES. The Borrower shall provide promptly
to the Banks notice of any investigation, threat, notice, or claim known by the
Borrower which implies that any Credit Party may have any liability related to
any Environmental Law or Hazardous Material.
0.0.0.63.36. MATERIAL CHANGES. The Borrower shall provide to the Banks
prompt written notice of any condition or event of which the Borrower has
knowledge, which condition or event has resulted or may reasonably be expected
to result in a material adverse effect on the ability of any Credit Party to
perform its obligations under any Credit Document. Without limiting the
foregoing, the Borrower shall promptly report any event causing any contingent
liability of any Credit Party in excess of $1,000,000.00.
0.0.0.63.37. OTHER INFORMATION. Subject to the confidentiality
provisions of Section 8.7(f), the Borrower shall provide to the Banks such
other information respecting the business, operations, or property of any
Credit Party, financial or otherwise, as any Bank may reasonably request.
0.0.0.63.38. INSPECTION. From time-to-time upon reasonable notice, the
Borrower shall permit any Bank and shall cause any Credit Party to permit any
Bank, to examine and copy the books and records of the Borrower or such Credit
Party, to visit and inspect the property of the Borrower or such Credit Party,
and to discuss the business operations and property of the Borrower or such
Credit Party with the officers and directors thereof.
Section 0.0.0.63.39. FINANCIAL COVENANTS. The following financial
covenants shall be calculated for the Borrower on a consolidated basis after
eliminating significant interentity balances and transactions:
0.0.0.63.40. MAXIMUM SENIOR DEBT RATIO. As of the last day of each
fiscal quarter of the Borrower, the ratio of (i) the Borrower's Debt as of such
day MINUS the outstanding principal amount of the Subordinated Debt as of such
day; PROVIDED that (A) on the last day of the fiscal quarter ending on or about
October 31, 1996, one-fourth, (B) on the last day of the fiscal quarter ending
on or about January 31, 1997, one-half, and (C) on the last day of the fiscal
quarter ending on or about April 30, 1997, three-fourths of the Borrower's Debt
and Subordinated Debt as at each such day shall be used to calculate this ratio
to (ii) EBITDA (A) for the fiscal quarter ending on or about October 31, 1996,
(B) for the two fiscal quarters ending on or about January 31, 1997, (C) for
the three fiscal quarters ending on or about April 30, 1997, and (D) for the
four fiscal quarters ending on each such day thereafter PLUS, with respect to
each acquisition permitted by this Agreement, including the Tender Offer, and
made during such period, the aggregate amount of EBITDA attributable to the
business acquired for the period commencing of the first day of such period and
ending on the day of the closing of such acquisition MINUS, with respect any
asset sales permitted by this Agreement and made during such period, the
aggregate amount of EBITDA attributable to the assets sold during such period
shall not be greater than (A) 3.00 to 1.00 as of the fiscal quarters ending
from on or about October 31, 1996 through on or about July 31, 1998, (B) 2.75
to 1.00 for the fiscal quarters ending from on or about October 31, 1998
through on or about July 31, 1999, and (C) 2.50 to 1.00 for each fiscal quarter
ending thereafter.
0.0.0.63.41. MAXIMUM TOTAL DEBT RATIO. As of the last day of each
fiscal quarter of the Borrower, the Total Debt Ratio shall not be greater than
(A) 5.25 to 1.00 for the fiscal quarters ending on or about October 31, 1996
and January 31, 1997; (B) 5.00 to 1.00 for the fiscal quarters ending on or
about April 30, 1997 and July 31, 1997; (C) 4.50 to 1.00 for the fiscal
quarters ending from on or about October 31, 1997 through on or about July 31,
1998; (D) 4.25 to 1.00 for the fiscal quarters ending from on or about October
31, 1998 through on or about July 31, 1999; and (E) 4.00 to 1.00 for each
fiscal quarter ending thereafter.
0.0.0.63.42. MINIMUM FIXED CHARGE COVERAGE RATIO. As of the last day of
each fiscal quarter of the Borrower, the ratio of (i) Adjusted Cash Flow (A)
for the fiscal quarter ending on or about October 31, 1996, (B) for the two
fiscal quarters ending on or about January 31, 1997, (C) for the three fiscal
quarters ending on or about April 30, 1997, and (D) for the four fiscal
quarters ending on each such day thereafter PLUS, to the extent deducted in
determining Net Income, Rental Expense for such period to (ii) the sum of (A)
Interest Expense for such period, (B) the Borrower's current maturities of
long-term debt as of such day; PROVIDED that (1) on the last day of the fiscal
quarter ending on or about October 31, 1996, one-fourth, (2) on the last day of
the fiscal quarter ending on or about January 31, 1997, one-half, and (3) on
the last day of the fiscal quarter ending on or about April 30, 1997, three-
fourths of the Borrower's current maturities of long-term debt as at each such
day shall be used to calculate this ratio, and (C) Rental Expense for such
period shall not be less than (1) 1.30 to 1.00 for the fiscal quarters ending
from on or about October 31, 1996 through on or about July 31, 1997 and (2)
1.40 to 1.00 for each fiscal quarter ending thereafter.
0.0.0.63.43. MINIMUM INTEREST COVERAGE RATIO. As of the last day of
each fiscal quarter of the Borrower, the ratio of (i) EBIT (A) for the fiscal
quarter ending on or about October 31, 1996, (B) for the two fiscal quarters
ending on or about January 31, 1997, (C) for the three fiscal quarters ending
on or about April 30, 1997, and (D) for the four fiscal quarters ending on each
such day thereafter to (ii) Interest Expense for such period shall not be less
than (A) 1.40 to 1.00 for the fiscal quarters ending from on or about October
31, 1996 through on or about July 31, 1997; (B) 1.50 to 1.00 for the fiscal
quarters ending from on or about October 31, 1997 through on or about July 31,
1998; (C) 1.75 to 1.00 for the fiscal quarters ending from on or about October
31, 1998 through on or about July 31, 1999; and (D) 2.00 to 1.00 for each
fiscal quarter ending thereafter.
0.0.0.63.44. MINIMUM NET WORTH. The Borrower's Net Worth at any time
shall not be less than (i) 90% of the Borrower's Net Worth on August 2, 1996
PLUS (ii) 75% of Net Income for each fiscal quarter beginning with the fiscal
quarter ending on or about October 31, 1996, during which Net Income is
positive, but without reductions for any fiscal quarters during which Net
Income is negative PLUS (iii) the net proceeds from the sale of capital stock
of Borrower or any Credit Party since August 2, 1996 PLUS (iv) any increase in
Net Worth from the conversion of any Debt to equity, including the any
conversion of the notes issued under the Convertible Note Indenture.
0.0.0.63.45. CAPITAL EXPENDITURES. The Borrower shall not and shall not
permit any Credit Party to acquire assets of another Person or another business
by an asset purchase or make a Capital Expenditure unless (i) such asset
acquisition or Capital Expenditure does not violate any other provision of this
Agreement; (ii) the aggregate consideration paid for any single asset
acquisition or Capital Expenditure or related series of asset acquisitions or
Capital Expenditures does not exceed $15,000,000.00; (iii) the aggregate
consideration paid for all asset acquisitions and Capital Expenditure made
during any consecutive four fiscal quarter period does not exceed
$40,000,000.00; and (iv) in the case of asset acquisitions, the Agent shall
have received a certificate executed by the chief financial officer of the
Borrower stating that no Default has occurred and is continuing or would occur
upon the consummation of such acquisition.
Section 0.0.0.63.46. DEBT. The Borrower shall not and shall not
permit any Credit Party to create, assume, incur, suffer to exist, or in any
manner become liable, directly, indirectly, or contingently in respect of, any
Debt other than Permitted Debt.
Section 0.0.0.63.47. LIENS. The Borrower shall not and shall not
permit any Credit Party to create, assume, incur, or suffer to exist any Lien
on the Property of the Borrower or any of its Subsidiaries, whether now owned
or hereafter acquired, or assign any right to receive any income, except
Permitted Liens.
Section 0.0.0.63.48. AGREEMENTS RESTRICTING LIENS. The Borrower shall
not, and shall not permit any Credit Party to, enter into any agreement (other
than a Credit Document) which, except with respect to specific Property
encumbered to secure payment of Debt related to such Property, imposes
restrictions greater than those under this Agreement upon the creation or
assumption of any Lien upon its Property, whether now owned or hereafter
acquired.
Section 0.0.0.63.49. USE OF PROCEEDS.
0.0.0.63.50. The proceeds of the Revolving Credit Advances shall be used
by the Borrower only for general corporate and working capital purposes and as
permitted by the following paragraph (b).
0.0.0.63.51. The proceeds of the Term Advances shall be, and proceeds of
Revolving Credit Advances may be, used for the financing of the Tender Offer
and the Merger so long as the aggregate principal amount of the Term Borrowings
and Revolving Credit Advances used for such purposes PLUS the proceeds of the
Senior Subordinated Notes used to finance the Tender Offer and Merger shall not
exceed (i) in the case of the Tender Offer, the sum of (A) $20.00 per share of
common stock of the Target tendered net to the sellers, (B) the aggregate
amount of indebtedness of the Target refinanced in connection with the Tender
Offer, (C) the aggregate amount of indebtedness of Maxxim Delaware under the
Existing Credit Agreement refinanced in connection with the initial borrowing
under this Agreement, and (D) the actual costs, expenses, and fees incurred in
connection with the Tender Offer (including the financing thereof) and (ii) in
the case of the Merger, the sum of (A) $20.00 per share of common stock of the
Target not purchased in connection with the Tender Offer net to the sellers
less, in the case of shares of stock issued in connection with the exercise of
options after June 10, 1996, the exercise price per share for each such share
and (B) the actual costs, expenses, and fees incurred in connection with the
Merger (including the financing thereof).
0.0.0.63.52. The Borrower shall not, directly or indirectly, use any
part of such proceeds for the purpose of purchasing or carrying any margin
stock within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System or to extend credit to any Person for the purpose of
purchasing or carrying any such margin stock, or for any purpose which
violates, or is inconsistent with, Regulation X of such Board of Governors.
Section 0.0.0.63.53. CORPORATE TRANSACTIONS. The Borrower shall not
permit any other Credit Party to merge or consolidate with or into any other
Person, except that the Borrower may merge with any of its wholly-owned
Subsidiaries and any of the Borrower's wholly-owned Subsidiaries may merge with
another of the Borrower's wholly-owned Subsidiaries, PROVIDED that immediately
after giving effect to any such proposed transaction no Default would exist
and, in the case of any such merger to which the Borrower is a party, the
Borrower is the surviving corporation. The Borrower shall not, and shall not
permit any of its Subsidiaries to, change its name or reorganize in another
jurisdiction, create or suffer to exist any Subsidiary not existing on the date
of this Agreement, sell or otherwise dispose of any of its ownership interest
in any Subsidiary, or in any manner rearrange its business structure as it
exists on the date of this Agreement, PROVIDED that upon 30 days prior notice
to the Agent, the Borrower may create new Subsidiaries if such new Subsidiaries
comply with Section 5.18.
Section 0.0.0.63.54. ASSET SALES. The Borrower shall not and shall
not permit any Credit Party to sell, convey, or otherwise transfer any of its
assets outside the ordinary course of business, except that the Borrower and
the Credit Parties may during any fiscal year of the Borrower transfer assets
outside the ordinary course of business up to an aggregate net book value equal
to $15,000,000.00, PROVIDED that amounts received from such sales are subject
to the mandatory prepayment provisions of Section 2.3(c).
Section 0.0.0.63.55. DISTRIBUTIONS.
0.0.0.63.56. Except as provided in Section 5.10(b) below, for dividends
by a wholly-owned Subsidiary of Maxxim Delaware to Maxxim Delaware, for
dividends by Maxxim Delaware to the Borrower, and for dividends by a wholly-
owned Subsidiary of the Target to the Target, the Borrower shall not and shall
not permit any Credit Party to (i) declare or pay any dividends; (ii) purchase,
redeem, retire, or otherwise acquire for value any of the capital stock of the
Borrower or any Credit Party; (iii) make any distribution of assets to its
stockholders in their capacity as stockholders, whether in cash, assets, or
obligations of the Borrower or any Credit Party; (iv) allocate or otherwise set
apart any sum for the foregoing purposes; or (v) make any other distribution by
reduction of capital or otherwise in respect of any shares of the capital
stock.
0.0.0.63.57. The Borrower may purchase its own capital stock for cash,
PROVIDED that (i) no Default is continuing at the time of such purchase; (ii)
such purchase will not nor would it reasonably be expected to cause a Default;
and (iii) the aggregate amount paid for such purchases made after the date
hereof does not exceed $1,000,000.00.
Section 0.0.0.63.58. TRANSACTIONS WITH AFFILIATES. The Borrower shall
not and shall not permit any Credit Party to enter into any transaction
directly or indirectly with or for the benefit of an Affiliate other than a
Subsidiary of the Borrower, except transactions with an Affiliate for the
leasing of property, the rendering or receipt of services, or the purchase or
sale of inventory or other assets in the ordinary course of business if the
monetary or business consideration arising from such a transaction would be
substantially as advantageous to the Borrower or the applicable Credit Party as
the monetary or business consideration which it would obtain in a comparable
arm's length transaction.
Section 0.0.0.63.59. INSURANCE. The Borrower shall and shall cause
each Credit Party to maintain the insurance coverage described in SCHEDULE IV
with the current carrier or other responsible and reputable insurance companies
or associations consented to by the Agent.
Section 0.0.0.63.60. INVESTMENTS. The Borrower shall not and shall
not permit any Credit Party to make or hold any direct or indirect investment
in any Person, including capital contributions to the Person, investments in or
the acquisition of the debt or equity securities of the Person, or any loans,
guaranties, trade credit, or other extensions of credit to any Person, except
Permitted Investments.
Section 0.0.0.63.61. LINES OF BUSINESS. The Borrower shall not and
shall not permit any Credit Party to change the character of the Borrower's or
any Credit Party's business as conducted on the date of this Agreement, or
engage in any type of business not reasonably related to the Borrower's or any
Credit Party's business as presently and normally conducted.
Section 0.0.0.63.62. COMPLIANCE WITH LAWS. The Borrower shall and
shall cause each Credit Party to comply, in all material respects with all
federal, state, and local laws and regulations which are applicable to the
operations and property of the Borrower and the Credit Parties, PROVIDED that
this Section shall not prevent the Borrower or any Credit Party from, in good
faith and with reasonable diligence, contesting the validity or application of
any such laws or regulations by appropriate legal proceedings for which
adequate reserves have been established.
Section 0.0.0.63.63. TAXES. The Borrower shall and shall cause each
Credit Party to pay and discharge all taxes, assessments, and other charges and
claims imposed on the Borrower or any Credit Party, PROVIDED that nothing in
this Section shall require the Borrower or any Credit Party to pay any tax,
assessment, or charge which is being contested in good faith and for which
adequate reserves have been established.
Section 0.0.0.63.64. ENVIRONMENTAL MATTERS. The Borrower (a) shall
and shall cause each Credit Party to comply with all Environmental Laws and
maintain all related permits necessary for the ownership and operation of the
Borrower's and each Credit Parties' property and business; (b) shall not and
shall not permit any Credit Party to create, handle, transport, use, or dispose
of any Hazardous Materials; and (c) shall not and shall not permit any of
Credit Party to release any Hazardous Materials into the environment and shall
not permit the Borrower's or its Subsidiaries' property to be subjected to any
release of Hazardous Materials.
Section 0.0.0.63.65. ADDITIONAL GUARANTIES. Upon the creation of any
new Subsidiary permitted by this Agreement, the Borrower will cause (a) such
Subsidiary to execute and deliver to each Bank a Guaranty and such evidence of
corporate authority to enter into such Guaranty as the Agent may reasonably
request and (b) the stockholder of such new Subsidiary to execute a Pledge
Agreement pledging , in the case of a U.S. Subsidiary, 100% of the capital
stock of such new Subsidiary and, in the case of a non-U.S. Subsidiary, 65% of
the capital stock of such new Subsidiary and such evidence of corporate
authority to enter into such Pledge Agreement as the Agent may reasonably
request, along with share certificates pledged thereby and appropriately
executed stock powers in blank.
Section 0.0.0.63.66. SUBORDINATED DEBT. The Borrower shall not amend
or modify the subordination or payment terms of any Subordinated Debt or make
any payments other than regularly scheduled payments of principal of and
interest on any Subordinated Debt or make any redemptions of any Subordinated
Debt (other than conversion of the notes issued under the Convertible Note
Indenture as contemplated by the Convertible Note Indenture).
Section 0.0.0.63.67. ADDITIONAL LEGAL OPINIONS. The Borrower shall
deliver to the Agent and each Bank on or before August 15, 1996 legal opinions
in form and substance reasonably acceptable to the Agent with respect to the
Borrower's foreign Subsidiaries and the Credit Documents executed by such
Subsidiaries.
ARTICLE 0.0.0.63.68.
DEFAULT AND REMEDIES
Section 0.0.0.63.69. EVENTS OF DEFAULT. The occurrence of any of the
following events shall constitute an "Event of Default" under this Agreement
and any other Credit Document:
0.0.0.63.70. PAYMENT FAILURE. Any Credit Party fails to pay, within
three Business Days of when due, any amount due under this Agreement or any
other Credit Document, including payments of principal, interest, fees,
reimbursements, and indemnifications;
0.0.0.63.71. FALSE REPRESENTATION OR WARRANTIES. Any representation or
warranty made by any Credit Party or any officer thereof in this Agreement or
in any other Credit Document is materially false or erroneous at the time it
was made or deemed made;
0.0.0.63.72. BREACH OF COVENANT. (i) Any breach by the Borrower or any
Guarantor of any of the covenants in Section 5.2, 5.3, 5.4, 5.5, 5.6, 5.7, 5.8,
5.9, 5.10, 5.11, 5.13, or 5.16 in this Agreement or as incorporated in the
Guaranties, (ii) any breach by the Borrower or any Guarantor of any other
covenant contained in this Agreement or any Guaranty and such breach if curable
is not cured within 30 days after the earlier of the date notice thereof is
given by any Bank or the date the Borrower obtained or should have obtained
knowledge thereof, or (iii) any breach by the Borrower or any other Credit
Party of any covenant in any other Credit Document;
0.0.0.63.73. GUARANTIES. Any Guaranty shall at any time (before its
expiration according to its terms) and for any reason cease to be in full force
and effect or shall be contested by any party thereto; or any Guarantor shall
deny it has any liability or obligation under its Guaranty;
0.0.0.63.74. CROSS DEFAULT. There shall occur (i) any "Event of
Default" as defined in the Convertible Note Indenture or the Senior
Subordinated Note Indenture; PROVIDED, however, that prior to the date of the
consummation of the Merger, the foregoing shall not apply to defaults in the
Convertible Note Indenture or the Senior Subordinated Note Indenture that
restrict the pledge or sale or other disposition of the capital stock of the
Target; (ii) the Borrower or any Credit Party shall fail to pay any principal
of or premium or interest on its Debt which is outstanding in a principal
amount of at least $2,000,000.00 individually or when aggregated with all such
Debt of the Borrower or the Credit Parties so in default (but excluding Debt
evidenced by the Notes) when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or otherwise),
and such failure shall continue after the applicable grace period, if any,
specified in the agreement or instrument relating to such Debt; (iii) any other
event shall occur or condition shall exist under any agreement or instrument
relating to Debt which is outstanding in a principal amount of at least
$2,000,000.00 individually or when aggregated with all such Debt of the
Borrower and the Credit Parties so in default, and shall continue after the
applicable grace period, if any, specified in such agreement or instrument, if
the effect of such event or condition is to accelerate, or to permit the
acceleration of, the maturity of such Debt prior to the stated maturity
thereof; PROVIDED, however, that prior to the date of the consummation of the
Merger, the foregoing shall not apply to defaults in any agreement or
instrument that restrict the pledge or sale or other disposition of the capital
stock of the Target; or (iv) any such Debt shall be declared to be due and
payable, or required to be prepaid (other than by a regularly scheduled
required prepayment);
0.0.0.63.75. BANKRUPTCY AND INSOLVENCY. The Borrower or any Credit
Party admits in writing its inability to pay its debts generally as they become
due; makes an assignment for the benefit of its creditors; consents to or
acquiesces in the appointment of a receiver, liquidator, fiscal agent, or
trustee of itself or any of its property; files a petition under bankruptcy or
other laws for the relief of debtors; or consents to any reorganization,
arrangement, workout, liquidation, dissolution, or similar relief. The
Borrower or any Credit Party shall have had, without its consent: any court
enter an order, judgment, or decree appointing a receiver, liquidator, fiscal
agent, or trustee of itself or any of its property; any court approve a
petition filed against it seeking reorganization, arrangement, workout,
liquidation, dissolution, or similar relief under bankruptcy or other laws for
the relief of debtors; or any court adjudicate the Borrower or such Credit
Party as bankrupt and such adjudication shall remain unvacated, not set aside,
or unstayed for an aggregate of 30 days, whether or not consecutive;
0.0.0.63.76. ADVERSE JUDGMENT. The Borrower and the other Credit
Parties suffer final judgments against any of them since the date of this
Agreement in an aggregate amount, less any insurance proceeds covering such
judgments which are received or as to which the insurance carriers admit
liability, greater than $1,000,000.00 and either (i) enforcement proceedings
shall have been commenced by any creditor upon such judgments or (ii) there
shall be any period of 30 consecutive days during which a stay of enforcement
of such judgments, by reason of a pending appeal or otherwise, shall not be in
effect;
0.0.0.63.77. TERMINATION EVENTS. Any Termination Event with respect to
a Plan shall have occurred, and, 30 days after notice thereof shall have been
given to the Borrower by the Agent, (i) such Termination Event shall have
created and caused to be continuing a material risk of Plan termination or
liability for withdrawal from the Plan as a substantive employer and (ii) the
then present value of such Plan's vested benefits exceeds the then current
value of assets accumulated in such Plan by more than the amount of
$2,000,000.00 (or in the case of a Termination Event involving the withdrawal
of a "substantial employer" (as defined in Section 4001(a)(2) of ERISA), the
withdrawing employer's proportionate share of such excess shall exceed such
amount);
0.0.0.63.78. PLAN WITHDRAWALS. The Borrower or any member of the
Controlled Group as employer under a Multiemployer Plan shall have made a
complete or partial withdrawal from such Multiemployer Plan and the plan
sponsor of such Multiemployer Plan shall have notified such withdrawing
employer that such employer has incurred a withdrawal liability in an annual
amount exceeding $2,000,000.00;
0.0.0.63.79. CHANGE IN CONTROL. The occurrence of a Change in Control,
a Repurchase Event (as defined in the Convertible Note Indenture), or a Change
of Control (as defined in the Senior Subordinated Note Indenture);
0.0.0.63.80. MERGER. The Merger shall not have occurred on or before
December 13, 1996; or
0.0.0.63.81. MATERIAL ADVERSE CHANGE. The occurrence of any material
adverse change in the Borrower or any Credit Party's ability to perform its
obligations under any Credit Document since the date of this Agreement.
Section 0.0.0.63.82. OPTIONAL ACCELERATION OF MATURITY. If any Event
of Default (other than an Event of Default pursuant to Section 6.1(f)) shall
have occurred and be continuing, then, and in any such event,
0.0.0.63.83. the Agent (i) shall at the request, or may with the
consent, of the Majority Banks, by notice to the Borrower, declare the
obligation of each Bank to make Advances and the obligation of the Issuing Bank
to issue, increase, or extend Letters of Credit to be terminated, whereupon the
same shall forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Majority Banks, by notice to the Borrower, declare the Notes,
all interest thereon, the Letter of Credit Obligations, and all other amounts
payable under this Agreement to be forthwith due and payable, whereupon the
Notes, all such interest, all such Letter of Credit Obligations and all such
amounts shall become and be forthwith due and payable in full, without
presentment, demand, protest or further notice of any kind (including, without
limitation, any notice of intent to accelerate or notice of acceleration), all
of which are hereby expressly waived by the Borrower;
0.0.0.63.84. the Borrower shall, on demand of the Agent at the request
or with the consent of the Majority Banks, deposit with the Agent into the Cash
Collateral Account an amount of cash equal to the Letter of Credit Exposure as
security for the Credit Obligations to the extent the Letter of Credit
Obligations are not otherwise paid at such time; and
0.0.0.63.85. the Agent shall at the request of, or may with the consent
of, the Majority Banks proceed to enforce its rights and remedies under the
Pledge Agreements, the Guaranties, or any other Credit Document for the ratable
benefit of the Banks by appropriate proceedings.
Section 0.0.0.63.86. AUTOMATIC ACCELERATION OF MATURITY. If any Event
of Default pursuant to Section 6.1(f) shall occur,
0.0.0.63.87. the obligation of each Bank to make Advances and the
obligation of the Issuing Bank to issue, increase, or extend Letters of Credit
shall immediately and automatically be terminated and the Notes, all interest
on the Notes, all Letter of Credit Obligations, and all other amounts payable
under this Agreement shall immediately and automatically become and be due and
payable in full, without presentment, demand, protest or any notice of any kind
(including, without limitation, any notice of intent to accelerate or notice of
acceleration), all of which are hereby expressly waived by the Borrower;
0.0.0.63.88. the Borrower shall deposit with the Agent into the Cash
Collateral Account an amount of cash equal to the outstanding Letter of Credit
Exposure as security for the Obligations to the extent the Letter of Credit
Obligations are not otherwise paid at such time and
0.0.0.63.89. the Agent shall at the request of, or may with the consent
of, the Majority Banks proceed to enforce its rights and remedies under the
Pledge Agreements, the Guaranties, or any other Credit Document for the ratable
benefit of the Banks by appropriate proceedings.
Section 0.0.0.63.90. CASH COLLATERAL ACCOUNT.
0.0.0.63.91. PLEDGE. The Borrower hereby pledges, and grants to the
Agent for the benefit of the Banks, a security interest in all funds held in
the Cash Collateral Account from time-to-time and all proceeds thereof, as
security for the payment of the Credit Obligations, including all Letter of
Credit Obligations owing to the Issuing Bank or any other Bank due and to
become due from the Borrower to the Issuing Bank or any other Bank under this
Agreement in connection with the Letters of Credit. Nothing in this
Section 6.4, however, shall either obligate the Agent to require any funds to
be deposited in the Cash Collateral Account or limit the right of the Agent,
which it may exercise at any time and from time-to-time, to release to the
Borrower any funds held in the Cash Collateral Account pursuant to the other
provisions of this Section 6.4.
0.0.0.63.92. APPLICATION AGAINST LETTER OF CREDIT OBLIGATIONS; RELEASE
OF FUNDS. The Agent may, at any time or from time-to-time apply funds then
held in the Cash Collateral Account to the payment of any Letter of Credit
Obligations owing to the Issuing Bank, in such order as the Agent may elect, as
shall have become or shall become due and payable by the Borrower to the
Issuing Bank under this Agreement in connection with the Letters of Credit.
0.0.0.63.93. DUTY OF CARE. The Agent shall exercise reasonable care in
the custody and preservation of any funds held in the Cash Collateral Account
and shall be deemed to have exercised such care if such funds are accorded
treatment substantially equivalent to that which the Agent accords its own
property, it being understood that the Agent shall not have any responsibility
for taking any necessary steps to preserve rights against any parties with
respect to any such funds.
Section 0.0.0.63.94. SETOFF. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent, if any, specified by Section 6.2 to authorize the
Agent to declare the Notes and any other amount payable hereunder due and
payable pursuant to the provisions of Section 6.2 or the automatic acceleration
of the Notes and all amounts payable under this Agreement pursuant to
Section 6.3, the Agent and each Bank is hereby authorized at any time and from
time-to-time, to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other indebtedness at any time owing by the Agent or such
Bank to or for the credit or the account of the Borrower against any and all of
the obligations of the Borrower now or hereafter existing under this Agreement,
the Note held by the Agent or such Bank, and the other Credit Documents,
irrespective of whether or not the Agent or such Bank shall have made any
demand under this Agreement, such Note, or such other Credit Documents, and
although such obligations may be unmatured. The Agent and each Bank agrees to
promptly notify the Borrower after any such set-off and application made by
such Bank, PROVIDED that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of the Agent and each
Bank under this Section are in addition to any other rights and remedies
(including, without limitation, other rights of set-off) which the Agent or
such Bank may have.
Section 0.0.0.63.95. REMEDIES CUMULATIVE, NO WAIVER. No right, power,
or remedy conferred any Bank in this Agreement or the Credit Documents, or now
or hereafter existing at law, in equity, by statute, or otherwise shall be
exclusive, and each such right, power, or remedy shall to the full extent
permitted by law be cumulative and in addition to every other such right, power
or remedy. No course of dealing and no delay in exercising any right, power,
or remedy conferred to any Bank in this Agreement and the Credit Documents or
now or hereafter existing at law, in equity, by statute, or otherwise shall
operate as a waiver of or otherwise prejudice any such right, power, or remedy.
Any Bank may cure any Event of Default without waiving the Event of Default.
No notice to or demand upon the Borrower shall entitle the Borrower to similar
notices or demands in the future.
Section 0.0.0.63.96. APPLICATION OF PAYMENTS. Prior to an Event of
Default, all payments made hereunder shall be applied as directed by the
Borrower, but such payments are subject to the terms of this Agreement,
including the application of prepayments according to Section 2.3. During the
existence of an Event of Default, all payments and collections shall be applied
to the Credit Obligations in accordance with Section 2.10 first to any
reimbursements and indemnifications due to the Banks, then ratably to any
accrued and unpaid interest and fees due to the Banks, then ratably to the
outstanding principal balance of the Advances.
ARTICLE 0.0.0.63.97.
THE AGENT AND THE ISSUING BANK
Section 0.0.0.63.98. AUTHORIZATION AND ACTION. Each Bank hereby
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated to the Agent
by the terms hereof and of the other Credit Documents, together with such
powers as are reasonably incidental thereto. As to any matters not expressly
provided for by this Agreement or any other Credit Document (including, without
limitation, enforcement or collection of the Notes), the Agent shall not be
required to exercise any discretion or take any action, but shall be required
to act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Banks, and such
instructions shall be binding upon all Banks and all holders of Notes; PROVIDED
that the Agent shall not be required to take any action which exposes the Agent
to personal liability or which is contrary to this Agreement, any other Credit
Document, or applicable law.
Section 0.0.0.63.99. AGENT RELIANCE, ETC. Neither the Agent nor any
of its directors, officers, agents, or employees shall be liable for any action
taken or omitted to be taken (INCLUDING THE AGENT'S OWN NEGLIGENCE) by it or
them under or in connection with this Agreement or the other Credit Documents,
except for its or their own gross negligence or willful misconduct. Without
limitation of the generality of the foregoing, the Agent: (a) may treat the
payee of any Note as the holder thereof until the Agent receives written notice
of the assignment or transfer thereof signed by such payee and in form
satisfactory to the Agent; (b) may consult with legal counsel (including
counsel for the Borrower), independent public accountants, and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (c) makes no warranty or representation to any Bank and
shall not be responsible to any Bank for any statements, warranties, or
representations made in or in connection with this Agreement or the other
Credit Documents; (d) shall not have any duty to ascertain or to inquire as to
the performance or observance of any of the terms, covenants, or conditions of
this Agreement or any other Credit Document on the part of the Borrower or its
Subsidiaries or to inspect the property (including the books and records) of
the Borrower or its Subsidiaries; (e) shall not be responsible to any Bank for
the due execution, legality, validity, enforceability, genuineness,
sufficiency, or value of this Agreement or any other Credit Document; and
(f) shall incur no liability under or in respect of this Agreement or any other
Credit Document by acting upon any notice, consent, certificate, or other
instrument or writing (which may be by telecopier, telegram, cable, or telex)
believed by it to be genuine and signed or sent by the proper party or parties.
Section 0.0.0.63.100. THE AGENT AND ITS AFFILIATES. With respect to
its Commitment, the Advances made by it, and the Note issued to it, the Agent
shall have the same rights and powers under this Agreement as any other Bank
and may exercise the same as though it were not the Agent. The term "Bank" or
"Banks" shall, unless otherwise expressly indicated, include the Agent in its
individual capacity. NationsBank and its Affiliates may accept deposits from,
lend money to, act as trustee under indentures of, and generally engage in any
kind of business with the Borrower or any of its Subsidiaries, and any Person
who may do business with or own securities of the Borrower or any of its
Subsidiaries, all as if the Agent were not an agent hereunder and without any
duty to account therefor to the Banks.
Section 0.0.0.63.101. BANK CREDIT DECISION. Each Bank acknowledges
that it has, independently and without reliance upon the Agent or any other
Bank and based on the financial statements referred to in Section 4.4 and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement and the Credit Documents.
Section 0.0.0.63.102. INDEMNIFICATION AND EXPENSES. THE BANKS
SEVERALLY AGREE TO INDEMNIFY THE AGENT AND THE ISSUING BANK (TO THE EXTENT NOT
REIMBURSED BY THE BORROWER), ACCORDING TO THEIR RESPECTIVE PRO RATA SHARES FROM
AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES,
ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES, OR DISBURSEMENTS OF ANY KIND OR
NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST THE
AGENT AND THE ISSUING BANK IN ANY WAY RELATING TO OR ARISING OUT OF THIS
AGREEMENT OR ANY ACTION TAKEN OR OMITTED BY THE AGENT OR THE ISSUING BANK UNDER
THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT (INCLUDING THE AGENT'S AND THE
ISSUING BANK'S OWN NEGLIGENCE), PROVIDED THAT NO BANK SHALL BE LIABLE FOR ANY
PORTION OF SUCH LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS,
JUDGMENTS, SUITS, COSTS, EXPENSES, OR DISBURSEMENTS RESULTING FROM THE AGENT'S
AND THE ISSUING BANK'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. WITHOUT
LIMITATION OF THE FOREGOING, EACH BANK AGREES TO REIMBURSE THE AGENT PROMPTLY
UPON DEMAND FOR ITS RATABLE SHARE OF ANY OUT-OF-POCKET EXPENSES (INCLUDING
COUNSEL FEES) INCURRED BY THE AGENT IN CONNECTION WITH THE PREPARATION,
EXECUTION, DELIVERY, ADMINISTRATION, MODIFICATION, AMENDMENT, OR ENFORCEMENT
(WHETHER THROUGH NEGOTIATIONS, LEGAL PROCEEDINGS, OR OTHERWISE) OF, OR LEGAL
ADVICE IN RESPECT OF RIGHTS OR RESPONSIBILITIES UNDER, THIS AGREEMENT OR ANY
OTHER CREDIT DOCUMENT, TO THE EXTENT THAT THE AGENT IS NOT REIMBURSED FOR SUCH
EXPENSES BY THE BORROWER.
Section 0.0.0.63.103. SUCCESSOR AGENT AND ISSUING BANK. The Agent or
the Issuing Bank may resign at any time by giving written notice thereof to the
Banks and the Borrower and may be removed at any time with or without cause by
the Majority Banks upon receipt of written notice from the Majority Banks to
such effect. Upon receipt of notice of any such resignation or removal, the
Majority Banks shall have the right to appoint a successor Agent or Issuing
Bank with, if an Event of Default has not occurred and is not continuing, the
consent of the Borrower, which consent shall not be unreasonably withheld. If
no successor Agent or Issuing Bank shall have been so appointed, and shall have
accepted such appointment, within 30 days after the retiring Agent's or Issuing
Bank's giving of notice of resignation or the Majority Banks' removal of the
retiring Agent or Issuing Bank, then the retiring Agent or Issuing Bank may, on
behalf of the Banks and the Borrower, appoint a successor Agent or Issuing
Bank, which shall be a commercial bank meeting the financial requirements of an
Eligible Assignee and, in the case of the Issuing Bank, a Bank. Upon the
acceptance of any appointment as Agent or Issuing Bank by a successor Agent or
Issuing Bank, such successor Agent or Issuing Bank shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent or Issuing Bank, and the retiring Agent or Issuing Bank shall be
discharged from its duties and obligations under this Agreement and the other
Credit Documents, except that the retiring Issuing Bank shall remain the
Issuing Bank with respect to any Letters of Credit outstanding on the effective
date of its resignation or removal and the provisions affecting the Issuing
Bank with respect to such Letters of Credit shall inure to the benefit of the
retiring Issuing Bank until the termination of all such Letters of Credit.
After any retiring Agent's or Issuing Bank's resignation or removal hereunder
as Agent or Issuing Bank, the provisions of this Article 7 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
or Issuing Bank under this Agreement and the other Credit Documents.
ARTICLE 0.0.0.63.104.
MISCELLANEOUS
Section 0.0.0.63.105. COSTS AND EXPENSES. The Borrower agrees to pay
on demand all reasonable out-of-pocket costs and expenses of Agent (but not of
other Banks) in connection with the preparation, execution, delivery,
administration, modification, and amendment of this Agreement, the Notes, and
the other Credit Documents including, without limitation, the reasonable fees
and out-of-pocket expenses of counsel for Agent (but not of other Banks) with
respect to advising the Agent as to its rights and responsibilities under this
Agreement, and all reasonable out-of-pocket costs and expenses, if any, of the
Agent, the Issuing Bank, and each Bank (including, without limitation,
reasonable counsel fees and expenses of each Bank) in connection with the
enforcement (whether through negotiations, legal proceedings, or otherwise) of
this Agreement, the Notes, and the other Credit Documents.
Section 0.0.0.63.106. INDEMNIFICATION. THE BORROWER SHALL INDEMNIFY
THE AGENT, THE ISSUING BANK, EACH BANK, AND EACH AFFILIATE THEREOF AND THEIR
RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AND AGENTS FROM, AND DISCHARGE,
RELEASE, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND ALL LOSSES,
LIABILITIES, CLAIMS, OR DAMAGES TO WHICH ANY OF THEM MAY BECOME SUBJECT,
INSOFAR AS SUCH LOSSES, LIABILITIES, CLAIMS, OR DAMAGES ARISE OUT OF OR RESULT
FROM (I) ANY ACTUAL OR PROPOSED USE BY THE BORROWER OR ANY AFFILIATE OF THE
BORROWER OF THE PROCEEDS OF ANY ADVANCE, (II) ANY BREACH BY THE BORROWER OF ANY
PROVISION OF THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT, OR (III) ANY
INVESTIGATION, LITIGATION, OR OTHER PROCEEDING (INCLUDING ANY THREATENED
INVESTIGATION OR PROCEEDING) RELATING TO THE FOREGOING AND THE BORROWER SHALL
REIMBURSE THE AGENT, THE ISSUING BANK, EACH BANK, AND EACH AFFILIATE THEREOF
AND THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AND AGENTS, UPON DEMAND
FOR ANY REASONABLE OUT-OF-POCKET EXPENSES (INCLUDING LEGAL FEES) INCURRED IN
CONNECTION WITH ANY SUCH INVESTIGATION, LITIGATION, OR OTHER PROCEEDING; AND
EXPRESSLY INCLUDING ANY SUCH LOSSES, LIABILITIES, CLAIMS, DAMAGES, OR EXPENSES
INCURRED BY REASON OF THE PERSON BEING INDEMNIFIED'S OWN NEGLIGENCE, BUT
EXCLUDING ANY SUCH LOSSES, LIABILITIES, CLAIMS, DAMAGES, OR EXPENSES INCURRED
BY REASON OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PERSON TO BE
INDEMNIFIED.
Section 0.0.0.63.107. WAIVERS AND AMENDMENTS. No amendment or waiver
of any provision of this Agreement, the Notes, or any other Credit Document,
nor consent to any departure by the Borrower or any Guarantor therefrom, shall
in any event be effective unless the same shall be in writing and signed by the
Majority Banks and the Borrower, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; PROVIDED that no amendment, waiver or consent shall, unless in writing
and signed by all the Banks and the Borrower, do any of the following:
(a) waive any of the conditions specified in Article 3, (b) increase the
Commitments of the Banks, (c) reduce the principal of, or interest on, the
Notes or any fees or other amounts payable hereunder or under any other Credit
Document, (d) postpone or extend any date fixed for any payment of principal
of, or interest on, the Notes or any fees or other amounts payable hereunder,
including the Revolving Credit Maturity Date, (e) change the number of Banks
which shall be required for the Banks or any of them to take any action
hereunder or under any other Credit Document, (f) amend Section 2.10(e) or this
Section 8.3, (g) release any Guarantor from its obligations under any Guaranty;
or (h) amend the definition of "Majority Banks"; and PROVIDED, further, that no
amendment, waiver or consent shall, unless in writing and signed by the Agent
or the Issuing Bank in addition to the Banks required above to take such
action, affect the rights or duties of the Agent or the Issuing Bank, as the
case may be, under this Agreement or any other Credit Document.
Section 0.0.0.63.108. SEVERABILITY. In case one or more provisions of
this Agreement or the other Credit Documents shall be invalid, illegal or
unenforceable in any respect under any applicable law, the validity, legality,
and enforceability of the remaining provisions contained herein or therein
shall not be affected or impaired thereby.
Section 0.0.0.63.109. SURVIVAL OF REPRESENTATIONS, ETC. All
representations and warranties contained in this Agreement or made in writing
by or on behalf of the Borrower in connection herewith shall survive the
execution and delivery of this Agreement and the Credit Documents, the making
of the Advances, and any investigation made by or on behalf of the Banks, none
of which investigations shall diminish any Bank's right to rely on such
representations and warranties. All obligations of the Borrower provided for
in Sections 8.1 and 8.2 shall survive any termination of this Agreement and
repayment in full of the Credit Obligations.
Section 0.0.0.63.110. BINDING EFFECT. This Agreement shall become
effective when it shall have been executed by the Borrower and the Agent, and
when the Agent shall have, as to each Bank, either received a counterpart
hereof executed by such Bank or been notified by such Bank that such Bank has
executed it and thereafter shall be binding upon and inure to the benefit of
the Borrower, the Agent, the Issuing Bank, and each Bank and their respective
successors and assigns, except that the Borrower shall not have the right to
assign its rights or delegate its duties under this Agreement or any interest
in this Agreement without the prior written consent of each Bank.
Section 0.0.0.63.111. BANK ASSIGNMENTS AND PARTICIPATIONS.
0.0.0.63.112. ASSIGNMENTS. Any Bank may assign to one or more banks or
other entities all or any portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitments,
the Advances owing to it, and the Notes held by it, and the participation
interest in the Letter of Credit Obligations held by it); PROVIDED that
(i) each such assignment must be of a constant, and not a varying, percentage
of all of such Bank's rights and obligations under this Agreement, (ii) the
amount of the Commitments and Advances of such Bank (unless it is assigning all
of its Commitments) being assigned pursuant to each such assignment (determined
as of the date of the Assignment and Acceptance with respect to such
assignment) must in no event be less than $10,000,000.00 and shall be an
integral multiple of $1,000,000.00, (iii) each such assignment must be to an
Eligible Assignee, (iv) the parties to each such assignment must execute and
deliver to the Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance, together with the Notes subject to such assignment,
and (v) each Eligible Assignee (other than the Eligible Assignee of the Agent)
shall pay to the Agent a $3,000.00 administrative fee. Upon such execution,
delivery, acceptance, and recording, from and after the effective date
specified in each Assignment and Acceptance, which effective date shall be at
least two Business Days after the execution thereof, (A) the assignee
thereunder shall be a party hereto for all purposes and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Bank hereunder
and (B) such Bank thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or the remaining
portion of such Bank's rights and obligations under this Agreement, such Bank
shall cease to be a party hereto).
0.0.0.63.113. TERMS OF ASSIGNMENTS. By executing and delivering an
Assignment and Acceptance, the Bank thereunder and the assignee thereunder
confirm to and agree with each other and the other parties hereto as follows:
(i) other than as provided in such Assignment and Acceptance, such Bank makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency, or value of this Agreement or any other instrument or document
furnished pursuant hereto; (ii) such Bank makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower or the Guarantors or the performance or observance by the Borrower or
the Guarantors of any of their obligations under this Agreement or any other
instrument or document furnished pursuant hereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with copies of the
financial statements referred to in Sections 4.4 and 5.2 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (iv) such
assignee will, independently and without reliance upon the Agent, such Bank, or
any other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (v) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Agent by the terms
hereof, together with such powers as are reasonably incidental thereto; and
(vi) such assignee agrees that it shall perform in accordance with their terms
all of the obligations which by the terms of this Agreement are required to be
performed by it as a Bank.
0.0.0.63.114. THE REGISTER. The Agent shall maintain at its address
referred to in SCHEDULE I a copy of each Assignment and Acceptance delivered to
and accepted by it and a register for the recordation of the names and
addresses of the Banks and the Commitments of, and principal amount of the
Advances owing to, each Bank from time-to-time (the "Register"). The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Agent, the Issuing Bank, and the Banks
may treat each Person whose name is recorded in the Register as a Bank
hereunder for all purposes of this Agreement. The Register shall be available
for inspection by the Borrower or any Bank at any reasonable time and from
time-to-time upon reasonable prior notice.
0.0.0.63.115. PROCEDURES. Upon its receipt of an Assignment and
Acceptance executed by a Bank and an Eligible Assignee, together with the
Revolving Credit Notes or Term Notes subject to such assignment, the Agent
shall, if such Assignment and Acceptance has been completed (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register, and (iii) give prompt notice thereof to the Borrower. Within five
Business Days after its receipt of such notice, the Borrower, at the Borrower's
own expense, shall execute and deliver to the Agent in exchange for the
surrendered Revolving Credit Notes Term Notes, a new Revolving Credit Note and
Term Note to the order of such Eligible Assignee in an amount equal to the
Revolving Credit Commitment assumed and Term Advances purchased by it pursuant
to such Assignment and Acceptance and, if such Bank has retained any Commitment
hereunder, a new Revolving Credit Note and new Term Notes to the order of such
Bank in an amount equal to the Revolving Credit Commitment and Term Advances
retained by it hereunder. Such new Notes shall be dated the effective date of
such Assignment and Acceptance.
0.0.0.63.116. PARTICIPATIONS. Each Bank may sell participations to one
or more banks or other entities in or to all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitments, the Advances owing to it, its participation
interest in the Letter of Credit Obligations, and the Notes held by it);
PROVIDED that (i) such Bank's obligations under this Agreement (including,
without limitation, its Commitments to the Borrower hereunder) shall remain
unchanged, (ii) such Bank shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) such Bank shall remain
the holder of any such Notes for all purposes of this Agreement, (iv) the
Borrower, the Agent, the Issuing Bank, and the other Banks shall continue to
deal solely and directly with such Bank in connection with such Bank's rights
and obligations under this Agreement, and (v) such Bank shall not require the
participant's consent to any matter under this Agreement, except for (A)
changes in the principal amount of the Notes, (B) reductions in fees, interest,
or any scheduled principal installment, (C) extensions of the Revolving Credit
Maturity Date or the date for payment of any installment of fees, principal, or
interest. The Borrower hereby agrees that participants shall have the same
rights under Sections 2.8, 2.9, 2.11(c), 2.12, and 8.2 as a Bank to the extent
of their respective participations.
0.0.0.63.117. CONFIDENTIALITY. The Agent, the Issuing Bank, and the
Banks understand and agree that the Borrower's common stock is a class of
securities registered under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and is listed on the New York Stock Exchange. By reason
of the foregoing, the Borrower has an obligation to prevent unauthorized
dissemination of material inside information. For this purpose, the Agent, the
Issuing Bank, and the Banks agree that, except as otherwise provided above,
they will keep confidential and will not disclose or divulge any information of
the Borrower which the Agent or the Banks may obtain from the Borrower pursuant
to financial or management reports or statements or other materials submitted
by the Borrower to the Agent, the Issuing Bank, or the Banks under this
Agreement or pursuant to visitation or inspection rights granted hereunder, or
use such information other than to monitor their loan portfolio, unless (1)
such information is known or becomes known to the public other than as a result
of a breach of this Agreement by the Agent, the Issuing Bank, or the Banks, (2)
such information is obtained without an obligation of confidentiality from
sources independent of the Borrower, (3) such information is developed
internally by such party without violation of this Agreement and by personnel
who have not had access to confidential information of the Borrower, or (4)
such information is provided to others to enforce such party's rights hereunder
or as required by law; PROVIDED that the Agent, the Issuing Bank, or the Banks
may disclose any such information to their officers, attorneys, accountants,
consultants, and other professionals engaged by the Agent or the Banks and
employees (collectively "Professionals and Employees") to the extent necessary
to obtain their services in connection with this Agreement and related matters.
The Agent and the Banks shall inform each of such Professionals and Employees
of their confidential obligations hereunder and shall use all reasonable
efforts to ensure that such Persons maintain the confidentiality of such
information. Subject to the foregoing, each Bank may provide any information
concerning the Borrower in the possession of such Bank from time-to-time to
assignees and participants (including prospective assignees and participants);
PROVIDED that, prior to any such disclosure, the assignee or participant or
proposed assignee or participant shall agree in writing to preserve the
confidentiality of any confidential information relating to the Borrower
received by it from such Bank.
Section 0.0.0.63.118. NOTICES, ETC. All notices and other
communications shall be in writing (including telecopy, telegraphic, telex, or
cable communication) and delivered, telecopied, telegraphed, telexed, or cabled
as follows: if to the Borrower, as specified in SCHEDULE I and if to any Bank,
at its Domestic Lending Office specified opposite its name in SCHEDULE I. Each
party may change its notice address by written notification to the other
parties. All such notices and communications shall, when delivered,
telecopied, telegraphed, telexed, or cabled, be effective when delivered,
telecopy transmission is completed, delivered to the telegraph company,
confirmed by telex answerback, or delivered to the cable company, respectively,
except that notices and communications to any Bank pursuant to Article 2 shall
not be effective until received.
Section 0.0.0.63.119. GOVERNING LAW. This Agreement, the Notes, and
the other Credit Documents shall be governed by, and construed and enforced in
accordance with, the laws of the State of Texas.
Section 0.0.0.63.120. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different 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.
Section 0.0.0.63.121. WAIVER OF JURY. THE BORROWER, THE BANKS, THE
AGENT, AND THE ISSUING BANK HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL
BY JURY IN RESPECT OF ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY OTHER CREDIT DOCUMENT, OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY.
THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS, AS DEFINED IN THIS AGREEMENT,
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
[remainder of page intentionally left blank]
EXECUTED as of the date first above written.
BORROWER:
MAXXIM MEDICAL, INC.
By:
Kenneth W. Davidson
President, Chief Executive Officer,
and Chairman of the Board
MAXXIM DELAWARE:
MAXXIM MEDICAL, INC.
By:
Kenneth W. Davidson
President, Chief Executive Officer,
and the Chairman of the Board
AGENT:
NATIONSBANK OF TEXAS, N.A.
By:
Frank T. Hundley
Senior Vice President
COMMITMENTS: BANKS:
NATIONSBANK OF TEXAS, N.A.
Revolving Credit
Commitment:
$75,000,000.00 By:
Frank T. Hundley
Term Commitment: Senior Vice President
$90,000,000.00
EXHIBIT C
FORM OF GUARANTY
This Guaranty dated as of July 30, 1996 ("Guaranty") is by
("Guarantor"), in favor of the Banks (as defined in the Credit Agreement
described below) and NationsBank of Texas, N.A., as Agent for the Banks
("Agent").
INTRODUCTION
A. This Guaranty is given in connection with the Second Amended and
Restated Credit Agreement dated as of July 30, 1996 (as the same may be amended,
modified or supplemented from time-to-time, the "Credit Agreement") among Maxxim
Medical, Inc., a Texas corporation ("Borrower"), the Banks named therein, and
the Agent.
B. The Borrower is the principal financing entity for all capital
requirements of its Subsidiaries, and from time-to-time the Borrower has made
capital contributions and advances to its Subsidiaries, including the Guarantor.
The Guarantor will derive substantial direct and indirect benefit from the
transactions contemplated by the Credit Agreement.
C. Under the Credit Agreement, it is a condition to the restatement of the
Existing Credit Agreement that the Guarantor shall have executed and delivered
this Guaranty.
Therefore, in consideration of the foregoing and for other good and
valuable consideration, the Guarantor hereby agrees with Agent for its benefit
and the ratable benefit of the Banks as follows:
Section 1. Definitions. All capitalized terms not otherwise defined in this
Guaranty that are defined in the Credit Agreement shall have the meaning
assigned to such terms by the Credit Agreement.
Section 2. Guaranty.
[3.] The Guarantor hereby unconditionally guarantees the punctual payment
when due, whether at stated maturity, by acceleration or otherwise, of (a) all
obligations of the Borrower to the Agent, the Banks, or any Bank now or
hereafter existing under the Credit Agreement, the Notes, and any other Credit
Document, whether for principal, obligations under any Interest Hedge Agreement,
interest, fees, expenses, or otherwise and (b) any increases, extensions, and
rearrangements of the foregoing obligations under any amendments, supplements,
and other modifications of the documents and agreements creating the foregoing
obligations (all of such obligations being the "Obligations"), and any and all
expenses (including reasonable counsel fees and expenses) incurred by the Agent
or any Bank in enforcing any rights under this Guaranty. Without limiting the
generality of the foregoing, the Guarantor's liability shall extend to all
amounts which constitute part of the Obligations even if such Obligations are
declared unenforceable or not allowable in a bankruptcy, reorganization or
similar proceeding involving the Borrower. The Guarantor will pay the Agent for
the ratable benefit of the Banks all amounts payable under this Guaranty in
immediately available funds one Business day after written demand from the
Agent.
[4.] If any sum due from the Guarantor under this Guaranty or any order or
judgment given in relation hereto has to be converted from the currency (the
"first currency") in which the same is payable hereunder or under such order or
judgment into another currency (the "second currency") for the purpose of (a)
making or filing a claim or proof against the Guarantor with any governmental
authority or in any court or tribunal or (b) enforcing any order or judgment
given in relation hereto, the Guarantor shall indemnify each Person to whom such
sum is due against any loss actually suffered as a result of any discrepancy
between (i) the rate of exchange used when restating the amount in question from
the first currency into the second currency and (ii) the rate or rates of
exchange at which such Person, acting in good faith in a commercially reasonable
manner, purchased the first currency with the second currency after receipt of a
sum paid to it in the second currency with the second currency after receipt of
a sum paid to it in the second currency in satisfaction, in whole or in party,
of any such order, judgment, claim, or proof. The foregoing indemnity shall
constitute a separate obligation of the Guarantor distinct from its other
obligations hereunder and shall survive the giving or making of any judgment or
order in relation to all or any of such other obligations.] [NOTE: Only for
foreign subsidiaries]
Section 5. Limit of Liability. The Guarantor shall be liable under this Guaranty
only for amounts aggregating up to the largest amount that would not render its
obligations hereunder subject to avoidance under Section 548 of the United
States Bankruptcy Code or any comparable provisions of any state law.
Section 6. Guaranty Absolute. The Guarantor guarantees that the Obligations will
be paid strictly in accordance with the terms of the Credit Agreement and the
Notes, regardless of any law, regulation, or order now or hereafter in effect in
any jurisdiction affecting any of such terms or the rights of the Agent or the
Banks with respect thereto. This Guaranty is a guarantee of payment, not of
collection and the Guarantor's obligations hereunder are primary, not secondary.
The obligations of the Guarantor under this Guaranty are independent of the
Obligations, joint and several with any guarantor of the Obligations in each and
every particular, and a separate action or actions may be brought and prosecuted
against the Borrower or any other person or whether the Borrower or any other
person is joined in any such action or actions. The liability of the Guarantor
under this Guaranty shall be absolute and unconditional irrespective of:
0.0.0.1. The unenforceability of the Obligations or any Credit Document for
any reason whatsoever, including that the act of creating the Obligations is
ultra vires, the officers or representatives executing the documents creating
the Obligations exceeded their authority, the Obligations violate usury or other
laws, or the Borrower has defenses to the payment of the Obligations, including
defenses based on failure of consideration, breach of warranty, fraud, statute
of frauds, bankruptcy, statute of limitations, lender liability, or accord and
satisfaction;
0.0.0.2. Any increase, reduction, extension, or rearrangement of the
Obligations, any amendment, supplement, or other modification of the Credit
Documents, or any waiver or consent granted under the Credit Documents,
including waivers of the payment and performance of the Obligations;
0.0.0.3. Any release, exchange, subordination, waste, or other impairment
(including negligent, willful, unreasonable, or unjustifiable impairment) of any
collateral securing payment of the Obligations; the failure of the Agent or any
Bank or any other person to exercise diligence or reasonable care in the
preservation, protection, enforcement, sale, or other handling of such
collateral; the fact that any security interest, lien, or assignment related to
any collateral for the Obligations shall not be properly perfected, or shall
prove to be unenforceable or subordinate to any other security interest, lien,
or assignment;
0.0.0.4. Any full or partial release of the Borrower, any guarantor, or any
other person liable for the payment of the Obligations;
0.0.0.5. The manner of applying payments or the proceeds of collateral
against the Obligations;
0.0.0.6. Any change in the organization or structure of the Borrower, any
guarantor, or any other person liable for the payment of the Obligations; any
change in the shareholders, directors, or officers of the Borrower or any other
person liable for the payment of the Obligations; or the insolvency, bankruptcy,
liquidation, or dissolution of the Borrower or any other person liable for the
payment of the Obligations;
0.0.0.7. The failure to give notice of any extension of credit made by the
Agent or any Bank to the Borrower, notice of acceptance of this Guaranty, notice
of any amendment, supplement, or other modification of any Credit Document,
notice of the execution of any document or agreement creating new Obligations,
notice of any default or event of default, however denominated, under the Credit
Documents, notice of intent to demand, notice of demand, notice of presentment
for payment, notice of nonpayment, notice of intent to protest, notice of
protest, notice of grace, notice of dishonor, notice of intent to accelerate,
notice of acceleration, notice of bringing of suit, notice of sale or
foreclosure (or posting or advertising for sale or foreclosure) of any
collateral for the Obligations notice of the Agent's or any Bank's transfer of
the Obligations, notice of the financial condition of or other circumstances
regarding the Borrower or any other Obligor, or any other notice of any kind
relating to the Obligations (and the parties intend that the Guarantor shall not
be considered a "Debtor" as defined in Section 9.105 of the Texas Business and
Commerce Code for the purpose of notices required to be given to a Debtor
thereunder);
0.0.0.8. Any payment or grant of collateral by the Borrower to the Agent or
any Bank is held to constitute a preference under bankruptcy laws, or for any
reason the Agent or any Bank is required to refund such payment or release such
collateral;
0.0.0.9. Any other action taken or omitted which affects the Obligations,
whether or not such action or omission prejudices the Guarantor or increases the
likelihood that the Guarantor will be required to pay the Obligations pursuant
to the terms hereof; or
0.0.0.10. the fact that all or any of the Obligations cease to exist by
operation of law, including, without limitation, by way of discharge, limitation
or tolling thereof under applicable bankruptcy laws.
Section 0.0.0.10.1. Certain Waivers.
0.0.0.10.2. Notice and Other Remedies. The Guarantor hereby waives
promptness, diligence, notice of acceptance and any other notice with respect to
any of the Obligations and this Guaranty and any requirement that the Agent or
any Bank protect, secure, perfect or insure any security interest or other Lien
or any Property subject thereto or exhaust any right to take any action against
the Guarantor or any other Person or any collateral, including any action
required by Chapter 34 of the Texas Business and Commerce Code.
0.0.0.10.3. Waiver of Subrogation and Contribution.
0.0.0.11. Until such time as the Obligations are paid in full, the
Guarantor hereby irrevocably waives any claim or other rights which it may
acquire against the Borrower that arise from the Guarantor's obligations under
this Guaranty or any other Credit Document, including, without limitation, any
right of subrogation (including, without limitation, any statutory rights of
subrogation under Section 509 of the Bankruptcy Code, 11 U.S.C. 509, or
otherwise), reimbursement, exoneration, contribution, indemnification, or any
right to participate in any claim or remedy of the Agent or any Bank against the
Borrower or any collateral which the Agent or any Bank now has or acquires. If
any amount shall be paid to the Guarantor in violation of the preceding sentence
and the Obligations shall not have been paid in full, such amount shall be held
in trust for the benefit of the Agent and the Banks, and shall promptly be paid
to the Agent for the benefit of the Agent and the Banks to be applied to the
Obligations, whether matured or unmatured, as the Agent may elect. The Guarantor
acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated by the Credit Agreement and that the waiver
set forth in this Section 5.02(a) is knowingly made in contemplation of such
benefits.
0.0.0.12. The Guarantor agrees that, to the extent that any Borrower makes
payments to the Agent or any Bank, or the Agent or any Bank receives any
proceeds of collateral, and such payments or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside,
or otherwise required to be repaid, then to the extent of such repayment the
Obligations shall be reinstated and continued in full force and effect as of the
date such initial payment or collection of proceeds occurred. THE GUARANTOR
SHALL INDEMNIFY THE AGENT, THE ISSUING BANK, EACH BANK, AND EACH AFFILIATE
THEREOF AND THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AND AGENTS FROM,
AND DISCHARGE, RELEASE, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND ALL
LOSSES, LIABILITIES, CLAIMS, OR DAMAGES TO WHICH ANY OF THEM MAY BECOME SUBJECT,
INSOFAR AS SUCH LOSSES, LIABILITIES, CLAIMS, OR DAMAGES ARISE OUT OF OR RESULT
FROM (I) ANY ACTUAL OR PROPOSED USE BY THE BORROWER OR ANY AFFILIATE OF THE
BORROWER OF THE PROCEEDS OF ANY ADVANCE, (II) ANY BREACH BY THE GUARANTOR OF ANY
PROVISION OF THIS GUARANTY OR ANY OTHER CREDIT DOCUMENT, OR (III) ANY
INVESTIGATION, LITIGATION, OR OTHER PROCEEDING (INCLUDING ANY THREATENED
INVESTIGATION OR PROCEEDING) RELATING TO THE FOREGOING AND THE GUARANTOR SHALL
REIMBURSE THE AGENT, THE ISSUING BANK, EACH BANK, AND EACH AFFILIATE THEREOF AND
THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AND AGENTS, UPON DEMAND FOR ANY
REASONABLE OUT-OF-POCKET EXPENSES (INCLUDING LEGAL FEES) INCURRED IN CONNECTION
WITH ANY SUCH INVESTIGATION, LITIGATION, OR OTHER PROCEEDING; AND EXPRESSLY
INCLUDING ANY SUCH LOSSES, LIABILITIES, CLAIMS, DAMAGES, OR EXPENSES INCURRED BY
REASON OF THE PERSON BEING INDEMNIFIED'S OWN NEGLIGENCE, BUT EXCLUDING ANY SUCH
LOSSES, LIABILITIES, CLAIMS, DAMAGES, OR EXPENSES INCURRED BY REASON OF THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PERSON TO BE INDEMNIFIED.
Section 0.0.0.12.1. Representations and Warranties; Covenants. The
representations and warranties set forth in Article 4 of the Credit Agreement
are incorporated herein by reference, and the Guarantor represents and warrants
to the Agent each such representation and warranty which applies to the
Guarantor as if set forth herein. The covenants set forth in Article 5 of the
Credit Agreement are incorporated herein by reference, and the Guarantor agrees
with the Agent to comply with each such covenant which applies to the Guarantor
as if set forth herein.
Section 0.0.0.12.2. Miscellaneous.
0.0.0.12.3. Amendments, Etc. No amendment or waiver of any provision of
this Guaranty nor consent to any departure by the Guarantor therefrom shall be
effective unless the same shall be in writing and signed by the Agent, the
Majority Banks and the Guarantor, provided that any amendment or waiver
releasing the Guarantor from any liability hereunder shall be signed by all the
Banks and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
0.0.0.12.4. Addresses for Notices. All notices and other communications to
any Person provided for hereunder shall be delivered to the address of such
Person set forth in the Credit Agreement and each such notice or communication
shall be effective as set forth in the Credit Agreement.
0.0.0.12.5. No Waiver; Remedies. No failure on the part of the Agent or any
Bank to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any right
hereunder preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.
0.0.0.12.6. Ri-ht of Set-Off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent, if any, specified by Section 6.2 of the Credit
Agreement to authorize the Agent to declare the Notes and any other amount
payable under the Credit Agreement due and payable pursuant to the provisions of
such Section 6.2 or the automatic acceleration of the Notes and all amounts
payable under the Credit Agreement pursuant to Section 6.3 thereunder, the Agent
and each Bank is hereby authorized at any time, to the fullest extent permitted
by law, to set off and apply any deposits (general or special, time or demand,
provisional or final) and other indebtedness owing by the Agent or such Bank to
the account of the Guarantor against any and all of the obligations of the
Guarantor under this Guaranty, irrespective of whether or not the Agent or such
Bank shall have made any demand under this Guaranty and although such
obligations may be contingent and unmatured. The Agent and each Bank agrees
promptly to notify the Guarantor after any such set-off and application made by
the Agent or such Bank provided that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of the Agent and
Banks under this Section 7.4 are in addition to other rights and remedies
(including, without limitation, other rights of set-off) which the Agent or the
Banks may have.
0.0.0.12.7. Continuing Guaranty; Assignments under Credit Agreement. This
Guaranty shall create a continuing guaranty and shall (i) remain in full force
and effect until irrevocable payment in full and termination of the Guaranteed
Obligations, (ii) be binding upon the Guarantor, its successors, and assigns,
and (iii) inure, together with the rights and remedies of the Agent and the
Banks hereunder, to the benefit of the Agent, the Banks, and their respective
successors and Eligible Assignees. Without limiting the generality of the
foregoing clause, when any Bank assigns or otherwise transfers any interest held
by it under the Credit Agreement or other Credit Document to any other Person
(pursuant to Section 8.7 of the Credit Agreement), that other Person shall
thereupon become vested with all the benefits held by such Bank under this
Guaranty. Upon the irrevocable payment in full and termination of the Guaranteed
Obligations, the guaranty granted hereby shall terminate and all rights
hereunder shall revert to the Guarantor to the extent such rights have not been
applied pursuant to the terms hereof. Upon any such termination, the Agent will,
at the Guarantor's expense, execute and deliver to the Guarantor such documents
as the Guarantor shall reasonably request and take any other actions reasonably
requested to evidence or effect such termination.
0.0.0.12.8. Execution in Counterparts. This Guaranty may be executed in any
number of counterparts and by different 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.
0.0.0.12.9. Governing Law. This Guaranty and the other Credit Documents
shall be governed by, and construed and enforced in accordance with, the laws of
the State of Texas.
0.0.0.12.10. WAIVER OF JURY. THE GUARANTOR, THE BANKS, THE AGENT, AND THE
ISSUING BANK HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN
RESPECT OF ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY, ANY
OTHER CREDIT DOCUMENT, OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY.
0.0.0.12.11. CHOICE OF FORUM AND VENUE. THE GUARANTOR AGREES AND SHALL NOT
CONTEST THAT PROPER FORUM AND VENUE FOR ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THE CREDIT DOCUMENTS OR ANY TRANSACTIONS RELATING THERETO ARE IN
THE COURTS OF THE STATE OF TEXAS IN HARRIS COUNTY, TEXAS, AND THE FEDERAL COURTS
LOCATED IN HARRIS COUNTY, TEXAS. THE GUARANTOR IRREVOCABLY WAIVES ANY OBJECTION
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE FOREGOING BASED UPON CLAIMS THAT THE
FOREGOING COURTS ARE AN INCONVENIENT FORUM.
0.0.0.12.12. SERVICE OF PROCESS. IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THE CREDIT DOCUMENTS OR ANY TRANSACTIONS RELATING THERETO, THE
GUARANTOR WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT, OR OTHER PROCESS OR
NOTICE AND AGREES THAT SERVICE BY FIRST CLASS MAIL, RETURN RECEIPT REQUESTED, TO
THE GUARANTOR AT ITS ADDRESS FOR NOTICES HEREUNDER, OR ANY OTHER FORM OF SERVICE
PROVIDED FOR IN THE TEXAS CIVIL PRACTICE LAW AND RULES THEN IN EFFECT SHALL
CONSTITUTE GOOD AND SUFFICIENT SERVICE UPON THE GUARANTOR. THE GUARANTOR
IRREVOCABLY APPOINTS THE BORROWER (MAXXIM MEDICAL, INC.), AS ITS AGENT FOR THE
PURPOSES OF SERVICE ON THE GUARANTOR, AND ANY PROPER SERVICE AGAINST THE
GUARANTOR MADE TO THE BORROWER, SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE
UPON THE GUARANTOR.
THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS, AS DEFINED IN THIS GUARANTY,
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
The Guarantor has caused this Guaranty to be duly executed as of the date
first above written.
[GUARANTOR]
By:
Name:
Title:
PLEDGE AGREEMENT
(Maxxim Delaware)
This Pledge Agreement dated as of July 30, 1996 ("Agreement"), is between
Maxxim Medical, Inc., a Delaware corporation ("Debtor"), and NationsBank of
Texas, N.A., as agent for the Banks (as defined in the Credit Agreement
described below) ("Secured Party").
INTRODUCTION
A. Reference is made to the Second Amended and Restated Credit Agreement
dated as of July 30, 1996 (as the same may be amended, supplemented, and
modified from time to time, the "Credit Agreement"), among Maxxim Medical, Inc.,
a Texas corporation ("Borrower"), the Banks (as defined therein), and the
Secured Party. Pursuant to the Guaranty dated as of even date herewith (as the
same may be amended, supplemented, and modified from time to time, the
"Guaranty") made by the Debtor in favor of the Secured Party and the Banks, the
Debtor has guaranteed the Borrower's obligations under Credit Agreement.
B. Under the Credit Agreement, it is a condition to the restatement of
the Existing Credit Agreement (as defined in the Credit Agreement) that the
Debtor shall enter into this Agreement.
Therefore, the Debtor hereby agrees with the Secured Party for its benefit
and the ratable benefit of the Banks as follows:
Section 1. DEFINITIONS. All capitalized terms not otherwise defined in this
Agreement that are defined in the Credit Agreement shall have the meaning
assigned to such terms by the Credit Agreement. Any terms used in this
Agreement that are defined in the Uniform Commercial Code as adopted in the
state of Texas ("UCC") shall have the meaning assigned to those terms by the
UCC, whether specified elsewhere in this Agreement or not. In addition, the
following terms shall have the following meanings:
"Chief Executive Office Location" means the Debtor's principal place of
business and chief executive office location at the address specified in the
notice provision of the Credit Agreement as of the date of this Agreement.
"Collateral" means all of the Debtor's present and future right, title, and
interest in the Pledged Securities, Records, any Collateral Accounts, and
Proceeds.
"Collateral Account" means any deposit account with the Secured Party which
is designated, maintained, and under the sole control of the Secured Party and
is pledged to the Secured Party which has been established pursuant to the
provisions of this Agreement for the purposes described in this Agreement
including collecting, holding, disbursing, or applying certain funds, all in
accordance with this Agreement. The Debtor agrees to execute any documents
reasonably requested by the Secured Party to create any Collateral Account and
pledge it to the Secured Party.
"Event of Default" means any Event of Default, as such term is defined in
the Credit Agreement.
"Pledged Securities" means all of the shares of stock described in SCHEDULE
I to this Agreement and all additional shares of stock of each issuer of such
shares of stock issued to Debtor (provided however that the percentage of the
issued and outstanding shares of capital stock of each issuer thereof pledged
hereunder shall not exceed the percentages reflected for such issuers in
SCHEDULE I to this Agreement), together with all dividends, cash, instruments,
and other proceeds from time to time received or otherwise distributed in
respect of the foregoing, including stock rights, options, rights to subscribe,
dividends, liquidating dividends, stock dividends, new securities (including any
shares of the Target received due to the merger of Acquisition into the Target),
or other properties or benefits to which the Debtor may become entitled to
receive on account of such property.
"Proceeds" means all present and future proceeds of the Pledged Securities,
whether arising from the collection, sale, exchange, assignment, or other
disposition of any Pledged Securities, the realization upon any Pledged
Securities, or any other transaction or occurrence, including all claims of
Debtor against third parties for impairment, loss, or damage to any Pledged
Securities, all proceeds payable under any put, call, hedge, or other protection
for the value of any Pledged Securities, and all rights under any indemnity,
warranty, or guaranty of or for any of the foregoing, whether such proceeds are
represented as money, deposit accounts, accounts, general intangibles,
securities, instruments, documents, chattel paper, inventory, equipment,
fixtures, or goods.
"Records" means all of the Debtor's present and future contracts,
accounting records, files, computer files, computer programs, and other records
relating to the Pledged Securities and Proceeds.
"Secured Obligations" means (a) all amounts now or hereafter owed by the
Debtor to the Secured Party, the Banks, or any Bank under the Guaranty and the
other Credit Documents, (b) all principal, interest, fees, reimbursements,
indemnifications, and other amounts now or hereafter owed by the Borrower to the
Secured Party, the Banks, or any Bank under the Credit Agreement and the other
Credit Documents, and (c) any increases, extensions, and rearrangements of the
foregoing obligations under any amendments, supplements, and other modifications
of the agreements creating the foregoing obligations.
Section 2. SECURITY INTEREST.
3. GRANT OF SECURITY INTEREST. The Debtor hereby grants to the Secured
Party, for its benefit and the ratable benefit of the Banks, a security interest
in the Collateral to secure the payment and performance of the Secured
Obligations.
4. DEBTOR REMAINS LIABLE. Anything herein to the contrary notwithstanding:
(a) the Debtor shall remain liable under the contracts and agreements included
in the Collateral to the extent set forth therein to perform its obligations
thereunder to the same extent as if this Agreement had not been executed; (b)
the exercise by Secured Party of any rights hereunder shall not release Debtor
from any obligations under the contracts and agreements included in the
Collateral; and (c) Secured Party shall not have any obligation under the
contracts and agreements included in the Collateral by reason of this Agreement,
nor shall Secured Party be obligated to perform or fulfill any of the
obligations of the Debtor thereunder, including any obligation to make any
inquiry as to the nature or sufficiency of any payment Debtor may be entitled to
receive thereunder, to present or file any claim, or to take any action to
collect or enforce any claim for payment thereunder.
Section 5. GENERAL PROVISIONS. The Debtor represents and warrants to and
agrees with the Secured Party as follows:
6. OWNERSHIP. The Debtor has good and indefeasible title to the Collateral
free from any liens, security interests, assignments, options, adverse claims,
restrictions, and other encumbrances whatsoever. The shares of stock
representing the Pledged Securities are duly authorized and validly issued and
are fully paid and nonassessable. As of the date of this Agreement, each issuer
of any Pledged Securities has no outstanding capital stock or other securities
except those shown in SCHEDULE I. The Pledged Securities constitute the
percentages reflected on SCHEDULE I of the issued and outstanding shares of
capital stock of each issuer thereof. No effective pledge or other transfer
regarding the Pledged Securities is in effect. No recorded financing statement
or similar recording or filing covering any part of the Collateral is in effect
or on file in any recording office, except those filed in connection with this
Agreement. The Debtor shall not, without the prior written consent of the
Secured Party, grant any lien, security interest, assignment, option,
restriction, claim, or other encumbrance on or against the Collateral, or lease,
sell, or otherwise transfer any of its rights in the Collateral.
7. PERFECTION. All certificates or instruments representing the Pledged
Securities are correctly described in the definition of "Pledged Securities" and
have been delivered to the Secured Party in a form suitable for transfer by
delivery, or accompanied by duly executed instruments of transfer or assignment
in blank, all in form and substance satisfactory to the Secured Party. No
authorization, approval, or other action is necessary to perfect such security
interests granted or purported to be granted hereunder, to allow the Debtor to
perform its obligations hereunder, or to permit the Secured Party to exercise
its rights and remedies hereunder (except as may be required in connection with
such disposition by laws affecting the offering and sale of securities
generally). The true and correct name of the Debtor as listed on its articles of
incorporation is the name specified in the first paragraph of this Agreement,
and the Debtor shall not change its name without the advance written consent of
the Secured Party. The chief executive office of the Debtor is located at the
Chief Executive Office Location. Without advance notice to the Secured Party and
the opportunity for the Secured Party to take all actions under Section 3.5 to
perfect the security interests purported to be granted hereunder, the Debtor
shall not change the Chief Executive Office Location. 8. PRIORITY. 9. The
security interest created by this Agreement is first priority, and the Debtor
shall preserve and maintain the status of such security interest to the end that
this Agreement shall remain a first priority security interest in the
Collateral.
10. If the proceeds of the Secured Obligations are used to pay any
indebtedness secured by prior liens, the Secured Party is subrogated to all of
the rights and liens of the holders of such indebtedness.
11. USE AND CONDITION.
12. The Debtor agrees that it will cause each issuer of the Pledged
Securities not to issue any stock or other securities in addition to or in
substitution for the Pledged Securities existing as of the date hereof which are
listed in the table in the definition of Pledged Securities. The Debtor agrees
that it will cause each issuer of any Pledged Securities not to issue any stock
or other securities except those in existence on the date of this Agreement.
13. All non-cash dividends which are received by the Debtor shall be
received in trust for the benefit of the Secured Party, shall be segregated from
other funds of the Debtor, and shall be promptly paid over to the Secured Party
to be held as Pledged Securities in the same form as so received (with any
necessary endorsement). Upon the Secured Party's request, if disposition of any
Collateral gives rise to any instruments, documents, or chattel paper the Debtor
shall promptly inform the Secured Party thereof and deliver such instruments,
documents, or chattel paper to the Secured Party with all necessary endorsements
and assignment agreements requested by the Secured Party.
14. With regard to the Pledged Securities, so long as no Default or Event of
Default shall exist the Debtor shall be entitled to exercise any voting and
other consensual rights pertaining to the Pledged Securities for any purpose not
inconsistent with the terms of this Agreement; provided, that the Debtor shall
not exercise or shall refrain from exercising any such right if, in the Secured
Party's judgment, such action would have a materially adverse effect on the
value of the Pledged Securities. The Secured Party shall execute and deliver (or
cause to be executed and delivered) to the Debtor all proxies and other
instruments that the Debtor may reasonably request to enable the Debtor to
exercise the voting and other rights which it is entitled to exercise hereunder
and to receive the dividends or interest payments which it is authorized to
receive and retain hereunder.
15. FURTHER ASSURANCES.
0.0.0.0.1. THE DEBTOR AGREES THAT AT ANY TIME THE DEBTOR
SHALL PROMPTLY EXECUTE AND DELIVER ALL FURTHER AGREEMENTS, AND TAKE ALL
FURTHER ACTION, THAT MAY BE NECESSARY OR THAT THE SECURED PARTY MAY REASON-
ABLY REQUEST, IN ORDER TO FURTHER EVIDENCE THE SECURITY INTERESTS GRANTED
OR PURPORTED TO BE GRANTED HEREUNDER AND PERFECT AND PROTECT THE SAME OR TO
ENABLE THE SECURED PARTY TO EXERCISE AND ENFORCE ITS RIGHTS AND REMEDIES
HEREUNDER. WITHOUT LIMITING THE FOREGOING, THE DEBTOR SHALL EXECUTE STOCK
POWERS, PLEDGE REGISTRATION REQUESTS, FINANCING STATEMENTS, AMENDMENTS AND
CONTINUATIONS OF FINANCING STATEMENTS, AND SUCH OTHER DOCUMENTS AND
AGREEMENTS AS THE SECURED PARTY MAY REASONABLY REQUEST IN ORDER TO PERFECT
AND PRESERVE THE SECURITY INTERESTS GRANTED OR PURPORTED TO BE GRANTED
HEREUNDER. THE DEBTOR SHALL FURNISH TO THE SECURED PARTY FROM TIME TO TIME
ANY STATEMENTS AND SCHEDULES FURTHER IDENTIFYING AND DESCRIBING ANY OF THE
COLLATERAL AND SUCH OTHER REPORTS IN CONNECTION WITH THE COLLATERAL AS THE
SECURED PARTY MAY REASONABLY REQUEST.
0.0.0.0.2. DURING THE EXISTENCE OF AN EVENT OF DEFAULT, THE
DEBTOR AGREES THAT, IF THE DEBTOR FAILS TO PERFORM UNDER THIS AGREEMENT,
THE SECURED PARTY MAY, BUT SHALL NOT BE OBLIGATED TO, PERFORM THE DEBTOR'S
OBLIGATIONS UNDER THIS AGREEMENT AND ANY EXPENSES INCURRED BY THE SECURED
PARTY IN PERFORMING THE DEBTOR'S OBLIGATIONS SHALL BE PAID BY THE DEBTOR.
ANY SUCH PERFORMANCE BY THE SECURED PARTY MAY BE MADE BY THE SECURED PARTY
IN REASONABLE RELIANCE ON ANY STATEMENT, INVOICE, OR CLAIM, WITHOUT INQUIRY
INTO THE VALIDITY OR ACCURACY THEREOF. THE AMOUNT AND NATURE OF ANY
EXPENSE OF THE SECURED PARTY HEREUNDER SHALL BE CONCLUSIVELY ESTABLISHED BY
A CERTIFICATE OF ANY OFFICER OF THE SECURED PARTY.
0.0.0.0.3. THE DEBTOR IRREVOCABLY APPOINTS THE SECURED PARTY
AS THE DEBTOR'S ATTORNEY IN FACT, WITH FULL AUTHORITY TO ACT DURING THE
EXISTENCE OF AN EVENT OF DEFAULT FOR THE DEBTOR AND IN THE NAME OF THE
DEBTOR, TO TAKE ANY ACTION AND EXECUTE ANY AGREEMENT WHICH THE SECURED
PARTY DEEMS NECESSARY OR ADVISABLE TO ACCOMPLISH THE PURPOSES OF THIS
AGREEMENT, INCLUDING TAKING ACTIONS THE SECURED PARTY IS EXPRESSLY
AUTHORIZED TO TAKE PURSUANT TO THIS AGREEMENT (SUCH AS THE MATTERS
DESCRIBED IN PARAGRAPH (A) ABOVE), INSTITUTING PROCEEDINGS THE SECURED
PARTY DEEMS NECESSARY OR DESIRABLE TO ENFORCE THE RIGHTS OF THE SECURED
PARTY WITH RESPECT TO THIS AGREEMENT, AND TAKING ACTIONS WITH RESPECT TO
RECEIVING, ENDORSING, AND COLLECTING INSTRUMENTS MADE PAYABLE TO THE DEBTOR
REPRESENTING ANY DIVIDEND, INTEREST PAYMENT, OR OTHER DISTRIBUTION IN
RESPECT OF THE PLEDGED SECURITIES AND GIVING FULL DISCHARGE FOR THE SAME.
0.0.0.0.4. THE POWERS CONFERRED ON THE SECURED PARTY UNDER
THIS AGREEMENT ARE SOLELY TO PROTECT ITS RIGHTS UNDER THIS AGREEMENT AND
SHALL NOT IMPOSE ANY DUTY UPON IT TO EXERCISE ANY SUCH POWERS. EXCEPT AS
ELSEWHERE PROVIDED HEREUNDER, THE SECURED PARTY SHALL HAVE NO DUTY AS TO
ANY OF THE COLLATERAL OR AS TO THE TAKING OF ANY NECESSARY STEPS TO
PRESERVE RIGHTS AGAINST PRIOR PARTIES OR ANY OTHER RIGHTS PERTAINING TO THE
COLLATERAL. THE SECURED PARTY SHALL HAVE NO RESPONSIBILITY FOR
(I) ASCERTAINING OR TAKING ACTION WITH RESPECT TO CALLS, CONVERSIONS,
EXCHANGES, MATURITIES, TENDERS, OR OTHER MATTERS RELATIVE TO ANY PLEDGED
SECURITIES, WHETHER OR NOT THE SECURED PARTY HAS OR IS DEEMED TO HAVE
KNOWLEDGE OF SUCH MATTERS, OR (II) TAKING ANY NECESSARY STEPS TO PRESERVE
RIGHTS AGAINST ANY PARTIES WITH RESPECT TO ANY PLEDGED SECURITIES.
Section 0.0.0.0.4.1. REMEDIES. During the continuation of any Event of
Default:
0.0.0.0.4.2. INTERIM REMEDIES.
0.0.0.0.4.3. The Secured Party may exercise all the rights and remedies of a
secured party under the UCC.
0.0.0.0.4.4. The Secured Party may prosecute actions in equity or at law for
the specific performance of any covenant or agreement herein contained or in aid
of the execution of any power herein granted or for the enforcement of any other
appropriate legal or equitable remedy.
0.0.0.0.4.5. All rights of the Debtor to exercise the voting and other
consensual rights which it would otherwise be entitled to exercise pursuant to
this Agreement shall cease, and all such rights shall thereupon become vested in
the Secured Party who shall thereupon have the sole right to exercise such
voting and other consensual rights.
0.0.0.0.4.6. To the extent permitted by applicable law, the Secured Party
shall have the right, without notice to the Debtor, to transfer or to register,
in the name of the Secured Party or any of its nominees, any of the Pledged
Securities. In addition, the Secured Party shall have the right at any time to
exchange the certificates or instruments representing the Pledged Securities for
certificates or instruments of smaller or larger denominations.
0.0.0.0.4.7. The Secured Party may require the Debtor to promptly assemble
any tangible Collateral and make it available to the Secured Party at a place to
be designated by the Secured Party. The Secured Party may occupy any premises
owned or leased by the Debtor where the Collateral is assembled for a reasonable
period in order to effectuate its rights and remedies hereunder or under law,
without obligation to the Debtor with respect to such occu- pation. The Secured
Party shall have no obligation to take any action to assemble or otherwise take
control of the Collateral, whether for the purposes of sale or otherwise.
0.0.0.0.4.8. The Secured Party may take any action permitted under the
Credit Agreement and the other Credit Documents, including declaring the unpaid
portion of the Secured Obligations to be immediately due and payable under the
terms of the Credit Agreement.
0.0.0.0.4.9. FORECLOSURE.
0.0.0.0.4.10. The Secured Party may foreclose on the Collateral in any
manner permitted by the courts of or in the State of Texas. If the Secured Party
should institute a suit for the collection of the Secured Obligations and for
the foreclosure of this Agreement, the Secured Party may at any time before the
entry of a final judgment dismiss the same, and take any other action permitted
by this Agreement.
0.0.0.0.4.11. The Secured Party may exercise all the rights and remedies of
a secured party under the UCC, including foreclosure.
0.0.0.1. IF, IN THE OPINION OF THE SECURED PARTY, THERE IS ANY QUESTION THAT
A PUBLIC OR SEMIPUBLIC SALE OR DISTRIBUTION OF ANY COLLATERAL WILL VIOLATE ANY
STATE OR FEDERAL SECURITIES LAW, THE SECURED PARTY IN ITS DISCRETION (A) MAY
OFFER AND SELL SECURITIES PRIVATELY TO PURCHASERS WHO WILL AGREE TO TAKE THEM
FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO DISTRIBUTION AND WHO WILL AGREE
TO IMPOSITION OF RESTRICTIVE LEGENDS ON THE CERTIFICATES REPRESENTING THE
SECURITY, OR (B) MAY, IF LAWFUL, SELL SUCH SECURITIES IN AN INTRASTATE OFFERING
UNDER SECTION 3(A)(11) OF THE SECURITIES ACT OF 1933, AS AMENDED, AND NO SALE SO
MADE IN GOOD FAITH BY THE SECURED PARTY SHALL BE DEEMED TO BE NOT "COMMERCIALLY
REASONABLE" BECAUSE SO MADE. DEBTOR SHALL COOPERATE FULLY WITH SECURED PARTY IN
ALL RESPECTS IN SELLING OR REALIZING UPON ALL OR ANY PART OF THE COLLATERAL. IN
ADDITION, DEBTOR SHALL FULLY COMPLY WITH THE SECURITIES LAWS OF CANADA, THE
UNITED STATES, THE STATE OF TEXAS, AND OTHER STATES OR JURISDICTIONS AND TAKE
SUCH ACTIONS AS MAY BE NECESSARY TO PERMIT THE SECURED PARTY TO SELL OR
OTHERWISE DISPOSE OF ANY SECURITIES PLEDGED HEREUNDER IN COMPLIANCE WITH SUCH
LAWS.
0.0.0.2. THE SECURED PARTY MAY SELL ANY COLLATERAL AT PUBLIC OR PRIVATE
SALE, AT THE OFFICE OF THE SECURED PARTY OR ELSEWHERE, FOR CASH OR CREDIT AND
UPON SUCH OTHER TERMS AS THE SECURED PARTY DEEMS COMMERCIALLY REASONABLE. THE
SECURED PARTY MAY SELL ANY COLLATERAL AT ONE OR MORE SALES, AND THE SECURITY
INTEREST GRANTED HEREUNDER SHALL REMAIN IN EFFECT AS TO THE UNSOLD PORTION OF
THE COLLATERAL. IF NOTICE IS REQUIRED BY LAW, THE DEBTOR HEREBY DEEMS TEN DAYS
ADVANCE NOTICE OF THE TIME AND PLACE OF ANY PUBLIC OR PRIVATE SALE REASONABLE
NOTIFICATION, RECOGNIZING THAT IF THE COLLATERAL IS PERISHABLE OR THREATENS TO
DECLINE SPEEDILY IN VALUE OR IS OF A TYPE CUSTOMARILY SOLD ON A RECOGNIZED
MARKET, SHORTER NOTICE MAY BE REASONABLE. THE SECURED PARTY SHALL NOT BE
OBLIGATED TO MAKE ANY SALE OF COLLATERAL REGARDLESS OF NOTICE OF SALE HAVING
BEEN GIVEN. THE SECURED PARTY MAY ADJOURN ANY SALE BY ANNOUNCEMENT AT THE TIME
AND PLACE FIXED THEREFOR, AND SUCH SALE MAY, WITHOUT FURTHER NOTICE, BE MADE AT
THE TIME AND PLACE TO WHICH IT WAS ADJOURNED. IN THE EVENT THAT ANY SALE
HEREUNDER IS NOT COMPLETED OR IS DEFECTIVE IN THE OPINION OF THE SECURED PARTY,
THE SECURED PARTY SHALL HAVE THE RIGHT TO CAUSE SUBSEQUENT SALES TO BE MADE
HEREUNDER. ANY STATEMENTS OF FACT OR OTHER RECITALS MADE IN ANY BILL OF SALE,
ASSIGNMENT, OR OTHER DOCUMENT REPRESENTING ANY SALE HEREUNDER, INCLUDING
STATEMENTS RELATING TO THE OCCURRENCE OF AN EVENT OF DEFAULT, ACCELERATION OF
THE SECURED OBLIGATIONS, NOTICE OF THE SALE, THE TIME, PLACE, AND TERMS OF THE
SALE, AND OTHER ACTIONS TAKEN BY THE SECURED PARTY IN RELATION TO THE SALE SHALL
BE CONCLUSIVE EVIDENCE OF THE TRUTH OF THE MATTERS SO STATED. THE SECURED PARTY
MAY DELEGATE TO ANY AGENT THE PERFORMANCE OF ANY ACTS IN CONNECTION WITH ANY
SALE HEREUNDER, INCLUDING THE SENDING OF NOTICES AND THE CONDUCT OF THE SALE.
0.0.0.2.1. APPLICATION OF PROCEEDS. Unless otherwise specified herein, any
cash proceeds received by the Secured Party from the sale of, collection of, or
other realization upon any part of the Collateral or any other amounts received
by the Secured Party hereunder may be, at the discretion of the Secured Party
(i) held by the Secured Party in one or more Collateral Accounts as cash
collateral for the Secured Obligations or (ii) applied to the Secured
Obligations. Amounts applied to the Secured Obligations shall be applied in the
following order: First, to the payment of the costs and expenses of exercising
the Secured Party's rights hereunder, whether expressly provided for herein or
otherwise; and Second, to the payment of the Secured Obligations in the order
determined by the Secured Party. Any surplus cash collateral or cash proceeds
held by the Secured Party after payment in full of the Secured Obligations and
the termination of any commitments of the Secured Party to the Debtor shall be
paid over to the Debtor or to whomever may be lawfully entitled to receive such
surplus.
0.0.0.2.2. WAIVER OF CERTAIN RIGHTS. To the full extent the Debtor may do
so, the Debtor shall not insist upon, plead, claim, or take advantage of any law
providing for any appraisement, valuation, stay, extension, or redemption, and
the Debtor hereby waives and releases the same, and all rights to a marshaling
of the assets of the Debtor, including the Collateral, or to a sale in inverse
order of alienation in the event of foreclosure of the liens and security
interests hereby created. The Debtor shall not assert any right under any law
pertaining to the marshaling of assets, sale in inverse order of alienation, the
administration of estates of decedents or other matters whatever to defeat,
reduce, or affect the right of the Secured Party under the terms of this
Agreement.
Section 0.0.0.2.3. MISCELLANEOUS.
0.0.0.2.4. ADDRESSES FOR NOTICES. All notices and other communications
provided for hereunder shall be in the manner and to the addresses set forth in
the Credit Agreement.
0.0.0.2.5. RETURN OF PLEDGED SECURITIES. Upon the irrevocable payment in
full of the Secured Obligations, the full performance of the Credit Parties'
obligations under the Credit Documents, and the absence of any commitment for
the Agent or any Bank to further extend credit under the Credit Documents, the
Agent shall return the Pledged Securities to the Debtor within 10 Business Days
of the Debtor's written request thereof.
0.0.0.2.6. CHOICE OF LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Texas.
THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
The parties hereto have caused this Agreement to be duly executed as of the
date first above written.
MAXXIM MEDICAL, INC., a Delaware corporation
By:
Kenneth W. Davidson
President, Chief Executive Officer,
and the Chairman of the Board
NATIONSBANK OF TEXAS, as Agent
By:
Frank T. Hundley
Senior Vice President
SCHEDULE I
Attached to and forming a part of that certain Pledge Agreement dated
July 30, 1996, by Maxim Medical, Inc., a Delaware Corporation, as
Debtor, to the Secured Party.
<TABLE>
<CAPTION>
PERCENTAGE
STOCK CERTIFICATE PLEDGED
OUSTANDING ------------------------------------------------- NUMBER OF TOTAL
STOCK ISSUER CLASS OF STOCK NO(S). PAR VALUE OF SHARES AND ISSUED
- -----------------------------------------------------------------------------------------------
STOCK OF ISSUER
- ---------------
<S> <C> <C> <C> <C> <C>
Fabritek la Romana, Inc., Common 3 $1.00 1,000 100%
a Mississippi corporation
Maxxim Medical Common 3 No par value 65 65%
Canada Limited,
an Ontario corporation
Medica B.V., a -- -- -- -- 65%
Netherlands corporation
Medica Hospital Common -- -- -- 65%
Supplies, N.V., a
Belgian corporation
Maxxim Acquisitions Co., Common 1 $.01 1,000 100%
a Virginia corporation,
to be merged with and
into Sterile Concepts
Holdings, Inc., a Virginia
corporation
</TABLE>
An additional 35 shares of Common Stock is owned by the Debtor.
Exhibit 3
Execution Copy
MAXXIM MEDICAL, INC.
$100,000,000
10 1/2% SENIOR SUBORDINATED NOTES DUE 2006
PURCHASE AGREEMENT
New York, New York
July 18, 1996
NationsBanc Capital Markets, Inc.
Bear, Stearns & Co. Inc.
c/o NationsBanc Capital Markets, Inc.
NationsBank Corporate Center
100 North Tryon Street, NC1-007-07-01
Charlotte, North Carolina 28255-0001
Ladies and Gentlemen:
Maxxim Medical, Inc., a Texas corporation (the "Company"),
proposes to issue and sell (the "Initial Placement") to NationsBanc Capital
Markets, Inc. and Bear, Stearns & Co. Inc. (the "Initial Purchasers")
$100,000,000 principal amount of its 10 1/2% Senior Subordinated Notes Due
2006 (the "Notes"). The Notes are to be unconditionally guaranteed, jointly and
severally, on a senior subordinated and unsecured basis (the "Note Guarantees")
by each existing and future direct and indirect subsidiary of the Company (each
such existing guarantor, a "Guarantor" and collectively, the "Guarantors"),
subject to certain exceptions. The Notes are to be issued under an indenture
(the "Indenture") to be dated as of the Closing Date (as defined below) among
the Company, the Guarantors and First Union National Bank of North Carolina, as
trustee. The Initial Placement is to occur concurrently with, and is conditioned
upon, (i) the acquisition by Maxxim Acquisition Co., a Virginia corporation and
an indirect, wholly owned subsidiary of the Company ("Maxxim Acquisition") of
more than two-thirds of the issued and outstanding common stock of Sterile
Concepts Holdings, Inc., a Virginia corporation ("Sterile Concepts"), on a
fully-diluted basis, pursuant to a tender offer (the "Tender Offer") made by the
Company, Maxxim Acquisition and Maxxim Medical Inc., a Delaware corporation and
a direct, wholly owned subsidiary of the Company ("Maxxim Delaware") for all of
the issued and outstanding common stock of Sterile Concepts at a purchase price
of $20.00 per share, which was commenced on June 14, 1996, pursuant to the terms
of the Agreement and Plan of Merger, dated as of June 10, 1996 (the "Merger
Agreement") among Maxxim Delaware, Maxxim Acquisition and Sterile Concepts, and
(ii) initial borrowings under the Second Amended and Restated Credit Agreement,
to be executed and delivered on or prior to the date on which the
<PAGE>
Notes are issued (the "Credit Agreement"), among the Company, NationsBank of
Texas, N.A., an affiliate of NationsBanc Capital Markets, Inc., one of the
Initial Purchasers, as agent and lender, and the other lenders named therein
(collectively, the "Banks"). After the consummation of the Tender Offer, Maxxim
Acquisition will be merged with and into Sterile Concepts (the "Merger"), with
Sterile Concepts being the surviving entity, pursuant to the Merger Agreement.
This Agreement, the registration rights agreement, to be dated the Closing Date,
between the Initial Purchasers and the Company (the "Registration Rights
Agreement"), the Indenture (including the Note Guarantees thereunder), the
Merger Agreement and the Credit Agreement are hereinafter collectively referred
to as the "Transaction Documents."
The sale of the Notes to the Initial Purchasers will be made
without registration of the Notes under the Securities Act of 1933, as amended
(the "Securities Act"), in reliance upon certain exemptions from the
registration requirements of the Securities Act. You have advised the Company
that you will offer and sell the Notes purchased by you hereunder in accordance
with Section 4 hereof as soon as you deem advisable.
In connection with the sale of the Notes, the Company has
prepared a preliminary offering memorandum, dated July 1, 1996 (including any
and all exhibits thereto and any information incorporated by reference therein,
the "Preliminary Memorandum"), and a final offering memorandum, dated July 18,
1996 (including any and all exhibits thereto and any information incorporated by
reference therein, the "Final Memorandum"). Each of the Preliminary Memorandum
and the Final Memorandum sets forth certain information concerning the Company
and the Notes. The Company hereby confirms that it has authorized the use of the
Preliminary Memorandum and the Final Memorandum, and any amendment or supplement
thereto, in connection with the offer and sale of the Notes by the Initial
Purchasers. Unless stated to the contrary, all references herein to the Final
Memorandum are to the Final Memorandum at the Execution Time (as defined below)
and are not meant to include any amendment or supplement, or any information
incorporated by reference therein, subsequent to the Execution Time.
1. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Initial Purchasers as set forth below in this Section 1.
(a) The Preliminary Memorandum, at the date thereof, did not
contain 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. The Final
Memorandum, at the date hereof, does not and at the Closing Date will
not (and any amendment or supplement thereto, at the date thereof and at
the Closing Date, will not), contain 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; PROVIDED, HOWEVER, that the Company makes no representation
or warranty as to the information contained in or omitted from the
Preliminary Memorandum or the Final Memorandum under the captions
"Notice to Investors" or "Plan of Distribution", or any amendment or
supplement thereto, in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of the Initial
Purchasers specifically for inclusion therein.
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(b) Neither the Company nor any of its Affiliates (as defined in
Rule 501(b) of Regulation D under the Securities Act ("Regulation D")),
nor any person acting on its or their behalf (other than the Initial
Purchasers or any of their Affiliates, as to whom the Company make no
representation or warranty) has, directly or indirectly, made offers or
sales of any security, or solicited offers to buy any security, under
circumstances that would require the registration of the Notes under the
Securities Act.
(c) Neither the Company nor any of its Affiliates, nor any person
acting on its or their behalf (other than the Initial Purchasers or any
of their Affiliates, as to whom the Company makes no representation or
warranty) has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D) in connection with any
offer or sale of the Notes.
(d) Neither the Company nor any of its Affiliates has (i) taken,
directly or indirectly, any action designed to cause or result in, or
that has constituted or that might reasonably be expected to constitute,
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Notes; or (ii) paid or
agreed to pay to any person any compensation for soliciting another to
purchase any securities of the Company (except as contemplated by this
Agreement).
(e) The Notes satisfy the eligibility requirements of Rule
144A(d)(3) under the Securities Act.
(f) It is not necessary in connection with the offer, sale and
delivery of the Notes in the manner contemplated by this Agreement and
the Final Memorandum to register any of such securities under the
Securities Act or to qualify the Indenture under the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act").
(g) The Company has been advised by the National Association of
Securities Dealers, Inc. (the "NASD") Private Offerings, Resales and
Trading through Automated Linkages market ("PORTAL") that the Notes have
been designated PORTAL-eligible securities in accordance with the rules
and regulations of the NASD.
(h) The Company is not an "investment company" within the meaning
of the Investment Company Act of 1940, as amended (the "Investment
Company Act").
(i) The Company is subject to and in full compliance in all
material respects with the reporting requirements of Section 13 or
Section 15(d) of the Exchange Act of 1934, as amended (the "Exchange
Act").
(j) Each of the Company and the Guarantors is validly existing as
a corporation in good standing under the laws of the jurisdiction in
which it is chartered or organized, with full power (corporate and
other) to own or lease its properties, conduct its business as described
in the Final Memorandum and enter into each Transaction Document to
which it is a party and to carry out all the terms and provisions of
each such Transaction Document to be carried out by it, and is duly
qualified to do business as a foreign corporation and is in good
standing under the laws of each jurisdiction that requires such
qualification wherein it owns or leases properties or conducts business,
in each case giving effect to the Merger, except in such jurisdictions
in which the failure to so qualify would not have a material adverse
effect on (i) the business, operations, properties, assets, liabilities,
net worth, condition (financial or otherwise) or prospects of the
Company and its subsidiaries taken as a whole or (ii) the ability of any
the Company or any Guarantor to perform any of their respective
obligations under the Transaction Documents or the Notes, in each case
giving effect to the Merger ("Material Adverse Effect").
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(k) The capital stock of the Company consists of 40,000,000
authorized shares of common stock, $.001 par value, of which 8,085,707
shares were outstanding as of July 17, 1996. All of the outstanding
shares of capital stock of the Company and each of the Guarantors have
been duly authorized and validly issued and are fully paid and
nonassessable. The issued shares of capital stock of Maxxim Delaware and
of each of the other Guarantors (other than Sterile Concepts and its
subsidiaries) are, and, after consummation of the Merger, will be, owned
of record and beneficially by the Company, either directly or through
wholly-owned subsidiaries, free and clear of any pledge, lien,
encumbrance, security interest, restriction on voting or transfer,
preemptive rights or other defect or claim of any third party, except as
otherwise set forth in the Final Memorandum under the caption
"Description of Certain Indebtedness -- Credit Agreement." Upon the
consummation of the Tender Offer and the issuance of the Notes, Maxxim
Acquisition will own beneficially and of record more than two-thirds of
the issued and outstanding shares of capital stock of Sterile Concepts,
on a fully-diluted basis, and upon consummation of the Merger, Maxxim
Delaware will own beneficially and of record all of the issued and
outstanding shares of capital stock of Sterile Concepts, on a
fully-diluted basis, and in each case free and clear of any pledge,
lien, encumbrance, security interest, restriction on voting or transfer,
preemptive rights or other defect or claim of any third party, except
for liens securing Sterile Concepts' obligations under any guarantee of
the Company's obligations under the Credit Agreement, which Sterile
Concepts might enter into on or after consummation of the Merger.
(l) This Agreement has been duly authorized by all necessary
corporate action of the Company, has been duly executed and delivered by
the Company and constitutes a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms,
(i) subject, as to enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium and other laws affecting
creditors' rights generally from time to time in effect ("Bankruptcy
Law") and the application of equitable principles in any action, legal
or equitable ("Equity"), and (ii) except to the extent that rights to
indemnity and contribution thereunder may be limited by federal or state
securities laws or the public policy underlying such laws. Each of the
other Transaction Documents has been, or will be on or before the
Closing Date, duly authorized by all necessary corporate action of each
of the Company and the Guarantors that is a party thereto, has been, or
will be on or before the Closing Date, duly executed and delivered by
the Company and such Guarantor or Guarantors, as the case may be, and
constitutes, or will constitute on or before the Closing Date, a legal,
valid and binding obligation of the Company or such Guarantor or
Guarantors, as the case may be, enforceable against the Company or such
Guarantor or Guarantors, as the case may be, in accordance with its
terms, (i) subject, as to enforcement of remedies, to applicable
Bankruptcy Law and Equity and (ii) except to the extent that rights to
indemnity and contribution thereunder may be limited by federal or state
securities laws or the public policy underlying such laws. The
descriptions of the Tender Offer, the Merger Agreement, the Indenture
(including the Note Guarantees), the Registration Rights Agreement, the
Notes, the Credit Agreement and the Company's 6-3/4% Convertible
Subordinated Debentures due 2003 contained in the Final Memorandum are
fair and accurate summaries thereof in all material respects.
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(m) The Notes have been duly and validly authorized by all
necessary corporate action of the Company for issuance and sale pursuant
to this Agreement and, when executed, authenticated, issued and
delivered in accordance with the provisions of the Indenture and paid
for by the Initial Purchasers as provided in this Agreement, will
constitute the legal, valid and binding obligations of the Company and,
following the consummation of the Merger, will remain the legal, valid
and binding obligations of the Company, entitled to the benefits of the
Indenture and enforceable against the Company in accordance with their
terms, subject, as to enforcement of remedies, to applicable Bankruptcy
Law and Equity.
(n) On or prior to the Closing Date (and in the case of Sterile
Concepts and its subsidiaries, at or immediately after the Merger), each
of the Note Guarantees in the Indenture will be duly and validly
authorized by all necessary corporate action of each Guarantor and, when
the Notes have been executed, authenticated, issued and delivered in
accordance with the provisions of the Indenture and paid for by the
Initial Purchasers as provided in this Agreement and the Indenture has
been duly executed and delivered by such Guarantor (and in the case of
Sterile Concepts and its subsidiaries, when or immediately after the
Merger has occurred), each of the Note Guarantees will constitute the
legal, valid and binding obligation of such Guarantor, enforceable
against such Guarantor in accordance with its terms, subject, as to
enforcement or remedies, to applicable Bankruptcy Law and Equity.
(o) (A) The issuance, offering and sale of the Notes to the
Initial Purchasers by the Company pursuant to this Agreement and the
compliance by the Company with the other provisions of this Agreement,
(B) the compliance by the Company and the Guarantors with the other
Transaction Documents, including without limitation, the Merger
Agreement, and (C) the consummation of the other transactions herein and
therein contemplated, including without limitation, the Tender Offer and
the Merger, do not and will not (i) require the consent, approval,
authorization, registration, qualification or order of or with any court
or governmental agency or body, except such as have been obtained
(including, without limitation, under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "Hart-Scott-Rodino Act")) and
such as may be required under state securities or blue sky laws or (ii)
conflict with, result in a breach or violation of, or constitute a
default under the charter documents or by-laws of the Company or any of
the Guarantors or any of the terms and provisions of any material
indenture, mortgage, deed of trust, lease or other agreement or
instrument to which the Company or any of the Guarantors is a party or
by which the Company or any of the Guarantors or any of their respective
properties are bound or any statute, judgment, decree, order, rule or
regulation of any court, regulatory body, administrative agency,
governmental body or arbitrator applicable to the Company or any of the
Guarantors, in each case giving effect to the Merger.
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(p) The consolidated financial statements (including the notes
thereto) and schedules of the Company and, to the best of the Company's
knowledge, Sterile Concepts included in the Final Memorandum comply as
to form in all material respects with the requirements of the Securities
Act and fairly present the financial position of the Company and, to the
best of the Company's knowledge, Sterile Concepts and the results of
operation and changes in financial condition as of the dates and periods
therein specified. Such financial statements and schedules have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved (except as
otherwise noted therein). Since the date of the latest of such financial
statements, there has been no change and no development or event
involving a prospective change that has had a Material Adverse Effect.
The unaudited pro forma financial statements of the Company included in
the Final Memorandum comply as to form in all material respects with the
requirements of the Securities Act; the pro forma adjustments have been
properly applied to the historical amounts in the compilation of such
pro forma statements; the assumptions described in the notes to such pro
forma statements provide a reasonable basis for presenting the
significant direct effects of the transactions contemplated therein; and
such pro forma adjustments give appropriate effect to those
transactions, in each case, in accordance with Regulation S-X under the
Securities Act ("Regulation S-X").
(q) To the best of the Company's knowledge, KPMG Peat Marwick
LLP, who have certified the financial statements of the Company and
Sterile Concepts and have delivered their reports with respect to
audited consolidated financial statements for the years ended October
31, 1993, October 30, 1994 and October 29, 1995 (in the case of the
Company) and for the years ended September 30, 1993, 1994 and 1995 (in
the case of Sterile Concepts) included in the Final Memorandum, are
independent public accountants within the meaning of the Securities Act
and the applicable rules and regulations thereunder.
(r) The Company and each of the Guarantors maintains a system of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity
with generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance
with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing assets
at reasonable intervals and appropriate action is taken with respect to
any differences.
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(s) None of the Company or any of the Guarantors is now, or,
after giving effect to the issuance of the Notes and the Note
Guarantees, and the execution, delivery and performance of the
Transaction Documents and the consummation of the transactions
contemplated thereby, will be (i) insolvent, (ii) left with unreasonably
small capital with which to engage in its anticipated businesses or
(iii) incurring debts beyond its ability to pay such debts as they
become due. None of the Company or any of its subsidiaries is in
liquidation, administration or receivership nor has any petition been
presented for the winding-up of the Company or any of its subsidiaries.
(t) (i) No ERISA Event (as defined below) has occurred, is
planned or is reasonably expected to occur and no condition or event
currently exists or currently is expected to occur that could result in
any such ERISA Event. The aggregate Underfunding (as defined below) with
respect to all Plans (as defined below) which have any Underfunding does
not exceed $100,000.
(ii) Neither the Company nor any of its ERISA Affiliates
(as defined below) has incurred unsatisfied liabilities in connection
with withdrawals from Multiemployer Plans and Multiple Employer Plans
(each as defined below), if any, in excess of an aggregate amount of
$700,000. If the Company and each of its ERISA Affiliates were to
completely withdraw on the date hereof from all Multiemployer Plans and
Multiple Employer Plans to which such entity is contributing or has an
obligation to contribute, the Company would not incur, directly or
indirectly, liability in excess of an aggregate amount of $700,000.
(iii) No labor dispute with the employees of the Company
or any of the subsidiaries of the Company exists or, to the best
knowledge of the Company, is threatened or imminent which is likely to
result in a Material Adverse Effect.
As used herein, the following terms shall have the
respective meaning ascribed to each below.
"Code" means the United States Internal Revenue
Code of 1986, as amended, and the regulations promulgated and the
rulings issued thereunder.
"ERISA" means the United States Employee Retirement
Income Security Act of 1974, as amended, and the regulations
promulgated and rulings issued thereunder.
"ERISA Affiliate" means Sterile Concepts and each
trade or business (whether or not incorporated) that would be
treated together with the Company or Sterile Concepts as a single
employer under Title IV or Section 302 of ERISA or Section 412 of
the Code.
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"ERISA Event" means (i) the occurrence of a
"reportable event" described in Section 4043 of ERISA (other than
a "reportable event" not subject to the provision for 30-day
notice), or (ii) the provision or filing of a notice of intent to
terminate a Plan (other than in a standard termination within the
meaning of Section 4041 of ERISA) or the treatment of a Plan
amendment as a distress termination under Section 4041 of ERISA,
or (iii) the institution of proceedings to terminate a Plan by
the Pension Benefit Guaranty Corporation, or (iv) the existence
of any "accumulated funding deficiency" or "liquidity shortfall"
(within the meaning of Section 302 of ERISA or Section 412 of the
Code), whether or not waived, or the filing of an application
pursuant to Section 412(e) of the Code or Section 304 of ERISA
for any extension of an amortization period, or (v) the receipt
of notice by the Company or any ERISA Affiliate that any
Multiemployer Plan may be terminated, partitioned or reorganized
or that any Multiple Employer Plan may be terminated, or (vi) the
occurrence of any transaction which might reasonably be expected
to constitute grounds for the imposition of liability under
Section 4069 of ERISA.
"Multiemployer Plan" means a "multiemployer plan"
as defined in Section 4001(a)(3) of ERISA.
"Multiple Employer Plan" means an employee benefit
plan described in Section 4063 of ERISA.
"Plan" means an employee benefit plan, other than a
Multiemployer Plan, with respect to which the Company or any of
its ERISA Affiliates could be subject to any liability under
Title IV of ERISA, Section 302 of ERISA or Section 412 of the
Code.
"Underfunding" means, with respect to any Plan, the
excess, if any, of the "projected benefit obligations" (within
the meaning of Statement of Financial Accounting Standards 87)
under such Plan (determined using the actuarial assumptions used
for purposes of calculating funding requirements in the most
recent actuarial report for such plan) over the fair market value
of the assets held under the Plan.
(u) (i) The Company and each subsidiary of the Company are and
have been in compliance with all applicable laws, statutes, ordinances,
rules, regulations, orders, judgments, decisions, decrees, standards,
and requirements ("Legal Requirements") relating to: human health and
safety; pollution; management, disposal or release of any chemical
substance, product or waste; and protection, cleanup, remediation or
corrective action relating to the environment or natural resources
("Environmental Law");
8
(ii) The Company and each subsidiary of the Company have
obtained and are in compliance with the conditions of all permits,
authorizations, licenses, approvals, authorizations, and variances
necessary under any Environmental Law for the continued conduct of the
business of the Company and each subsidiary of the Company in the manner
now conducted ("Environmental Permits");
(iii) There are no past or present conditions or
circumstances, including but not limited to pending changes in any
Environmental Law or Environmental Permit, that are likely to interfere
with the conduct of the business of the Company or any subsidiary of the
Company in the manner now conducted or which would interfere with
compliance with any Environmental Law or Environmental Permit; and
(iv) There are no past or present conditions or
circumstances at, or arising out of, the business, assets and properties
of the Company or any subsidiary of the Company or any formerly leased,
operated or owned businesses, assets or properties of the Company or any
subsidiary of the Company, including but not limited to on-site or
off-site disposal or release of any chemical substance, product or
waste, which may give rise to: (A) liabilities or obligations for any
cleanup, remediation or corrective action under any Environmental Law,
(B) claims arising under any Environmental Law for personal injury,
property damage, or damage to natural resources, (C) liabilities or
obligations incurred to enable the Company or any subsidiary of the
Company to comply with any Environmental Law, or (D) fines or penalties
arising under any Environmental Law;
except in each case for any noncompliance or conditions or circumstances
that, singly or in the aggregate, would not result in a Material Adverse
Effect.
(v) No legal or governmental proceedings or investigations are
pending to which the Company or any of its subsidiaries is a party or to
which the property of the Company or any of its subsidiaries is subject
that are not described in the Final Memorandum, and no such proceedings
or investigations, to the best knowledge of the Company, have been
threatened against the Company or any of its subsidiaries or with
respect to any of their respective properties, except in each case for
such proceedings or investigations that, if the subject of an
unfavorable decision, ruling or finding, would not, singly or in the
aggregate, result in a Material Adverse Effect.
(x) To the best of the Company's knowledge, the Company and its
subsidiaries own or otherwise possess the right to use all patents,
trademarks, service marks, trade names and copyrights, all applications
and registrations for each of the foregoing, and all other proprietary
rights and confidential information used in the conduct of their
respective businesses as currently conducted; and neither the Company
nor any such subsidiary has received any notice, or is otherwise aware,
of any infringement of or conflict with the rights of any third party
with respect to any of the foregoing which, singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, would
result in a Material Adverse Effect.
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(y) The Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or
foreign regulatory authorities necessary to conduct their respective
businesses, and neither the Company nor any such subsidiary has received
any notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in a Material Adverse Effect.
(z) All representations and warranties of the Company contained
in the Credit Agreement are true and correct on the date hereof as if
made on the date hereof.
All references in this Section 1 to "Guarantors" or to
"subsidiaries" or "Affiliate" of the Company shall include Sterile Concepts and
its subsidiaries, as if Maxxim Acquisition had acquired all shares of the
capital stock of Sterile Concepts immediately prior to the execution of this
Agreement; provided that the representations and warranties made in this Section
1 with respect to Sterile Concepts and its subsidiaries, except for those in
paragraphs (l) and (n) of this Section 1, are made to the best of the Company's
knowledge.
Each certificate signed by any officer of the Company or any
Guarantor and delivered to the Initial Purchasers or its counsel shall be deemed
to be a representation and warranty by the Company or such Guarantor, as the
case may be, to the Initial Purchasers as to the matters covered thereby.
2. PURCHASE AND SALE. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Initial Purchaser, and each Initial Purchaser agrees,
severally and not jointly, to purchase from the Company, at a purchase price of
97% of the principal amount thereof, plus accrued interest, if any, from the
date on which the Notes are issued to the Closing Date, the principal amount of
Notes set forth opposite such Initial Purchaser's name in Schedule I hereto.
3. DELIVERY AND PAYMENT. Delivery of and payment for the Notes
shall be made at 10:00 AM, New York City time, on July 30, 1996, or such later
date as Initial Purchasers and the Company may agree (such date and time of
delivery and payment for the Notes being herein called the "Closing Date") at
the office of Cleary, Gottlieb, Steen & Hamilton ("Counsel for the Initial
Purchasers"), One Liberty Plaza, New York, New York 10006. Delivery of the Notes
shall be made to the Initial Purchasers against payment by the Initial
Purchasers of the purchase price thereof to or upon the order of the Company by
intrabank transfer payable in same day funds or such other manner of payment as
may be agreed by the Company and the Initial Purchasers. The Notes shall be made
available for inspection at the office of Counsel for the Initial Purchasers at
least one business day in advance of the Closing Date. Certificates for the
Notes shall be registered in such names and in such denominations as the Initial
Purchasers may request not less than two full business days in advance of the
Closing Date.
The Company agrees to have the Notes available for inspection,
checking and packaging by the Initial Purchasers in New York, New York, not
later than 1:00 PM on the business day prior to the Closing Date.
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4. OFFERING OF NOTES. Each Initial Purchaser, severally and not
jointly, represents and warrants to and agrees with the Company that:
(a) It has not offered or sold, and will not offer or sell, any
Notes except (i) to those it reasonably believes to be qualified
institutional buyers (as defined in Rule 144A under the Securities Act)
("QIBs") or (ii) to other institutional "accredited investors" (as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D) who provide
to it and to the Company a letter in the form of Exhibit A hereto. In
connection with each sale pursuant to clause (i) above, such Initial
Purchaser has taken or will take reasonable steps to ensure that the
purchaser of such Notes is aware that such sale is being made in
reliance on Rule 144A.
(b) Neither it nor any person acting on its behalf has made or
will make offers or sales of the Notes by means of any form of general
solicitation or general advertising (within the meaning of Regulation
D).
5. AGREEMENTS. The Company agrees with each Initial Purchaser
that:
(a) The Company will furnish to each Initial Purchaser and to
Counsel for the Initial Purchasers, without charge, during the period
referred to in paragraph (c) below, as many copies of the Final
Memorandum and any amendments and supplements thereto as they may
reasonably request. The Company will pay the expenses of printing or
other production of all documents relating to the offering of the Notes
and will reimburse the Initial Purchasers for payment of the required
PORTAL filing fee.
(b) The Company will not amend or supplement the Final Memorandum
prior to the completion of the distribution of the Notes by the Initial
Purchasers, without the prior written consent of the Initial Purchasers.
(c) If at any time prior to the completion of the sale of the
Notes by the Initial Purchasers (as determined by the Initial
Purchasers) any event occurs as a result of which the Final Memorandum,
as then amended or supplemented, 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 if it should be necessary to amend or
supplement the Final Memorandum to comply with applicable law, the
Company will promptly notify the Initial Purchasers of the same and,
subject to the requirements of paragraph (b) of this Section 5, will
prepare and provide to the Initial Purchasers pursuant to paragraph (a)
of this Section 5 an amendment or supplement that will correct such
statement or omission or effect such compliance.
(d) The Company will arrange for the qualification of the Notes
for sale by the Initial Purchasers under the laws of such jurisdictions
as the Initial Purchasers may designate and will maintain such
qualifications in effect so long as required for the sale of the Notes.
The Company will promptly advise the Initial Purchasers of the receipt
by the Company of any notification with respect to the suspension of the
qualification of the Notes for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose.
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(e) The Company, whenever it publishes or makes available to the
public (by filing with any regulatory authority or securities exchange
or by publishing a press release or otherwise) any information that
could reasonably be expected to be material in the context of the issue
of Notes under this Agreement, shall immediately notify the Initial
Purchasers as to the nature of such information or event. The Company
will likewise notify the Initial Purchasers of (i) any decrease in the
rating of the Notes or any other debt securities of the Company by any
nationally recognized statistical rating organization (as defined in
Rule 436(g)(2) under the Securities Act) or (ii) any notice given of any
intended or potential decrease in any such rating or of a possible
change in any such rating that does not indicate the direction of the
possible change, as soon as the Company becomes aware of any such
decrease or notice. The Company will also deliver to the Initial
Purchasers, as soon as available and without request, copies of its
latest annual report and quarterly statement and any report of its
auditors thereon.
(f) The Company will not, and will not permit any of its
Affiliates to, resell any Notes that have been acquired by it or any of
them.
(g) Except as contemplated in the Registration Rights Agreement,
neither the Company, any of its Affiliates, nor any person acting on its
or their behalf (other than the Initial Purchasers or any of its
Affiliates, as to whom the Company expresses no opinion) will, directly
or indirectly, make offers or sales of any security, or solicit offers
to buy any security, under circumstances that would require the
registration of the Notes under the Securities Act.
(h) Neither the Company nor any of its Affiliates, nor any person
acting on its or their behalf (other than the Initial Purchasers or any
of its Affiliates, as to whom the Company expresses no opinion) will
engage in any form of general solicitation or general advertising
(within the meaning of Regulation D) in connection with any offer or
sale of the Notes.
(i) So long as any of the Notes are "restricted securities"
within the meaning of Rule 144(a)(3) under the Securities Act, the
Company will provide to each holder of such restricted securities and to
each prospective purchaser (as designated by such holder) of such
restricted securities, upon the request of such holder or prospective
purchaser, any information required to be provided by Rule 144A(d)(4)
under the Securities Act. Such information, at the date of its provision
by the Company to such holders or prospective purchasers, will not
contain 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. This covenant
is intended to be for the benefit of the holders, and the prospective
purchasers designated by such holders, from time to time of such
restricted securities.
12
(j) The Company will cooperate with the Initial Purchasers and
use its best efforts to permit the Notes that are sold to QIBs to be
eligible for clearance and settlement through The Depository Trust
Company.
(k) The Company will not, until 180 days following the Closing
Date, without the prior written consent of the Initial Purchasers,
offer, sell or contract to sell, or otherwise dispose of, directly or
indirectly, or announce the offering of, any securities issued or
guaranteed by the Company (other than the Notes or pursuant to a
registered public offering as provided in the Registration Rights
Agreement).
(l) The Company will conduct its operations in a manner that will
not subject the Company to registration as an investment company under
the Investment Company Act.
6. CONDITIONS TO THE OBLIGATIONS OF THE INITIAL PURCHASERS. The
obligations of the Initial Purchasers to purchase the Notes shall be subject to
the accuracy of the representations and warranties on the part of the Company
contained herein at the date and time that this Agreement is executed and
delivered by the parties hereto (the "Execution Time") and the Closing Date, to
the accuracy of the statements of the Company made in any certificates pursuant
to the provisions hereof, to the performance by the Company of its obligations
hereunder and to the following additional conditions:
(a) The Company shall have entered into the Registration Rights
Agreement.
(b) The Company shall have furnished to the Initial Purchasers
the favorable opinion of Boyer, Ewing & Harris, counsel for the Company,
or other counsel reasonably satisfactory to the Initial Purchasers,
dated the Closing Date, to the effect set forth in Exhibit B attached
hereto.
(c) The Initial Purchasers shall have received from Counsel for
the Initial Purchasers such opinion or opinions, dated the Closing Date,
with respect to the issuance and sale of the Notes, the Final Memorandum
(as amended or supplemented at the Closing Date) and other related
matters as the Initial Purchasers may reasonably require, and the
Company shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such matters.
(d) The Company shall have furnished to the Initial Purchasers a
certificate of the Company, respectively, signed by the Chairman of the
Board or the President and the principal financial or accounting officer
of the Company, respectively, each dated the Closing Date, to the effect
that the signers of such certificates have carefully examined the Final
Memorandum, any amendment or supplement to the Final Memorandum and this
Agreement and that:
(i) the representations and warranties of the Company in
this Agreement are true and correct in all material respects on
and as of the Closing Date with the same effect as if made on the
Closing Date, and the Company has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date;
13
(ii) since the date of the most recent financial
statements included in the Final Memorandum, there has been no
change or development or event involving a prospective change
constituting a Material Adverse Effect, except as set forth in or
contemplated by the Final Memorandum (exclusive of any amendment
or supplement thereto);
(iii) all conditions to borrowings under the Credit
Agreement have been satisfied or waived; and
(iv) the Company has received tenders of more than
two-thirds of all of the issued and outstanding shares of common
stock of Sterile Concepts on a fully-diluted basis and all other
conditions to the consummation of Tender Offer have been
satisfied and have not been waived.
(e) At the Execution Time and at the Closing Date, KPMG Peat
Marwick LLP shall have furnished to the Initial Purchasers a letter or
letters, dated respectively as of the Execution Time and as of the
Closing Date, in form and substance satisfactory to the Initial
Purchasers, confirming that they are independent public accountants
within the meaning of the Securities Act, the Exchange Act of 1934, as
amended (the "Exchange Act"), and the applicable rules and regulations
thereunder and Rule 101 of the Code of Professional Conduct of the
American Institute of Certified Public Accountants (the "AICPA") and
stating in effect that:
(i) on the basis of a reading of the latest unaudited
financial statements made available by the Company and its
subsidiaries and Sterile Concepts and its subsidiaries; their
limited review in accordance with standards established by the
AICPA of the unaudited interim financial information as indicated
in their reports incorporated in the Final Memorandum; carrying
out certain specified procedures (but not an examination in
accordance with generally accepted auditing standards) that would
not necessarily reveal matters of significance with respect to
the comments set forth in such letter; a reading of the minutes
of the meetings of the stockholders, directors and committees of
the boards of directors of the Company and its subsidiaries and
Sterile Concepts and its subsidiaries; and inquiries of certain
officials of the Company and Sterile Concepts who have
responsibility for financial and accounting matters of the
Company and its subsidiaries and Sterile Concepts and its
subsidiaries, as to transactions and events subsequent to October
29, 1995 (in the case of the Company) or September 30, 1995 (in
the case of Sterile Concepts), nothing came to their attention
that caused them to believe that:
(1) any material modifications should be made to
the unaudited consolidated financial statements included
in the Final Memorandum for them to be in conformity in
all material respects with generally accepted accounting
principles;
14
(2) the unaudited consolidated financial statements
included in the Final Memorandum do not comply as to form
in all material respects with the applicable accounting
requirements of the Securities Act, the Exchange Act and
the related published rules and regulations;
(3) with respect to the period subsequent to May 5,
1996, there were, at a specified date not more than five
business days prior to the date of the letter, any changes
in the capital stock, increases in the long-term debt of
the Company or decreases in consolidated net current
assets or the shareholders' equity of the consolidated
Company as compared with the amounts shown on the May 5,
1996 unaudited consolidated balance sheet of the Company
included in the Final Memorandum, or for the period from
May 6, 1996 to such specified date there were any
decreases, as compared with the corresponding period in
the preceding year, in consolidated net sales, net income
before the cumulative effect of change in accounting for
income taxes or the per-share amounts of net income,
except in all instances for changes or decreases set forth
in such letter, in which case the letter shall be
accompanied by an explanation by the Company as to the
significance thereof unless said explanation is not deemed
necessary by the Initial Purchasers;
(4) with respect to the period subsequent to March
31, 1996, there were, at a specified date not more than
five business days prior to the date of the letter, any
changes in the long-term debt of Sterile Concepts or
decreases in the stockholders' equity or net current
assets as compared with the amounts shown on the March 31,
1996 consolidated balance sheet of Sterile Concepts
included in the Final Memorandum, or for the period from
April 1, 1996 to such specified date there were any
decreases, as compared with the corresponding period in
the preceding year, in net sales or decreases in the
shareholders' equity, operating income or net earnings,
except in all instances for changes or decreases set forth
in such letter, in which case the letter shall be
accompanied by an explanation by Sterile Concepts as to
the significance thereof unless said explanation is not
deemed necessary by the Initial Purchasers; and
(ii) they have performed certain other specified
procedures as a result of which they determined that certain
information of an accounting, financial or statistical nature
(which is limited to accounting, financial or statistical
information derived from the respective general accounting
records of the Company and its subsidiaries and Sterile Concepts
and its subsidiaries) set forth in the Final Memorandum,
including without limitation the information set forth under the
captions "Offering Memorandum Summary," "Summary Unaudited
Combined Pro Forma Financial Data," "Company Summary Historical
Financial Data," "Sterile Concepts Summary Historical Financial
Date," "Risk Factors," "Unaudited Pro Forma Capitalization,"
"Unaudited Pro Forma Financial Data," "Company Selected
Consolidated Financial Data," "Company Management's Discussion
and Analysis of Financial Condition and Results of Operations,"
"Sterile Concepts Selected Consolidated Financial Data," "Sterile
Management's Discussion and Analysis of Financial Condition and
Results of Operations," "Business and Industry Overview" and
"Management," in the Final Memorandum agrees with the accounting
records of the Company, excluding any questions of legal
interpretation; and
15
(iii) as to pro forma financial information,
(1) they have read the unaudited pro forma
financial information, included in the Final Memorandum;
(2) they have inquired of certain officials of the
Company and Sterile Concepts who have responsibility for
financial and accounting matters as to whether all
significant assumptions regarding the Merger have been
reflected in the pro forma adjustments and whether the
unaudited pro forma consolidated financial statements
included in the Final Memorandum comply as to form in all
material respects with the applicable accounting
requirements of Rule 11-02 of Regulation S-X and obtained
statements from such officials that all significant
assumptions regarding the Merger have been reflected in
the pro forma adjustments;
(3) they have compared the respective historical
financial information included in the unaudited pro forma
consolidated balance sheet and the unaudited pro forma
income statement in the Final Memorandum with the
historical information for the Company and Sterile
Concepts and found them to be in agreement;
(4) they have proved the arithmetic accuracy of the
application of the pro forma adjustments to the historical
amounts in the unaudited pro forma consolidated financial
statements;
(5) they have performed certain other specified
procedures as a result of which they determined that
certain pro forma information of an accounting, financial,
or statistical nature set forth in the Final Memorandum,
including without limitation the information set forth
under the captions "Offering Memorandum Summary," "Summary
Unaudited Combined Pro Forma Financial Data," "Risk
Factors," "Unaudited Pro Forma Capitalization," "Unaudited
Pro Forma Financial Data," "Company Selected Consolidated
Financial Data," "Company Management's Discussion and
Analysis of Financial Condition and Results of
Operations," and "Description of Notes" in the Offering
Memorandum agrees to or can be derived from the pro forma
financial statements of the Company or the analysis
completed in the preparation of such pro forma financial
statements, excluding any questions of legal
interpretation; and
16
(6) nothing has led them to believe that the pro
forma adjustments have not been properly applied to the
historical amounts in the compilation of such statements.
All references in this Section 6(e) to the Final Memorandum shall
be deemed to include any amendment or supplement thereto at the date of
the letter or letters.
(f) Subsequent to the Execution Time or, if earlier, the dates as
of which information is given in the Final Memorandum, there shall not
have been (i) any change or decrease specified in the letter or letters
referred to in paragraph (e) of this Section 6, or (ii) any change, or
any development involving a prospective change, in or affecting the
business or properties of the Company or Sterile Concepts or any of the
Guarantors, giving effect to the Merger, the effect of which, in any
case referred to in clause (i) or (ii) above, is, in the judgment of the
Initial Purchasers, so material and adverse as to make it impractical or
inadvisable to market the Notes as contemplated by the Final Memorandum.
(g) Subsequent to the respective dates as of which information is
given in the Final Memorandum and giving effect to the Merger and
borrowings under the Credit Agreement, (i) none of the Company or
Sterile Concepts or any of the Guarantors shall have incurred any
material liability or obligation, direct or contingent, or entered into
any material transaction not in the ordinary course of business, other
than the Merger and the Credit Agreement; (ii) the Company shall not
have purchased any of its outstanding capital stock, nor declared, paid
or otherwise made any dividend or distribution of any kind on its
capital stock; and (iii) there shall not have been any material change
in the capital stock of the Company or any of the Guarantors or in the
short-term debt or long-term debt of the Company and the Guarantors
taken as a whole or Sterile Concepts and its subsidiaries taken as a
whole, except in each case as described in or contemplated by the Final
Memorandum.
(h) Subsequent to the Execution Time, there shall not have been
any decrease in the rating of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Securities Act) or any notice given of
any intended or potential decrease in any such rating or of a possible
change in any such rating that does not indicate the direction of the
possible change.
(i) Each of the Transaction Documents (including any amendments
thereto) shall have been duly authorized, executed and delivered by each
of the parties thereto, and the Initial Purchasers shall have received
copies of each such Transaction Document (including any amendments
thereto) as so executed and delivered in the form provided to the
Initial Purchasers on or before the date hereof except for changes
approved by the Initial Purchasers or changes which do not materially
affect the rights or obligations of the Company or the Guarantors that
are parties thereto or the beneficiaries thereof.
17
(j) All conditions to borrowings under the Credit Agreement shall
have been satisfied, the initial borrowings under the Credit Agreement
shall have occurred concurrently with the closing of the sale of the
Notes hereunder as contemplated in the Final Memorandum and all
representations and warranties of the Company contained in the Credit
Agreement shall be true and correct on the Closing Date as if made on
the Closing Date.
(k) On the Closing Date, there shall be no less than $36 million
of additional availability under the Credit Agreement (as defined in the
Indenture), after giving effect to the Acquisition and any borrowings
under the Credit Agreement.
(l) All applicable waiting periods (and any extensions thereof)
under the Hart-Scott-Rodino Act with respect to the consummation of the
Tender Offer shall have expired or otherwise been terminated, and the
Tender Offer shall have been consummated as contemplated in the Merger
Agreement on the Closing Date, without any waiver or modification of any
of the provisions thereof. Pursuant to the Tender Offer, Maxxim
Acquisition shall have acquired more than two-thirds of the issued and
outstanding common stock of Sterile Concepts, on a fully-diluted basis
and shall have full voting rights with respect to such shares if any
vote of shareholders of Sterile Concepts is required in connection with
the Merger. No restrictions of any anti-takeover statute shall be
applicable to the Merger, and the sole right of shareholders of Sterile
Concepts who did not tender their shares pursuant to the Tender Offer
shall be to receive a cash payment of $20 per share pursuant to the
Merger.
(m) On the Closing Date, the Company shall have paid the fees and
expenses of the Initial Purchasers (including the fees and expenses of
Counsel for the Initial Purchasers) incurred in connection with the
preparation of Preliminary Memorandum, the Final Memorandum, this
Agreement and the Registration Rights Agreement and in connection with
the offering of the Notes and the transactions contemplated thereby.
(n) Prior to the Closing Date, the Company shall have furnished
to the Initial Purchasers such further information, certificates and
documents as the Initial Purchasers may reasonably request.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Initial Purchasers and Counsel for the
Initial Purchasers, this Agreement and all obligations of the Initial Purchasers
hereunder may be canceled at the Closing Date by the Initial Purchasers. Notice
of such cancellation shall be given to the Company in writing or by telephone or
telegraph confirmed in writing.
18
The documents required to be delivered by this Section 6 will be
delivered at the office of Counsel for the Initial Purchasers at One Liberty
Plaza, New York, New York, 10006 on the Closing Date.
7. REIMBURSEMENT OF EXPENSES; FEES.
Whether or not the transactions contemplated by the Offering
Documents are consummated, the Company will (i) pay all expenses incident to the
performance of its obligations under the offering documents, including the fees
and disbursements of its accountants and counsel, the cost of printing or other
production and delivery of the Preliminary Memorandum, the Final Memorandum, all
amendments thereof and supplements thereto, this Agreement, the Registration
Rights Agreement and all other documents relating to the offering of the Notes,
the cost of preparing, printing, packaging and delivering the Notes, the fees
and disbursements, including fees of counsel, incurred in compliance with
Section 5(d), the fees and disbursements of the Trustee and the fees of any
agency that rates the Notes, the fees and expenses, if any, incurred in
connection with the admission of the Notes for trading in the PORTAL system,
(ii) pay the fees and expenses of Counsel for the Initial Purchasers incurred in
connection with the proposed purchase and resale of the Notes and (iii)
reimburse the Initial Purchaser as requested for all other reasonable
out-of-pocket expenses incurred by the Initial Purchaser in connection with the
proposed purchase and resale of the Notes.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to
indemnify and hold harmless each Initial Purchaser, the directors, officers,
employees and agents of each Initial Purchaser and each person who controls any
Initial Purchaser within the meaning of either the Securities Act or the
Exchange Act against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the Securities
Act, the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Preliminary Memorandum, the Final Memorandum or any information provided by the
Company to any holder or prospective purchaser of Notes pursuant to Section
5(i), or in any amendment thereof or supplement thereto, 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, in
light of the circumstances under which they were made, not misleading, and
agrees to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; PROVIDED, HOWEVER,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made in
the Preliminary Memorandum or the Final Memorandum, or in any amendment thereof
or supplement thereto, in reliance upon and in conformity with written
information furnished to the Company by or on behalf of the Initial Purchasers
specifically for inclusion therein. This indemnity agreement will be in addition
to any liability that the Company may otherwise have.
19
(b) Each Initial Purchaser, severally and not jointly, agrees to
indemnify and hold harmless the Company, its directors, its officers, its
employees, its agents and each person who controls the Company within the
meaning of either the Securities Act or the Exchange Act, to the same extent as
the foregoing indemnity from the Company to such Initial Purchaser, but only
with reference to written information relating to such Initial Purchaser
furnished to the Company by or on behalf of such Initial Purchaser specifically
for inclusion in the Preliminary Memorandum or the Final Memorandum (or in any
amendment or supplement thereto). This indemnity agreement will be in addition
to any liability that such Initial Purchaser may otherwise have. The Company
acknowledges that the statements set forth in the last paragraph of the cover
page and under the headings "Notice to Investors" and "Plan of Distribution" in
the Preliminary Memorandum and the Final Memorandum constitute the only
information furnished in writing by or on behalf of the Initial Purchasers for
inclusion in the Preliminary Memorandum or the Final Memorandum (or in any
amendment or supplement thereto).
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
PROVIDED, HOWEVER, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding.
20
(d) If the indemnity provided in paragraph (a) or (b) of this
Section 8 is unavailable to or insufficient to hold harmless an indemnified
party for any reason, the Company, on the one hand, and each Initial Purchaser,
severally and not jointly, on the other, agree to contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same)
(collectively "Losses") to which the Company, on the one hand, and such Initial
Purchaser, on the other, may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company, on the one hand, and by
such Initial Purchaser, on the other, from the offering of the Notes; PROVIDED,
HOWEVER, that in no case shall any Initial Purchaser be responsible for any
amount in excess of the purchase discount or commission applicable to the Notes
purchased by such Initial Purchaser hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Company, on
the one hand, and each Initial Purchaser, on the other, shall contribute in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company, on the one hand, and of such Initial
Purchaser, on the other, in connection with the statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
Benefits received by the Company shall be deemed to be equal to the total net
proceeds from the offering (before deducting expenses), and benefits received by
such Initial Purchaser shall be deemed to be equal to the total purchase
discounts and commissions received by such Initial Purchaser from the Company in
connection with the purchase of the Notes hereunder. Relative fault shall be
determined by reference to whether any alleged untrue statement or omission
relates to information provided by the Company or such Initial Purchaser. The
Company and the Initial Purchasers agree that it would not be just and equitable
if contribution were determined by pro rata allocation or any other method of
allocation that does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this paragraph (d), 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 Section 8,
each person who controls an Initial Purchaser within the meaning of either the
Securities Act or the Exchange Act and each director, officer, employee and
agent of such Initial Purchaser shall have the same rights to contribution as
such Initial Purchaser, and each person who controls the Company within the
meaning of either the Securities Act or the Exchange Act and each officer,
director, employee and agent of the Company shall have the same rights to
contribution as the Company, subject in each case to the applicable terms and
conditions of this paragraph (d).
9. DEFAULT BY AN INITIAL PURCHASER. If any Initial Purchaser
shall fail to purchase and pay for any of the Notes agreed to be purchased by
such Initial Purchaser hereunder and such failure to purchase shall constitute a
default in the performance of its obligations under this Agreement, the
remaining Initial Purchaser shall be obligated severally to take up and pay for
the Notes which the defaulting Initial Purchaser agreed but failed to purchase;
PROVIDED, HOWEVER, that in the event that the aggregate principal amount of
Notes which the defaulting Initial Purchaser agreed but failed to purchase shall
exceed 10% of the aggregate principal amount of Notes set forth in Schedule I
hereto, the remaining Initial Purchaser shall have the right to purchase all,
but shall not be under any obligation to purchase any, of the Notes, and if such
non-defaulting Initial Purchaser does not purchase all the Notes, this Agreement
will terminate without liability to the non-defaulting Initial Purchaser or the
Company. In the event of a default by any Initial Purchaser as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
seven days, as such non-defaulting Initial Purchaser shall determine in order
that the required changes in the Final Memorandum or in any other documents or
arrangements may be effected. Nothing contained in this Agreement shall relieve
any defaulting Initial Purchaser of its liability, if any, to the Company or any
non-defaulting Initial Purchaser for damages occasioned by its default
hereunder.
21
10. TERMINATION. This Agreement shall be subject to termination
by notice given to the Company prior to delivery of and payment for the Notes,
if prior to such time there shall have occurred (i) trading in any of the
Company's securities shall have been suspended by the Commission or trading in
securities generally on the New York Stock Exchange shall have been suspended or
limited or minimum prices shall have been established on such exchange, (ii) any
material adverse change in the market for subordinated debt similar in nature to
the Notes, (iii) any disruption of or material adverse change in financial,
banking or capital market conditions generally or (iv) any outbreak or
escalation of hostilities, declaration by the United States of a national
emergency or war or other calamity or crisis, the effect of which, in any case
referred to in clause (ii), (iii) or (iv) above, is, in the judgment of the
Initial Purchasers, so material or adverse as to make it impracticable or
inadvisable to proceed with the offering or delivery of the Notes as
contemplated by the Final Memorandum.
11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective
agreements, representations, warranties, indemnities and other statements of the
Company and of the Initial Purchasers set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of the Initial Purchasers or the Company or any of the
officers, directors or controlling persons referred to in Section 8 hereof, and
will survive delivery of and payment for the Notes. The provisions of Sections 7
and 8 hereof shall survive the termination or cancellation of this Agreement.
12. NOTICES. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Initial Purchasers, will be
mailed, delivered or telecopied and confirmed to it at NationsBank Corporate
Tower, 100 North Tryon Street, NC1-007-07-01, Charlotte, North Carolina
28255-0001, Telecopy No.: (704) 388-9941; or, if sent to the Company, will be
mailed, delivered or telecopied and confirmed to them at 104 Industrial
Boulevard, Sugar Land, Texas, 77478, Attention: Chief Operating Officer.
13. SUCCESSORS. This Agreement will inure to the benefit of and
be binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 8 hereof,
and, except as expressly set forth in Section 5(i) hereof, no other person will
have any right or obligation hereunder.
22
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE.
15. BUSINESS DAY. For purposes of this Agreement, "business day"
means each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on
which banking institutions in The City of New York, New York are authorized or
obligated by law, executive order or regulation to close.
16. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original, but all such
counterparts will together constitute one and the same instrument.
23
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement and your acceptance shall represent a binding agreement among the
Company and the Initial Purchasers.
Very truly yours,
MAXXIM MEDICAL, INC.,
a Texas corporation
By: __________________________
Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
NATIONSBANC CAPITAL MARKETS, INC.
By: ___________________________
Name: David Stith
Title: Director
BEAR, STEARNS & CO INC.
By: ___________________________
Name: Sheldon I. Stein
Title: Senior Managing Director
<PAGE>
Schedule I
Principal Amount of
Name Of Initial Purchaser Notes to be Purchased
- ------------------------- ---------------------
NationsBanc Capital Markets, Inc. $75,000,000
Bear, Stearns & Co. Inc. $25,000,000
I-1
EXHIBIT A
FORM OF INVESTMENT LETTER
FOR INSTITUTIONAL ACCREDITED INVESTORS
, 1996
NationsBanc Capital Markets, Inc.
Bear, Stearns & Co. Inc.
c/o NationsBanc Capital Markets, Inc.
NationsBank Corporate Center
100 North Tryon Street, NC1-007-07-01
Charlotte, NC 28255-0001
Maxxim Medical, Inc.
104 Industrial Boulevard
Sugar Land, Texas 77478
Re: Purchase of $________ principal amount
of 10 1/2% Senior Subordinated Notes Due 2006
(THE "NOTES"), OF MAXXIM MEDICAL, INC. (THE "COMPANY")
Ladies and Gentlemen:
In connection with our purchase of the Notes we confirm that:
1. We understand that the Notes are not being and will not be
registered under the Securities Act of 1933, as amended (the "Securities Act"),
and are being sold to us in a transaction that is exempt from the registration
requirements of the Securities Act.
2. We acknowledge that (a) neither the Company, nor the Initial
Purchasers (as defined in the Offering Memorandum dated July 18, 1996 relating
to the Notes (the "Final Memorandum")) nor any person acting on behalf of the
Company or the Initial Purchasers has made any representation to us with respect
to the Company or the offer or sale of any Notes and (b) any information we
desire concerning the Company and the Notes or any other matter relevant to our
decision to purchase the Notes (including a copy of the Final Memorandum) is or
has been made available to us.
3. We have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an
investment in the Notes, and we are (or any account for which we are purchasing
under paragraph 5 below is) an institutional "accredited investor" (within the
meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) (an "IAI") able to bear the economic risk of investment in the Notes.
<PAGE>
4. We understand that the minimum principal amount of Notes that
may be purchased by an IAI is $250,000.
5. We are acquiring the Notes for our own account (or for
accounts as to which we exercise sole investment discretion and have authority
to make, and do make, the statements contained in this letter) and not with a
view to any distribution of the Notes, subject, nevertheless, to the
understanding that the disposition of our property will at all times be and
remain within our control.
6. We understand that (a) the Notes will be in registered form
only and that any certificates delivered to us in respect of the Notes will bear
a legend substantially to the following effect:
"This Note has not been registered under the Securities Act of
1933, as amended (the "Securities Act"), and this Note may not be
offered, sold, pledged or otherwise transferred except pursuant
to an effective registration statement or in accordance with an
applicable exemption from the registration requirements of the
Securities Act (subject to the delivery of such evidence, if any,
required under the indenture pursuant to which this Note is
issued) and in accordance with any applicable securities laws of
any state of the United States or any other jurisdiction."
7. We agree that in the event that at some future time we wish to
dispose of any of the Notes, we will not do so unless such disposition is made
in accordance with any applicable securities laws of any state of the United
States and:
(a) the Notes are sold in compliance with Rule 144(k) under the
Securities Act; or
(b) the Notes are sold in compliance with Rule 144A under the
Securities Act; or
(c) the Notes are sold in compliance with Rule 904 of Regulation
S under the Securities Act; or
(d) the Notes are sold pursuant to an effective registration
statement under the Securities Act; or
(e) the Notes are sold to the Company or an affiliate (as defined
in Rule 501(b) of Regulation D) of the Company; or
A-2
(f) the Notes are disposed of in any other transaction that does
not require registration under the Securities Act, and we theretofore
have furnished to the Company or its designee an opinion of counsel
experienced in securities law matters to such effect or such other
documentation as the Company or its designee may reasonably request.
8. We understand that the Company and NationsBanc Capital
Markets, Inc., and Bear, Stearns & Co. Inc., as the Initial Purchasers, and
other persons will rely upon the truth and accuracy of the statements set forth
herein, and we agree that if any of such statements are no longer true or
accurate we will promptly so notify the Company and NationsBanc Capital Markets,
Inc. and Bear, Stearns & Co. Inc.
Very truly yours,
By ______________________
(Authorized Officer)
A-3
EXHIBIT B
OPINION OF BOYER, EWING & HARRIS, INCORPORATED (OR OTHER COUNSEL
SATISFACTORY TO THE INITIAL PURCHASERS)
1. Each Transaction Party has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
jurisdiction in which it is chartered or organized, with full corporate power
and authority to own or lease properties and conduct its business as described
in the Final Memorandum and enter into each Transaction Document to which it is
a party and to carry out all the terms and provisions of each such Transaction
Document to be carried out by it, and is duly qualified to do business as a
foreign corporation and is in good standing under the laws of each jurisdiction
which requires such qualification wherein it owns or leases material properties
or conducts material business.
2. All the outstanding shares of capital stock of each
Transaction Party have been duly and validly authorized and issued and are fully
paid and nonassessable, and, except as otherwise set forth in the Final
Memorandum, all outstanding shares of capital stock of the Guarantors are owned
of record and beneficially by the Company either directly or through wholly
owned subsidiaries free and clear of any security interest and, to the knowledge
of such counsel, after due inquiry, any other claims, liens or encumbrances.
3. The Company's authorized equity capitalization is as set forth
in the Final Memorandum, and the Notes conform to the description thereof
contained in the Final Memorandum.
4. Each of the Transaction Documents has been duly authorized,
executed and delivered by each Transaction Party that is a party thereto and
each of the Merger Agreement, the Indenture, the Purchase Agreement and the
Registration Rights Agreement constitutes a legal, valid and binding instrument
enforceable against each such Transaction Party in accordance with its terms;
the Notes have been duly and validly authorized by all necessary corporate
action of the Company for issuance and sale pursuant to the Purchase Agreement
and, when executed, authenticated and delivered in accordance with the
provisions of the Indenture and paid for by the Initial Purchasers in accordance
with the terms of the Purchase Agreement, will constitute the legal, valid and
binding obligations of the Company, entitled to the benefits of the Indenture
and enforceable against the Company in accordance with their terms; and each of
the Note Guarantees has been duly and validly authorized by all necessary
corporate action of each Guarantor and, when the Notes have been executed and
authenticated and delivered to the Initial Purchasers in accordance with the
terms of the Purchase Agreement, will constitute the legal, valid and binding
obligation of such Guarantor, enforceable against such Guarantor in accordance
with its terms.
<PAGE>
5. The statements set forth under the heading "Description of
Notes" in the Final Memorandum, insofar as such statements purport to summarize
certain provisions of the Notes, the Indenture and the Registration Rights
Agreement, provide a fair summary of such provisions. The statements set forth
under the heading "The Acquisition," insofar as such statements purport to
summarize certain provisions of the Merger Agreement, provide a fair summary of
such provisions. The statements set forth under the heading "Description of
Certain Indebtedness" in the Final Memorandum, insofar as such statements
purport to summarize certain provisions of the Second Amended and Restated
Credit Agreement, dated as of July ___, 1996, between the Company and
NationsBank of Texas, N.A., the Company's 6-3/4% Convertible Subordinated
Debentures and the Indenture dated as of March 18, 1993 between the Company, as
issuer, and Chemical Bank, as trustee, provide a fair summary of such
provisions.
6. The information contained in the Final Memorandum under the
headings "Business and Industry Overview -- Legal Proceedings" and "Securities
Ownership and Certain Relationships and Transactions -- Employment Contracts"
fairly summarizes the matters therein described.
7. No consent, approval, authorization, registration,
qualification or order of any court or governmental agency or body is required
for the issuance, offer and sale of the Notes or the consummation of the
transactions contemplated in the Transaction Documents or for the performance by
any Transaction Party of its obligations under the Notes or any Transaction
Document, except (i) such as may be required under the blue sky or securities
laws of any jurisdiction in connection with the purchase and sale of the Notes
by the Initial Purchasers or (ii) such as may be required under such blue sky or
securities laws or under the Securities Act of 1933 or the Trust Indenture Act
of 1939 in connection with a registration under the Securities Act of 1933
pursuant to the Registration Rights Agreement.
8. To the best of such counsel's knowledge, under Virginia law,
(i) Maxxim Acquisition shall have full voting rights with respect to any shares
of outstanding common stock of Sterile Concepts that it shall acquire pursuant
to the Tender Offer if any vote of shareholders of Sterile Concepts is required
in connection with the Merger and (ii) no restrictions of any anti-takeover
statute shall be applicable to the Merger, and the sole right of shareholders of
Sterile Concepts who did not tender their shares pursuant to the Tender Offer
shall be to receive a cash payment of $20 per share pursuant to the Merger.
9. Neither the issuance and sale of the Notes, the consummation
of any other of the transactions contemplated in the Transaction Documents nor
the fulfillment of the terms thereof will conflict with, result in a breach or
violation of, or constitute a default under any statute, rule or regulation or
the charter or by-laws of any Transaction Party or the terms of the Indenture
dated as of March 18, 1993 between the Company, as issuer, and Chemical Bank, as
trustee, or any other agreement or instrument known to such counsel and to which
any Transaction Party is a party or bound, or any judgment, order or decree
known to such counsel to be applicable to any Transaction Party of any court,
regulatory body, administrative agency, governmental body or arbitrator having
jurisdiction over any Transaction Party or any statute, rule or regulation.
<PAGE>
10. Assuming the accuracy of the representations and warranties
and compliance with the agreements contained in the Purchase Agreement, no
registration of the Notes under the Securities Act and no qualification of the
Indenture under the Trust Indenture Act are required for the offer and sale by
the Initial Purchasers of the Notes in the manner contemplated by the Purchase
Agreement.
11. Neither the Company nor any of its subsidiaries is an
"investment company" within the meaning of the Investment Company Act without
taking account of any exemption arising out of the number of holders of the
Company's securities.
12. Such counsel has no reason to believe that at the date and
time of the execution and delivery of the Purchase Agreement by the parties
thereto the Final Memorandum contained an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading or that the Final Memorandum includes an untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
* * *
"Transaction Party" shall include (i) the Company, (ii) each
domestic Guarantor and (iii) each foreign Guarantor with respect to which the
Initial Purchasers may reasonably request a legal opinion.
In rendering the foregoing opinion, Boyer, Ewing & Harris, Inc.,
may rely on the opinions of counsel satisfactory to the Initial Purchasers with
respect to laws other than the federal laws of the United States, the laws of
the State of Texas and the corporate law of the State of Delaware, and may
assume that the laws of the State of New York do not differ in any material
respect from the laws of the State of Texas.
<PAGE>
EXHIBIT B
July 18, 1996
KPMG Peat Marwick LLP
Suite 1900
1021 East Cary Street
Richmond, Virginia 23219
KPMG Peat Marwick LLP
700 Louisiana
Suite 2700
Houston, Texas 77002
Ladies and Gentlemen:
Reference is hereby made to the Purchase Agreement (the "Purchase
Agreement") dated July 18, 1996 between the undersigned (the "Initial
Purchasers") and Maxxim Medical, Inc., a Texas corporation (the "Company"),
pursuant to which the Company will sell to the Initial Purchasers, and the
Initial Purchasers will purchase from the Company, an aggregate of $100,000,000
principal amount of the Company's Senior Subordinated Notes Due August 1, 2006
(the "Notes").
Pursuant to Section 6(d) of the Purchase Agreement, you are
required to deliver certain letters, in form and substance satisfactory to us,
setting forth the matters described in such Section (the "Comfort Letters"). In
connection with your delivery of the Comfort Letters, we confirm to you that:
(i) we are knowledgeable with respect to the due diligence review
process that would be performed if this placement of Notes were being registered
pursuant to the Securities Act of 1933, as amended (the "Act"); and
(ii) we will be reviewing certain information relating to the
Company that will be included or incorporated by reference in the Final
Memorandum (as defined in the Purchase Agreement), which will be delivered to
investors and utilized by them as a basis for their investment decision, and
this review process, applied to the information relating to the Company, will be
substantially consistent with the due diligence review process that we would
perform if this placement of Notes were being registered pursuant to the Act.
In accordance with the foregoing, we hereby request that you
deliver to us Comfort Letters concerning the financial statements of the Company
and certain statistical and other data included in the Final Memorandum.
<PAGE>
This letter is being furnished to you solely for the purpose of
obtaining the Comfort Letters and may not be relied upon or used by you for any
other purpose, or given or shown to any other person, without our prior written
consent.
Very truly yours,
NATIONSBANC CAPITAL MARKETS, INC.
By: _________________________
Name: David Stith
Title: Director
BEAR, STEARNS & CO. INC.
By: _________________________
Name: Sheldon I. Stein
Title: Senior Managing Director
EXHIBIT 4
NOTE: Certain exhibits have been omitted due to their being substantially
described in the body of the Indenture dated July 30, 1996.
[EXECUTION COPY]
================================================================================
MAXXIM MEDICAL, INC.
AS ISSUER
AND
MAXXIM MEDICAL, INC. (DELAWARE)
MAXXIM ACQUISITION CO.
FABRITEK LA ROMANA, INC.
MAXXIM MEDICAL CANADA LIMITED
MEDICA B.V. AND
MEDICA HOSPITAL SUPPLIES, N.V.
AS GUARANTORS
$100,000,000
10 1/2% SENIOR SUBORDINATED NOTES DUE 2006
------------------------------
INDENTURE
DATED AS OF JULY 30, 1996
------------------------------
FIRST UNION NATIONAL BANK OF NORTH CAROLINA,
TRUSTEE
================================================================================
<PAGE>
CROSS-REFERENCE TABLE
Reconciliation and tie between the Trust Indenture Act of 1939,
as amended, and the Indenture, dated as of July 30, 1996.
TRUST
INDENTURE
ACT INDENTURE
SECTION SECTION
- ---------- -------
ss.310(a)(1) .......................................... 7.10
(a)(2) .......................................... 7.10
(a)(3) .......................................... N.A.
(a)(4) .......................................... N.A.
(a)(5) .......................................... 7.10
(b) ............................................. 7.08; 7.10
(c) ............................................. N.A.
ss.311(a) ............................................. 7.11
(b) ............................................. 7.11
(c) ............................................. N.A.
ss.312(a) ............................................. 7.06(a); 7.06(b)
(b) ............................................. 7.06(c)
(c) ............................................. 7.06(d)
ss.313(a) ............................................. 7.06(e)
(b) ............................................. 7.06(f)
(c) ............................................. 7.06(f)
(d) ............................................. 7.06(g)
ss.314(a) ............................................. 4.16; 4.20
(b) ............................................. N.A.
(c)(1) .......................................... 12.03
(c)(2) .......................................... 12.03
(c)(3) .......................................... N.A.
(d) ............................................. N.A.
(e) ............................................. 12.04
(f) ............................................. 4.19
ss.315(a) ............................................. 7.01(b)
(b) ............................................. 7.05
(c) ............................................. 7.01(a)
(d) ............................................. 7.01(c)
(e) ............................................. 6.10
ss.316(a) ............................................. 2.08
(a)(1)(A) ....................................... 6.05
(a)(1)(B) ....................................... 6.04
(a)(2) .......................................... N.A.
(b) ............................................. 6.07
(c) ............................................. 9.05(b)
ss.317(a)(1) .......................................... 6.03
(a)(2) .......................................... 6.08
(b) ............................................. 2.04
ss.318(a) ............................................. 12.01
Note: This reconciliation and tie shall not, for any purpose, be deemed to be
part of the Indenture.
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions............................................1
SECTION 1.02. Incorporation by Reference of Trust Indenture Act.....19
SECTION 1.03. Rules of Construction.................................19
SECTION 1.04. Form of Documents Delivered to Trustee................20
SECTION 1.05. Acts of Holders.......................................20
SECTION 1.06. Satisfaction and Discharge............................21
ARTICLE II
THE NOTES
SECTION 2.01. Form and Dating.......................................22
SECTION 2.02. Execution and Authentication..........................24
SECTION 2.03. Registrar and Paying Agent............................26
SECTION 2.04. Paying Agent to Hold Money in Trust...................26
SECTION 2.05. Global Notes..........................................27
SECTION 2.06. Transfer and Exchange.................................27
SECTION 2.07. Replacement Notes.....................................34
SECTION 2.08. Outstanding Notes.....................................34
SECTION 2.09. Temporary Notes.......................................35
SECTION 2.10. Cancellation..........................................35
SECTION 2.11. Payment of Interest; Interest Rights Preserved........36
SECTION 2.12. Computation of Interest...............................37
SECTION 2.13. Persons Deemed Owners.................................37
SECTION 2.14. CUSIP Numbers.........................................37
ARTICLE III
REDEMPTION
SECTION 3.01. Notice to Trustee.....................................37
SECTION 3.02. Selection of Notes to be Redeemed.....................37
SECTION 3.03. Notice of Redemption..................................37
SECTION 3.04. Effect of Notice of Redemption........................38
SECTION 3.05. Deposit of Redemption Price...........................39
SECTION 3.06. Notes Redeemed in Part................................39
ARTICLE IV
COVENANTS
SECTION 4.01. Payment of Notes......................................40
SECTION 4.02. Maintenance of Office or Agency.......................40
SECTION 4.03. Money for the Note Payments to be Held in Trust.......41
SECTION 4.04. Corporate Existence...................................41
SECTION 4.05. Maintenance of Property...............................41
SECTION 4.06. Payment of Taxes and Other Claims.....................41
SECTION 4.07. Repurchase at the Option of Holders upon a Change of
Control............................................42
SECTION 4.08. Limitation on Asset Sales.............................44
SECTION 4.09. Limitation on Incurrence of Indebtedness and Issuance of
Preferred Stock....................................48
SECTION 4.10. Limitation on Restricted Payments.....................49
SECTION 4.11. Limitation on Dividends and Other Payment Restrictions
Affecting Subsidiaries.............................52
SECTION 4.12. Limitation on Layering Debt...........................53
SECTION 4.13. Limitation on Liens...................................53
SECTION 4.14. Limitation on Ownership of and Liens on Capital Stock.53
SECTION 4.15. Transactions with Affiliates..........................54
SECTION 4.16. Reports...............................................54
SECTION 4.17. Unrestricted Subsidiaries.............................54
SECTION 4.18. Payments for Consent, Waiver or Amendment.............55
SECTION 4.19. Waiver of Stay, Extension or Usury Laws...............55
SECTION 4.20. Compliance Certificate; Notice of Default or Event of
Default............................................55
SECTION 4.21. Investment Company Act................................56
SECTION 4.22. Further Instruments and Acts..........................56
ARTICLE V
CONSOLIDATION, MERGER, CONVEYANCE,
LEASE OR TRANSFER
SECTION 5.01. Merger, Consolidation or Sale of Assets...............56
SECTION 5.02. Successor Corporation Substituted.....................57
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default.....................................58
SECTION 6.02. Acceleration..........................................59
SECTION 6.03. Other Remedies........................................60
SECTION 6.04. Waiver of Past Defaults...............................60
ii
SECTION 6.05. Control by Majority...................................61
SECTION 6.06. Limitation on Suits...................................61
SECTION 6.07. Rights of Holders to Receive Payment..................61
SECTION 6.08. Trustee May File Proofs of Claim......................62
SECTION 6.09. Priorities............................................62
SECTION 6.10. Undertaking for Costs.................................63
SECTION 6.11. Waiver of Stay or Extension Laws......................63
SECTION 6.11. Trustee May Enforce Claims Without Possession of the
Notes..............................................63
SECTION 6.13. Restoration of Rights and Remedies....................63
SECTION 6.14. Rights and Remedies Cumulative........................63
SECTION 6.15. Delay or Omission Not Waiver..........................64
ARTICLE VII
TRUSTEE
SECTION 7.01. Duties of Trustee.....................................64
SECTION 7.02. Rights of Trustee.....................................65
SECTION 7.03. Individual Rights of Trustee..........................65
SECTION 7.04. Trustee's Disclaimer..................................66
SECTION 7.05. Notice of Defaults....................................66
SECTION 7.06. Preservation of Information; Reports by Trustee to
Holders............................................66
SECTION 7.07. Compensation and Indemnity............................67
SECTION 7.08. Replacement of Trustee................................68
SECTION 7.09. Successor Trustee by Merger...........................70
SECTION 7.10. Eligibility; Disqualification.........................70
SECTION 7.11. Preferential Collection of Claims Against Company.....71
ARTICLE VIII
DEFEASANCE
SECTION 8.01. Company's Option to Effect Legal Defeasance or Covenant
Defeasance.........................................71
SECTION 8.02. Legal Defeasance and Discharge........................71
SECTION 8.03. Covenant Defeasance...................................72
SECTION 8.04. Conditions to Defeasance or Covenant Defeasance.......72
SECTION 8.05. Deposited Money and U.S. Government Obligations to be
Held in Trust; Miscellaneous Provisions............74
SECTION 8.06. Reinstatement.........................................74
ARTICLE IX
AMENDMENTS
SECTION 9.01. Without Consent of Holders............................75
iii
SECTION 9.02. With Consent of Holders...............................75
SECTION 9.03. Effect of Supplemental Indentures.....................77
SECTION 9.04. Compliance with Trust Indenture Act...................77
SECTION 9.05. Revocation and Effect of Consents and Waivers.........77
SECTION 9.06. Notation on or Exchange of Notes......................77
SECTION 9.07. Trustee to Execute Supplemental Indentures............77
ARTICLE X
SUBORDINATION
SECTION 10.01. Agreement to Subordinate..............................78
SECTION 10.02. Liquidation; Dissolution; Bankruptcy..................79
SECTION 10.03. Default on Designated Senior Indebtedness.............79
SECTION 10.04. Acceleration of Notes.................................80
SECTION 10.05. When Distribution Must be Paid Over...................80
SECTION 10.06. Notice By Company.....................................81
SECTION 10.07. Subrogation...........................................81
SECTION 10.08. Relative Rights.......................................81
SECTION 10.09. Subordination May Not be Impaired by Company..........81
SECTION 10.10. Distribution or Notice to Representative..............81
SECTION 10.11. Rights of Trustee and Paying Agent....................82
SECTION 10.12. Authorization to Effect Subordination.................82
ARTICLE XI
NOTE GUARANTEES; SUBORDINATION OF NOTE
GUARANTEES; RELEASE OF NOTE GUARANTEES
SECTION 11.01. Note Guarantees.......................................83
SECTION 11.02 Obligations of Guarantors Unconditional...............85
SECTION 11.03. Limitation of Guarantors' Liability...................85
SECTION 11.04. Subordination of Note Guarantees......................85
SECTION 11.05. Release of Note Guarantees............................87
SECTION 11.06. Application of Certain Terms and Provisions to
Guarantors.........................................87
SECTION 11.07. Additional Guarantors.................................88
ARTICLE XII
MISCELLANEOUS
SECTION 12.01. Trust Indenture Act Controls..........................88
SECTION 12.02. Notices...............................................88
SECTION 12.03. Certificate and Opinion as to Conditions Precedent....89
SECTION 12.04. Statements Required in Certificate or Opinion.........89
SECTION 12.05. Rules by Trustee, Paying Agent and Registrar..........89
SECTION 12.06. Payments on Business Days.............................89
iv
SECTION 12.07. Governing Law, Submission to Jurisdiction. ...........89
SECTION 12.08. No Recourse Against Others............................90
SECTION 12.09. Successors............................................90
SECTION 12.10. Counterparts..........................................90
SECTION 12.11. Table of Contents; Headings...........................90
SECTION 12.12. Severability..........................................90
SECTION 12.13. Further Instruments and Acts. ........................90
EXHIBIT A FORM OF INITIAL GLOBAL NOTE
EXHIBIT B FORM OF INITIAL CERTIFICATED NOTE
EXHIBIT C FORM OF NEW GLOBAL NOTE
EXHIBIT D FORM OF NEW CERTIFICATED NOTE
EXHIBIT E FORM OF TRANSFER CERTIFICATE TO A QIB
EXHIBIT F FORM OF TRANSFER CERTIFICATE FOR TRANSFER TO AN INSTITUTIONAL
ACCREDITED INVESTOR
EXHIBIT G FORM OF INVESTMENT LETTER FOR INSTITUTIONAL ACCREDITED INVESTORS
EXHIBIT H FORM OF TRANSFER CERTIFICATE FOR TRANSFER TO A NON-U.S. PERSON
EXHIBIT I FORM OF INVESTMENT LETTER FOR REGULATION S PURCHASERS
EXHIBIT J FORM OF REGISTRATION RIGHTS AGREEMENT
v
INDENTURE, dated as of July 30, 1996, among MAXXIM MEDICAL, INC.,
a Texas corporation (the "Company"), having its principal office at 104
Industrial Blvd., Sugar Land, Texas 77478, and MAXXIM MEDICAL, INC. (DELAWARE),
a Delaware corporation, MAXXIM ACQUISITION CO., a Virginia corporation, FABRITEK
LA ROMANA, INC., a Mississippi corporation, MAXXIM MEDICAL CANADA LIMITED, a
Canadian corporation, MEDICA B.V., a Netherlands corporation, and MEDICAL
HOSPITAL SUPPLIES, N.V., a Belgian corporation (collectively, the "Guarantors"),
and FIRST UNION NATIONAL BANK OF NORTH CAROLINA, a North Carolina banking
corporation, as trustee hereunder (the "Trustee"), having its Corporate National
Trust Office at 230 South Tryon Street, Ninth Floor, Charlotte, North Carolina
28288.
RECITALS
The Company has duly authorized the creation and issue of its 10
1/2% Senior Subordinated Notes Due 2006 (the "Initial Notes") of substantially
the tenor and amount hereinafter set forth and to provide therefor and for, if
and when issued in exchange for the Initial Notes pursuant to the Indenture and
the Registration Rights Agreement, the Company's 10 1/2% Senior Subordinated
Notes Due 2006 (the "New Notes," and together with the Initial Notes, the
"Notes"), the Company has duly authorized the execution and delivery of this
Indenture.
Each of the Guarantors has duly authorized the execution and
delivery of this Indenture to provide a guarantee of the Notes and of certain of
the obligations of the Company hereunder.
All things necessary to make the Notes, when executed by the
Company and authenticated and delivered by the Trustee hereunder and duly issued
by the Company, the valid obligations of the Company, and to make this Indenture
a valid instrument of the Company and of each of the Guarantors, in accordance
with their respective terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that, for and in
consideration of the premises and the purchase of the Initial Notes by the
Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Notes, as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. DEFINITIONS. For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned
to them in this Article, and include the plural as well as the singular;
and
<PAGE>
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP.
"ACQUIRED INDEBTEDNESS" means, with respect to any specified
Person, (i) any Indebtedness or Disqualified Stock of any other Person existing
at the time such other Person is merged with or into or becomes a Subsidiary of
such specified Person, including, without limitation, Indebtedness incurred in
connection with, or in contemplation of, such other Person merging with or into
or becoming a Subsidiary of such specified Person, and (ii) Indebtedness secured
by a Lien encumbering any asset acquired by such specified Person, and in either
case for purposes of this Indenture shall be deemed to be incurred by such
specified Person at the time such other Person is merged with or into or becomes
a Subsidiary of such specified Person or at the time such asset is acquired by
such specified Person, as the case may be.
"ACT" when used with respect to any Holder, has the meaning set
forth in Section 1.05 hereof.
"AFFILIATE" of any specified Person means (i) any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person or (ii) any other Person who is a
director or executive officer of (a) such specified Person or (b) any Person
described in the preceding clause (i). For 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, shall mean 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 any class, or any series of
any class, of equity securities of a Person, whether or not voting, shall be
deemed to be control.
"AGENT BANK" means NationsBank of Texas, N.A. and its successors
under the Credit Agreement.
"AGENT MEMBERS" has the meaning set forth in Section 2.05(a)
hereof.
"ASSET SALE" means with respect to any Person, the sale, lease,
conveyance or other disposition, that does not constitute a Restricted Payment
or an Investment, by such Person of any of its assets (including, without
limitation, by way of a sale and leaseback and including the issuance, sale or
transfer of any Equity Interests in any Subsidiary of the Company or the sale or
transfer of Equity Interests in any Unrestricted Subsidiary) other than to the
Company (including the receipt of proceeds of insurance paid on account of the
loss of or damage to any asset and awards of compensation for any asset taken by
condemnation, eminent domain or similar proceeding, and including the receipt of
proceeds of business interruption insurance), in each case, in one or a series
of related transactions; PROVIDED, that notwithstanding the foregoing, the term
"Asset Sale" shall not include:
(i) the sale, lease, conveyance, disposition or other transfer of
all or substantially all of the assets of the Company, in accordance with
Section 5.01 hereof;
2
(ii) the sale or lease of equipment, inventory, accounts
receivable or other assets in the ordinary course of business consistent with
past practice;
(iii) a transfer of assets by the Company to a Wholly Owned
Subsidiary of the Company or by a Wholly Owned Subsidiary of the Company to the
Company or to another Wholly Owned Subsidiary of the Company;
(iv) an issuance of Equity Interests by a Wholly Owned Subsidiary
of the Company to the Company or to another Wholly Owned Subsidiary of the
Company, PROVIDED that the consideration paid by the Company or such Wholly
Owned Subsidiary of the Company for such Equity Interests shall be deemed to be
an Investment; or
(v) the sale or other disposition of cash or Cash Equivalents.
"ASSET SALE OFFER" has the meaning set forth in Section 4.08(d)
hereof.
"ASSET SALE OFFER AMOUNT" has the meaning set forth in Section
4.08(d) hereof.
"ASSET SALE PURCHASE DATE" has the meaning set forth in Section
4.08(e)(ii) hereof.
"BANKRUPTCY LAW" means Title 11, United States Code, or any other
applicable federal, state or foreign bankruptcy, insolvency or similar law as
now or hereafter constituted.
"BOARD" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board.
"BOARD RESOLUTION" means a duly adopted resolution of the Board
in full force and effect at the time of determination and certified as such by
the Secretary or an Assistant Secretary of the Company.
"BUSINESS DAY" means each Monday, Tuesday, Wednesday, Thursday
and Friday that is not a day on which banking institutions in the Borough of
Manhattan, The City of New York or in Charlotte, North Carolina are authorized
or obligated by law, executive order or regulation to close.
"CAPITAL LEASE OBLIGATION" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"CAPITAL STOCK" means (i) in the case of a corporation, capital
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of capital stock, (iii) in the case of a partnership, partnership
interests (whether general or limited) and (iv) any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.
3
"CASH EQUIVALENT" means:
(i) securities issued or directly and fully guaranteed or insured
by the United States of America or any agency or instrumentality thereof
(provided that the full faith and credit of the United States is pledged in
support thereof) having maturities not more than twelve months from the date of
acquisition;
(ii) U.S. dollar denominated (or foreign currency fully hedged)
time deposits, certificates of deposit, Eurodollar time deposits or Eurodollar
certificates of deposit of (a) any domestic commercial bank of recognized
standing having capital and surplus in excess of $500 million or (b) any bank
whose short-term commercial paper rating from S&P is at least A-1 or the
equivalent thereof or from Moody's is at least P-1 or the equivalent thereof
(any such bank being an "Approved Lender"), in each case with maturities of not
more than twelve months from the date of acquisition; and
(iii) commercial paper issued by any Approved Lender (or by the
parent company thereof) or any variable rate notes issued by, or guaranteed by,
any domestic corporation rated A-2 (or the equivalent thereof) or better by S&P
or P-2 (or the equivalent thereof) or better by Moody's and maturing within
twelve months of the date of acquisition.
"CERTIFICATED NOTES" means Notes in certificated form.
"CHANGE OF CONTROL" means such time as either:
(i) any Person or group (within the meaning of Section 13(d) or
14(d) of the Exchange Act) (other than an underwriter conducting a firm
commitment underwriting of the Company's Voting Stock) has become, directly or
indirectly, the beneficial owner by way of merger, consolidation or otherwise,
of 35% or more of the voting power of the Voting Stock of the Company on a
fully-diluted basis, after giving effect to the conversion and exercise of all
outstanding warrants, options and other securities of the Company convertible
into or exercisable for Voting Stock of the Company (whether or not such
securities are then currently convertible or exercisable); or
(ii) the sale, lease or transfer of all or substantially all of
the assets of the Company to any Person or group; or
(iii) during any period of two consecutive calendar years,
individuals who at the beginning of such period constituted the Board, together
with any new members of such Board whose election by such Board or whose
nomination for election by the stockholders of the Company was approved by a
vote of a majority of the members of such Board then still in office who either
were directors at the beginning of such period or whose election or nomination
for election was previously so approved, cease for any reason to constitute a
majority of the directors of the Company then in office; or
(iv) the Company consolidates with or merges with or into another
Person or any Person consolidates with, or merges with or into, the Company (in
each case, whether or not in
4
compliance with the terms of this Indenture), in any such event pursuant to a
transaction in which immediately after the consummation thereof Persons owning a
majority of the Voting Stock of the Company immediately prior to such
consummation shall cease to own a majority of the Voting Stock of the Company or
the surviving entity if other than the Company.
"CHANGE OF CONTROL OFFER" has the meaning set forth in Section
4.07(a) hereof.
"CHANGE OF CONTROL PAYMENT DATE" has the meaning set forth in
Section 4.07(a) hereof.
"CHANGE OF CONTROL PURCHASE PRICE" has the meaning specified in
Section 4.07(a) hereof.
"CLEARING AGENCY" has the meaning set forth in Section 3(a)(23)
of the Exchange Act.
"COMMISSION" means the United States Securities and Exchange
Commission, as from time to time constituted, created under the Exchange Act,
or, if at any time after the execution of this Indenture such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"COMPANY" means the party named as such in the preamble to this
Indenture until a successor replaces it pursuant to the applicable provisions
hereof and, thereafter, means such successor.
"COMPANY ORDER" means a written order signed in the name of the
Company by (i) the Chairman of the Board, Chief Executive Officer, President,
Chief Operating Officer or any Vice President of the Company and (ii) the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
the Company, and delivered to the Trustee.
"CONSOLIDATED EBITDA" means, with respect to any Person for any
period, the sum, of, without duplication, (i) the Consolidated Net Income of
such Person and its Subsidiaries for such period, plus (ii) the Fixed Charges
for such period, plus (iii) amortization of deferred financing charges for such
period, plus (iv) provision for taxes based on income or profits for such period
(to the extent such income or profits were included in computing Consolidated
Net Income for such period), plus (v) consolidated depreciation, amortization
and other noncash charges of such Person and its Subsidiaries required to be
reflected as expenses on the books and records of such Person, minus (vi) cash
payments with respect to any nonrecurring, noncash charges previously added back
pursuant to clause (v), and excluding (vii) the impact of foreign currency
translations. Notwithstanding the foregoing, the provision for taxes based on
the income or profits of, and the depreciation and amortization and other
noncash charges of, a Subsidiary of a Person shall be added to Consolidated Net
Income to compute Consolidated EBITDA 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 such Person
by such Subsidiary without prior approval (unless such approval has been
obtained),
5
pursuant to the terms of its charter and all agreements, instruments, judgments,
decrees, orders, statutes, rules and governmental regulations applicable to that
Subsidiary or its stockholders.
"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 (unless such approval has 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) the Net Income of, or
any dividends or other distributions from, any Unrestricted Subsidiary, to the
extent otherwise included, shall be excluded, until distributed in cash to the
Company or one of its Subsidiaries.
"CONSOLIDATED NET WORTH" means, with respect to any Person as of
any date, the sum of (i) the consolidated equity of the common stockholders of
such Person and its consolidated Subsidiaries as of such date plus (ii) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of preferred stock (other than Disqualified Stock) that by
its terms is not entitled to the payment of dividends unless such dividends may
be declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such preferred stock, less (x) all write-ups subsequent
to the date of this Indenture in the book value of any asset owned by such
Person or a consolidated Subsidiary of such Person (other than purchase
accounting adjustments made, in connection with any acquisition of any entity
that becomes a consolidated Subsidiary of such Person after the date of this
Indenture, to the book value of the assets of such entity), (y) all investments
as of such date in unconsolidated Subsidiaries and in Persons that are not
Subsidiaries (except, in each case, Permitted Investments), and (z) all
unamortized debt discount and expense and unamortized deferred charges as of
such date, all of the foregoing determined on a consolidated basis in accordance
with GAAP.
"CORPORATE NATIONAL TRUST OFFICE" means the principal office of
the Trustee at which at any particular time its corporate trust business shall
be principally administered, which office is, at the date of execution of this
Indenture, 230 South Tryon Street, Ninth Floor, Charlotte, North Carolina,
28288; PROVIDED, that for purposes of Section 4.02 hereof, "Corporate National
Trust Office" shall mean the office of the Trustee located at IBJ Schroder Bank
& Trust Co., One State Street Plaza, New York, New York, 10004, Ref. SC-1.
"COVENANT DEFEASANCE" has the meaning set forth in Section 8.03
hereof.
6
"CREDIT AGREEMENT" means that certain Second Amended and Restated
Credit Agreement dated as of the date of this Indenture, by and among the
Company and NationsBank of Texas, N.A., as agent, and the lenders parties
thereto, including any related notes, guarantees, collateral documents,
instruments and agreements executed in connection therewith, and in each case as
amended, modified, increased, renewed, refunded, replaced, restated or
refinanced from time to time.
"CUSTODIAN" means any receiver, trustee, assignee, liquidator,
custodian or similar official under any Bankruptcy Law.
"DEFAULT" means any event that is or with the passage of time or
the giving of notice or both would be an Event of Default.
"DEFAULTED INTEREST" has the meaning set forth in Section 2.11
hereof.
"DEPOSITARY" means The Depository Trust Company, its nominees,
and their respective successors.
"DESIGNATED SENIOR INDEBTEDNESS" means, in respect of the
Company, (i) so long as the Senior Bank Debt is outstanding, the Senior Bank
Debt and (ii) any other Senior Indebtedness permitted under this Indenture the
principal amount of which is $15.0 million or more and that has been designated
by the Company as "Designated Senior Indebtedness" and, in respect of any
Guarantor, any guarantee by such Guarantor of Designated Senior Indebtedness of
the Company.
"DISQUALIFIED STOCK" means (i) with respect to any Person,
Capital Stock of such Person that, by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable), or upon the
happening of any event matures 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 which is one year
after the date on which the Notes mature and (ii) with respect to any Subsidiary
of such Person (including with respect to any Subsidiary of the Company), any
Capital Stock other than any common stock with no preference, privileges, or
redemption or repayment provisions.
"EQUITY INTERESTS" means Capital Stock and all warrants, options
or other rights to acquire Capital Stock (but excluding any debt security that
is convertible into, or exchangeable for, Capital Stock), whether outstanding
prior to, on or after the date of this Indenture.
"EVENT OF DEFAULT" has the meaning set forth in Section 6.01
hereof.
"EXCESS PROCEEDS" has the meaning set forth in Section 4.08(c)
hereof.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
7
"EXEMPT AFFILIATE TRANSACTIONS" means (i) transactions between or
among the Company and/or its Wholly Owned Subsidiaries, (ii) advances to
officers of the Company or any Subsidiary of the Company in the ordinary course
of business to provide for the payment of reasonable expenses incurred by such
persons in the performance of their responsibilities to the Company or such
Subsidiary or in connection with any relocation, (iii) fees and compensation
paid to and indemnity provided on behalf of directors, officers or employees of
the Company or any Subsidiary of the Company in the ordinary course of business,
(iv) any employment agreement that is in effect on the date of this Indenture in
the ordinary course of business and any such agreement entered into by the
Company or a Subsidiary of the Company after the date of this Indenture in the
ordinary course of business of the Company or such Subsidiary and (v) any
Restricted Payment that is not prohibited by Section 4.10 hereof.
"EXEMPT ASSET SALE" means an Asset Sale on or after the date of
this Indenture the Net Proceeds of which plus the Net Proceeds of all other
Asset Sales (other than Net Proceeds from a sale of the Company's sterilization
unit in Oldsmar, Florida) concurrently or previously made on or after the date
of this Indenture do not exceed $10.0 million.
"EXISTING INDEBTEDNESS" means the Indebtedness of the Company and
its Subsidiaries (other than Indebtedness under the Credit Agreement) in
existence on the date of this Indenture, until such amounts are repaid.
"FINAL MEMORANDUM" means the final Offering Memorandum, dated
July 18, 1996, used in connection with the Initial Placement.
"FIXED CHARGE COVERAGE RATIO" means with respect to any Person
for any period, the ratio of the Consolidated EBITDA of such Person and its
Subsidiaries for such period to the Fixed Charges of such Person and its
Subsidiaries for such period. In the event that the Company or any of its
Subsidiaries incurs, assumes, guarantees or repays or redeems any Indebtedness
(other than revolving credit borrowings) or issues or redeems preferred stock
subsequent to the commencement of the four-quarter reference period for which
the Fixed Charge Coverage Ratio is being calculated but on or prior to the date
on which the event for which the calculation of the Fixed Charge Coverage Ratio
is made (the "Calculation Date"), then the Fixed Charge Coverage Ratio shall be
calculated giving pro forma effect to such incurrence, assumption, guarantee,
repayment or redemption of Indebtedness, or such issuance or redemption of
preferred stock, as if the same had occurred at the beginning of the applicable
four-quarter reference period. For purposes of making the computation referred
to above, (i) acquisitions that have been made by the Company or any of its
Subsidiaries, including through mergers or consolidations and including any
related financing transactions, during the four-quarter reference period or
subsequent to such reference period and on or prior to the Calculation Date
shall be deemed to have occurred on the first day of the four-quarter reference
period, and (ii) the Consolidated EBITDA attributable to discontinued
operations, as determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, shall be excluded, and (iii) the
Fixed Charges attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded, but only to the extent that the obligations
giving rise to such
8
Fixed Charges will not be obligations of the referent Person or any of its
Subsidiaries following the Calculation Date.
"FIXED CHARGES" means, with respect to any Person for any period,
the sum, without duplication, of (i) the consolidated interest expense of such
Person and its Subsidiaries for such period (net of any interest income)
including, without limitation, amortization of original issue discount, noncash
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 but excluding amortization of deferred
financing charges for such period and (ii) the consolidated interest expense of
such Person and its Subsidiaries that was capitalized during such period, and
(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 cash dividend payments (and noncash
dividend payments in the case of a Person that is a Subsidiary) on any series of
preferred stock of such Person payable to a party other than the Company or a
Wholly Owned Subsidiary, multiplied by (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, on a
consolidated basis and in accordance with GAAP.
"GAAP" means generally accepted accounting principles set forth
in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession of the United States, that are applicable to the
circumstances as of the date of determination; PROVIDED THAT, except as
specifically provided in this Indenture, all calculations made for purposes of
determining compliance with the covenants set forth in Article IV and Section
5.01 of this Indenture shall use GAAP as in effect on the date of this Indenture
for financial statements for fiscal years ending on or after December 31, 1996.
"GLOBAL NOTES" means the Initial Global Note and the New Global
Note.
"GUARANTEE" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
"GUARANTOR" means (i) Maxxim Medical, Inc. (Delaware), a Delaware
corporation, (ii) Maxxim Acquisition Co., (iii) each other existing Subsidiary
of the Company, (iv) each Subsidiary of the Company formed or acquired (and each
other Person that becomes a Subsidiary of the Company) after the date of this
Indenture that guarantees the Company's obligations under the Credit Agreement
or any other Senior Indebtedness, and (v) each other Wholly Owned Subsidiary
formed or acquired or that becomes such after the date of this
9
Indenture; PROVIDED that (a) Sterile Concepts and its Subsidiaries shall not
become Guarantors until the consummation of the Merger; (b) any Subsidiary of
the Company acquired after the date of this Indenture which is prohibited from
entering into a Note Guarantee pursuant to restrictions contained in any debt
instrument in existence at the time such Subsidiary was so acquired and not
entered into in anticipation or contemplation of such acquisition shall not
become a Guarantor so long as any such restriction is in existence and to the
extent of any such restriction and so long as such Subsidiary does not guarantee
any Senior Indebtedness; and (c) any non-Wholly Owned Subsidiary of the Company
that is released from its guarantee of the Company's obligations under the
Credit Agreement shall also be released from its Note Guarantee so long as such
Subsidiary does not guarantee any Senior Indebtedness.
"HEDGING OBLIGATIONS" means, with respect to any Person, the
obligations of such Person entered into in the ordinary course of business under
(i) interest rate swap agreements, interest rate cap agreements and interest
rate collar agreements and other similar financial agreements or arrangements
designed to protect such Person against, or manage the exposure of such Person
to, fluctuations in interest rates, and (ii) forward exchange agreements,
currency swap, currency option and other similar financial agreements or
arrangements designed to protect such Person against, or manage the exposure of
such Person to, fluctuations in foreign currency exchange rates.
"HOLDER" means (i) in the case of any Certificated Note, the
Person in whose name such Certificated Note is registered on the Note Register
and (ii) in the case of any Global Note, the Depositary.
"INCUR" shall have the meaning specified in Section 4.09(a)
hereof.
"INDEBTEDNESS" means, with respect to any Person, any
indebtedness of such Person, whether or not contingent, in respect of borrowed
money or evidenced by bonds, notes, debentures or similar instruments or letters
of credit (or reimbursement agreements in respect thereof) or banker's
acceptances or representing Capital Lease Obligations, or the balance deferred
and unpaid of the purchase price of any property or representing any Hedging
Obligations, except any such balance that constitutes an accrued expense or
trade payable incurred in the ordinary course of business, if and to the extent
any of the foregoing indebtedness (other than letters of credit and Hedging
Obligations) would appear as a liability upon a balance sheet of such Person
prepared in accordance with GAAP, as well as all indebtedness of others secured
by a Lien on any asset of such Person (whether or not such indebtedness is
assumed by such Person) and, to the extent not otherwise included, the guarantee
by such Person of any indebtedness of any other Person.
"INDENTURE" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
and shall include, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument, and any such supplemental indenture,
respectively.
10
"INDEPENDENT DIRECTOR" means a director of the Company other than
a director who is a party, or who is a director, officer, employee or Affiliate
(or is related by blood or marriage to any such person) of the other party, to
the transaction in question, and who is, in fact, independent in respect of such
transaction.
"INDEPENDENT FINANCIAL ADVISOR" means a nationally recognized
investment banking firm that is, in the reasonable judgment of the Board,
qualified to perform the task for which such firm has been engaged and
disinterested and independent with respect to the Company.
"INITIAL CERTIFICATED NOTES" has the meaning set forth in Section
2.01(c) hereof.
"INITIAL GLOBAL NOTE" has the meaning set forth in Section
2.01(c) hereof.
"INITIAL NOTES" has the meaning set forth in the Recitals hereto
and, more particularly, means any of the Notes authenticated and delivered under
this Indenture other than pursuant to the Registered Exchange Offer or in
exchange for New Notes.
"INITIAL PLACEMENT" means the initial sales of the Notes by the
Initial Purchaser.
"INITIAL PURCHASERS" means NationsBanc Capital Markets, Inc. and
Bear, Stearns & Co. Inc.
"INSTITUTIONAL ACCREDITED INVESTORS" means institutional
"accredited investors," as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, other than QIBs.
"INTEREST PAYMENT DATE" means each semiannual interest payment
date on February 1 and August 1 of each year, commencing February 1, 1997, in
respect of the Notes.
"INVESTMENTS" means, with respect to any Person, all investments
by such Person in other Persons (including Affiliates) in the form of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding advances to officers of the type
specified in clause (ii) of the definition of Exempt Affiliate Transactions),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities and all other items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP;
PROVIDED that an acquisition of assets, Equity Interests or other securities by
the Company for consideration consisting of common equity securities of the
Company shall not be deemed to be an Investment.
"LEGAL DEFEASANCE" has the meaning set forth in Section 8.02
hereof.
"LIEN" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law (including any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to sell or give a
11
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
"LIQUIDATED DAMAGES" shall have the meaning specified in Section
4 of the Registration Rights Agreement.
"MATURITY" means, when used with respect to a Note, the date on
which the principal of such Note becomes due and payable as provided therein or
in this Indenture, whether on the date specified in such Note as the fixed date
on which the principal of such Note is due and payable, on the Change of Control
Payment Date or Asset Sale Purchase Date, or by declaration of acceleration,
call for redemption or otherwise.
"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 preferred stock dividends, excluding,
however, (i) any gain (but not loss), together with any related provision for
taxes on such gain (but not loss), realized in connection with (a) any Asset
Sale (including, without limitation, dispositions pursuant to sale and leaseback
transactions) 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 (but not
loss), together with any related provision for taxes on such extraordinary or
nonrecurring gain (but not loss).
"NET PROCEEDS" means the aggregate cash proceeds received by the
Company or any of its Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
noncash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale (including, without limitation, legal, accounting
and investment banking fees, and sales commissions), taxes paid or payable as a
result thereof, and any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP.
"NEW CERTIFICATED NOTES" has the meaning set forth in Section
2.01(d) hereof.
"NEW GLOBAL NOTE" has the meaning set forth in Section 2.01(d)
hereof.
"NEW NOTES" has the meaning set forth in the Recitals hereto and
more particularly means any of the Notes authenticated and delivered under this
Indenture pursuant to the Registered Exchange Offer.
"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; and (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
12
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity.
"NON-U.S. GUARANTOR" has the meaning set forth in Section 4.09(a)
hereof.
"NON-U.S. PERSON" means any Person who is not a "U.S. Person," as
defined in Rule 902(o) under the Securities Act.
"NOTE GUARANTEE" means the guarantee of the Notes by each
Guarantor under Article XI hereof.
"NOTE REGISTER" has the meaning set forth in Section 2.03 hereof.
"NOTES" has the meaning set forth in the Recitals of the Company
and the Guarantors and more particularly means any of the Notes authenticated
and delivered under this Indenture.
"OBLIGATIONS" means any principal, interest, penalties, premiums,
fees, indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Indebtedness.
"OFFICERS' CERTIFICATE" means a certificate signed by (i) the
Chairman of the Board, the Chief Executive Officer, President, Chief Operating
Officer or any Vice President of the Company and (ii) the Chief Financial
Officer, the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary of the Company, and delivered to the Trustee, which certificate shall
comply with the provisions of Section 12.04 hereof; PROVIDED THAT any Officers'
Certificate delivered pursuant to the first paragraph of Section 4.20 hereof
shall be signed by the Chief Executive Officer or the Chief Financial Officer of
the Company.
"OPINION OF COUNSEL" means a written opinion from legal counsel
(who may be counsel to the Company or the Trustee) who is acceptable to the
Trustee, which opinion shall comply with the provisions of Section 12.04 hereof;
PROVIDED THAT any Opinion of Counsel delivered pursuant to Section 8.04 hereof
shall not be rendered by an employee of the Company or any of its Subsidiaries.
"PARI PASSU," as applied to the ranking of any Indebtedness of a
Person in relation to other Indebtedness of such Person, means that each such
Indebtedness either (i) is not subordinate in right of payment to any
Indebtedness or (ii) is subordinate in right of payment to the same Indebtedness
as is the other, and is so subordinate to the same extent, and is not
subordinate in right of payment to each other or to any Indebtedness as to which
the other is not so subordinate.
"PAYING AGENT" means any Person authorized by the Company to make
payments of principal, premium, if any, or interest with respect to the Notes on
behalf of the Company.
13
"PAYMENT BLOCKAGE NOTICE" has the meaning set forth in Section
10.03(a) (ii) hereof.
"PERMITTED INVESTMENTS" means:
(i) any Investments in the Company;
(ii) any Investments in Cash Equivalents;
(iii) Investments made as a result of the receipt of noncash
consideration from an Asset Sale that was made pursuant to and in compliance
with Section 4.08 hereof;
(iv) Investments outstanding as of the date of this Indenture;
and
(v) Investments in Wholly Owned Subsidiaries of the Company and
any entity that (a) is engaged in the same or a similar line of business as the
Company or any of its Subsidiaries was engaged in on the date of this Indenture
or any reasonable extensions or expansions thereof, and (b) as a result of such
Investment, becomes a Wholly Owned Subsidiary of the Company.
"PERMITTED REFINANCING INDEBTEDNESS" means any Indebtedness of
the Company or any of its Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Subsidiaries; PROVIDED
that:
(i) the principal amount of such Permitted Refinancing
Indebtedness does not exceed the principal amount of the Indebtedness so
extended, refinanced, renewed, replaced, defeased or refunded (plus the amount
of reasonable expenses incurred in connection therewith);
(ii) such Permitted Refinancing Indebtedness has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average Life to
Maturity of, the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded;
(iii) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the Notes,
such Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and is subordinated in right of payment to, the Notes on
terms at least as favorable to the Holders as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; and
(iv) such Indebtedness is incurred either by the Company or by
the Subsidiary of the Company that is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"PERSON" means any individual, corporation, limited or general
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, or government or any agency or political
subdivision thereof.
14
"PRIVATE PLACEMENT LEGEND" means the legend in the form set forth
in Section 2.01(e)(i) hereof.
"PRO FORMA" means, with respect to any calculation made or
required to be made pursuant to the terms hereof, a calculation in accordance
with Article 11 of Regulation S-X promulgated under the Securities Act (to the
extent applicable), as interpreted in good faith by the Board after consultation
with the independent certified public accountants of the Company, or otherwise a
calculation made in good faith by the Board after consultation with the
independent certified public accountants of the Company, as the case may be.
"PROPERTY" means, with respect to any Person, any interest of
such Person in any kind of property or asset, whether real, personal or mixed,
tangible or intangible, excluding Capital Stock in any other Person.
"PURCHASE AGREEMENT" means the purchase agreement relating to the
Notes, dated July 18, 1996, among the Company and the Initial Purchasers.
"PURCHASE MONEY OBLIGATIONS" of any Person means any obligations
of such Person to any seller or any other Person incurred or assumed to finance
the construction and/or acquisition of real or personal property to be used in
the business of such Person or any of its Subsidiaries in an amount that is not
more than 100% of the cost of such property, and incurred within 180 days after
the date of such construction or acquisition (excluding accounts payable to
trade creditors incurred in the ordinary course of business).
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"RECORD DATE" means, for the interest payable on any Interest
Payment Date, the date specified in Section 2.11 hereof.
"REDEMPTION DATE" means, when used with respect to any Note or
part thereof to be redeemed hereunder, the date fixed for redemption of such
Notes pursuant to the terms of the Notes and this Indenture.
"REDEMPTION PRICE" means, when used with respect to any Note or
part thereof to be redeemed hereunder, the price fixed for redemption of such
Note pursuant to the terms of the Notes and this Indenture, plus accrued and
unpaid interest thereon, if any, and Liquidated Damages, if any, to the
Redemption Date.
"REGISTERED EXCHANGE OFFER" has the meaning set forth in the
Registration Rights Agreement.
"REGISTRAR" has the meaning set forth in Section 2.03 hereof.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement relating to the Notes, dated July 30, 1996, among the Company and the
Initial Purchasers, in substantially the form of Exhibit J hereto.
15
"REGULATION D" means Regulation D under the Securities Act
(including any successor regulation thereto), as it may be amended from time to
time.
"REGULATION S" means Regulation S under the Securities Act
(including any successor regulation thereto), as it may be amended from time to
time.
"REGULATION S-X" means Regulation S-X under the Securities Act
(including any successor regulation thereto), as it may be amended from time to
time.
"REPRESENTATIVE" means the trustee, agent or representative (if
any) for an issue of Senior Indebtedness or, if no such trustee, agent or
representative exists, the holder thereof.
"RESOLUTION" means a copy of a resolution certified by the
secretary or an assistant secretary of the Company to have been duly adopted by
the Board and to be in full force and effect on the date of such certification,
delivered to the Trustee.
"RESTRICTED PAYMENT" has the meaning set forth in Section 4.10
hereof.
"RULE 144" means Rule 144 under the Securities Act (including any
successor regulation thereto), as it may be amended from time to time.
"RULE 144A" means Rule 144A under the Securities Act (including
any successor regulation thereto), as it may be amended from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
Hill Corporation, or, if Standard & Poor's Ratings Group shall cease rating the
specified debt securities and such ratings business with respect thereto shall
have been transferred to a successor Person, such successor Person; PROVIDED
THAT if Standard & Poor's Ratings Group ceases rating the specified debt
securities and its ratings business with respect thereto shall not have been
transferred to any successor Person or such successor Person is Moody's, then
"S&P" shall mean any other nationally recognized rating agency (other than
Moody's) that rates the specified debt securities and that shall have been
designated by the Company in an Officers' Certificate.
"SECURITIES ACT" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"SENIOR BANK DEBT" means the Obligations outstanding under the
Credit Agreement.
"SENIOR INDEBTEDNESS" means, with respect to the Company, (i) the
Senior Bank Debt and (ii) any other Indebtedness permitted to be incurred by the
Company under the terms of this Indenture, unless the instrument under which
such Indebtedness is incurred expressly provides that it is subordinated in
right of payment to any Indebtedness for money borrowed. Notwithstanding
anything to the contrary in the foregoing, Senior Indebtedness will not include
(a) any liability for federal, state, local or other taxes owed or owing by the
Company, (b) any
16
Indebtedness of the Company to any of its Subsidiaries, Unrestricted
Subsidiaries or other Affiliates, (c) any trade payables or (d) any Indebtedness
to the extent that is incurred in violation of this Indenture. "Senior
Indebtedness" means, with respect to any Guarantor, any guarantee by such
Guarantor of Senior Indebtedness of the Company.
"SENIOR REVOLVING DEBT" means revolving credit borrowings and
letters of credit under the Credit Agreement and/or any successor facility or
facilities.
"SHELF REGISTRATION STATEMENT" has the meaning set forth in the
Registration Rights Agreement.
"SPECIAL RECORD DATE" means a date fixed by the Trustee pursuant
to Section 2.11 for the payment of Defaulted Interest.
"STATED MATURITY" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing for the repurchase
of such security at the option of the holder thereof upon the happening of any
contingency unless such contingency has occurred), and, when used with respect
to any installment of interest on such security, the fixed date on which such
installment of interest is due and payable.
"STERILE CONCEPTS" means Sterile Concepts Holdings, Inc., a
Virginia corporation.
"SUBORDINATED REORGANIZATION SECURITIES" has the meaning
specified in Section 10.02(a) hereof.
"SUBSIDIARY" means, with respect to any Person, (i) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of such Person (or a
combination thereof) and (ii) any partnership (a) the sole general partner or
the managing general partner of which is such Person or a Subsidiary of such
Person or (b) the only general partners of which are such Person or of one or
more Subsidiaries of such Person (or any combination thereof). Notwithstanding
the foregoing, an Unrestricted Subsidiary and all of its Subsidiaries shall not
be Subsidiaries of the Company for any purposes of this Indenture.
"TEMPORARY NOTES" has the meaning set forth in Section 2.09
hereof.
"TRADE PAYABLES" means, with respect to any Person, any accounts
payable or any Indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person arising in the ordinary course of business
of such Person in connection with the acquisition of goods or services.
17
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 (15
U.S.C. ss.ss. 77aaa-77bbbb) as in effect on the date of this Indenture except as
required by Section 9.04 hereof or if the Indenture is qualified under the Trust
Indenture Act, then as of the date of such qualification; PROVIDED that in the
event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939, as so amended.
"TRUST OFFICER" means any officer or assistant officer of the
Trustee (or a successor trustee) assigned by the Trustee (or a successor
trustee) to administer this Indenture.
"TRUSTEE" means the party named as such in the preamble to this
Indenture until a successor replaces it in accordance with the provisions of
this Indenture and, thereafter, means such successor Trustee.
"UNRESTRICTED SUBSIDIARY" means (i) any Person that (a) is
acquired or formed after the date of this Indenture and that is organized under
the laws of a jurisdiction other than the United States of America, any state
thereof or the District of Columbia, (b) at the time of acquisition or formation
shall be designated an Unrestricted Subsidiary by the Board in the manner
provided below and (c) would, but for such designation, be a Subsidiary of the
Company, and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board shall
make any such designation if (i) such Subsidiary does not, directly or
indirectly, own any Capital Stock or Indebtedness of, or own or hold any Lien on
any property of, the Company or any other Subsidiary of the Company that is not
a Subsidiary of the Subsidiary to be so designated; (ii) the amount of the
Investment by the Company or any of its Subsidiaries in such Unrestricted
Subsidiary would be permitted under Section 4.10 hereof as a Restricted Payment
after giving effect to the designation; and (iii) all Indebtedness of such
Unrestricted Subsidiary is Non-Recourse Debt. The Board may designate any
Unrestricted Subsidiary to be a Subsidiary; PROVIDED, HOWEVER, that immediately
after giving pro forma effect to such designation (I) the Company could incur
$1.00 of additional Indebtedness pursuant to the Consolidated Interest Coverage
Ratio test in Section 4.09 hereof and (II) no Default or Event of Default shall
have occurred and be continuing following such designation. Any such designation
by the Board shall be evidenced to the Trustee by promptly filing with the
Trustee a copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complies with the
foregoing provisions.
"U.S. GOVERNMENT OBLIGATIONS" means:
(i) securities that are (a) direct obligations of the United
States of America for the payment of which the full faith and credit of the
United States of America is pledged or (b) 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
(ii) depositary receipts issued by a bank (as defined in Section
3(a)(2) of the Securities Act) as custodian with respect to any U.S. Government
Obligation which is specified
18
in clause (i) above and held by such bank for the account of the holder of such
depositary receipt, or with respect to any specific payment of principal or
interest on any U.S. Government Obligation which is so specified and held,
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 depositary
receipt from any amount received by the custodian in respect of the U.S.
Government Obligation or the specific payment of principal or interest of the
U.S. Government Obligation evidenced by such depositary receipt.
"VOTING STOCK" of a corporation means all classes of Capital
Stock of such corporation then outstanding and normally entitled to vote in the
election of directors.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the product obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payments at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"WHOLLY OWNED SUBSIDIARY" of any Person means a Subsidiary of
such Person all of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) shall at the time be owned by
such Person or by one or more Wholly Owned Subsidiaries of such Person.
Unrestricted Subsidiaries shall not be included in the definition of Wholly
Owned Subsidiary for any purpose of this Indenture.
SECTION 1.02. INCORPORATION BY REFERENCE OF TRUST INDENTURE
ACT. (a) This Indenture is expressly made subject to the Trust Indenture Act
as if this Indenture were, on the Date hereof, subject to the Trust Indenture
Act under the provisions of such statute and such provisions are incorporated by
reference in this Indenture.
(b) Whenever this Indenture refers to a provision of the Trust
Indenture Act, the provision is incorporated by reference in and made a part of
this Indenture. The following Trust Indenture Act terms incorporated by
reference in this Indenture have the following meanings:
"indenture securities" means the Notes.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company, the
Guarantors, or other obligors on the Notes, if any.
19
All other Trust Indenture Act terms used or incorporated by
reference in this Indenture that are defined by the Trust Indenture Act, defined
by Trust Indenture Act reference to another statute or defined by Commission
rule have the meanings assigned to them therein.
SECTION 1.03. RULES OF CONSTRUCTION. Unless the context
otherwise requires:
(a) the words "herein," "hereof" and "hereunder," and other words
of similar import, refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision;
(b) "or" is not exclusive;
(c) "including" means "including without limitation";
(d) the principal amount of any noninterest bearing or other
discount security at any date shall be the principal amount thereof that
would be shown on a balance sheet of the issuer dated such date prepared
in accordance with GAAP; and
(e) when used with respect to the Notes, the term "principal
amount" shall mean the principal amount thereof at the Stated Maturity
of such principal amount.
SECTION 1.04. FORM OF DOCUMENTS DELIVERED TO TRUSTEE. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company or any
Guarantor may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such officer
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such certificate or opinion
or Opinion of Counsel may be based, insofar as it relates to factual matters,
upon a certificate or opinion of, or representations by, an officer or officers
of the Company, or such Guarantor, as the case may be, stating that the
information with respect to such factual matters is in the possession of the
Company, or such Guarantor, as the case may be, unless such officer or counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
20
SECTION 1.05. ACTS OF HOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such Holders
in person or by an agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 7.01)
conclusive in favor of the Trustee, the Company, and the Guarantors, if made in
the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by an acknowledgment of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than such signer's
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of the signer's authority. The fact and date of the execution
of any such instrument or writing, or the authority of the person executing the
same, may also be proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register,
and the ownership of beneficial interests in the Global Note shall be proved by
the records of the Depositary.
SECTION 1.06. SATISFACTION AND DISCHARGE. This Indenture shall
cease to be of further effect (except as to the rights of Holders under Sections
2.06, 2.07, 2.09, 4.02, 4.03 and 4.04 hereof) and the Trustee, on receipt of a
Company Order requesting such action, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture, when (a) either (i)
all outstanding Notes have been delivered to the Trustee for cancellation or
(ii) such Notes not theretofore delivered to the Trustee for cancellation have
become due and payable and the Company has irrevocably deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose an amount
sufficient to pay and discharge the entire indebtedness on such Notes, for
principal, premium, if any, and interest and Liquidated Damages, if any, to the
date of such deposit together with irrevocable instructions from the Company in
form and substance satisfactory to the Trustee directing the Trustee to apply
such funds to the payment thereof; (b) the Company has paid or caused to be paid
all other sums payable hereunder by the Company; and (c) the Company has
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that all factual and legal conditions precedent, respectively,
herein provided for relating to the satisfaction and discharge of this Indenture
have been complied with. Notwithstanding the satisfaction and discharge of this
Indenture pursuant to this Section 1.06, the obligations of the Company and the
Guarantors to the Trustee under Section 7.07 hereof, and, if
21
money shall have been deposited with the Trustee in trust for the Holders
pursuant to this Section 1.06, the obligations of the Trustee under this Section
1.06 and Section 4.03 hereof shall survive.
All money deposited with the Trustee pursuant to this Section
1.06 shall be held in trust and applied by it, in accordance with the provisions
of the Notes and this Indenture, to the payment, either directly or through any
Paying Agent, to the Persons entitled thereto, of the principal, premium, if
any, and interest and Liquidated Damages, if any, for the payment of which such
money has been deposited with the Trustee. If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with this
Section 1.06 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 Company's and the Guarantors'
obligations under this Indenture and the Notes shall be revived and reinstated
as though no deposit had occurred pursuant to this Section 1.06 until such time
as the Trustee or Paying Agent is permitted to apply all such money or U.S.
Government Obligations in accordance with this Section 1.06; PROVIDED, that if
the Company or the Guarantors have made any payment on any Notes because of the
reinstatement of its obligations, the Company or the Guarantors, as the case may
be, shall be subrogated to the rights of the Holders of such Notes to receive
such payment from the cash or U.S. Government Obligations held by the Trustee or
Paying Agent.
The Company shall pay and indemnify the Trustee against any tax,
fee or other charges imposed on or assessed against the U.S. Government
Obligations deposited pursuant to this Section 1.06 on the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of outstanding Notes.
ARTICLE II
THE NOTES
SECTION 2.01. FORM AND DATING. (a) The Initial Notes and the
certificate of authentication of the Trustee thereon shall be substantially in
the form of Exhibit A or Exhibit B hereto, as applicable, which are hereby
incorporated in and expressly made a part of this Indenture. The New Notes and
the certificate of authentication of the Trustee thereon shall be substantially
in the form of Exhibit C or Exhibit D hereto, as applicable, which are hereby
incorporated in and expressly made a part of this Indenture.
(b) The Notes may have such letters, numbers or other marks of
identification and such legends and endorsements, stamped, printed, lithographed
or engraved thereon, (i) as the Company may deem appropriate and as are not
inconsistent with the provisions of this Indenture, (ii) as may be required to
comply with this Indenture, any law or any rule of any securities exchange on
which the Notes may be listed and (iii) as may be necessary to conform to
customary usage. Each Note shall be dated the date of its authentication by the
Trustee. The Notes shall be issued only in fully registered form, without
coupons, in denominations of $1,000 and integral multiples thereof; PROVIDED
that Initial Certificated Notes originally purchased by or transferred to
Institutional Accredited Investors shall be subject to a minimum denomination of
$250,000. Definitive Notes shall be typed, printed, lithographed or engraved or
produced by any
22
combination of such methods or produced in any other manner permitted by the
rules of any securities exchange on which such Notes may be listed, all as
determined by the officers of the Company executing such Notes, as evidenced by
their execution of such Notes.
(c) Initial Notes offered and sold to QIBs in reliance on Rule
144A as provided in the Purchase Agreement shall be issued initially in the form
of a single, permanent global note in definitive, fully registered form, without
coupons, substantially in the form set forth in Exhibit A hereto and shall bear
the legends set forth in Section 2.01(e)(i), Section 2.01(e)(ii) and Section
2.01(e)(iii) hereof (the "Initial Global Note"). Upon issuance, such Initial
Global Note shall be registered in the name of the Depositary or its nominee,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided and deposited on behalf of the purchasers of the Initial Notes
represented thereby with the Trustee at its Corporate National Trust Office, as
custodian for the Depositary. Owners of beneficial interests in the Initial
Global Note shall be entitled to receive physical delivery of Certificated Notes
pursuant to Section 2.06(b)(ii). Initial Notes offered and sold to Institutional
Accredited Investors as provided in the Purchase Agreement shall be issued in
the form of a note in definitive, fully registered form, without coupons,
substantially in the form set forth in Exhibit B hereto and shall bear the
legend set forth in Section 2.01(e)(i) hereof, except as provided in Section
2.06(a) (such Notes together with interests in the Initial Global Note that are
subsequently transferred or exchanged pursuant to Sections 2.06(b)(ii),
2.06(b)(iii), 2.06(b)(iv) or 2.06(c), the "Initial Certificated Notes") Upon
issuance, any such Initial Certificated Note shall be duly executed by the
Company and authenticated by the Trustee as hereinafter provided. Upon transfer
of any Initial Certificated Note to a QIB pursuant to Section 2.06(b)(i) hereof,
such Initial Certificated Note may be exchanged for a beneficial interest in the
Initial Global Note, except as provided in Section 2.06(c).
(d) If the Initial Global Note is tendered in a Registered
Exchange Offer, it shall be exchanged for a single, permanent global note in
definitive, fully registered form, without coupons, substantially in the form
set forth in Exhibit C hereto and shall bear the legends set forth in Section
2.01(e)(ii) and Section 2.01(e)(iv) hereof (the "New Global Note"). Upon
issuance, such New Global Note shall be registered in the name of the Depositary
or its nominee, duly executed by the Company and authenticated by the Trustee as
hereinafter provided and deposited on behalf of the beneficial owners of the New
Notes represented thereby in accordance with the procedures of the Depositary.
If Initial Certificated Notes are tendered in a Registered
Exchange Offer, they will be exchanged for Certificated Notes in definitive,
fully registered form, without coupons and without legends, substantially in the
form set forth in Exhibit D hereto ("New Certificated Notes"). Upon issuance,
any such New Certificated Note shall be duly executed by the Company and
authenticated by the Trustee as hereinafter provided.
At the option of the Holder thereof, New Notes may be held either
in the form of a beneficial interest in the New Global Note or as New
Certificated Notes.
23
(e) The following legends shall appear on each Global Note and
each Certificated Note as indicated below:
(i) Except as provided in Section 2.06(a) hereof, each Initial
Global Note and Initial Certificated Note shall bear the following
legend (the "Private Placement Legend") on the face thereof:
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS NOTE MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT OR IN ACCORDANCE WITH AN
APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (SUBJECT TO THE DELIVERY OF SUCH EVIDENCE, IF ANY,
REQUIRED UNDER THE INDENTURE PURSUANT TO WHICH THIS NOTE IS
ISSUED) AND IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION.
(ii) Each Global Note shall bear the following legend on the face
thereof:
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO MAXXIM MEDICAL, INC. OR A
SUCCESSOR THEREOF OR THE REGISTRAR FOR REGISTRATION OF TRANSFER
OR EXCHANGE AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR SUCH OTHER ENTITY AS HAS BEEN REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS HAS BEEN
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
(iii) The Initial Global Note shall bear the following legend on
the face thereof:
TRANSFER OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, AND NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST
COMPANY OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND
TRANSFERS OF INTERESTS IN THIS GLOBAL NOTE SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.06 OF THE INDENTURE, DATED AS OF JULY 30, 1996, AMONG
MAXXIM MEDICAL, INC., AS ISSUER, AND MAXXIM MEDICAL, INC.
24
(DELAWARE), MAXXIM ACQUISITION CO., FABRITEK LA ROMANA, INC.,
MAXXIM MEDICAL CANADA, LIMITED, MEDICA B.V., AND MEDICA HOSPITAL
SUPPLIES, N.V. AS GUARANTORS, AND FIRST UNION NATIONAL BANK OF
NORTH CAROLINA, AS TRUSTEE, PURSUANT TO WHICH THIS NOTE WAS
ISSUED.
(iv) The New Global Note shall bear the following legend on the
face thereof:
TRANSFER OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, AND NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST
COMPANY OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE.
SECTION 2.02. EXECUTION AND AUTHENTICATION. The Notes may be
issued in two series, a series of Initial Notes and a series of New Notes. The
aggregate principal amount of Notes outstanding at any time shall not exceed
$100,000,000 except as provided in Section 2.07 hereof. The Notes shall be
executed on behalf of the Company by its Chief Executive Officer, President,
Chief Operating Officer, Treasurer or any Vice President, under its corporate
seal reproduced or imprinted on the Notes by facsimile or otherwise, and shall
be attested by the Company's Secretary or one of its Assistant Secretaries, in
each case by manual or facsimile signature.
The Notes shall be authenticated by manual signature of an
authorized signatory of the Trustee and shall not be valid for any purpose
unless so authenticated.
In case any officer of the Company whose signature shall have
been placed upon any of the Notes shall cease to be such officer of the Company
before authentication of such Notes by the Trustee and the issuance and delivery
thereof, such Notes may, nevertheless, be authenticated by the Trustee and
issued and delivered with the same force and effect as though such Person had
not ceased to be such officer of the Company.
The Trustee shall, upon receipt of a Company Order requesting
such action, authenticate (a) Initial Notes for original issue up to the
aggregate principal amount not to exceed $100,000,000 outstanding at any given
time, or (b) New Notes for issue pursuant to a Registered Exchange Offer for
Initial Notes in a principal amount equal to the principal amount of Initial
Notes exchanged in such Registered Exchange Offer. Such Company Order shall
specify the amount of Notes to be authenticated and the date on which, in the
case of clause (a) above, the Initial Notes or, in the case of clause (b) above,
the New Notes, are to be authenticated and shall further provide instructions
concerning registration, amounts for each Holder and delivery.
Upon the occurrence of any event specified in Section 2.06(c)
hereof, the Company shall execute and the Trustee shall authenticate and make
available for delivery to each beneficial owner identified by the Depositary, in
exchange for such beneficial owner's interest in the Initial Global Note or New
Global Note, as the case may be, Initial Certificated Notes or New
25
Certificated Notes, as the case may be, representing Notes theretofore
represented by the Initial Global Note or New Global Note, as the case may be.
A Note shall not be valid or entitled to any benefits under this
Indenture or obligatory for any purpose unless executed by the Company and
authenticated by the manual signature of one of the authorized signatories of
the Trustee as provided herein. Such signature upon any Note shall be conclusive
evidence, and the only evidence, that such Note has been duly authenticated and
delivered under this Indenture and is entitled to the benefits of this
Indenture.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate the Notes. Unless limited by the terms
of such appointment, an authenticating agent may authenticate the Notes whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. Any authenticating agent of the
Trustee shall have the same rights hereunder as any Registrar or Paying Agent.
Notwithstanding the foregoing, if any Note shall have been
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Note to the Trustee for cancellation as
provided in Section 2.10 together with a written statement (which need not
comply with Section 1.04 and need not be accompanied by an Opinion of Counsel)
stating that such Note has never been issued and sold by the Company, for all
purposes of this Indenture such Note shall be deemed never to have been
authenticated and delivered hereunder and shall not be entitled to the benefits
of this Indenture.
SECTION 2.03. REGISTRAR AND PAYING AGENT. The Company shall
maintain, pursuant to Section 4.02 hereof, an office or agency where the Notes
may be presented for registration of transfer or for exchange (the "Registrar"),
an office or agency where Notes may be presented for payment (the "Paying
Agent") and an office or agency where notices and demands to or upon the Company
in respect of the Notes and this Indenture may be served.
The Company shall cause to be kept at such office a register (the
"Note Register") in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Notes and of
transfers of Notes entitled to be registered or transferred as provided herein.
The Trustee, at its Corporate National Trust Office, is initially appointed
Registrar for the purpose of registering Notes and transfers of Notes as herein
provided. The Company may, upon written notice to the Trustee, change the
designation of the Trustee as Registrar and appoint another Person to act as
Registrar for purposes of this Indenture. If any Person other than the Trustee
acts as Registrar, the Trustee shall have the right at any time, upon reasonable
notice, to inspect or examine the Note Register and to make such inquiries of
the Registrar as the Trustee shall in its discretion deem necessary or desirable
in performing its duties hereunder.
The Company shall enter into an appropriate agency agreement with
any Person designated by the Company as Registrar or Paying Agent that is not a
party to this Indenture, which agreement shall incorporate the provisions of the
Trust Indenture Act and shall implement the provisions of this Indenture that
relate to such Registrar or Paying Agent. Prior to the
26
designation of any such Person, the Company shall, by written notice (which
notice shall include the name and address of such Person), inform the Trustee of
such designation. The Trustee, at its Corporate National Trust Office, is
initially appointed Paying Agent under this Indenture. If the Company fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such.
Subject to Section 2.06 hereof, upon surrender for registration
of transfer of any Note at an office or agency of the Company designated for
such purpose, the Company shall execute, and the Trustee shall authenticate and
make available for delivery, in the name of the designated transferee or
transferees, one or more new Initial Notes or New Notes, as the case may be, of
any authorized denomination or denominations, of like tenor and aggregate
principal amount, all as requested by the transferor.
Every Note presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company, the Trustee or the
Registrar) be duly endorsed, or be accompanied by a duly executed instrument of
transfer in form satisfactory to the Company, the Trustee and the Registrar, by
the Holder thereof or such Holder's attorney duly authorized in writing.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST. On or prior to
each due date of the principal, premium, if any, or any payment of interest or
Liquidated Damages, if any, with respect to any Note, the Company shall deposit
with the Paying Agent a sum sufficient to pay such principal, premium, if any,
or interest or Liquidated Damages, if any, when so becoming due.
The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that such Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money held by such Paying Agent for the
payment of principal, premium, if any, or interest or Liquidated Damages, if
any, with respect to the Notes, shall notify the Trustee of any default by the
Company in making any such payment and at any time during the continuance of any
such default, upon the written request of the Trustee, shall forthwith pay to
the Trustee all sums held in trust by such Paying Agent.
The Company at any time may require a Paying Agent to pay all
money held by it to the Trustee and to account for any funds disbursed by such
Paying Agent. Upon complying with this Section 2.04, the Paying Agent shall have
no further liability for the money delivered to the Trustee.
SECTION 2.05. GLOBAL NOTES. (a) So long as a Global Note is
registered in the name of the Depositary or its nominee, members of, or
participants in, the Depositary ("Agent Members") shall have no rights under
this Indenture with respect to the Global Note held on their behalf by the
Depositary or the Trustee as its custodian, and the Depositary may be treated by
the Company, the Guarantors, the Trustee and any agent of the Company, the
Guarantors or the Trustee as the absolute owner of such Global Note for all
purposes. Notwithstanding the foregoing, nothing herein shall (i) prevent the
Company, the Guarantors, the Trustee or any agent of the Company, the Guarantors
or the Trustee, from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or (ii) impair, as between the
27
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a Holder.
(b) The Holder of a Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests in such Global Note through Agent Members, to take any action which a
Holder is entitled to take under this Indenture or the Notes.
(c) Whenever, as a result of an optional redemption of Notes by
the Company, a Change of Control Offer, an Asset Sale Offer, a Registered
Exchange Offer or an exchange for Certificated Notes pursuant to the provisions
of Section 2.06(b) or Section 2.06(c) hereof, a Global Note is redeemed,
repurchased or exchanged in part, such Global Note shall be surrendered by the
Holder thereof to the Trustee who shall cause an adjustment to be made to
Schedule A thereof so that the principal amount of such Global Note will be
equal to the portion of such Global Note not redeemed, repurchased or exchanged
and shall thereafter return such Global Note to such Holder, PROVIDED that each
such Global Note shall be in a principal amount of $1,000 or an integral
multiple thereof.
SECTION 2.06. TRANSFER AND EXCHANGE. (a) By its acceptance of any
Initial Note represented by a certificate bearing the Private Placement Legend,
each Holder of, and beneficial owner of an interest in, such Initial Note
acknowledges the restrictions on transfer of such Initial Note set forth in the
Private Placement Legend and agrees that it will transfer such Initial Note only
in accordance with the Private Placement Legend. Upon the registration of
transfer, exchange or replacement of an Initial Note not bearing the Private
Placement Legend, the Trustee shall deliver an Initial Note or Initial Notes
that do not bear the Private Placement Legend. Upon the transfer, exchange or
replacement of an Initial Note bearing the Private Placement Legend, the Trustee
shall deliver an Initial Note or Initial Notes bearing the Private Placement
Legend, unless such legend may be removed from such Note as provided in this
Section 2.06(a). If the Private Placement Legend has been removed from an
Initial Note, as provided herein, no other Initial Note issued in exchange for
all or any part of such Initial Note shall bear such legend, unless the Company
has reasonable cause to believe that such other Initial Note represents a
"restricted security" within the meaning of Rule 144 and instructs the Trustee
in writing to cause a legend to appear thereon. Each Initial Note shall bear the
Private Placement Legend unless and until:
(i) a transfer of such Initial Note is made pursuant to
an effective Shelf Registration Statement, in which case the Private
Placement Legend shall be removed from such Initial Note so transferred
at the request of the Holder; or
(ii) there is delivered to the Company such satisfactory
evidence, which may include an opinion of independent counsel licensed
to practice law in the State of New York, as may reasonably be requested
by the Company confirming that neither such legend nor the restrictions
on transfer set forth therein are required to ensure that transfers of
such Initial Note will not violate the registration and prospectus
delivery requirements of the Securities Act; PROVIDED that the Trustee
shall not be required to determine (but
28
may rely on a determination made by the Company with respect to) the
sufficiency of any such evidence; and upon provision of such evidence,
the Trustee shall authenticate and deliver in exchange for such Initial
Note, an Initial Note or Initial Notes (representing the same aggregate
principal amount of the Initial Note being exchanged) without such
legend.
(b) SPECIAL TRANSFER PROVISIONS. The following provisions of this
paragraph (b) are applicable only to Initial Notes bearing the Private Placement
Legend:
(i) TRANSFERS TO QIBS. If the Holder of an Initial
Certificated Note wishes to transfer such Initial Certificated Note to a
QIB pursuant to Rule 144A, such Holder may, subject to the rules and
procedures of the Depositary, cause the exchange of such Initial
Certificated Note for an equivalent beneficial interest in the Initial
Global Note. Upon receipt by the Trustee, as Registrar, at its Corporate
National Trust Office of (A) such Initial Certificated Note, duly
endorsed as provided herein, (B) instructions from such Holder directing
the Trustee, as Registrar, to credit or cause to be credited a
beneficial interest in the Initial Global Note equal to the principal
amount of the Initial Certificated Note to be exchanged, such
instructions to contain information regarding the participant account
with the Depositary to be credited with such increase and (C) a
certificate in the form of Exhibit E attached hereto from the
transferor, then the Trustee, as Registrar, shall cancel or cause to be
canceled such Initial Certificated Note and shall instruct the
Depositary to increase or cause to be increased such Initial Global Note
by the aggregate principal amount of the beneficial interest in the
Initial Certificated Note to be exchanged and to credit or cause to be
credited to the account of the Person specified in such instructions a
beneficial interest in the Initial Global Note equal to the principal
amount of the Initial Certificated Note so canceled;
(ii) TRANSFERS TO INSTITUTIONAL ACCREDITED INVESTORS AND
EXCHANGE OF INTERESTS IN GLOBAL NOTES.
(A) If a Holder of a beneficial interest in the Initial
Global Note deposited with the Depositary or the Trustee as
custodian for the Depositary wishes at any time to transfer its
interest in such Initial Global Note to an Institutional
Accredited Investor or to exchange such interest for an Initial
Certificated Note evidencing such interest, such Holder may,
subject to the rules and procedures of the Depositary, cause the
transfer or exchange of such interest for one or more Initial
Certificated Notes of any authorized denomination or
denominations and of the same aggregate principal amount. Upon
receipt by the Trustee, as Registrar, at its Corporate National
Trust Office of (I) instructions from the Depositary directing
the Trustee, as Registrar, to authenticate and deliver one or
more Initial Certificated Notes of the same aggregate principal
amount as the beneficial interest in the Initial Global Note to
be transferred or exchanged, such instructions to contain the
name or names of the designated transferee or transferees, if
any, the authorized denomination or denominations of the Initial
Certificated Notes to be so issued and appropriate delivery
instructions and (II) in the case of a transfer,
29
(x) a certificate in the form of Exhibit F attached hereto from
the transferor, (y) a certificate in the form of Exhibit G
attached hereto from the transferee and (z) such other
certifications, legal opinions or other information as the
Company or the Trustee may reasonably require to confirm that
such transfer is being made pursuant to an exemption from, or in
a transaction not subject to, the registration requirements of
the Securities Act, then the Trustee, as Registrar, will instruct
the Depositary to reduce or cause to be reduced such Initial
Global Note by the aggregate principal amount of the beneficial
interest therein to be exchanged or transferred and to debit or
cause to be debited from the account of the Person making such
exchange or transfer the beneficial interest in the Initial
Global Note that is being exchanged or transferred, and
concurrently with such reduction and debit the Company shall
execute, and the Trustee shall authenticate and deliver, one or
more Initial Certificated Notes of the same aggregate principal
amount in accordance with the instructions referred to above; and
(B) if a Holder of an Initial Certificated Note wishes to
transfer such Note to an Institutional Accredited Investor, such
Holder may, subject to the restrictions on transfer set forth
herein and in such Initial Certificated Note, cause the exchange
of such Initial Certificated Note for one or more Initial
Certificated Notes of any authorized denomination or
denominations and of the same aggregate principal amount. Upon
receipt by the Trustee, as Registrar, at its Corporate National
Trust Office of (I) such Initial Certificated Note, duly endorsed
as provided herein, (II) instructions from such Holder directing
the Trustee, as Registrar, to authenticate and deliver one or
more Initial Certificated Notes of the same aggregate principal
amount as the Initial Certificated Notes to be exchanged, such
instructions to contain the name or names of the designated
transferee or transferees, the authorized denomination or
denominations of the Initial Certificated Notes to be so issued
and appropriate delivery instructions, (III) a certificate in the
form of Exhibit F attached hereto from the transferor, (IV) a
certificate in the form of Exhibit G attached hereto from the
transferee and (V) such other certifications, legal opinions or
other information as the Company or the Trustee may reasonably
require to confirm that such transfer is being made pursuant to
an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act, then the
Trustee, as Registrar, shall cancel or cause to be canceled such
Initial Certificated Note and concurrently therewith, the Company
shall execute, and the Trustee shall authenticate and deliver,
one or more Initial Certificated Notes of the same aggregate
principal amount, in accordance with the instructions referred to
above;
(iii) TRANSFERS TO NON-U.S. PERSONS. (A) If a Holder of a
beneficial interest in the Initial Global Note deposited with the
Depositary or the Trustee as custodian for the Depositary wishes
at any time to transfer its interest in such Initial Global Note
to a Non-U.S. Person pursuant to Regulation S who wishes to take
delivery thereof in the form of a Certificated Note, such Holder
may, subject to the rules and procedures of the Depositary, cause
the exchange of such interest
30
for one or more Initial Certificated Notes of any authorized
denomination or denominations and of the same aggregate principal
amount. Upon receipt by the Trustee, as Registrar, at its
Corporate National Trust Office of (I) instructions from the
Depositary directing the Trustee, as Registrar, to authenticate
and deliver one or more Initial Certificated Notes of the same
aggregate principal amount as the beneficial interest in the
Initial Global Note to be exchanged, such instructions to contain
the name or names of the designated transferee or transferees,
the authorized denomination or denominations of the Initial
Certificated Notes to be so issued and appropriate delivery
instructions, (II) a certificate in the form of Exhibit H
attached hereto from the transferor and (III) a certificate in
the form of Exhibit I attached hereto from the transferee, then
the Trustee, as Registrar, will instruct the Depositary to reduce
or cause to be reduced such Initial Global Note by the aggregate
principal amount of the beneficial interest therein to be
exchanged and to debit or cause to be debited from the account of
the Person making such transfer the beneficial interest in the
Initial Global Note that is being transferred, and concurrently
with such reduction and debit the Company shall execute, and the
Trustee shall authenticate and deliver, one or more Initial
Certificated Notes of the same aggregate principal amount in
accordance with the instructions referred to above; and
(B) if a Holder of an Initial Certificated Note wishes to
transfer such Note to a Non-U.S. Person pursuant to Regulation S
who wishes to take delivery thereof in the form of a Certificated
Note, such Holder may, subject to the restrictions on transfer
set forth herein and in such Initial Certificated Note, cause the
exchange of such Initial Certificated Note for one or more
Initial Certificated Notes of any authorized denomination or
denominations and of the same aggregate principal amount. Upon
receipt by the Trustee, as Registrar, at its Corporate National
Trust Office of (I) such Initial Certificated Note, duly endorsed
as provided herein, (II) instructions from such Holder directing
the Trustee, as Registrar, to authenticate and deliver one or
more Initial Certificated Notes of the same aggregate principal
amount as the Initial Certificated Notes to be exchanged, such
instructions to contain the name or names of the designated
transferee or transferees, the authorized denomination or
denominations of the Initial Certificated Notes to be so issued
and appropriate delivery instructions, (III) a certificate in the
form of Exhibit H attached hereto from the transferor and (IV) a
certificate in the form of Exhibit I attached hereto from the
transferee, then the Trustee, as Registrar, shall cancel or cause
to be canceled such Initial Certificated Note and concurrently
therewith, the Company shall execute, and the Trustee shall
authenticate and deliver, one or more Initial Certificated Notes
of the same aggregate principal amount, in accordance with the
instructions referred to above;
(iv) TRANSFERS PURSUANT TO OTHER EXEMPTIONS. (A) If a
Holder of a beneficial interest in the Initial Global Note
deposited with the Depositary or the Trustee as custodian for the
Depositary wishes at any time to transfer its interest
31
in such Initial Global Note pursuant to another applicable
exemption from the registration requirements of the Securities
Act, such Holder may, subject to the rules and procedures of the
Depositary, cause the exchange of such interest for one or more
Initial Certificated Notes of any authorized denomination or
denominations and of the same aggregate principal amount. Upon
receipt by the Trustee, as Registrar, at its Corporate National
Trust Office of (I) instructions from the Depositary directing
the Trustee, as Registrar, to authenticate and deliver one or
more Initial Certificated Notes of the same aggregate principal
amount as the beneficial interest in the Initial Global Note to
be exchanged, such instructions to contain the name or names of
the designated transferee or transferees, the authorized
denomination or denominations of the Initial Certificated Notes
to be so issued and appropriate delivery instructions and (II)
such certifications, legal opinions or other information as the
Company or the Trustee may reasonably require to confirm that
such transfer is being made pursuant to an exemption from, or in
a transaction not subject to, the registration requirements of
the Securities Act, then the Trustee, as Registrar, will instruct
the Depositary to reduce or cause to be reduced such Initial
Global Note by the aggregate principal amount of the beneficial
interest therein to be exchanged and to debit or cause to be
debited from the account of the Person making such transfer the
beneficial interest in the Initial Global Note that is being
transferred, and concurrently with such reduction and debit the
Company shall execute, and the Trustee shall authenticate and
deliver, one or more Initial Certificated Notes of the same
aggregate principal amount in accordance with the instructions
referred to above; and
(B) if a Holder of a Initial Certificated Note wishes to
transfer such Initial Certificated Note pursuant to another
applicable exemption from the registration requirements of the
Securities Act, such Holder may, subject to the restrictions on
transfer set forth herein and in such Initial Certificated Note,
cause the exchange of such Initial Certificated Note for one or
more Initial Certificated Notes of any authorized denomination or
denominations and of the same aggregate principal amount. Upon
receipt by the Trustee, as Registrar, at its Corporate National
Trust Office of (I) such Initial Certificated Note, duly endorsed
as provided herein, (II) instructions from such Holder directing
the Trustee, as Registrar, to authenticate and deliver one or
more Initial Certificated Notes of the same aggregate principal
amount as the Initial Certificated Notes to be exchanged, such
instructions to contain the name or authorized denomination or
denominations of the Initial Certificated Notes to be so issued
and appropriate delivery instructions and (III) such
certifications, legal opinions or other information as the
Company or the Trustee may reasonably require to confirm that
such transfer is being made pursuant to an exemption from, or in
a transaction not subject to, the registration requirements of
the Securities Act, then the Trustee, as Registrar, shall cancel
or cause to be canceled such Initial Certificated Note and
concurrently therewith, the Company shall execute, and the
Trustee shall authenticate and deliver, one or more Initial
Certificated Notes of the same aggregate principal amount, in
accordance with the instructions referred to above.
32
The Company shall deliver to the Trustee, and the Trustee shall retain for two
years, copies of all documents received pursuant to this Section 2.06(b). The
Company shall have the right to inspect and make copies of all such documents at
any reasonable time upon the giving of reasonable written notice to the Trustee.
(c) The Initial Global Note or New Global Note, as the case may
be, shall be exchanged by the Company for one or more Initial Certificated Notes
or New Certificated Notes, as the case may be, if (i) the Depositary has
notified the Company that it is unwilling or unable to continue as, or ceases to
be, a clearing agency registered under Section 17A of the Exchange Act and a
successor to the Depositary registered as a clearing agency under Section 17A of
the Exchange Act is not able to be appointed by the Company within 90 calendar
days, or (ii) the Depositary is at any time unwilling or unable to continue as
Depositary and a successor to the Depositary is not able to be appointed by the
Company within 90 calendar days, or (iii) the Company, at its option, notifies
the Trustee in writing that it elects to cause the issuance of Notes in the form
of Certificated Notes. If an Event of Default occurs and is continuing, the
Company shall, at the request of the Holder thereof, exchange all or part of the
Initial Global Note or New Global Note, as the case may be, for one or more
Initial Certificated Notes or New Certificated Notes, as the case may be;
PROVIDED that the principal amount of each of such Initial Certificated Notes or
New Certificated Notes, as the case may be, and such Global Note, after such
exchange, shall be $1,000 or an integral multiple thereof. Whenever a Global
Note is exchanged as a whole for one or more Initial Certificated Notes or New
Certificated Notes, as the case may be, it shall be surrendered by the Holder
thereof to the Trustee for cancellation. Whenever a Global Note is exchanged in
part for one or more Initial Certificated Notes or New Certificated Notes, as
the case may be, it shall be surrendered by the Holder thereof to the Trustee
and the Trustee shall make the appropriate notations thereon pursuant to Section
2.05(c) hereof. All Initial Certificated Notes or New Certificated Notes, as the
case may be, issued in exchange for a Global Note or any portion thereof shall
be registered in such names, and delivered, as the Depositary shall instruct the
Trustee. Any Initial Certificated Notes issued pursuant to this Section 2.06(c)
shall include the Private Placement Legend, except as set forth in Section
2.06(a) hereof.
(d) Any Initial Notes that are presented to the Registrar for
exchange pursuant to a Registered Exchange Offer shall be exchanged for New
Notes of equal principal amount upon surrender to the Registrar of the Initial
Notes to be exchanged in accordance with the terms of the Registered Exchange
Offer; PROVIDED that the Initial Notes so surrendered for exchange are
accompanied by a letter of transmittal and duly endorsed or accompanied by a
written instrument of transfer in form satisfactory to the Company, the Trustee
and the Registrar and duly executed by the Holder thereof or such Holder's
attorney who shall be duly authorized in writing to execute such document on
behalf of such Holder. Whenever any Initial Notes are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver to the surrendering Holder thereof, New Notes in the same aggregate
principal amount as the Initial Notes so surrendered.
(e) A Holder may transfer a Note only upon the surrender of such
Note for registration of transfer. No such transfer shall be effected until, and
the transferee shall succeed
33
to the rights of a Holder only upon, final acceptance and registration of the
transfer in the Note Register by the Registrar. When Notes are presented to the
Registrar with a request to register the transfer of, or to exchange, such
Notes, the Registrar shall register the transfer or make such exchange as
requested if its requirements for such transactions and any applicable
requirements hereunder are satisfied. To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate
Certificated Notes at the Registrar's request.
(f) The Company shall not be required to make and the Registrar
need not register the transfer or exchange of Certificated Notes or portion
thereof selected for redemption (except, in the case of a Certificated Note to
be redeemed in part, the portion of such Note not to be redeemed) or any
Certificated Notes for a period of 15 calendar days before a selection of Notes
to be redeemed.
(g) No service charge shall be made for any registration of
transfer or exchange of Notes, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer of Notes (other than in respect of
a Registered Exchange Offer, except as provided in the Registration Rights
Agreement).
(h) All Notes issued upon any registration of transfer or
exchange pursuant to the terms of this Indenture will evidence the same debt and
will be entitled to the same benefits under this Indenture as the Notes
surrendered for such registration of transfer or exchange.
(i) Any Holder of a Global Note shall, by acceptance of such
Global Note, agree that transfers of beneficial interests in such Global Note
may be effected only through a book-entry system maintained by such Holder (or
its agent), and that ownership of a beneficial interest in the Notes represented
thereby shall be required to be reflected in book-entry form. Transfers of a
Global Note shall be limited to transfers in whole and not in part, to the
Depositary, its successors, and their respective nominees. Interests of
beneficial owners in a Global Note shall be transferred in accordance with the
rules and procedures of the Depositary (or its successors), which shall, in the
case of the Initial Global Note, include restrictions designed to ensure that
the beneficial owners of such Initial Global Note are QIBs.
SECTION 2.07. REPLACEMENT NOTES. If any mutilated Note is
surrendered to the Trustee, the Company shall execute and upon its written
request the Trustee shall authenticate and make available for delivery, in
exchange for any such mutilated Note, a new Note containing identical provisions
and of like principal amount, bearing a number not contemporaneously
outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Note and
(ii) such security or indemnity as may be required by them to save either of
them and any agent of each of them harmless, then, in the absence of notice to
the Company or the Trustee that such Note has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and make available for delivery, in lieu of any such destroyed,
lost or stolen Note, a new Note
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containing identical provisions and of like principal amount, bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Note has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Note, pay such Note.
Upon the issuance of any new Note under this Section 2.07, the
Company may require the payment by the Holder of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee) connected
therewith.
Every new Note issued pursuant to this Section 2.07 in lieu of
any destroyed, lost or stolen Note shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Note shall be at any time enforceable by anyone, and shall be entitled to
all the benefits of this Indenture equally and proportionately with any and all
other Notes duly issued hereunder.
The provisions of this Section 2.07 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
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, those paid pursuant to Section 2.07
hereof and those described in this Section 2.08 as not outstanding. A Note does
not cease to be outstanding because the Company or an Affiliate of the Company
holds such Note.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases
to be outstanding unless the Trustee and the Company receive proof satisfactory
to them that such replaced Note is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance
with this Indenture, on a redemption date or Maturity date money sufficient to
pay all principal, premium, if any, and interest and Liquidated Damages, if any,
payable on that date with respect to the Notes (or portions thereof) to be
redeemed or maturing, as the case may be, then on and after that date such Notes
(or such portions thereof) shall cease to be outstanding and interest on them
shall cease to accrue.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent or any
amendment, modification or other change to this Indenture, Notes held or
beneficially owned by the Company, any Subsidiary of the Company or any of their
respective Affiliates or by agents of any of the foregoing shall be disregarded,
except that for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent or any amendment,
modification or other change to this Indenture, only Notes which a Trust Officer
actually knows are so owned shall be so
35
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 such
pledgee's right so to act with respect to the Notes and that the pledgee is not
the Company, any Subsidiary of the Company, any Unrestricted Subsidiary or any
of their respective Affiliates or any of their agents.
SECTION 2.09. TEMPORARY NOTES. Pending the preparation of
definitive Notes, the Company may execute, and the Trustee shall authenticate,
temporary notes ("Temporary Notes") which are printed, lithographed, or
otherwise produced, substantially of the tenor of the definitive Notes in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officer executing the Notes may
reasonably determine, as conclusively evidenced by such officer's execution of
such Notes.
If Temporary Notes are issued, the Company shall cause definitive
Notes to be prepared without unreasonable delay. After the preparation of
definitive Notes, the Temporary Notes shall be exchangeable for definitive Notes
upon surrender of the Temporary Notes to the Trustee, without charge to the
Holder. Until so exchanged, Temporary Notes will evidence the same debt and will
be entitled to the same benefits under this Indenture as the definitive Notes in
lieu of which they have been issued.
SECTION 2.10. CANCELLATION. The Company at any time may deliver
Notes to the Trustee for prompt cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Notes surrendered to them for registration of
transfer, exchange, purchase or payment. The Trustee shall cancel all Notes
surrendered for registration of transfer, exchange, purchase, payment or
cancellation and shall return such canceled Notes to the Company. The Company
may not issue new Notes to replace Notes it has redeemed or paid or that have
been delivered to the Trustee for cancellation.
SECTION 2.11. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Interest on any Note which is payable, and is punctually paid or duly provided
for, on any Interest Payment Date shall be paid to the Person in whose name such
Note is registered at the close of business on the Record Date for such interest
payment, which shall be the January 15 or July 15 (whether or not a Business
Day) immediately preceding such Interest Payment Date.
Any interest on any Note which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the registered
Holder on the relevant Record Date, and, except as hereinafter provided, such
Defaulted Interest, and any interest payable on such Defaulted Interest, may be
paid by the Company, at its election, as provided in clause (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted
Interest, and any interest payable on such Defaulted Interest, to the Persons in
whose names the Notes are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on the Notes and the date of
the proposed payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest
36
or shall make arrangements satisfactory to the Trustee for such deposit prior to
the date of the proposed payment, such money when deposited to be held in trust
for the benefit of the Persons entitled to such Defaulted Interest as provided
in this Section 2.11(a). Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more than 15
calendar days and not less than 10 calendar days prior to the date of the
proposed payment and not less than 10 calendar days after the receipt by the
Trustee of the notice of the proposed payment. The Trustee shall promptly notify
the Company of such Special Record Date and, in the name and at the expense of
the Company, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be sent, first-class mail,
postage prepaid, to each Holder at such Holder's address as it appears in the
Note Register, not less than 10 calendar days prior to such Special Record Date.
Notice of the proposed payment of such Defaulted Interest and the Special Record
Date therefor having been mailed as aforesaid, such Defaulted Interest shall be
paid to the Persons in whose names the Notes are registered at the close of
business on such Special Record Date and shall no longer be payable pursuant to
the following clause (b); or
(b) The Company may make payment of any Defaulted Interest, and
any interest payable on such Defaulted Interest, on the Notes in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Notes may be listed, and upon such notice as may be required by
such exchange, if, after notice given by the Company to the Trustee of the
proposed payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section 2.11, each
Note delivered under this Indenture upon registration of transfer of, or in
exchange for, or in lieu of, any other Note, shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Note.
SECTION 2.12. COMPUTATION OF INTEREST. Interest on the Notes
shall be computed on the basis of a 360-day year of twelve 30-day months.
SECTION 2.13. PERSONS DEEMED OWNERS. Prior to the due
presentation for registration of transfer of any Note, the Company, the Trustee,
the Paying Agent, the Registrar or any co-registrar may deem and treat the
person in whose name such Note is registered as the absolute owner of such Note
for the purpose of receiving payment of principal of, premium, if any, and
interest and Liquidated Damages, if any, on such Note and for all other purposes
whatsoever, whether or not such Note is overdue, and none of the Company, the
Trustee, the Paying Agent, the Registrar or any co-Registrar shall be affected
by notice to the contrary.
SECTION 2.14. CUSIP NUMBERS. The Company, in issuing the Notes,
may use a "CUSIP" number for each series of Notes and, if so, the Trustee shall
use the relevant CUSIP number in any notices to Holders as a convenience to such
Holders; PROVIDED that any such notice may state that no representation is made
as to the correctness or accuracy of the CUSIP number printed in the notice or
on the Notes and that reliance may be placed only on the other
37
identification numbers printed on the Notes. The Company shall promptly notify
the Trustee of any change in any CUSIP number used.
ARTICLE III
REDEMPTION
SECTION 3.01. NOTICE TO TRUSTEE. If the Company elects to redeem
Notes pursuant to the optional redemption provisions thereof it shall notify the
Trustee in writing of the Redemption Date and the principal amount of Notes to
be redeemed. The Company shall give each such notice to the Trustee at least 45
calendar days prior to the Redemption Date unless the Trustee consents to a
shorter period. Such notice shall be accompanied by an Officers' Certificate and
an Opinion of Counsel from the Company to the effect that such redemption will
comply with any conditions to such redemption set forth herein and in the Notes.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED. If less than all
the Notes are to be redeemed at any time, the Trustee shall select the Notes to
be redeemed by such method as the Trustee shall deem fair and appropriate and
that complies with the requirements of the principal national securities
exchange, if any, on which the Notes are listed, or if the Notes are not so
listed, on a PRO RATA basis. In selecting Notes to be redeemed pursuant to this
Section 3.02, the Trustee shall make such adjustments, reallocations and
eliminations as it shall deem proper so that the principal amount of each Note
to be redeemed shall be $1,000 or an integral multiple thereof, by increasing,
decreasing or eliminating any amount less than $1,000 which would be allocable
to any Holder. Provisions of this Indenture that apply to Notes called for
redemption also apply to portions of Notes called for redemption. The Trustee
shall notify the Company promptly of the Notes or portions of Notes to be
redeemed.
SECTION 3.03. NOTICE OF REDEMPTION. At least 30 calendar days but
not more than 60 calendar days before a Redemption Date, the Company shall send
a notice of redemption, first class mail, postage prepaid, to Holders to be
redeemed at the addresses of such Holders as they appear in the Note Register.
The notice shall identify the Notes to be redeemed (including
CUSIP number) and shall state:
(a) the Redemption Date;
(b) the Redemption Price (and shall specify the portion of such
Redemption Price that constitutes the amount of accrued and unpaid interest and
Liquidated Damages to be paid, if any);
(c) the name and address of the Paying Agent;
(d) that the Notes called for redemption must be surrendered to
the Paying Agent to collect the Redemption Price;
38
(e) if any Global Note is being redeemed in part, the portion of
the principal amount of such Note to be redeemed and that, after the Redemption
Date, the Global Note, with a notation on Schedule A thereof adjusting the
principal amount thereof to be equal to the unredeemed portion, will be returned
to the Holder thereof;
(f) if any Certificated Note is being redeemed in part, the
portion of the principal amount of such Note to be redeemed and that, after the
Redemption Date, a new Certificated Note or Certificated Notes in principal
amount equal to the unredeemed portion will be issued;
(g) if fewer than all the outstanding Notes are to be redeemed,
the identification and principal amounts of the particular Notes to be redeemed;
(h) that, unless the Company defaults in making the redemption
payment, interest on the Notes (or portions thereof) called for redemption shall
cease and such Notes (or portions thereof) shall cease to accrue interest on and
after the Redemption Date;
(i) the paragraph of the Notes pursuant to which the Notes are
being called for redemption; and
(j) any other information necessary to enable Holders to comply
with the notice of redemption.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by this
Section 3.03 in a timely manner.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION. Once notice of
redemption is mailed, Notes called for redemption shall become due and payable
on the Redemption Date and at the Redemption Price stated in such notice. Upon
surrender to the Paying Agent, such Notes shall be paid at the Redemption Price
stated in such notice. Failure to give notice or any defect in the notice to any
Holder shall not affect the validity of the notice to any other Holder.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE. On or prior to 10:00
a.m., New York City time, on each Redemption Date, the Company shall deposit
with the Paying Agent (or, if the Company, one of its Subsidiaries or any of
their Affiliates is the Paying Agent, the Paying Agent shall segregate and hold
in trust for the benefit of the Holders) money, in federal or other immediately
available funds, sufficient to pay the Redemption Price on all Notes or portions
thereof to be redeemed on that date other than Notes or portions of Notes called
for redemption on such date which have been delivered by the Company to the
Trustee for cancellation.
So long as the Company complies with the preceding paragraph and
the other provisions of this Article III, interest on the Notes or portions
thereof to be redeemed on the applicable Redemption Date shall cease to accrue
from and after such date and such Notes or portions thereof shall be deemed not
to be entitled to any benefit under this Indenture except to receive payment of
the Redemption Price on the Redemption Date (subject to the right of each Holder
of record on the relevant Record Date to receive interest due on the relevant
Interest
39
Payment Date). If any Note called for redemption shall not be so paid upon
surrender for redemption, then, from the Redemption Date until such Redemption
Price is paid, interest shall be paid on the unpaid principal and premium and,
to the extent permitted by law, on any accrued but unpaid interest thereon, in
each case at the rate prescribed therefor by such Notes.
SECTION 3.06. NOTES REDEEMED IN PART. (a) Upon surrender and
cancellation of a Certificated Note that is redeemed in part, the Company shall
issue and the Trustee shall authenticate and make available for delivery to the
surrendering Holder (at the Company's expense) a new Certificated Note equal in
principal amount to the unredeemed portion of the Certificated Note surrendered
and canceled, PROVIDED THAT each such Certificated Note shall be in a principal
amount of $1,000 or an integral multiple thereof.
(b) Upon surrender of a Global Note that is redeemed in part, the
Paying Agent shall forward such Global Note to the Trustee who shall make a
notation on Schedule A thereof to reduce the principal amount of such Global
Note to an amount equal to the unredeemed portion of such Global Note, as
provided in Section 2.05(c) hereof.
ARTICLE IV
COVENANTS
SECTION 4.01. PAYMENT OF NOTES. The Company shall promptly pay
the principal of, premium, if any, and interest and Liquidated Damages, if any,
on, the Notes on the dates and in the manner provided in the Notes and in this
Indenture. Principal, premium, interest and overdue Liquidated Damages shall be
considered paid on the date due if, on such date, the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal, premium, interest and Liquidated Damages then due.
To the extent lawful, the Company shall pay interest on overdue
principal, overdue premium, Defaulted Interest and Liquidated Damages (without
regard to any applicable grace period) at the interest rate borne on the Notes.
The Company's obligation pursuant to the previous sentence shall apply whether
such overdue amount is due at its Stated Maturity, as a result of the Company's
obligations pursuant to Sections 3.05, Section 4.07 or Section 4.08 hereof, or
otherwise.
All payments with respect to a Global Note or a Certificated Note
(including principal, premium, if any, interest and Liquidated Damages, if any)
the Holders of whom have given wire transfer instructions to the Company will be
required to be made by wire transfer of immediately available funds to the
account or (in the case of a Global Note) accounts specified by the Holders
thereof or, if no such account is specified, by sending via first-class mail,
postage prepaid, a check to each such Holders' registered address.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY. The Company
shall maintain in the Borough of Manhattan, The City of New York, an office or
agency where Notes may be presented or surrendered for payment, where Notes may
be surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the
40
Notes and this Indenture may be served, which office shall be initially the
Corporate National Trust Office. The Company shall give prompt written notice to
the Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate National Trust Office of the Trustee, and the Company hereby appoints
the Trustee its agent to receive all presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more
other offices or agencies (in or outside of The City of New York) where the
Notes may be presented or surrendered for any or all of such purposes, and may
from time to time rescind such designations; PROVIDED that no such designation
or rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in The City of New York for such purposes. The
Company shall give prompt written notice to the Trustee of any such designation
and any change in the location of any such other office or agency.
The Company hereby designates the Corporate National Trust Office
of the Trustee as one such office or agency of the Company in accordance with
Section 2.03 hereof.
SECTION 4.03. MONEY FOR THE NOTE PAYMENTS TO BE HELD IN TRUST. If
the Company, any Subsidiary of the Company or any of their respective Affiliates
shall at any time act as Paying Agent with respect to the Notes, such Paying
Agent shall, on or before each due date of the principal of, premium, if any, or
interest or Liquidated Damages, if any, on any of the Notes, segregate and hold
in trust for the benefit of the Persons entitled thereto money sufficient to pay
the principal, premium, if any, or interest or Liquidated Damages, if any, so
becoming due until such money shall be paid to such Persons or otherwise
disposed of as herein provided, and shall promptly notify the Trustee of its
action or failure so to act.
Whenever the Company shall have one or more Paying Agents with
respect to the Notes, it shall, prior to or on each due date of the principal
of, premium, if any, or interest or Liquidated Damages, if any, on any of the
Notes, deposit with a Paying Agent a sum sufficient to pay the principal,
premium, if any, or interest or Liquidated Damages, if any, so becoming due,
such sum to be held in trust for the benefit of the Persons entitled to such
principal, premium or interest or Liquidated Damages, if any, and (unless such
Paying Agent is the Trustee) the Paying Agent shall promptly notify the Trustee
of the Company's action or failure so to act.
SECTION 4.04. CORPORATE EXISTENCE. Subject to the provisions
of Article V hereof, the Company shall do or cause to be done all things
necessary to preserve and keep in full force and effect the corporate existence,
rights (charter and statutory) and franchises of the Company and each of its
Subsidiaries; PROVIDED that the Company and any such Subsidiary shall not be
required to preserve the corporate existence of any such Subsidiary or any such
right or franchise if the Board shall determine that the preservation thereof is
no longer desirable in the conduct of the business of the Company and that the
loss thereof is not disadvantageous in any material respect to the Holders.
41
SECTION 4.05. MAINTENANCE OF PROPERTY. The Company shall cause
all Property used or useful in the conduct of its business or the business of
any of its Subsidiaries to be maintained and kept in good condition, repair and
working order and supplied with all necessary equipment and shall cause to be
made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as, in the judgment of the Company, may be necessary so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times; PROVIDED that nothing in this Section 4.05 shall prevent
the Company from discontinuing the operation or maintenance of any of such
Property if such discontinuance is, in the judgment of the Company, desirable in
the conduct of its business or the business of any of its Subsidiaries and not
disadvantageous in any material respect to the Holders.
SECTION 4.06. PAYMENT OF TAXES AND OTHER CLAIMS. The Company
shall pay or discharge or cause to be paid or discharged, before the same shall
become delinquent, (a) all taxes, assessments and governmental charges levied or
imposed upon the Company or any of its Subsidiaries or upon the income, profits
or Property of the Company or any of its Subsidiaries and (b) all lawful claims
for labor, materials and supplies which, if unpaid, might by law become a Lien
upon the Property of the Company or any of its Subsidiaries; PROVIDED that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount, applicability
or validity is being contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP or other appropriate provision
has been made.
SECTION 4.07. REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE
OF CONTROL. (a) Upon the occurrence of a Change of Control, each Holder shall
have the right to require the Company to purchase such Holder's Notes, in whole
or in part, in a principal amount that is an integral multiple of $1,000,
pursuant to the offer described in Section 4.07(b) hereof (the "Change of
Control Offer") at a purchase price (the "Change of Control Purchase Price") in
cash equal to 101% of the principal amount of such Notes (or portions thereof)
to be redeemed plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the date of purchase (the "Change of Control Payment Date") (subject
to the right of each Holder of record on the relevant Record Date to receive
interest due on the relevant Interest Payment Date).
(b) Within 30 calendar days after the date of any Change of
Control, the Company, or the Trustee at the request and expense of the Company,
shall send to each Holder by first class mail, postage prepaid, a notice
prepared by the Company describing the transaction or transactions that
constitute the Change of Control and stating:
(i) that a Change of Control has occurred and a Change of
Control Offer is being made pursuant to this Section 4.07, and that all
Notes that are timely tendered will be accepted for payment;
(ii) the Change of Control Purchase Price, and the Change of
Control Payment Date, which date shall be a Business Day no earlier than
30 calendar days nor later than 60 calendar days subsequent to the date
such notice is mailed;
42
(iii) that any Notes or portions thereof not tendered or
accepted for payment will continue to accrue interest;
(iv) that, unless the Company defaults in the payment of the
Change of Control Purchase Price with respect thereto, all Notes or
portions thereof accepted for payment pursuant to the Change of Control
Offer shall cease to accrue interest from and after the Change of
Control Payment Date;
(v) that any Holder electing to have any Notes or portions
thereof purchased pursuant to a Change of Control Offer will be required
to tender such Notes, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of such Notes completed, to the Paying Agent at
the address specified in the notice prior to the close of business on
the third Business Day preceding the Change of Control Payment Date;
(vi) that any Holder shall be entitled to withdraw such election
if the Paying Agent receives, not later than the close of business on
the second Business Day preceding the Change of Control Payment Date, a
facsimile transmission or letter, setting forth the name of the Holder,
the principal amount of Notes delivered for purchase, and a statement
that such Holder is withdrawing such Holder's election to have such
Notes or portions thereof purchased pursuant to the Change of Control
Offer;
(vii) that any Holder electing to have Notes purchased pursuant
to the Change of Control Offer must specify the principal amount that is
being tendered for purchase, which principal amount must be $1,000 or an
integral multiple thereof;
(viii) if Certificated Notes have been issued, that any Holder
of Certificated Notes whose Certificated Notes are being purchased only
in part will be issued new Certificated Notes equal in principal amount
to the unpurchased portion of the Certificated Note or Notes
surrendered, which unpurchased portion will be equal in principal amount
to $1,000 or an integral multiple thereof;
(ix) that the Trustee will return to the Holder of a Global Note
that is being purchased in part, such Global Note with a notation on
Schedule A thereof adjusting the principal amount thereof to be equal to
the unpurchased portion of such Global Note; and
(x) any other information necessary to enable any Holder to
tender Notes and to have such Notes purchased pursuant to this Section
4.07.
(c) On the Change of Control Payment Date, the Company shall (i)
accept for payment all Notes or portions thereof properly tendered pursuant to
the Change of Control Offer, (ii) irrevocably deposit with the Paying Agent, by
10:00 a.m., New York City time, on such date, in immediately available funds, an
amount equal to the Change of Control Purchase Price in respect of all Notes or
portions thereof so tendered and (iii) deliver or cause to be delivered to the
Trustee the Notes so tendered together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions thereof being purchased by the
Company. Subject to the
43
provisions of Section 4.01 hereof, the Paying Agent shall promptly send by first
class mail, postage prepaid, to each Holder or portions thereof so accepted for
payment the Change of Control Purchase Price for such Notes or portions thereof.
The Company shall publicly announce the results of the Change of Control Offer
on or as soon as practicable after the Change of Control Payment Date. For
purposes of this Section 4.07, the Trustee shall act as the Paying Agent.
(d) Upon surrender and cancellation of a Certificated Note that
is purchased in part pursuant to the Change of Control Offer, the Company shall
promptly issue and the Trustee shall authenticate and deliver to the
surrendering Holder of such Certificated Note a new Certificated Note equal in
principal amount to the unpurchased portion of such surrendered Certificated
Note; PROVIDED that each such new Certificated Note shall be in a principal
amount of $1,000 or an integral multiple thereof.
Upon surrender of a Global Note that is purchased in part
pursuant to a Change of Control Offer, the Paying Agent shall forward such
Global Note to the Trustee who shall make a notation on Schedule A thereof to
reduce the principal amount of such Global Note to an amount equal to the
unpurchased portion of such Global Note, as provided in Section 2.05(c) hereof.
(e) The Company shall comply with the requirements of Section
14(e) of, and Rule 14e-1 under, the Exchange Act and any other securities laws
or regulations to the extent such laws and regulations are applicable in
connection with the purchase of Notes pursuant to a Change of Control Offer.
(f) Prior to complying with the provisions of this Section 4.07,
but in any event within 30 days following a Change of Control, the Company shall
either repay all outstanding Senior Indebtedness or obtain the requisite
consents, if any, under all agreements governing outstanding Senior Indebtedness
to permit the repurchase of Notes required by this Section 4.07.
SECTION 4.08. LIMITATION ON ASSET SALES. (a) The Company shall
not, and shall not permit any of its Subsidiaries to, directly or indirectly,
engage in an Asset Sale (except an Exempt Asset Sale) unless:
(i) the Company (or such Subsidiary) receives consideration at
the time of such Asset Sale at least equal to the fair market value of
the assets sold or otherwise disposed of, and in the case of a lease of
assets, a lease providing for rent and other conditions which are no
less favorable to the Company (or such Subsidiary) in any material
respect than the then prevailing market conditions (as determined in
each case by the Board, whose determination shall be conclusive if made
in good faith and evidenced by a Board Resolution set forth in an
Officers' Certificate delivered to the Trustee); and
(ii) at least 75% (100% in the case of lease payments) of the
consideration therefor received by the Company or such Subsidiary is in
the form of cash or Cash Equivalents; PROVIDED that an Asset Sale of the
Company's sterilization unit in Oldsmar, Florida shall not be subject to
the requirement set forth in this clause (ii).
44
(b) The Company may apply, and may permit its Subsidiaries to
apply, Net Proceeds of an Asset Sale (other than an Exempt Asset Sale), at its
option, in each case within 365 days after the consummation of such an Asset
Sale:
(i) to permanently reduce Senior Indebtedness other than
Senior Revolving Debt;
(ii) to permanently reduce Senior Revolving Debt (and to
correspondingly reduce the commitments, if any, with respect thereto);
(iii) to permanently reduce any outstanding Indebtedness
of any Guarantor (and to correspondingly reduce the commitments, if any,
with respect thereto);
(iv) to acquire another business or any substantial part
of another business or other long-term assets, in each case, in, or used
or useful in, the same or a similar line of business as the Company or
any of its Subsidiaries was engaged in on the date of this Indenture or
any reasonable extensions or expansions thereof (including the Capital
Stock of another Person engaged in such business, PROVIDED such other
Person is, or immediately after giving effect to any such acquisition
shall become, a Wholly Owned Subsidiary of the Company); or
(v) to reimburse the Company or its Subsidiaries for
expenditures made, and costs incurred, to repair, rebuild, replace or
restore property subject to loss, damage or taking to the extent that
the Net Proceeds consist of insurance proceeds received on account of
such loss, damage or taking.
Pending the final application of any such Net Proceeds, the Company may
temporarily reduce Senior Revolving Debt or otherwise invest such Net Proceeds
temporarily in Cash Equivalents.
(c) Any Net Proceeds from Asset Sales (other than Exempt Asset
Sales) that are not applied as provided in paragraph (b) of this Section 4.08
within 365 days after the consummation of such an Asset Sale will be deemed to
constitute "Excess Proceeds."
(d) When the aggregate amount of Excess Proceeds exceeds $5.0
million, the Company will be required to make an offer to all Holders (an "Asset
Sale Offer"), to purchase, on a pro rata basis the principal amount of Notes
equal in amount to the Excess Proceeds (and not just the amount thereof that
exceeds $5.0 million) (the "Asset Sale Offer Amount"), at a purchase price in
cash in an amount equal to 100% of the principal amount thereof plus accrued and
unpaid interest and Liquidated Damages thereon to the date of purchase (subject
to the right of each Holder or record on the relevant Record Date to receive
interest due on the relevant Interest Payment Date), in accordance with the
procedures set forth in this Indenture, and in accordance with the following
standards:
(i) If the aggregate principal amount of Notes surrendered by
Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall
select the Notes to be purchased on a PRO RATA basis, based on the
principal amount of Notes tendered, with such
45
adjustments as may be deemed appropriate by the Trustee, so that only
Notes in denominations of $1,000 or integral multiples thereof shall be
purchased.
(ii) If the aggregate principal amount of Notes tendered
pursuant to such Asset Sale Offer is less than the Excess Proceeds, the
Company may use any remaining Excess Proceeds following the completion
of the Asset Sale Offer for general corporate purposes (subject to the
other provisions of this Indenture).
Upon completion of an Asset Sale Offer, the amount of Excess Proceeds then
required to be otherwise applied in accordance with this covenant shall be reset
to zero, subject to any subsequent Asset Sale.
(e) Within 30 calendar days after the date the amount of Excess
Proceeds exceeds $5.0 million, the Company, or the Trustee at the request and
expense of the Company, shall send to each Holder by first-class mail, postage
prepaid, a notice prepared by the Company stating:
(i) that an Asset Sale Offer is being made pursuant to
this Section 4.08 and that all Notes that are timely tendered will be
accepted for payment, subject to proration if the amount of Excess
Proceeds is less than the aggregate principal amount of all Notes timely
tendered pursuant to the Asset Sale Offer;
(ii) the Asset Sale Offer Amount, the amount of Excess
Proceeds that are available to be applied to purchase tendered Notes,
and the date Notes are to be purchased pursuant to the Asset Sale Offer
(the "Asset Sale Purchase Date"), which date shall be a Business Day no
earlier than 30 calendar days nor later than 60 calendar days subsequent
to the date such notice is mailed;
(iii) that any Notes or portions thereof not tendered or
accepted for payment will continue to accrue interest;
(iv) that, unless the Company defaults in the payment of
the Asset Sale Offer Amount with respect thereto, all Notes or portions
thereof accepted for payment pursuant to the Asset Sale Offer shall
cease to accrue interest from and after the Asset Sale Purchase Date;
(v) that any Holder electing to have any Notes or portions
thereof purchased pursuant to the Asset Sale Offer will be required to
surrender such Notes, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of such Notes completed, to the Paying Agent at
the address specified in the notice prior to the close of business on
the third Business Day preceding the Asset Sale Purchase Date;
(vi) that any Holder shall be entitled to withdraw such
election if the Paying Agent receives, not later than the close of
business on the second Business Day preceding the Asset Sale Purchase
Date, a facsimile transmission or letter, setting forth the name of the
Holder, the principal amount of Notes delivered for purchase, and a
46
statement that such Holder is withdrawing such Holder's election to have
such Notes or portions thereof purchased pursuant to the Asset Sale
Offer;
(vii) that any Holder electing to have Notes purchased
pursuant to the Asset Sale Offer must specify the principal amount that
is being tendered for purchase, which principal amount must be $1,000 or
an integral multiple thereof;
(viii) if Certificated Notes have been issued hereof, that
any Holder of Certificated Notes whose Certificated Notes are being
purchased only in part will be issued new Certificated Notes equal in
principal amount to the unpurchased portion of the Certificated Note or
Notes surrendered, which unpurchased portion will be equal in principal
amount to $1,000 or an integral multiple thereof;
(ix) that the Trustee will return to the Holder of a
Global Note that is being purchased in part, such Global Note with a
notation on Schedule A thereof adjusting the principal amount thereof to
be equal to the unpurchased portion of such Global Note; and
(x) any other information necessary to enable any Holder
to tender Notes and to have such Notes purchased pursuant to this
Section 4.08.
(f) On the Asset Sale Payment Date, the Company shall (i) accept
for payment any Notes or portions thereof properly tendered and selected for
purchase pursuant to the Asset Sale Offer and Section 4.08(e) hereof; (ii)
irrevocably deposit with the Paying Agent, by 10:00 a.m., New York City time, on
such date, in immediately available funds, an amount equal to the Asset Sale
Offer Amount in respect of all Notes or portions thereof so accepted; and (iii)
deliver, or cause to be delivered, to the Trustee the Notes so accepted together
with an Officers' Certificate listing the Notes or portions thereof tendered to
the Company and accepted for payment. Subject to the provisions of Section 4.01,
the Paying Agent shall promptly send by first class mail, postage prepaid, to
each Holder or portions thereof so accepted for payment the Asset Sale Offer
Amount for such Notes or portions thereof. The Company shall publicly announce
the results of the Asset Sale Offer on or as soon as practicable after the Asset
Sale Purchase Date. For purposes of this Section 4.08, the Trustee shall act as
the Paying Agent.
(g) Upon surrender and cancellation of a Certificated Note that
is purchased in part, the Company shall promptly issue and the Trustee shall
authenticate and deliver to the surrendering Holder of such Certificated Note, a
new Certificated Note equal in principal amount to the unpurchased portion of
such surrendered Certificated Note; PROVIDED that each such new Certificated
Note shall be in a principal amount of $1,000 or an integral multiple thereof.
(h) Upon surrender of a Global Note that is purchased in part,
the Paying Agent shall forward such Global Note to the Trustee who shall make a
notation on Schedule A thereof to reduce the principal amount of such Global
Note, as provided in Section 2.05(c) hereof.
(i) Upon completion of an Asset Sale Offer (including payment of
the Asset Sale Purchase Price for accepted Notes), any surplus Excess Proceeds
that were the subject of such
47
offer shall cease to be Excess Proceeds, and the Company may then use such
amounts for general corporate purposes (subject to other provisions of this
Indenture).
(j) If at any time any non-cash consideration received by the
Company or any Subsidiary of the Company in connection with any Asset Sale is
converted into or sold or otherwise disposed of for cash, then such conversion
or disposition shall be deemed to constitute an Asset Sale hereunder and the Net
Proceeds thereof shall be applied in accordance with this Section 4.08.
(k) The provisions of this Section 4.08 shall not apply to a
transaction consummated in compliance with the provisions of Section 5.01
hereof. In the event of the transfer of substantially all (but not all) of the
property and assets of the Company and its Subsidiaries as an entirety to a
Person in a transaction permitted by Section 5.01 hereof, the successor
corporation shall be deemed to have sold the properties and assets of the
Company and its Subsidiaries not so transferred for purposes of this covenant,
and shall comply with the provisions of this covenant with respect to such
deemed sale as if it were an Asset Sale. In addition, the fair market value of
such properties and assets of the Company and its Subsidiaries deemed to be sold
shall be deemed to be Net Proceeds for purposes of this Section 4.08.
(l) The Company may use Net Proceeds from Exempt Asset Sales for
general corporate purposes (subject to the other provisions of this Indenture).
(m) The Company shall comply with the requirements of Section
14(e) of, and Rule 14e-1 under, the Exchange Act and any other securities laws
or regulations, to the extent such laws and regulations are applicable in
connection with the purchase of Notes pursuant to an Asset Sale Offer.
SECTION 4.09. LIMITATION ON INCURRENCE OF INDEBTEDNESS AND
ISSUANCE OF PREFERRED STOCK. (a) The Company shall not, and shall not permit any
of its Subsidiaries to, directly or indirectly, create, incur, issue, assume,
guarantee or otherwise become directly or indirectly liable, contingently or
otherwise, with respect to (collectively, "incur") any Indebtedness (including
Acquired Indebtedness) and the Company shall not issue any Disqualified Stock
and shall not permit any of its Subsidiaries to issue any shares of preferred
stock; PROVIDED, HOWEVER, that the Company and any Guarantor that is organized
under the laws of a jurisdiction other than the United States of America, any
state thereof or the District of Columbia (a "Non-U.S. Guarantor") may incur
Indebtedness (including Acquired Indebtedness) and the Company may issue shares
of Disqualified Stock if:
(i) the Fixed Charge Coverage Ratio for the Company's most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Disqualified Stock is issued
would have been at least 2.0 to 1.0, determined on a pro forma basis
(including a pro forma application of the net proceeds therefrom), as if
the additional Indebtedness had been incurred, or the Disqualified Stock
had been issued, as the case may be, at the beginning of such
four-quarter period; and
48
(ii) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
PROVIDED, that the aggregate principal amount of any such Indebtedness incurred
by all such non-U.S. Guarantors pursuant to this Section 4.09(a) and outstanding
at any time shall not exceed $15.0 million.
(b) The foregoing limitations on the incurrence of Indebtedness
will not apply to:
(i) the incurrence by the Company of Indebtedness under the
Credit Agreement (and the incurrence by Subsidiaries of the Company of
guarantees thereof) in an aggregate principal amount at any time
outstanding (with letters of credit being deemed to have a principal
amount equal to the maximum potential liability of the Company and its
Subsidiaries thereunder) not to exceed $165.0 million, less the
aggregate amount of all Net Proceeds of Asset Sales applied to
permanently reduce the outstanding amount or the commitments with
respect to such Indebtedness pursuant to Section 4. 08;
(ii) the incurrence by the Company and the Guarantors of
Indebtedness represented by the Notes and the Note Guarantees;
(iii) the incurrence by the Company or any of its Subsidiaries
of Indebtedness represented by Capital Lease Obligations, mortgage
financings or Purchase Money Obligations, in each case incurred for the
purpose of financing all or any part of the purchase price or cost of
construction or improvement of property used in the business of the
Company or such Subsidiary, or any Permitted Refinancing Indebtedness
thereof (PROVIDED, that the requirements of clause (ii) of the
definition of Permitted Refinancing Indebtedness need not be met for
purposes of this clause (iii)), in an aggregate principal amount not to
exceed $5.0 million at any time outstanding;
(iv) the incurrence by the Company of Permitted Refinancing
Indebtedness in exchange for, or the net proceeds of which are used to
extend, refinance, renew, replace, defease or refund, any Indebtedness
described in Section 4.09(a) above or Indebtedness evidenced by the
Company's 6 3/4% Convertible Subordinated Debentures due 2003 issued
pursuant to an Indenture dated as of March 18, 1993 among Henley
International Maxxim Medical, Inc., as predecessor to the Company, and
Chemical Bank, as trustee;
(v) the incurrence by the Company or any of its Subsidiaries of
intercompany Indebtedness between or among the Company and any of its
Wholly Owned Subsidiaries or between or among any Wholly Owned
Subsidiaries; PROVIDED that, in the case of Indebtedness of the Company,
such obligations shall be unsecured and subordinated in case of an event
of default in all respects to the Company's obligations pursuant to the
Notes; and PROVIDED, HOWEVER that (a) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness being
held by a Person other than the Company or a Wholly Owned Subsidiary of
the Company and (b) any sale or other
49
transfer of any such Indebtedness to a Person that is not either the
Company or a Wholly Owned Subsidiary of the Company shall be deemed, in
each case, to constitute an incurrence of such Indebtedness by the
Company or such Subsidiary, as the case may be;
(vi) the incurrence by the Company of Hedging Obligations;
(vii) the incurrence by Subsidiaries of Indebtedness represented
by Guarantees of Indebtedness of the Company permitted under Section
4.09(a) or Section 4.09(b)(iv) hereof; and
(viii) the incurrence by the Company and its Subsidiaries of
Indebtedness (in addition to Indebtedness permitted by any other clause
of this Section 4.09) in an aggregate principal amount at any time
outstanding not to exceed $10.0 million.
SECTION 4.10. Limitation on Restricted Payments"3". (a) The
Company shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly:
(i) declare or pay any dividend or make any distribution
of any kind or character (whether in cash, securities or other property)
on account of any class of the Company's or any of its Subsidiaries'
Equity Interests or to holders thereof (including, without limitation,
any payment to stockholders of the Company in connection with a merger
or consolidation involving the Company), other than (A) dividends or
distributions payable solely in Equity Interests (other than
Disqualified Stock) of the Company or (B) dividends or distributions
payable solely to the Company or any Wholly Owned Subsidiary of the
Company and, if such Subsidiary is not a Wholly Owned Subsidiary of the
Company, payable simultaneously to its minority shareholders on a PRO
RATA basis;
(ii) purchase, redeem or otherwise acquire or retire for
value any Equity Interests of the Company, any Subsidiary of the Company
or any Unrestricted Subsidiary or any other Affiliate of the Company
(other than any such Equity Interests owned by the Company or any Wholly
Owned Subsidiary of the Company);
(iii) make any principal payment on, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness of the
Company or any Guarantor that is PARI PASSU with or subordinated to the
Notes or the Note Guarantees prior to any scheduled repayment date,
mandatory sinking fund payment date or final maturity date (other than
the Notes), other than through the purchase, redemption or acquisition
by the Company of Indebtedness of the Company or any of its Subsidiaries
through the issuance in exchange therefor of Equity Interests (other
than Disqualified Stock) of the Company; or
(iv) make any Investment (other than Permitted
Investments)
50
(all such payments and other actions set forth in clauses (i) through
(iv) above being collectively referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted
Payment:
(I) no Default or Event of Default shall have
occurred and be continuing or would occur as a consequence
thereof;
(II) at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted
Payment had been made at the beginning of the applicable
four-quarter period, the Company would have been permitted to
incur at least $1.00 of additional Indebtedness pursuant to the
Fixed Charge Coverage Ratio test set forth under Section 4.09(a)
hereof; and
(III) such Restricted Payment, together with the
aggregate amount of all other Restricted Payments declared or
made by the Company and its Subsidiaries on or after the date of
this Indenture (excluding Restricted Payments permitted by
Sections 4.10(c)(ii), 4.10(c)(iii) and 4.10(c)(iv) hereof) is
less than the sum of (A) 50% of the Consolidated Net Income of
the Company for the period (taken as one accounting period) from
the beginning of the first fiscal quarter commencing after the
date of this Indenture to the end of the Company's most recently
ended fiscal quarter for which internal financial statements are
available at the time of such Restricted Payment (or, if such
Consolidated Net Income for such period is a deficit, less 100%
of such deficit), PLUS (B) 100% of the aggregate net cash
proceeds received by the Company from the issue or sale after the
date of this Indenture of Equity Interests of the Company or of
debt securities of the Company that have been converted into such
Equity Interests (other than Equity Interests (or convertible
debt securities) sold to a Subsidiary of the Company or an
Unrestricted Subsidiary and other than Disqualified Stock or debt
securities that have been converted into Disqualified Stock),
subject to the proviso of Section 4.10(b) hereof.
(b) The foregoing clause (III) of Section 4.10(a) will not
prohibit the Company and its Subsidiaries from declaring or making up to an
aggregate amount of $10.0 million of Restricted Payments, in addition to the
aggregate amount of Restricted Payments that are permitted under the foregoing
clause (III); PROVIDED, HOWEVER, that if the aggregate amount of Restricted
Payments declared or made under this Section 4.10(b) equals $10.0 million,
neither the Company nor any of its Subsidiaries may declare or make any further
Restricted Payments under the foregoing clause (III) unless, and only to the
extent that, the aggregate amount of Restricted Payments that would, but for
this sentence, be permitted by clause (III) exceeds $10.0 million.
(c) The foregoing clauses (II) and (III) of Section 4.10(a) will
not prohibit:
(i) the payment of any dividend on any class of Capital
Stock of the Company or any Subsidiary of the Company within 60 days
after the date of declaration
51
thereof, if on the date on which such dividend was declared such payment
would have complied with the provisions of this Indenture; or
(ii) the making of any Investment in exchange for, or out
of the proceeds of, the substantially concurrent sale (other than to a
Subsidiary of the Company or to any Unrestricted Subsidiary) of Equity
Interests of the Company (other than Disqualified Stock); PROVIDED, that
any net cash proceeds that are utilized for any such Investment, and any
Net Income resulting therefrom, shall be excluded from clause (III) of
Section 4.10(a); or
(iii) the redemption, repurchase, retirement or other
acquisition of any Equity Interests of the Company in exchange for, or
out of the proceeds of, the substantially concurrent sale (other than to
a Subsidiary of the Company or to any Unrestricted Subsidiary) of other
Equity Interests of the Company (other than any Disqualified Stock);
PROVIDED that any net cash proceeds that are utilized for any such
redemption, repurchase, retirement or other acquisition, and any Net
Income resulting therefrom, shall be excluded from clause (III) of
Section 4.10(a); or
(iv) the defeasance, redemption or repurchase of PARI
PASSU or subordinated Indebtedness with the net cash proceeds from an
incurrence of Permitted Refinancing Indebtedness or the substantially
concurrent sale (other than to a Subsidiary of the Company or to any
Unrestricted Subsidiary) of Equity Interests of the Company (other than
Disqualified Stock); PROVIDED, that any net cash proceeds that are
utilized for any such defeasance, redemption or repurchase, and any Net
Income resulting therefrom, shall be excluded from clause (III) of
Section 4.10(a).
(d) The amount of all Restricted Payments (other than cash) shall
be the fair market value (as determined by the Board, whose determination shall
be conclusive if made in good faith and evidenced by a Board Resolution) on the
date of the Restricted Payment of the asset(s) proposed to be transferred by the
Company or such Subsidiary, as the case may be, pursuant to the Restricted
Payment. 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, setting forth the basis upon which the
calculations required by this Section 4.10 were computed and accompanied by such
Board Resolution, which calculations may be based upon the Company's latest
available financial statements.
SECTION 4.11. LIMITATION ON DIVIDENDS AND OTHER PAYMENT
RESTRICTIONS AFFECTING SUBSIDIARIES. The Company shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any encumbrance or
restriction on the ability of any Subsidiary of the Company to:
(a) (i) pay dividends or make any other distributions to the
Company or any of its Subsidiaries on its Capital Stock or with respect
to any other interest or participation in, or measured by, its profits,
or (ii) pay any Indebtedness or other obligation owed to the Company or
any of its Subsidiaries; or
52
(b) make loans or advances to the Company or any of its
Subsidiaries; or
(c) sell, lease or transfer any of its properties or assets to
the Company or any of its Subsidiaries; or
(d) guarantee the obligations of the Company evidenced by the
Notes or any renewals, refinancings, exchanges, refundings or extensions
thereof, except for such encumbrances or restrictions existing under or by
reason of:
(i) Existing Indebtedness as in effect on the date of this
Indenture consisting of capital leases whose encumbrances or
restrictions are limited to the property subject to such leases,
(ii) this Indenture and the Notes,
(iii) applicable law,
(iv) any instrument governing Acquired Indebtedness or
Capital Stock of a Person acquired by the Company or any of its
Subsidiaries as in effect at the time of such acquisition (except to the
extent such Acquired Indebtedness was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is
not applicable to any Person, or the properties or assets of any Person,
other than the Person, or the property or assets of the Person, so
acquired, PROVIDED that the Consolidated EBITDA of such Person is not
taken into account in determining whether such acquisition was permitted
by the terms of this Indenture, or
(v) any document or instrument governing Indebtedness
incurred pursuant to Section 4.09(b)(iii) hereof, PROVIDED that any such
restriction contained therein relates only to the asset or assets
constructed or acquired in connection therewith, or
(vi) Permitted Refinancing Indebtedness of Indebtedness
described in clause (iv) of this Section 4.11(d), PROVIDED that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive than those contained in
the agreements governing the Indebtedness being refinanced.
SECTION 4.12. LIMITATION ON LAYERING DEBT. The Company shall not
incur, create, issue, assume , guarantee or otherwise become liable for any
Indebtedness that is subordinate or junior in right of payment to any Senior
Indebtedness and senior in any respect in right of payment to the Notes.
SECTION 4.13. LIMITATION ON LIENS. The Company shall not, and
shall not permit any of its Subsidiaries to, directly or indirectly, create,
incur, assume or suffer to exist any Lien on any of its assets, now owned or
hereafter acquired, securing any Indebtedness other than Senior Indebtedness or
Indebtedness specified in clauses (a) or (c) of the second sentence of the
definition of "Senior Indebtedness," unless the Notes, in the case of the
Company, or the Note Guarantees, in the case of the Guarantors, are secured
equally and ratably with such other
53
Indebtedness; PROVIDED that, if such Indebtedness is by its terms expressly
subordinate to the Notes or the Note Guarantees, the Lien securing such
subordinate or junior Indebtedness shall be subordinate and junior to the Lien
securing the Notes or the Note Guarantees with the same relative priority as
such subordinated or junior Indebtedness shall have with respect to the Notes or
the Note Guarantees.
SECTION 4.14. LIMITATION ON OWNERSHIP OF AND LIENS ON CAPITAL
STOCK. The Company (a) shall not permit any Person (other than the Company or
any Wholly Owned Subsidiary of the Company) to own any Capital Stock of any
Subsidiary of the Company, and (b) shall not permit any Subsidiary of the
Company to issue Capital Stock (except to the Company or to a Wholly Owned
Subsidiary) or create, incur, assume or suffer to exist any Lien thereon, in
each case except:
(i) directors' qualifying shares;
(ii) Capital Stock issued prior to the time such Person became a
Subsidiary of the Company, provided that such Capital Stock was not issued in
anticipation of such transaction;
(iii) if such Subsidiary merges with another Subsidiary of the
Company;
(iv) if such Subsidiary ceases to be a Subsidiary of the Company
(as a result of the sale of 100% of the shares of such Subsidiary, the Net
Proceeds from which are applied in accordance with Section 4.08 hereof); or
(v) Liens on Capital Stock of any Subsidiary of the Company
incurred to secure Indebtedness under the Credit Agreement or other Senior
Indebtedness incurred in compliance with the Fixed Charge Coverage Ratio Test
set forth in Section 4.09 (a), or (vi) Liens on Capital Stock of any Subsidiary
of the Company granted in accordance with the provisions of Section 4.13 hereof.
SECTION 4.15. TRANSACTIONS WITH AFFILIATES. The Company shall
not, and shall not permit any of its Subsidiaries to, directly or indirectly,
after the date of this Indenture, in any one transaction or a series of related
transactions, sell, lease, transfer or otherwise dispose of any of its
properties, assets or services to, or make any payment to, or purchase any
property, assets or services from, or enter into or make any agreement, loan,
advance or guarantee with, or for the benefit of, any Affiliate (each of the
FOREGOING, an "Affiliate Transaction"), other than Exempt Affiliate
Transactions, unless:
(a) such Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Subsidiary than those that would have
been obtained in a comparable arm's length transaction by the Company or such
Subsidiary with a Person that is not an Affiliate; and
(b) the Company delivers to the Trustee (i) with respect to any
Affiliate Transaction entered into after the date of this Indenture involving
aggregate consideration in excess of $1.0 million, a Board Resolution, as set
forth in an Officer's Certificate, certifying that
54
such Affiliate Transaction complies with clause (a) above and that such
Affiliate Transaction has been approved by a majority of the disinterested
members of the Board, and (ii) with respect to any Affiliate Transaction
involving aggregate consideration in excess of $5.0 million, a written opinion
issued by an independent financial advisor of national standing that such
Affiliate Transaction is fair to the Company or such Subsidiary, as the case may
be, from a financial point of view.
SECTION 4.16. REPORTS. Whether or not required by the rules
and regulations of the Commission, so long as any Notes are outstanding, the
Company shall furnish to the Holders, and file with the Trustee, within 15 days
after it is or would have been required to file such with the Commission (i) all
quarterly and annual financial information that is or would be required to be
contained in a filing with the Commission on Forms 10-Q and 10-K if the Company
is or were required to file such Forms, including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and, with respect to
the annual information only, a report thereon by the Company's certified
independent accountants and (ii) all current reports that are or would be
required to be filed with the Commission on Form 8-K if the Company is or were
required to file such reports. In addition, whether or not required by the rules
and regulations of the Commission, at any time after the Company files a
registration statement with respect to the Exchange Offer or a Shelf
Registration Statement, the Company shall file a copy of all such information
and reports with the Commission for public availability (unless the Commission
will not accept such a filing) and make such information available to securities
analysts and prospective investors upon request. In addition, for so long as any
Notes remain outstanding, the Company shall furnish to the Holders and
securities analysts and prospective investors, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act. The Company also shall comply with the other provisions of
Section 314(a) of the Trust Indenture Act.
SECTION 4.19. UNRESTRICTED SUBSIDIARIES. An Unrestricted
Subsidiary shall continue to be an Unrestricted Subsidiary only if it (a) has no
Indebtedness other than Non-Recourse Debt and (b) is a Person with respect to
which neither the Company nor any of its Subsidiaries has any direct or indirect
obligation (i) to subscribe for additional Equity Interests or (ii) to maintain
or preserve such Person's financial condition or to cause such Person to achieve
any specified levels of operating results. If, at any time, any Unrestricted
Subsidiary fails to meet the foregoing requirements, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Unrestricted Subsidiary 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 4.09 hereof, the Company
shall be in default of such covenant).
SECTION 4.18. PAYMENTS FOR CONSENT, WAIVER OR AMENDMENT. Neither
the Company nor any of its Subsidiaries or any Unrestricted Subsidiaries shall,
directly or indirectly, pay or cause to be paid any consideration, whether by
way of interest, fee or otherwise, to any Holder for or as an inducement to any
consent, waiver or amendment of any terms or provisions of the Notes, unless
such consideration is offered to be paid or agreed to be paid to all Holders of
55
the Notes which so consent, waive or agree to amend in the time frame set forth
in the solicitation documents relating to such consent, waiver or amendment.
SECTION 4.19. WAIVER OF STAY, EXTENSION OR USURY LAWS. The
Company and the Guarantors will not at any time, to the extent that they may
lawfully not do so, insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive the Company or the Guarantors from
paying all or any portion of the principal of or premium, if any, or interest or
Liquidated Damages, if any, on the Notes as contemplated herein, wherever
enacted, now or at any time hereafter in force, or that may affect the covenants
or the performance of this Indenture; and, to the extent that they may lawfully
do so, the Company and the Guarantors hereby expressly waive all benefit or
advantage of any such law and expressly agree that they will not hinder, delay
or impede the execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
SECTION 4.20. COMPLIANCE CERTIFICATE; NOTICE OF DEFAULT OR EVENT
OF DEFAULT. (a) The Company shall deliver to the Trustee within 120 calendar
days after the end of each fiscal year of the Company ending after the date
hereof, an Officers' Certificate stating whether or not, to the best knowledge
of such officer, the Company has complied with all conditions and covenants
under this Indenture, and, if the Company shall be in Default, specifying all
such Defaults and the nature thereof of which such officer may have knowledge.
For the purposes of this Section 4.20(a), compliance shall be
determined without regard to any period of grace or requirement of notice under
this Indenture.
(b) The Company shall deliver written notice to the Trustee
immediately upon any executive officer of the Company becoming aware of the
occurrence of any event which constitutes, or with the giving of notice or the
lapse of time or both would constitute, a Default or Event of Default,
describing such Default or Event of Default, its status and what action the
Company is taking or proposes to take with respect thereto.
(c) So long as not contrary to the then-current recommendations
of the American Institute of Certified Public Accountants, the year-end
financial statements delivered pursuant to Section 4.16 hereof shall be
accompanied by a written statement of the Company's independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Article IV or Article V hereof or, if any
such violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.
SECTION 4.21. INVESTMENT COMPANY ACT. None of the Company, its
Subsidiaries or its Unrestricted Subsidiaries shall become an investment company
subject to registration under the Investment Company Act of 1940, as amended.
56
SECTION 4.22. FURTHER INSTRUMENTS AND ACTS. Upon request of the
Trustee, the Company shall execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
ARTICLE V
CONSOLIDATION, MERGER, CONVEYANCE, LEASE OR TRANSFER
SECTION 5.01. MERGER, CONSOLIDATION OR SALE OF ASSETS. The
Company shall not, and shall not permit any Subsidiary of the Company to, in a
single transaction or series of related transactions, consolidate or merge with
or into (other than the consolidation or merger of a Wholly Owned Subsidiary of
the Company with another Wholly Owned Subsidiary of the Company or into the
Company) (whether or not the Company or such Subsidiary is the surviving
corporation), or directly and/or indirectly through its Subsidiaries sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all
of the properties or assets of the Company and its Subsidiaries (determined on a
consolidated basis for the Company and its Subsidiaries taken as a whole) in one
or more related transactions to, another corporation, Person or entity unless:
(a) either (i) the Company, in the case of a transaction
involving the Company, or such Subsidiary, in the case of a transaction
involving a Subsidiary of the Company, is the surviving corporation or (ii) in
the case of a transaction involving the Company or such Subsidiary, the entity
or the Person formed by or surviving any such consolidation or merger (if other
than the Company or such Subsidiary) or to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made is a
corporation organized or existing under the laws of the United States of
America, any state thereof or the District of Columbia and expressly assumes all
the obligations of the Company under the Notes and this Indenture or such
Subsidiary under the relevant Note Guarantee and this Indenture, as the case may
be, pursuant to a supplemental indenture in a form reasonably satisfactory to
the Trustee;
(b) immediately after such transaction no Default or Event of
Default exists;
(c) in the case of a transaction involving the Company, the
Company or, if other than the Company, the entity or Person formed by or
surviving any such consolidation or merger, or to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made (i) will
have Consolidated Net Worth immediately after the transaction equal to or
greater than the Consolidated Net Worth of the Company immediately preceding the
transaction and (ii) will, at the time of such transaction and after giving pro
forma effect thereto as if such transaction had occurred at the beginning of the
applicable four-quarter period, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set
forth in Section 4.09 hereof;
(d) if, as a result of any such transaction, property or assets
of the Company or a Guarantor would become subject to a Lien securing
Indebtedness not excepted from the provisions of this Indenture described in
Section 4.13 hereof, the Company, any such Guarantor
57
or the surviving entity, as the case may be, shall have secured the Notes and
the relevant Note Guarantee, as required by such provisions; and
(e) the Company shall deliver, or cause to be delivered to the
Trustee, in form reasonably satisfactory to the Trustee, an Officers'
Certificate and, except in the case of a merger of a Subsidiary of the Company
into the Company or into a Wholly Owned Subsidiary of the Company, an Opinion of
Counsel, each stating that such consolidation, merger, conveyance, lease or
disposition and any supplemental indenture with respect thereto, comply with
this Section 5.01 and that all conditions precedent herein provided relating to
such transaction or series of transactions have been complied with.
For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Subsidiaries of the Company the Capital Stock of which constitutes all or
substantially all of the properties and assets of the Company, shall be deemed
to be the transfer of all or substantially all of the properties and assets of
the Company.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED. Upon any
consolidation with, or merger by the Company with and into, any other
corporation, or any sale, assignment, transfer, lease, conveyance or other
disposition of all or substantially all of the Property of the Company and its
Subsidiaries taken as a whole in accordance with Section 5.01 hereof, the
successor corporation formed by such consolidation or into which the Company is
merged, or the Person to which such sale, conveyance, assignment, transfer,
lease, conveyance or other disposition 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 Person has 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 for the obligation to pay the principal of, premium, if any, and interest
or Liquidated Damages, if any, on the Notes.
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT. The term "Event of Default,"
wherever used herein with respect to the Notes, means any one of the following
events (whatever the reason for such event, and whether it shall be voluntary or
involuntary, or be effected by operation of law, pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the Company fails to make any payment of interest on, or
Liquidated Damages with respect to, any Note when the same becomes due and
payable and such failure continues for a period of 30 calendar days, whether or
not such payment is prohibited by the provisions of Article X hereof; or
58
(b) the Company fails to make any payment of the principal or of
premium, if any, on any Note when the same becomes due and payable at Maturity,
whether or not such payment is prohibited by the provisions of Article X hereof;
or
(c) the Company fails to observe or perform any covenant,
condition or agreement on the part of the Company to be observed or performed
pursuant to Sections 4.07, 4.08, 4.09, 4.10, 4.14 and 5.01 hereof; or
(d) the Company fails to consummate the merger of Maxxim
Acquisition Co. with and into Sterile Concepts on or prior to December 15, 1996;
or
(e) the Company fails to comply with any of its other agreements
or covenants in or provisions of the Notes or this Indenture and such failure
continues for 60 days after written notice by the Trustee or Holders of at least
25% of the aggregate principal amount of the Notes outstanding; or
(f) a default occurs under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by the Company or any 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 date of this Indenture, which default (a) is caused by a failure to
pay principal of such Indebtedness at final maturity thereof (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
as to which there has been a Payment Default or the maturity of which has been
so accelerated, exceeds in the aggregate $5.0 million; or
(g) a final judgment or final judgments for the payment of money
not fully covered by insurance are entered by a court or courts of competent
jurisdiction against the Company or any of its Subsidiaries and such judgment or
judgments remain undischarged for a period (during which execution shall not be
effectively stayed) of 60 days, PROVIDED that the aggregate of all such
undischarged judgments exceeds $5.0 million; or
(h) the entry by a court having jurisdiction in the premises of
(i) a decree or order for relief in respect of the Company or any Subsidiary of
the Company in an involuntary case or proceeding under any Bankruptcy Law or
(ii) a decree or order (A) adjudging the Company or any Subsidiary of the
Company a bankrupt or insolvent, or (B) approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of, or in respect
of, the Company or any Subsidiary of the Company under any Bankruptcy Law, or
(C) appointing a Custodian of the Company or any Subsidiary of the Company or of
any substantial part of the Property of the Company or any Subsidiary of the
Company, or (D) ordering the winding-up or liquidation of the affairs of the
Company or any Subsidiary of the Company, and in each case, the continuance of
any such decree or order for relief or any such other decree or order unstayed
and in effect for a period of 60 consecutive calendar days; or
59
(i) (i) the commencement by the Company or any Subsidiary of the
Company of a voluntary case or proceeding under any Bankruptcy Law or of any
other case or proceeding to be adjudicated a bankrupt or insolvent; or (ii) the
consent by the Company or any Subsidiary of the Company to the entry of a decree
or order for relief in respect of the Company or any Subsidiary of the Company
in an involuntary case or proceeding under any Bankruptcy Law or to the
commencement of any bankruptcy or insolvency case or proceeding against the
Company or any Subsidiary of the Company; or (iii) the filing by the Company or
any Subsidiary of the Company of a petition or answer or consent seeking
reorganization or relief under any Bankruptcy Law; or (iv) the consent by the
Company or any Subsidiary of the Company to the filing of such petition or to
the appointment of or taking possession by a Custodian of the Company or any
Subsidiary of the Company or of any substantial part of the Property of the
Company or any Subsidiary of the Company, or (v) the making by the Company or
any Subsidiary of the Company of an assignment for the benefit of creditors; or
(vi) the admission by the Company or any Subsidiary of the Company in writing of
its inability to pay its debts generally as they become due; or (vii) the
approval by stockholders of the Company or any Subsidiary of the Company of any
plan or proposal for the liquidation or dissolution of the Company or any
Subsidiary of the Company; or (viii) the taking of corporate action by the
Company or any Subsidiary of the Company in furtherance of any such action; or
(j) the Note Guarantee of any Guarantor is held in any judicial
proceeding to be unenforceable or invalid or ceases for any reason to be in full
force and effect (other than in accordance with the terms of the Indenture) or
any Guarantor or any Person acting on behalf of any Guarantor denies or
disaffirms such Guarantor's obligations under its Note Guarantee (other than by
reason of a release of such Guarantor from its Note Guarantee in accordance with
the terms of the Indenture).
SECTION 6.02. ACCELERATION. If an Event of Default (other than an
Event of Default specified in Section 6.01(h) or Section 6.01(i)) occurs and is
continuing, then and in every such case the Trustee by notice to the Company, or
the Holders of at least 25% in aggregate principal amount of all of the then
outstanding Notes by written notice to the Company and the Trustee may declare
the unpaid principal of and any accrued interest on all the Notes then
outstanding to be immediately due and payable. Upon such declaration the
principal and interest shall be due and payable immediately (together with any
premium or Liquidated Damages, if applicable). If an Event of Default specified
in Section 6.01(h) or Section 6.01(i) hereof occurs, such an amount shall IPSO
FACTO become and be immediately due and payable without any declaration or other
act on the part of the Trustee or any Holder.
The Holders of a majority in aggregate principal amount of the
then outstanding Notes by written notice to the Trustee and the Company may
rescind and annul such acceleration and its consequences if the rescission would
not conflict with any judgment or decree and if all existing Events of Default
(except nonpayment of principal, interest, premium or Liquidated Damages that
have become due solely because of the acceleration) have been cured or waived.
No such recission shall affect any subsequent Default or impair any right
consequent thereto.
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SECTION 6.03. OTHER REMEDIES. The Company covenants that if an
Event of Default specified in Section 6.01(a) or Section 6.01(b) occurs the
Company shall, upon demand of the Trustee, pay to the Trustee, for the benefit
of the Holders, the whole amount then due and payable on the Notes for principal
(and premium, if any) and interest (and Liquidated Damages, if any) and, to the
extent that payment of such interest shall be legally enforceable, interest upon
the overdue principal (and premium, if any) and upon Defaulted Interest (and
Liquidated Damages, if any) at the rate or rates prescribed therefor in the
Notes; and, in addition thereto, such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel and all other amounts due to the Trustee pursuant to Section 7.07
hereof.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, and may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Company, each Guarantor or any other obligor upon
the Notes and collect the moneys adjudged or decreed to be payable in the manner
provided by law out of the Property of the Company, each Guarantor or any other
obligor upon the Notes, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may
in its discretion proceed to protect and enforce its rights and the rights of
the Holders by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 6.04. WAIVER OF PAST DEFAULTS. The Holders of not less
than a majority in principal amount of the outstanding Notes may, on behalf of
the Holders of all the Notes, waive any existing Default or Event of Default and
its consequences under this Article VI, except a continuing Default or Event of
Default (a) in the payment of the principal of, premium, if any, or interest or
Liquidated Damages, if any, on any Note (except a payment default resulting from
an acceleration that has been rescinded), or (b) in respect of a covenant or
provision hereof which under Section 9.02 hereof cannot be modified or amended
without the consent of the Holder of each outstanding Note. Any such waiver may
(but need not) be given in connection with a tender offer or exchange offer for
the Notes.
SECTION 6.05. CONTROL BY MAJORITY. The Holders of not less
than a majority in principal amount of the outstanding Notes shall have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on
the Trustee; PROVIDED that
(a) such direction shall not be in conflict with any rule of law
or with this Indenture or unduly prejudicial to the rights of other Holders and
would not subject the Trustee to personal liability, and
(b) 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. No Holder shall have any
right to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(a) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the Notes;
(b) the Holders of not less than 25% in principal amount of the
outstanding Notes shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
hereunder;
(c) such Holder or Holders have offered to the Trustee security
or indemnity satisfactory to the Trustee in its reasonable discretion against
the costs, expenses and liabilities to be incurred in compliance with such
request;
(d) the Trustee for 30 calendar days after its receipt of such
notice, request and offer of security or indemnity has failed to institute any
such proceeding; and
(e) no direction inconsistent with such written request has been
given to the Trustee during such 30-day period by the Holders of a majority in
principal amount of the outstanding Notes;
in any event, it being understood and intended that no one or more Holders shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all Holders.
SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any Holder
to receive payment of principal of, premium, if any, and interest and Liquidated
Damages, if any, on the Notes held by such Holder, on or after the respective
due dates expressed in the Notes or the Redemption Dates or purchase dates
provided for therein, or to bring suit for the enforcement of any such payment
on or after such respective dates, shall be absolute and unconditional and shall
not be impaired or affected without the consent of such Holder.
SECTION 6.08. TRUSTEE MAY FILE PROOFS OF CLAIM. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceedings, or any voluntary or involuntary case under any Bankruptcy Law
relative to the Company or any other obligor upon the Notes or the Property of
the Company or of such other obligor or their creditors, the Trustee
(irrespective of whether the principal of such Notes shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Company for the payment of
overdue principal or interest) shall be entitled and empowered, by intervention
in such proceeding or otherwise, (i) to file and prove a claim for the whole
amount of principal of, premium, if any, and interest and Liquidated Damages, if
any, owing and unpaid
62
in respect of the Notes, to file such other papers or documents and to take such
other actions, including participating as a member or otherwise in any official
committee of creditors appointed in the matter, 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 all other amounts due to the Trustee pursuant to
Section 7.07 hereof) and of the Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other Property payable or deliverable
on any such claims and to distribute the same; and any Custodian, in any such
proceeding is hereby authorized by each Holder to make such payments to the
Trustee, and in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. Nothing contained herein shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Notes or the rights of any Holder thereof, or to authorize the Trustee to vote
in respect of the claim of any Holder in any such proceeding.
SECTION 6.09. PRIORITIES. Any money collected by the Trustee
pursuant to this Article VI shall be applied in the following order, at the date
or dates fixed by the Trustee and, in case of the distribution of such money on
account of principal of, premium, if any, or interest or Liquidated Damages, if
any, upon presentation of the Notes and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 7.07 hereof;
SECOND: To the payment of the amounts then due and unpaid for
principal of, premium, if any, and interest and Liquidated Damages, if
any, on the Notes, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Notes for principal,
premium, if any, and interest and Liquidated Damages, if any,
respectively; and
THIRD: To the Company.
The Trustee may fix a record date and payment date for any
payment to Holders pursuant to this Section 6.09. At least 15 calendar days
before such record date, the Company shall mail to each Holder and the Trustee a
notice that states such record date, the payment date and amount to be paid. The
Trustee may mail such notice in the name and at the expense of the Company.
SECTION 6.10. UNDERTAKING FOR COSTS. All parties to this
Indenture agree, and each Holder of any Note by such Holder's acceptance thereof
shall be deemed to have agreed, that any court may in its discretion require, 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, suffered or omitted by it as
Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees and expenses, against any
party litigant in such suit, having due regard to the
63
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in principal amount of the outstanding Notes, or to
any suit instituted by any Holder for the enforcement of the payment of the
principal of, premium, if any, or interest or Liquidated Damages, if any, on any
Note on or after its Stated Maturity.
SECTION 6.11. WAIVER OF STAY OR EXTENSION LAWS. The Company (to
the extent it may lawfully do so) shall not at any time insist upon, or plead,
or in any manner whatsoever claim or take the benefit or advantage of, any stay
or extension law wherever enacted, now or at any time hereafter in force, which
may affect the covenants or the performance of this Indenture; and the Company
(to the extent that it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law, and shall not hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been enacted.
SECTION 6.11. Trustee May Enforce Claims Without Possession of the Notes"3". All
rights of action and claims under this Indenture or the Notes may be prosecuted
and enforced by the Trustee without the possession of any of the Notes or the
production thereof in any proceeding relating thereto, and any such proceeding
instituted by the Trustee shall be brought in its own name, as trustee of an
express trust, and any recovery of judgment shall, after provision for the
payment of the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, be for the ratable benefit of the Holders
of the Notes.
SECTION 6.13. RESTORATION OF RIGHTS AND REMEDIES. If the Trustee
or any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case the Company, the Trustee and the Holders shall, subject
to any determination in such proceeding, be restored severally and respectively
to their former positions hereunder, and thereafter all rights and remedies of
the Trustee and the Holders shall continue as though no such proceeding had been
instituted.
SECTION 6.14. RIGHTS AND REMEDIES CUMULATIVE. Except as otherwise
provided in Section 2.07 hereof, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent permitted
by law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 6.15. DELAY OR OMISSION NOT WAIVER. No delay or omission
of the Trustee or of any Holder of any Note to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article VI or by law to the
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Trustee or to the Holders may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee or by the Holders, as the case may be.
ARTICLE VII
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and shall use the same degree of care and skill
in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default: (i) the
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture and no implied covenants or obligations
shall be read into this Indenture against the Trustee; and (ii) in the absence
of bad faith on its part, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture; PROVIDED that in the case of any such
certificates or opinions that by any provision of this Indenture are
specifically required to be furnished to the Trustee, the Trustee shall examine
such certificates and opinions to determine whether or not they conform to the
requirements of this Indenture.
(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, PROVIDED that: (i) this paragraph (c) shall not limit the effect of
paragraph (b) of this Section 7.01; (ii) the Trustee shall not be liable for any
error of judgment made in good faith by a Trust Officer unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and (iii) the
Trustee shall not be liable with respect to any action it takes or omits to take
in good faith in accordance with a direction received by it pursuant to Section
6.05 hereof.
(d) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
(e) Money held in trust by the Trustee need not be segregated
from other funds except to the extent required by law.
(f) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk of liability is
not reasonably assured to it.
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(g) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Article VII and to the provisions of the Trust
Indenture Act.
SECTION 7.02. RIGHTS OF TRUSTEE. (a) The Trustee may rely on
any document believed by it to be genuine and to have been signed or presented
by the proper Person. Except as provided in Section 7.01(b) hereof, the Trustee
need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate and an Opinion of Counsel. The Trustee shall
not be liable for any action it takes or omits to take in good faith in reliance
on any Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any such agent; PROVIDED that
such agent was appointed with due care by the Trustee.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; PROVIDED that the Trustee's conduct does not constitute
willful misconduct or negligence.
(e) The Trustee shall not be charged with knowledge of any
Default or Event of Default under Sections 6.01(c), 6.01(d), 6.01(e), 6.01(f),
6.01(g), 6.01(h) or 6.01(i) hereof, of the identity of any Subsidiary or of the
existence of any Change of Control or Asset Sale unless either (i) a Trust
Officer with responsibility for the administration of this Indenture shall have
actual knowledge thereof, or (ii) the Trustee shall have received notice thereof
in accordance with Section 12.02 hereof from the Company or any Holder.
(f) The Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.
(g) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture or other paper or document, but the Trustee, in its discretion may
make such further inquiry or investigation into such facts or matters as it may
see fit, and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee, any
Paying Agent or Registrar, in its individual or any other capacity, may become
the owner or pledgee of Notes and may otherwise deal with the Company, the
Guarantors or their Affiliates with the same rights it would have if it were not
Trustee, Paying Agent or Registrar hereunder, as the case may be; PROVIDED that
the Trustee must in any event comply with Section 7.10 and Section 7.11 hereof.
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SECTION 7.04. TRUSTEE'S DISCLAIMER. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Notes, it shall not be accountable for the Company's use
of the proceeds from the Notes, and it shall not be responsible (a) for any
statement of the Company in this Indenture, including the recitals contained
herein, or in any document issued in connection with the sale of the Notes or in
the Notes other than the Trustee's certificate of authentication or (b) for
compliance by the Company with the Registration Rights Agreement.
SECTION 7.05. NOTICE OF DEFAULTS. Within 90 calendar days after
the occurrence of any Default hereunder with respect to the Notes, the Trustee
shall transmit by mail to all Holders, as their names and addresses appear in
the Note Register, notice of such Default hereunder known to the Trustee, unless
such Default shall have been cured or waived; PROVIDED that, except in the case
of a Default in the payment of the principal of (or premium, if any) or interest
(or Liquidated Damages) on any Note, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Trust Officers of the Trustee
in good faith determine that the withholding of such notice is in the interest
of the Holders.
SECTION 7.06. PRESERVATION OF INFORMATION; REPORTS BY TRUSTEE TO
HOLDERS. (a) The Company shall furnish or cause to be furnished to the
Trustee:
(i) semiannually, not less than 10 calendar days prior to each
Interest Payment Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of the
Record Date immediately preceding such Interest Payment Date, and
(ii) at such other times as the Trustee may request in writing,
within 30 calendar days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than
15 calendar days prior to the time such list is furnished;
PROVIDED, HOWEVER, that if and so long as the Trustee shall be the Registrar for
the Notes, no such list need be furnished with respect to the Notes.
(b) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 7.06(a) hereof and
the names and addresses of Holders received by the Trustee in its capacity as
Registrar, if so acting. The Trustee may destroy any list furnished to it as
provided in Section 7.06(a) hereof upon receipt of a new list so furnished.
(c) Holders may communicate as provided in Section 312(b) of the
Trust Indenture Act with other Holders with respect to their rights under this
Indenture or under the Notes.
(d) Each Holder, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee shall be
held accountable by reason of the disclosure of any such information as to the
names and addresses of the Holders in
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accordance with this Section 7.06, regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under this Section
7.06.
(e) Within 60 calendar days after July 15 of each year commencing
with the year 1997, the Trustee shall transmit by mail to all Holders, a brief
report dated as of such July 15 if and to the extent required under Section
313(a) of the Trust Indenture Act.
(f) The Trustee shall comply with Sections 313(b) and 313(c) of
the Trust Indenture Act.
(g) A copy of each report described in Section 7.06(e) hereof
shall, at the time of its transmission to Holders, be filed by the Trustee with
each stock exchange, if any, upon which the Notes are then listed, with the
Commission and also with the Company. The Company shall promptly notify the
Trustee of any stock exchange upon which the Notes are listed.
SECTION 7.07. COMPENSATION AND INDEMNITY. (a) The Company shall
pay to the Trustee from time to time such compensation for its services as the
Company and the Trustee shall from time to time agree. The Company shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred or made by it, including costs of collection, in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the Trustee's agents
and counsel. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust.
(b) The Company shall indemnify the Trustee for, and hold it
harmless against, any and all loss, liability, damage, claim or expense
(including reasonable attorneys' fees and expenses) arising out of or incurred
by it in connection with the acceptance or administration of the trust created
by this Indenture and the performance of its duties hereunder, except as set
forth in the next paragraph. The Trustee shall notify the Company promptly of
any claim for which it may seek indemnity. Failure by the Trustee to so notify
the Company shall not relieve the Company of its obligations hereunder. The
Company shall defend any such claim and the Trustee shall cooperate in the
defense of such claim. The Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need not
pay for any settlement made without its consent, which consent shall not be
unreasonably withheld.
(c) The Company need not reimburse any expense or indemnify
against any loss, liability or expense incurred by the Trustee through the
Trustee's own willful misconduct, negligence or bad faith.
(d) To secure the Company's payment obligations in this Section
7.07, the Trustee shall have a Lien prior to the Notes on all money or property
held or collected by the Trustee other than money or property held in trust to
pay principal of, premium, if any, and interest and Liquidated Damages, if any,
on, particular Notes.
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(e) The Company's payment obligations pursuant to this Section
7.07 shall survive the resignation or removal of the Trustee and discharge of
this Indenture. Subject to any other rights available to the Trustee under
applicable bankruptcy law, when the Trustee incurs expenses after the occurrence
of a Default specified in Section 6.01(h) or Section 6.01(i) hereof, the
expenses are intended to constitute expenses of administration under Bankruptcy
Law.
SECTION 7.08. REPLACEMENT OF TRUSTEE. (a) No resignation or
removal of the Trustee and no appointment of a successor Trustee pursuant to
this Article VII shall become effective until the acceptance of appointment by
the successor Trustee under this Section 7.08.
(b) The Trustee may resign at any time by giving written notice
thereof to the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 calendar days after the
giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders
of a majority in principal amount of the outstanding Notes, delivered to the
Trustee and to the Company. A successor Trustee may be appointed by Act of the
Holders with the Company's consent. If an instrument of acceptance by a
successor Trustee shall not have been delivered to the Trustee within 30
calendar days after the giving of notice of removal, the Trustee being removed
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
(d) If at any time:
(i) the Trustee shall fail to comply with Section 310(b)
of the Trust Indenture Act after written request therefor by the Company
or by any Holder who has been a bona fide Holder of a Note for at least
six months, unless the Trustee's duty to resign is stayed in accordance
with the provisions of Section 310(b) of the Trust Indenture Act; or
(ii) the Trustee shall cease to be eligible under Section
7.10 hereof and shall fail to resign after written request therefor by
the Company or by any such Holder; or
(iii) the Trustee shall become incapable of acting or a
decree or order for relief by a court having jurisdiction in the
premises shall have been entered in respect of the Trustee in an
involuntary case under any Bankruptcy Law; or a decree or order by a
court having jurisdiction in the premises shall have been entered for
the appointment of a Custodian of the Trustee or of its Property or
affairs, or any public officer shall take charge or control of the
Trustee or of its Property or affairs for the purpose of rehabilitation,
conservation, winding up or liquidation; or
(iv) the Trustee shall commence a voluntary case under any
Bankruptcy Law or shall consent to the appointment of or taking
possession by a Custodian of the Trustee or its Property or affairs, or
shall make an assignment for the
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benefit of creditors, or shall admit in writing its inability to pay its
debts generally as they become due, or shall take corporate action in
furtherance of any such action,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to the Notes, or (ii) subject to Section 6.10 hereof, any
Holder who has been a bona fide Holder of a Note for at least six months may, on
behalf of such Holder and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee for the Notes. If an instrument of acceptance by a successor
Trustee shall not have been delivered to the Trustee within 30 calendar days
after the giving of notice of removal, the Trustee being removed may petition
any court of competent jurisdiction for the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of Trustee for any cause,
the Company, by or pursuant to a Board Resolution, shall promptly appoint a
successor Trustee. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee shall be
appointed by the Holders of a majority in principal amount of the outstanding
Notes delivered to the Company and the retiring Trustee, the successor Trustee
so appointed shall, forthwith upon its acceptance of such appointment in
accordance with this Section 7.08, become the successor Trustee and to that
extent replace any successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders and shall
have accepted appointment in the manner hereinafter provided, any Holder that
has been a bona fide Holder for at least six months may, subject to Section 6.10
hereof, on behalf of such Holder and all others similarly situated, petition any
court of competent jurisdiction for the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee by mailing
written notice of such resignation, removal and appointment by first-class mail,
postage prepaid, to the Holders as their names and addresses appear in the Note
Register. Each notice shall include the name of the successor Trustee with
respect to the Notes and the address of its Corporate National Trust Office.
(g) In the event of an appointment hereunder of a successor
Trustee, each such successor Trustee so appointed shall execute, acknowledge and
deliver to the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee, and shall duly assign, transfer and
deliver to such successor Trustee all Property and money held by such former
Trustee hereunder, subject to its Liens, if any, provided for in Section 7.07
hereof.
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(h) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in Section 7.08(g) hereof.
(i) No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article VII and under the Trust Indenture Act.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER. Any corporation
into which the Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder; PROVIDED that such
corporation shall be otherwise qualified and eligible under this Article VII and
under the Trust Indenture Act, without the execution or filing of any paper or
any further act on the part of any of the parties hereto. In case any Notes
shall have been authenticated, but not delivered, by the Trustee then in office,
any successor by merger, conversion or consolidation to such authenticating
Trustee may adopt such authentication and deliver the Notes so authenticated
with the same effect as if such successor Trustee had itself authenticated such
Notes. In the event that any Notes shall not have been authenticated by such
predecessor Trustee, any such successor Trustee may authenticate and deliver
such Notes, in either its own name or that of its predecessor Trustee, with the
full force and effect which this Indenture provides for the certificate of
authentication of the Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION. (a) There shall at
all times be a Trustee hereunder which shall be:
(i) a corporation organized and doing business under the laws of
the United States of America, any State or Territory thereof or the
District of Columbia, authorized under such laws to exercise corporate
trust powers, and subject to supervision or examination by Federal,
State, Territorial or District of Columbia authority; or
(ii) a corporation or other Person organized and doing business
under the laws of a foreign government that is permitted to act as
Trustee pursuant to a rule, regulation or order of the Commission,
authorized under such laws to exercise corporate trust powers, and
subject to supervision or examination by authority of such foreign
government or a political subdivision thereof substantially equivalent
to supervision or examination applicable to United States institutional
trustees,
in either case having a combined capital and surplus of at least $50,000,000.
(b) If such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section 7.10, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. Neither the Company nor any Guarantor nor any their respective
Affiliates shall serve as Trustee hereunder. If at any time the Trustee shall
cease to be eligible to serve as Trustee hereunder
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pursuant to the provisions of this Section 7.10, it shall resign immediately in
the manner and with the effect specified in this Article VII.
(c) If the Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Trustee and the Company shall in all respects comply with the provisions of
Section 310(b) of the Trust Indenture Act. Nothing herein shall prevent the
Trustee from filing with the Commission the application referred to in the
penultimate paragraph of Section 310(b) of the Trust Indenture Act.
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee shall comply with Section 311(a) of the Trust Indenture Act,
excluding any creditor relationship listed in Section 311(b) of the Trust
Indenture Act. A Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent indicated therein.
ARTICLE VIII
DEFEASANCE
SECTION 8.01. COMPANY'S OPTION TO EFFECT LEGAL DEFEASANCE OR
COVENANT DEFEASANCE. The Company may elect, at its option, at any time, to have
Section 8.02 or Section 8.03 hereof applied to the outstanding Notes (in whole
and not in part) upon compliance with the conditions set forth below in this
Article VIII. Such election shall be evidenced by a Board Resolution delivered
to the Trustee and shall specify whether the Notes are being defeased to Stated
Maturity or to a specified Redemption Date determined in accordance with the
terms of this Indenture and the Notes.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE. Upon the Company's
exercise under Section 8.01 hereof of its option to have this Section 8.02
applied to the outstanding Notes (in whole and not in part), the Company and the
Guarantors shall be deemed to have been discharged from their obligations with
respect to such Notes as provided in this Section 8.02 on and after the date the
conditions set forth in Section 8.04 hereof are satisfied (hereinafter called
"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 such Notes which shall thereafter be deemed to be "outstanding"
only for the purpose of Section 8.05 hereof and the other Section of this
Indenture referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture insofar as such Notes are
concerned (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), subject to the
following which shall survive until otherwise terminated or discharged
hereunder:
(a) the rights of Holders of outstanding Notes to receive
payments in respect of the principal of premium, if any, and interest and
Liquidated Damages, if any, on such Notes when payments are due from the trust
referred to below,
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(b) the Company's obligations with respect to such Notes under
Sections 2.03, 2.04, 2.06, 2.07, 2.09, 4.02, 4.03 and 4.04 hereof,
(c) the Company's obligations under the Registration Rights
Agreement,
(d) the rights, powers, trusts, duties and immunities of the
Trustee under this Indenture and the Company's obligations in connection
therewith,
(e) Article III hereof, and
(f) this Article VIII.
Subject to compliance with this Article VIII, the Company may
exercise its option to have this Section 8.02 applied to the outstanding Notes
(in whole and not in part) notwithstanding the prior exercise of its option to
have Section 8.03 hereof applied to such Notes.
SECTION 8.03. COVENANT DEFEASANCE. Upon the Company's exercise
under Section 8.01 hereof of its option to have this Section 8.03 applied to the
outstanding Notes (in whole and not in part):
(a) the Company shall be released from its obligations under
Section 5.01(c), Sections 4.05 through 4.17, inclusive;
(b) the occurrence of any event specified in Section 6.01(c), or
Section 6.01(e) hereof, with respect to any of Section 5.01(c) or Sections 4.05
through 4.17, inclusive, shall be deemed not to be or result in an Event of
Default, in each case with respect to such Notes as provided in this Section
8.03 on and after the date the conditions set forth in Section 8.04 hereof are
satisfied (hereinafter called "Covenant Defeasance"); and
(c) the Notes shall thereafter be deemed not "outstanding" for
the purposes of any direction, waiver, consent, declaration or act of Holders
(and the consequences of any thereof) in connection with such covenants, but
shall continue to be deemed "outstanding" for all other purposes hereunder (it
being understood that such Notes shall not be deemed outstanding for accounting
purposes).
For this purpose, such Covenant Defeasance means that, with
respect to such Notes, the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
specified Section (to the extent so specified in the case of Sections 6.01(c)
and 6.01(e) hereof), whether directly or indirectly by reason of any reference
elsewhere herein to any such Section or by reason of any reference in any such
Section to any other provision herein or in any other document; but the
remainder of this Indenture and such Notes shall be unaffected thereby. In
addition, upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03 hereof, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, Sections 6.01 (f) and 6.01(g)
hereof shall thereafter not constitute Events of Default.
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SECTION 8.04. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of Section 8.02 or
Section 8.03 hereof to the outstanding Notes:
(a) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to the benefits of the Holders, (i) cash in United States dollars, or (ii) 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 one day before the due date of any payment, cash in United States
dollars, or (iii) 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 any such other qualifying trustee)
to pay and discharge, the principal of, premium, if any, and any installment of
interest and Liquidated Damages on the outstanding Notes on the Stated Maturity
thereof or applicable Redemption Date, as the case may be, in accordance with
the terms of this Indenture and such Notes;
(b) In the event of an election to have Section 8.02 hereof apply
to the outstanding Notes, the Company shall have delivered to the Trustee an
Opinion of Counsel in the United States stating that (i) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (ii) since the date of this Indenture, there has been a change in the
applicable Federal income tax law, in either case (i) or (ii) to the effect
that, and based thereon such opinion shall confirm that, the Holders will not
recognize income, gain or loss for Federal income tax purposes as a result of
the deposit, Legal Defeasance and discharge to be effected with respect to such
Notes and will be subject to Federal income tax on the same amounts, in the same
manner and at the same times as would be the case if such deposit, Legal
Defeasance and discharge were not to occur;
(c) In the event of an election to have Section 8.03 hereof apply
to the outstanding Notes, the Company shall have delivered to the Trustee an
Opinion of Counsel in the United States to the effect that the Holders will not
recognize income, gain or loss for Federal income tax purposes as a result of
the deposit and Covenant Defeasance to be effected with respect to such Notes
and will be subject to Federal income tax on the same amounts, in the same
manner and at the same times as would be the case if such deposit and Covenant
Defeasance were not to occur;
(d) No Default or Event of Default with respect to the
outstanding Notes shall have occurred and be continuing at the time of such
deposit (other than a Default or Event of Default resulting from the borrowing
of funds to be applied to such deposit) after giving effect thereto or, with
respect to a Default or Event of Default specified in Section 6.01(h) or Section
6.01(i), any time on or prior to the 123rd calendar day after the date of such
deposit (it being understood that this condition shall not be deemed satisfied
until after such 123rd calendar day);
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(e) Such Legal Defeasance or Covenant Defeasance shall not cause
the Trustee to have a conflicting interest within the meaning of the Trust
Indenture Act (assuming for the purpose of this clause (e) that all Notes are in
default within the meaning of such Act);
(f) Such Legal Defeasance or Covenant Defeasance shall not result
in a breach or violation of, or constitute a default under, any material
agreement or instrument to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries is bound;
(g) The Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders over any other creditors of the Company or the
Guarantors or with the intent of defeating, hindering, delaying or defrauding
any other creditors of the Company, the Guarantors or others;
(h) Such Legal Defeasance or Covenant Defeasance shall not result
in the trust arising from such deposit constituting an investment company within
the meaning of the Investment Company Act of 1940, as amended, unless such trust
shall be registered under such Act or exempt from registration thereunder; and
(i) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent with respect to such Legal Defeasance or Covenant Defeasance have been
complied with.
SECTION 8.05. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO
BE HELD IN TRUST; MISCELLANEOUS PROVISIONS. (a) All money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee pursuant
to Section 8.04 hereof in respect of the outstanding Notes shall be held in
trust and applied by the Trustee, in accordance with the provisions of such
Notes and this Indenture, to the payment, either directly or through any such
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 and any premium and
interest and Liquidated Damages, but money so held in trust need not be
segregated from other funds except to the extent required by law. Money and U.S.
Government Obligations so held in trust are not subject to Article X hereof. The
Company 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 8.04 hereof or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of outstanding Notes.
(b) Anything in this Article VIII to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon receipt of a Company Order any money or U.S. Government Obligations
held by it as provided in Section 8.04 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 that would then be required to be deposited to effect the Legal
Defeasance or Covenant Defeasance, as the case may be, with respect to the
outstanding Notes.
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SECTION 8.06. REINSTATEMENT. If the Trustee or Paying Agent is
unable to apply any money in accordance with this Article VIII with respect to
any Notes by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, then
the obligations under this Indenture and such Notes from which the Company and
the Guarantors have been discharged or released pursuant to Section 8.02 or 8.03
hereof shall be revived and reinstated as though no deposit had occurred
pursuant to this Article VIII with respect to such Notes, until such time as the
Trustee or Paying Agent is permitted to apply all money held in trust pursuant
to Section 8.05 hereof with respect to such Notes in accordance with this
Article VIII; PROVIDED that if the Company makes any payment of principal of or
any premium or interest or Liquidated Damages on any such Note following such
reinstatement of its obligations, the Company shall be subrogated to the rights
(if any) of the Holders of such Notes to receive such payment from the money so
held in trust.
ARTICLE IX
AMENDMENTS
SECTION 9.01. WITHOUT CONSENT OF HOLDERS. The Company, the
Guarantors and the Trustee may, at any time, and from time to time, without
notice to or consent of any Holder, enter into one or more indentures
supplemental hereto, in form reasonably satisfactory to the Trustee, for any of
the following purposes:
(a) to evidence the succession of another Person to the Company
and the assumption by such successor of the covenants of the Company herein and
contained in the Notes; or
(b) to add to the covenants of the Company, for the benefit of
the Holders of all of the Notes, or to surrender any right or power herein
conferred upon the Company; or
(c) to add any additional Events of Default; or
(d) to provide for uncertificated Notes in addition to or in
place of Certificated Notes; or
(e) to evidence and provide for the acceptance of appointment
hereunder of a successor Trustee; or
(f) to secure the Notes; or
(g) to cure any ambiguity herein, or to correct or supplement any
provision hereof which may be inconsistent with any other provision hereof or to
add any other provisions with respect to matters or questions arising under this
Indenture; PROVIDED that such actions shall not adversely affect the interests
of the Holders in any material respect; or
(h) to comply with the requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the Trust Indenture
Act; or
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(i) to evidence the agreement or acknowledgment of a Subsidiary
that it is a Guarantor for all purposes under this Indenture (including, without
limitation, Article XI hereof).
SECTION 9.02. WITH CONSENT OF HOLDERS. (a) With the consent of
the Holders of not less than a majority in principal amount of the outstanding
Notes (which consent may, but need not, be given in connection with any tender
offer or exchange offer for the Notes), by Act of said Holders delivered to the
Company and the Trustee, the Company, the Guarantors and the Trustee may enter
into one or more indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of modifying in any manner the rights of the Holders
(including Sections 4.07 and 4.08 hereof); PROVIDED that no such supplemental
indenture shall, without the consent of the Holder of each outstanding Note:
(i) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver; or
(ii) reduce the principal of or premium on or change the Stated
Maturity of any Note or alter or waive any of the provisions with
respect to the redemption of the Notes, except as provided above with
respect to Sections 4.07 and 4.08 hereof; or
(iii) reduce the rate of or change the time for payment of
interest, including Defaulted Interest, on any Note;
(iv) waive a Default or Event of Default in the payment of
principal of or premium, if any, or interest or Liquidated Damages, if
any, on any Note (except a rescission of acceleration of the Notes by
the Holders of at least a majority in aggregate principal amount of the
then outstanding Notes and a waiver of the payment default that resulted
from such acceleration); or
(v) make any Note payable in money other than that stated in the
Notes; or
(vi) make any change in the provisions of this Indenture relating
to waivers of past Defaults or the rights of Holders to receive payments
of principal of or premium, if any, or interest or Liquidated Damages,
if any, on the Notes; or
(vii) waive a redemption payment with respect to any Note (other
than a payment required by Section 4.07 or Section 4.08 hereof); or
(viii) modify the ranking or priority of the Notes or the Note
Guarantee of any Guarantor; or
(ix) release any Guarantor from any of its obligations under its
Note Guarantee or this Indenture other than in accordance with the terms
of this Indenture; or
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(x) make any change in Sections 6.04 or 6.07 hereof or the
foregoing amendment and waiver provisions.
(b) It shall not be necessary for any Act of Holders under this
Section 9.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
(c) After an amendment or supplement under this Section or a
waiver under Section 6.04 becomes effective, the Company shall mail to the
Holders a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not
however, in any way impair or affect the validity of any such amended or
supplemented indenture or waiver.
SECTION 9.03. EFFECT OF SUPPLEMENTAL INDENTURES. Upon the
execution of any supplemental indenture under this Article IX, this Indenture
shall be modified in accordance therewith, and such supplemental indenture shall
form a part of this Indenture for all purposes; and every Holder theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
SECTION 9.04. COMPLIANCE WITH TRUST INDENTURE ACT. Every
amendment or supplement to this Indenture or the Notes shall comply with the
Trust Indenture Act as then in effect.
SECTION 9.05. REVOCATION AND EFFECT OF CONSENTS AND WAIVERS. (a)
A consent to an amendment, supplement or a waiver by a Holder of a Note shall
bind the Holder and every subsequent Holder of such Note or portion of such Note
that evidences the same debt as the consenting Holder's Note, even if notation
of the consent or waiver is not made on such Note; PROVIDED that any such Holder
or subsequent Holder may revoke the consent or waiver as to such Holder's Note
or portion of such Note if the Trustee receives the notice of revocation before
the date the amendment, supplement or waiver becomes effective. After an
amendment, supplement or waiver becomes effective pursuant to this Article IX,
it shall bind every Holder.
(b) The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to give their consent
or take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
calendar days after such record date.
SECTION 9.06. NOTATION ON OR EXCHANGE OF NOTES. If a supplemental
indenture changes the terms of a Note, the Trustee may require the Holder
thereof to deliver such Note to the Trustee. The Trustee may place an
appropriate notation on such Note regarding the changed terms and return it to
the Holder. Alternatively, if the Company or the Trustee so determines, the
Company in exchange for such Note shall issue and the Trustee shall authenticate
a new Note
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that reflects the changed terms. Failure to make the appropriate notation or to
issue a new Note shall not affect the validity of such amendment or supplement.
SECTION 9.07. TRUSTEE TO EXECUTE SUPPLEMENTAL INDENTURES. The
Trustee shall execute any supplemental indenture authorized pursuant to this
Article IX if such supplemental indenture does not adversely affect the rights,
duties, liabilities or immunities of the Trustee. If it does, the Trustee may,
but shall not be required to, execute such supplemental indenture. In executing
any supplemental indenture, the Trustee shall be entitled to receive indemnity
reasonably satisfactory to it and to receive, and (subject to Section 7.01
hereof) shall be fully protected in relying upon, an Officers' Certificate
(which need only cover the matters set forth in clause (a) below) and an Opinion
of Counsel provided by the Company stating that:
(a) such supplemental indenture is authorized or permitted by
this Indenture and that all conditions precedent to the execution, delivery and
performance of such supplemental indenture have been satisfied;
(b) the Company and each Guarantor have all necessary corporate
power and authority to execute and deliver the supplemental indenture and that
the execution, delivery and performance of such supplemental indenture have been
duly authorized by all necessary corporate action of the Company and each
Guarantor;
(c) the execution, delivery and performance of the supplemental
indenture do not conflict with, or result in the breach of or constitute a
default under any of the terms, conditions or provisions of (i) this Indenture,
(ii) the charter documents and By-Laws of the Company or any Guarantor or (iii)
any material agreement or instrument to which the Company or any Guarantor is
subject;
(d) to the best knowledge and belief of legal counsel writing
such Opinion of Counsel, the execution, delivery and performance of the
supplemental indenture do not conflict with, or result in the breach of any of
the terms, conditions or provisions of (i) any law or regulation applicable to
the Company or any Guarantor or (ii) any material order, writ, injunction or
decree of any court or governmental instrumentality applicable to the Company or
any Guarantor;
(e) such supplemental indenture has been duly and validly
executed and delivered by the Company and each Guarantor, and this Indenture
together with such supplemental indenture constitutes a legal, valid and binding
obligation of the Company and each Guarantor enforceable against the Company and
each Guarantor in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and general equitable principles; and
(f) this Indenture together with such amendment or supplement
complies with the Trust Indenture Act.
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ARTICLE X
SUBORDINATION
SECTION 10.01. AGREEMENT TO SUBORDINATE. The Company agrees, and
each Holder by accepting a Note agrees, that the Indebtedness evidenced by the
Note is subordinated in right of payment, to the extent and in the manner
provided in this Article X, to the prior payment in full in cash of all Senior
Indebtedness (whether outstanding on the date hereof or hereafter incurred), and
that the subordination is for the benefit of the holders of Senior Indebtedness.
This Article X shall constitute a continuing offer to all Persons who become
holders of, or continue to hold, Senior Indebtedness, and such provisions are
made for the benefit of the holders of Senior Indebtedness.
SECTION 10.02. LIQUIDATION; DISSOLUTION; BANKRUPTCY. Upon any
distribution to creditors of the Company in a liquidation or dissolution of the
Company or in a bankruptcy, reorganization, insolvency, receivership or similar
proceeding relating to the Company or its property, in an assignment for the
benefit of creditors or any marshaling of the Company's assets and liabilities:
(a) holders of Senior Indebtedness shall be entitled to receive
payment in full in cash of all Obligations due in respect of Senior Indebtedness
(including interest after the commencement of any such proceeding at the rate
specified in the applicable Senior Indebtedness) before Holders shall be
entitled to receive any payment with respect to the Notes and until all
obligations with respect to Senior Indebtedness are paid in full in cash, any
distribution to which the Holders would be entitled shall be made to the holders
of Senior Indebtedness (except that Holders may receive and retain (i)
securities of a Person that are subordinated ("Subordinated Reorganization
Securities") to at least the same extent as the Notes to (A) Senior Indebtedness
and (B) any securities issued in exchange for Senior Indebtedness, and (ii)
payments and other distributions made from any defeasance trust created pursuant
to Section 8.01 hereof); and
(b) until all Obligations with respect to Senior Indebtedness (as
provided in subsection (a) above) are paid in full in cash, any distribution to
which Holders would be entitled but for this Article shall be made to holders of
Senior Indebtedness (except that Holders may receive and retain (i) Subordinated
Reorganization Securities and (ii) payments and other distributions made from
any defeasance trust created pursuant to Section 8.01 hereof), as their
interests may appear.
SECTION 10.03. DEFAULT ON DESIGNATED SENIOR INDEBTEDNESS. (a) The
Company may not make any payment upon or in respect of the Notes (other than (i)
Subordinated Reorganization Securities and (ii) payments and other distributions
made from any defeasance trust created pursuant to Section 8.01 hereof) if:
(i) a default in the payment of any principal, premium, if
any, or interest with respect to Designated Senior Indebtedness occurs
and is continuing beyond any
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applicable grace period in the agreement, indenture or other document
governing Designated Senior Indebtedness; or
(ii) any other default occurs and is continuing with
respect to Designated Senior Indebtedness which permits holders of such
Designated Senior Indebtedness as to which such default relates to
accelerate its maturity and the Trustee receives a notice of such
default (a "Payment Blockage Notice") from a Person who may give it
pursuant to Section 10.11 hereof. If the Trustee receives any such
Payment Blockage Notice, no subsequent Payment Blockage Notice shall be
effective for purposes of this Section 10.03 unless and until at least
360 days shall have elapsed since the effectiveness of the immediately
prior Payment Blockage Notice. No default specified in this clause (ii)
that existed or was continuing on the date of delivery of any Payment
Blockage Notice to the Trustee shall be, or be made, the basis for a
subsequent Payment Blockage Notice, unless such default has been cured
or waived for a period of not less than 90 days. No new period of
payment blockage may be commenced by a Payment Blockage Notice unless
and until 360 days have elapsed since the first day of the effectiveness
of the immediately prior Payment Blockage Notice.
(b) The Company may and shall resume payments on and
distributions in respect of the Notes and may acquire them upon the earlier of:
(i) in the case of a default referred to in Section
10.03(a), the date upon which such default is cured or waived, or
(ii) in the case of a default referred to in Section
10.03(b) hereof, the earlier of the date on which such default is cured
or waived or 179 days after the date on which the applicable Payment
Blockage Notice is received, unless the maturity of such Designated
Senior Indebtedness has been accelerated,
if this Article X otherwise permits the payment, distribution or acquisition at
the time of such payment or acquisition.
SECTION 10.04. ACCELERATION OF NOTES. If payment of the Notes is
accelerated because of an Event of Default, the Company shall promptly notify
holders of Senior Indebtedness of the acceleration.
SECTION 10.05. WHEN DISTRIBUTION MUST BE PAID OVER. In the event
that the Trustee or any Holder receives any payment of any Obligations with
respect to the Notes at a time when the Trustee or such Holder, as applicable,
has actual knowledge that such payment is prohibited by Section 10.03 hereof,
such payment shall be held by the Trustee or such Holder, in trust for the
benefit of, and shall be paid forthwith over and delivered, upon written
request, to, the holders of Senior Indebtedness as their interests may appear or
their Representative under the indenture or other agreement (if any) pursuant to
which Senior Indebtedness may have been issued, for application to the payment
of all Obligations with respect to Senior Indebtedness remaining unpaid to the
extent necessary to pay such Obligations in full in accordance with their terms,
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after giving effect to any concurrent payment or distribution to or for the
holders of Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform only such obligations on the part of the Trustee as are
specifically set forth in this Article X, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness, and shall not be
liable to any such holders if the Trustee shall pay over or distribute to or on
behalf of Holders or any other Person money or assets to which any holders of
Senior Indebtedness shall be entitled by virtue of this Article X, except if
such payment is made as a result of the willful misconduct or gross negligence
of the Trustee.
SECTION 10.06. NOTICE BY COMPANY. The Company shall promptly
notify the Trustee and the Paying Agent of any facts known to the Company that
would cause a payment of any Obligations with respect to the Notes to violate
this Article X, but failure to give such notice shall not affect the
subordination of the Notes to Senior Indebtedness as provided in this Article X.
SECTION 10.07. SUBROGATION. After all Senior Indebtedness is paid
in full and until the Notes are paid in full, Holders shall be subrogated to the
rights of holders of Senior Indebtedness to receive distributions applicable to
Senior Indebtedness to the extent that distributions otherwise payable to the
Holders have been applied to the payment of Senior Indebtedness. A distribution
made under this Article X to holders of Senior Indebtedness that otherwise would
have been made to Holders is not, as between the Company and Holders, a payment
by the Company on Senior Indebtedness.
SECTION 10.08. RELATIVE RIGHTS. This Article X defines the
relative rights of Holders and holders of Senior Indebtedness. Nothing in this
Indenture shall:
(a) impair, as between the Company and Holders, the obligation of
the Company, which is absolute and unconditional, to pay principal of, premium,
if any, on and interest and Liquidated Damages, if any, on the Notes in
accordance with their terms;
(b) affect the relative rights of Holders and creditors of the
Company other than their rights in relation to holders of Senior Indebtedness;
or
(c) prevent the Trustee or any Holder from exercising its
available remedies upon a Default or Event of Default, subject to the rights of
holders and owners of Senior Indebtedness to receive distributions and payments
otherwise payable to Holders.
If the Company fails because of this Article X to pay principal
of, premium, if any, on or interest or Liquidated Damages, if any, on a Note on
the due date, the failure is still a Default or Event of Default.
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SECTION 10.09. SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY. No
right of any holder of Senior Indebtedness to enforce the subordination of the
Indebtedness evidenced by the Notes shall be impaired by any act or failure to
act by the Company or any Holder or by the failure of the Company or any Holder
to comply with this Indenture.
SECTION 10.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE. Whenever
a distribution is to be made or a notice given to holders of Senior
Indebtedness, the distribution may be made and the notice given to their
Representative.
Upon any payment or distribution of assets of the Company
referred to in this Article X, the Trustee and the Holders shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee or
agent or other Person making any distribution to the Trustee or to the Holders
for the purpose of ascertaining the Persons entitled to participate in such
distribution, the holders of Senior Indebtedness and other Indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article X.
The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee or agent on behalf of such holder) to establish that
such notice has been given by a holder of Senior Indebtedness (or a trustee or
agent on behalf of any such holder). In the event that the Trustee determines in
good faith that further evidence is required with respect to the right of any
Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article X, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article X, and if such
evidence is not furnished, the Trustee may defer any payment which it may be
required to make for the benefit of such Person pursuant to the terms of this
Indenture pending judicial determination as to the rights of such Person to
receive such payment.
SECTION 10.11. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article X or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment or distribution by the
Trustee, and the Trustee and the Paying Agent may continue to make payments on
the Notes, unless the Trustee shall have received at its Corporate National
Trust Office at least two Business Days prior to the date of such payment
written notice of facts that would cause the payment of any Obligations with
respect to the Notes to violate this Article X. Only the holders of Designated
Senior Indebtedness or a Representative thereof may give the notice. Nothing in
this Article X shall impair the claims of, or payments to, the Trustee under or
pursuant to Section 7.07 hereof.
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The Trustee in its individual or any other capacity may hold
Senior Indebtedness with the same rights it would have if it were not Trustee.
Any Paying Agent may do the same with like rights.
SECTION 10.12. AUTHORIZATION TO EFFECT SUBORDINATION. Each Holder
of a Note by the Holder's acceptance thereof authorizes and directs the Trustee
on the Holder's behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article X, and appoints the
Trustee to act as the Holder's attorney-in-fact for any and all such purposes.
If the Trustee does not file a proper proof of claim or proof of debt in the
form required in any judicial proceeding relative to the Company (or any other
obligor upon the Notes), its creditors or its property at least 30 days before
the expiration of the time to file such claim, the Representative of the
Designated Senior Indebtedness (or, if no Designated Senior Indebtedness exists,
any Representative) is hereby authorized to file an appropriate claim for and on
behalf of the Holders of the Notes.
ARTICLE XI
NOTE GUARANTEES; SUBORDINATION OF NOTE GUARANTEES;
RELEASE OF NOTE GUARANTEES
SECTION 11.01. NOTE GUARANTEES.(a) Subject to the provisions of
this Article XI, each Guarantor, jointly and severally, hereby irrevocably and
unconditionally Guarantees to each Holder and to the Trustee on behalf of the
Holders (i) the due and punctual payment of principal of, premium, if any,
interest and Liquidated Damages, if any, in full on each Note when and as the
same shall become due and payable whether at Stated Maturity, by declaration of
acceleration, in connection with a Change of Control Offer, Asset Sale Offer or
redemption, or otherwise, (ii) the due and punctual payment of interest on the
overdue principal of, premium, if any, interest and Liquidated Damages, if any,
in full on the Notes, to the extent permitted by law, and (iii) the due and
punctual performance of all other Obligations of the Company and the other
Guarantors to the Holders or the Trustee, including without limitation the
payment of fees, expenses, indemnification or other amounts, all in accordance
with the terms of the Notes and this Indenture. In case of the failure of the
Company punctually to make any such principal or interest payment or the failure
of the Company or any other Guarantor to perform any such other Obligation, each
Guarantor hereby agrees to cause any such payment to be made punctually when and
as the same shall become due and payable, whether at Stated Maturity by
declaration of acceleration, in connection with a Change of Control Offer, Asset
Sale Offer or redemption or otherwise, and as if such payment were made by the
Company and to perform any such other Obligation of the Company immediately.
Each Guarantor hereby further agrees to pay any and all expenses (including
reasonable counsel fees and expenses) incurred by the Trustee or the Holders in
enforcing any rights under these Note Guarantees. The Note Guarantees under this
Article XI are guarantees of payment and not of collection.
(b) Each of the Company and the Guarantors hereby waives
diligence, presentment, demand of payment, filing of claims with a court in the
event of merger, insolvency or bankruptcy of the Company or any other Guarantor,
any right to require a proceeding first
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against the Company or any other Guarantor, protest or notice with respect to
the Notes or the Indebtedness evidenced thereby and all demands whatsoever, and
covenants that the Note Guarantees will not be discharged except by complete
performance of the Obligations contained in the Notes, in this Indenture and
pursuant to the Note Guarantees.
(c) Each Guarantor hereby waives and relinquishes:
(i) any right to require the Trustee, the Holders or the Company
(each, a "Benefited Party") to proceed against the Company, the
Subsidiaries of the Company or any other Person or to proceed against or
exhaust any security held by a Benefited Party at any time or to pursue
any other remedy in any secured party's power before proceeding against
such Guarantor;
(ii) any defense that may arise by reason of the incapacity, lack
of authority, death or disability of any other Person or Persons or the
failure of a Benefited Party to file or enforce a claim against the
estate (in administration, bankruptcy or any other proceeding) of any
other Person or Persons;
(iii) demand, protest and notice of any kind (except as expressly
required by this Indenture), including but not limited to notice of the
existence, creation or incurring of any new or additional Indebtedness
or obligation or of any action or non-action on the part of any of the
Guarantors, the Company, the Subsidiaries of the Company, any Benefited
Party, or any creditor of the Guarantors, the Company or the
Subsidiaries of the Company or on the part of any other Person
whomsoever in connection with any obligations the performance of which
are hereby guaranteed;
(iv) any defense based upon an election of remedies by a
Benefited Party, including but not limited to an election to proceed
against any Guarantor for reimbursement;
(v) any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in
amount nor in other respects more burdensome than that of the principal;
(vi) any defense arising because of a Benefited Party's election,
in any proceeding instituted under the Bankruptcy Law, of the
application of Section 1111(b)(2) of the Bankruptcy Law; and
(vii) any defense based on any borrowing or grant of a security
interest under Section 364 of the Bankruptcy Law.
(d) Each Guarantor further agrees that, as between such
Guarantor, on the one hand, and Holders and the Trustee, on the other hand, (i)
for purposes of the relevant Note Guarantee, the maturity of the Obligations
Guaranteed by such Note Guarantee may be accelerated as provided in Article VI,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Obligations guaranteed thereby, and (ii) in the
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event of any acceleration of such Obligations (whether or not due and payable)
such Obligations shall forthwith become due and payable by such Guarantor for
purposes of such Note Guarantee.
(e) The Note Guarantees shall continue to be effective or shall
be reinstated, as the case may be, if at any time any payment, or any part
thereof, of principal of, premium, if any, or interest or Liquidated Damages, if
any, on any of the Notes is rescinded or must otherwise be returned by the
Holders or the Trustee upon the insolvency, bankruptcy or reorganization of the
Company or any of the Guarantors, all as though such payment had not been made.
(f) Each Guarantor shall be subrogated to all rights of the
Holders against the Company in respect of any amounts paid by such Guarantor
pursuant to the provisions of the Note Guarantees or this Indenture; PROVIDED,
HOWEVER, that a Guarantor shall not be entitled to enforce or to receive any
payments until the principal of, premium, if any, interest and Liquidated
Damages, if any, on all Notes issued hereunder shall have been paid in full.
(g) Each Guarantor specifically designates the relevant Note
Guarantee as Indebtedness of such Guarantor for purposes of this Indenture.
SECTION 11.02 OBLIGATIONS OF GUARANTORS UNCONDITIONAL. Each
Guarantor hereby agrees that its Obligations hereunder shall be guarantees of
payment and shall be unconditional, irrespective of and unaffected by the
validity, regularity or enforceability of the Notes or this Indenture, or of any
amendment thereto or hereto, the absence of any action to enforce the same, the
waiver or consent by any Holder or by the Trustee with respect to any provisions
thereof or of this Indenture, the entry of any judgment against the Company or
any other Guarantor or any action to enforce the same or any other circumstance
which might otherwise constitute a legal or equitable discharge or defense of a
guarantor.
SECTION 11.03. LIMITATION OF GUARANTORS' LIABILITY. Each
Guarantor, and by its acceptance hereof each Holder, hereby confirms that it is
the intention of all such parties that the Note Guarantee by such Guarantor
pursuant to its Note Guarantee not constitute a fraudulent transfer or
conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar federal, state or
foreign law. To effectuate the foregoing intention, the Holders and such
Guarantor hereby irrevocable agree that the Obligations of such Guarantor under
this Article XI shall be limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such Guarantor and after
giving effect to any collections from or payments made by or on behalf of any
other Guarantor in respect of the Obligations of such other Guarantor under this
Article XI, result in the Obligations of such Guarantor under its Note Guarantee
not constituting a fraudulent transfer or conveyance under applicable federal,
state or foreign law.
SECTION 11.04. SUBORDINATION OF NOTE GUARANTEES. (a) Each
Guarantor agrees, and each Holder by accepting a Note agrees, that the Note
Guarantee of such Guarantor shall be junior and subordinated to Senior
Indebtedness of such Guarantor on the same basis that the Notes are junior and
subordinated to Senior Indebtedness of the Company pursuant to Article X hereof.
Without limiting the foregoing sentence, (i) each Guarantor may make, and the
Trustee and the Holders of the Notes shall have the right to receive and/or
retain, payments by such
86
Guarantor only at such time as they may receive and/or retain payments in
respect of the Notes pursuant to this Indenture, including Article X hereof, and
(ii) the rights and obligations of the relevant parties relative to the Note
Guarantee of such Guarantor and Senior Indebtedness of such Guarantor shall be
the same as the respective rights and obligations relative to the Notes and
Senior Indebtedness of the Company pursuant to Article X hereof.
(b) Upon any distribution to creditors of a Guarantor in a
liquidation or dissolution of such Guarantor or in a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to such Guarantor or its
property, in an assignment for the benefit of creditors or any marshaling of
such Guarantor's assets and liabilities:
(i) holders of Senior Indebtedness of such Guarantor shall
be entitled to receive and retain payment in full in cash of all
Obligations due in respect of Senior Indebtedness (including interest
after the commencement of any such proceeding at the rate specified in
the applicable Senior Indebtedness of such Guarantor) before Holders
shall be entitled to receive any payment with respect to the relevant
Note Guarantee and until all obligations with respect to Senior
Indebtedness of such Guarantor are paid in full in cash, any
distribution to which Holders would be entitled shall be made to holders
of Senior Indebtedness (except that Holders may receive and retain
Subordinated Reorganization Securities and payments and other
distributions made from any defeasance trust pursuant to Section 8.01
hereof); and
(ii) until all Obligations with respect to Senior
Indebtedness (as provided in subsection (a) above) are paid in full in
cash, any distribution that would have been made under such Note
Guarantee but for this Article shall be made to holders of Senior
Indebtedness of such Guarantor (except that Holders may receive and
retain Subordinated Reorganization Securities and payments and other
distributions made from any defeasance trust pursuant to Section 8.01
hereof), as their interests may appear.
(c) Such Guarantor may not make any payment in respect of its
Note Guarantee (other than Subordinated Reorganization Securities and payments
and other distributions made from any defeasance trust pursuant to Section 8.01
hereof) if:
(i) a default in the payment of any principal, premium, if
any, or interest with respect to Designated Senior Indebtedness of such
Guarantor occurs and is continuing beyond any applicable grace period in
the agreement, indenture or other document governing such Designated
Senior Indebtedness; or
(ii) any other default occurs and is continuing with
respect to such Designated Senior Indebtedness which then permits
holders of such Designated Senior Indebtedness to accelerate its
maturity and the Trustee receives a Payment Blockage Notice from a
holder of Designated Senior Indebtedness or a Representative thereof. If
the Trustee receives any such Payment Blockage Notice, no subsequent
Payment Blockage Notice shall be effective for purposes of this Section
11.04(c) unless and until at least 360 days shall have elapsed since the
effectiveness of the immediately prior Payment Blockage Notice. No
default specified in this clause (ii) that existed or was
87
continuing on the date of delivery of any Payment Blockage Notice to the
Trustee shall be, or be made, the basis for a subsequent Payment
Blockage Notice, unless such default has been cured or waived for a
period of not less than 90 days. No new period of payment blockage may
be commenced by a Payment Blockage Notice unless and until 360 days have
elapsed since the first day of the effectiveness of the immediately
prior Payment Blockage Notice.
Such Guarantor may and shall resume payments on and distributions
in respect of its Note Guarantee upon the earlier of:
(i) in the case of a default referred to in Section
11.04(c)(i), the date upon which such default is cured or waived, or
(ii) in the case of a default referred to in Section
11.04(c)(ii) hereof, the earlier of the date on which such default is
cured or waived or 179 days after the date on which the applicable
Payment Blockage Notice is received, unless the maturity of such
Designated Senior Indebtedness has been accelerated,
if this Article XI otherwise permits the payment, distribution or acquisition at
the time of such payment or acquisition.
SECTION 11.05. RELEASE OF NOTE GUARANTEES. In the event of a sale
or other disposition of all or substantially all of the assets of any Guarantor,
by way of merger, consolidation or otherwise, or a sale or other disposition of
all of the Capital Stock of any Guarantor, by way of merger, consolidation or
otherwise, such Guarantor will be released and relieved of any obligations under
its Note Guarantee; PROVIDED, in each case, that (i) such transaction is carried
out pursuant to and in accordance with Section 4.08 and Section 5.01 hereof and
(ii) such Guarantor is also released from its guarantee of the Company's
obligations under the Credit Agreement and does not guarantee any Senior
Indebtedness. Upon delivery by the Company to the Trustee of an Officers'
Certificate and Opinion of Counsel, to the effect that such sale or other
disposition was made by the Company in accordance with the provisions of this
Indenture, including without limitation Section 4.08 and Section 5.01 hereof,
the Trustee shall execute any documents reasonably required in order to evidence
the release of any such Guarantor from its obligations under its Note Guarantee.
In addition, any non-Wholly Owned Subsidiary of the Company that
is released from its guarantee of the Company's obligations under the Credit
Agreement shall also be released from its Note Guarantee so long as such
Subsidiary does not guarantee any Senior Indebtedness. Upon delivery by the
Company to the Trustee of an Officers' Certificate to the effect that such
Guarantor (i) is not a Wholly Owned Subsidiary of the Company, (ii) has been
released from its guarantee of the Company's obligations under the Credit
Agreement, and (iii) does not guarantee any Senior Indebtedness, the Trustee
shall execute any documents reasonably required in order to evidence the release
of any such Guarantor from its obligations under its Note Guarantee.
88
Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of, premium, if
any, interest and Liquidated Damages, if any, on the Notes and for the other
obligations of the Company, such Guarantor and any other Guarantor under this
Indenture as provided in this Article XI.
SECTION 11.06. APPLICATION OF CERTAIN TERMS AND PROVISIONS TO
GUARANTORS. (a) For purposes of any provision of this Indenture which provides
for the delivery by any Guarantor of an Officers' Certificate or an Opinion of
Counsel, or both, the definitions of such terms in Section 1.01 hereof shall
apply to such Guarantor as if references therein to the Company were references
to such Guarantor.
(b) Any request, direction, order or demand which by any
provision of this Indenture is to be made by any Guarantor, shall be sufficient
if evidenced by a Company Order; PROVIDED that the definition of such term in
Section 1.01 hereof shall apply to such Guarantor as if references therein to
the Company were references to such Guarantor.
(c) Any notice or demand which by any provision of this Indenture
is required or permitted to be given or served by the Trustee or by the Holders
to or on any Guarantor may be given or served as described in Section 12.02
hereof.
(d) Upon any demand, request or application by any Guarantor to
the Trustee to take any action under this Indenture, such Guarantor shall
furnish to the Trustee such certificates and opinions as are required in Section
12.03 and Section 12.04 hereof as if all references therein to the Company were
references to such Guarantor.
SECTION 11.07. ADDITIONAL GUARANTORS. The Company shall cause
each Person that becomes a Guarantor after the date of this Indenture to execute
and deliver to the Trustee, promptly upon becoming a Guarantor, (a) a
supplemental indenture in form and substance satisfactory to the Trustee
pursuant to which such Person agrees and acknowledges that it is a Guarantor for
all purposes of this Indenture (including, without limitation, Article X hereof)
and which subjects such Person to the provisions of this Indenture as a
Guarantor, and (b) an Opinion of Counsel to the effect that such supplemental
indenture has been duly authorized and executed by such Person and constitutes
the legal, valid, binding and enforceable obligation of such Person (subject to
such customary exceptions concerning fraudulent conveyance laws, creditors'
rights and equitable principles as may be acceptable to the Trustee in its
discretion).
ARTICLE XII
MISCELLANEOUS
SECTION 12.01. TRUST INDENTURE ACT CONTROLS. If and to the extent
that any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by, or with another provision (an "incorporated provision")
included in this Indenture by operation of, Sections 310 to 318, inclusive, of
the Trust Indenture Act, such imposed duties or incorporated provision shall
control.
89
SECTION 12.02. NOTICES. (a) Any notice or communication shall be
in writing and delivered in person or mailed by first class mail, postage
prepaid, addressed as follows: if to the Company, or any Guarantor: c/o Maxxim
Medical, Inc., 104 Industrial Blvd., Sugar Land, Texas, 77478, Attention: Chief
Operating Officer, with copies to Boyer, Ewing & Harris, Inc., Nine Greenway
Plaza, Suite 3100, Houston, Texas, 77046, Attention: John R. Boyer, Jr., Esq.;
if to the Trustee: First Union National Bank of North Carolina, 230 South Tryon
Street, Ninth Floor, Charlotte, North Carolina 28288, Attention: Corporate Trust
Department.
(b) The Company, a Guarantor or the Trustee, by notice to the
others, may designate additional or different addresses for subsequent notices
or communications. Any notice or communication mailed to a Holder shall be sent
to the Holder by first-class mail, postage prepaid, at the Holder's address as
it appears in the Note Register and shall be duly given if so sent within the
time prescribed. Failure to mail a notice or communication to a Holder or any
defect in it shall not affect its sufficiency with respect to other Holders. If
a notice or communication is mailed to the Company, the Trustee or a Holder in
the manner provided above, it is duly given, whether or not the addressee
receives it. In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give notice by mail to
Holders, then such notification as shall be made with the approval of the
Trustee shall constitute a sufficient notification for every purpose hereunder.
(c) Any notice or communication delivered to the Company under
the provisions herein shall constitute notice to the Guarantors.
SECTION 12.03. CERTIFICATE AND OPINION AS TO CONDITIONS
PRECEDENT. Upon any request or application by the Company to the Trustee to take
or refrain from taking any action under this Indenture, the Company shall
furnish to the Trustee upon request: (a) an Officers' Certificate stating that,
in the opinion of the signers, all conditions precedent, if any, provided for in
this Indenture relating to the proposed action have been complied with; and (b)
an Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
SECTION 12.04. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a covenant or
condition provided for in this Indenture (other than pursuant to Section 4.20
hereof) shall include: (a) a statement that the individual making such
certificate or opinion has read such covenant or condition; (b) a brief
statement as to the nature and scope of the examination or investigation upon
which the statements or opinions contained in such certificate or opinion are
based; (c) a statement that, in the opinion of such individual, such person has
made such examination or investigation as is necessary to enable such person to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and (d) a statement as to whether or not, in the opinion of
such individual, such covenant or condition has been complied with.
SECTION 12.05. RULES BY TRUSTEE, PAYING AGENT AND REGISTRAR. The
Trustee may make reasonable rules for action by or a meeting of Holders, and any
Registrar and Paying
90
Agent may make reasonable rules for their functions; PROVIDED that no such rule
shall conflict with terms of this Indenture or the Trust Indenture Act.
SECTION 12.06. PAYMENTS ON BUSINESS DAYS. If a payment hereunder
is scheduled to be made on a date that is not a Business Day payment shall be
made on the next succeeding day that is a Business Day, and no interest shall
accrue with respect to that payment during the intervening period. If a regular
record date is a date that is not a Business Day, such record date shall not be
affected.
SECTION 12.07. GOVERNING LAW, SUBMISSION TO JURISDICTION.
(a) THIS INDENTURE, THE NOTE GUARANTEES AND THE NOTES SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE.
(b) Each of the Company and each of the Guarantors hereby (i)
agrees that any suit, action or proceeding against it arising out of or relating
to this Indenture or the Notes, as the case may be, may be instituted in any
Federal or state court sitting in The City of New York, (ii) waives, to the
extent permitted by applicable law, any objection which it may now or hereafter
have to the laying of venue of any such suit, action or proceeding, and any
claim that any suit, action or proceeding in such a court has been brought in an
inconvenient forum, (iii) irrevocably submits to the non-exclusive jurisdiction
of such courts in any suit, action or proceeding, (iv) agrees that final
judgment in any such suit, action or proceeding brought in such a court shall be
conclusive and binding upon each and may be enforced in the courts of the
jurisdiction of which each is subject, respectively, by a suit upon judgment,
(v) agrees that service of process by mail to the addressed specified in Section
12.02 hereof shall constitute personal service of such process on it in any such
suit, action or proceeding.
SECTION 12.08. NO RECOURSE AGAINST OTHERS. No director, officer,
employee, incorporator or stockholder of the Company, as such, shall have any
liability for any obligations of the Company under the Notes or this Indenture
or for any claim based on, in respect of, or by reason of, such obligations or
their creation, solely by reason of its status as a director, officer, employee,
incorporator or stockholder of the Company. No director, officer, employee,
incorporator or stockholder of any Guarantor, as such, shall have any liability
for any obligations of any Guarantor under its Note Guarantee or this Indenture
or for any claim based on, in respect of, or by reason of, such obligations or
their creation, solely by reason of its status as a director, officer, employee,
incorporator or stockholder of such Guarantor. By accepting a Note, each Holder
waives and releases all such liability (but only such liability) as part of the
consideration for issuance of such Note to such Holder.
SECTION 12.09. SUCCESSORS. All agreements of each of the Company
and the Guarantors in this Indenture and the Notes shall bind its successors and
assigns whether so expressed or not. All agreements of the Trustee in this
Indenture shall bind its successors and assigns whether so expressed or not.
91
SECTION 12.10. COUNTERPARTS. This Indenture may be executed in
any number of counterparts and by the parties thereto 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.
SECTION 12.11. TABLE OF CONTENTS; HEADINGS. The table of
contents, cross-reference table and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not
intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof.
SECTION 12.12. SEVERABILITY. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 12.13. FURTHER INSTRUMENTS AND ACTS. Upon request of
the Trustee, the Company and each Guarantor will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purposes of this Indenture.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture
to be duly executed as of the day and year first above written.
MAXXIM MEDICAL, INC.,
as Issuer
By --------------------
Name: Alan S. Blazei
Title: Vice President
MAXXIM MEDICAL, INC. (DELAWARE),
as Guarantor
By --------------------
Name: Alan S. Blazei
Title:
MAXXIM ACQUISITION CO.,
as Guarantor
By --------------------
Name: Alan S. Blazei
Title:
FABRITEK LA ROMANA, INC.,
as Guarantor
By --------------------
Name: Alan S. Blazei
Title:
MAXXIM MEDICAL CANADA LIMITED,
as Guarantor
By --------------------
Name: Alan S. Blazei
Title:
MEDICA B.V.
as Guarantor
By --------------------
Name: Alan S. Blazei
Title:
<PAGE>
MEDICA HOSPITAL SUPPLIES, N.V.
as Guarantor
By --------------------
Name: Alan S. Blazei
Title:
FIRST UNION NATIONAL BANK OF NORTH CAROLINA,
By --------------------
Name: Shannon Stahel
Title:
<PAGE>
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 30th day of July, 1996, before me personally came Alan S.
Blazei, to me known, who, being by me duly sworn, did depose and say that he is
Vice President of Maxxim Medical, Inc., one of the corporations described in and
which executed the foregoing instrument, and that he signed his name thereto by
authority of the Board of Directors of such corporation.
-----------------------------------
Notary Public
State of
My commission expires / /
[Seal]
<PAGE>
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 30th day of July, 1996, before me personally came , to me
known, who, being by me duly sworn, did depose and say that he is
_______________________ of Maxxim Medical, Inc. (Delaware), one of the
corporations described in and which executed the foregoing instrument, and that
he signed his name thereto by authority of the Board of Directors of such
corporation.
-----------------------------------
Notary Public
State of
My commission expires / /
[Seal]
<PAGE>
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 30th day of July, 1996, before me personally came Alan S.
Blazei, to me known, who, being by me duly sworn, did depose and say that he is
____________________ of Maxxim Acquisition Co., one of the corporations
described in and which executed the foregoing instrument, and that he signed his
name thereto by authority of the Board of Directors of such corporation.
-----------------------------------
Notary Public
State of
My commission expires / /
[Seal]
<PAGE>
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 30th day of July, 1996, before me personally came Alan S.
Blazei, to me known, who, being by me duly sworn, did depose and say that he is
_______________________ of Fabritek La Romana, Inc., one of the corporations
described in and which executed the foregoing instrument, and that he signed his
name thereto by authority of the Board of Directors of such corporation.
-----------------------------------
Notary Public
State of
My commission expires / /
[Seal]
<PAGE>
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 30th day of July, 1996, before me personally came Alan S.
Blazei, to me known, who, being by me duly sworn, did depose and say that he is
_______________________ of Maxxim Medical Canada Limited, one of the
corporations described in and which executed the foregoing instrument, and that
he signed his name thereto by authority of the Board of Directors of such
corporation.
-----------------------------------
Notary Public
State of
My commission expires / /
[Seal]
<PAGE>
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 30th day of July, 1996, before me personally came Alan S.
Blazei, to me known, who, being by me duly sworn, did depose and say that he is
_______________________ of Medica B.V., one of the corporations described in and
which executed the foregoing instrument, and that he signed his name thereto by
authority of the Board of Directors of such corporation.
-----------------------------------
Notary Public
State of
My commission expires / /
[Seal]
<PAGE>
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 30th day of July, 1996, before me personally came Alan S.
Blazei, to me known, who, being by me duly sworn, did depose and say that he is
_______________________ of Medica Hospital Supplies, N.V., one of the
corporations described in and which executed the foregoing instrument, and that
he signed his name thereto by authority of the Board of Directors of such
corporation.
-----------------------------------
Notary Public
State of
My commission expires / /
[Seal]
<PAGE>
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 30th day of July, 1996, before me personally came Shannon
Stahel, to me known, who, being by me duly sworn, did depose and say that she is
_______________ of First Union National Bank of North Carolina, one of the
corporations described in and which executed the foregoing instrument, and that
she signed her name thereto by like authority.
-----------------------------------
Notary Public
State of
My commission expires / /
[Seal]
<PAGE>
[Execution Copy]
EXHIBIT A
FORM OF INITIAL GLOBAL NOTE
FACE OF INITIAL GLOBAL NOTE
MAXXIM MEDICAL, INC.
No. __ CUSIP No. 57777GAB1
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND THIS NOTE MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT OR IN ACCORDANCE WITH AN APPLICABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (SUBJECT TO
THE DELIVERY OF SUCH EVIDENCE, IF ANY, REQUIRED UNDER THE INDENTURE
PURSUANT TO WHICH THIS NOTE IS ISSUED) AND IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER JURISDICTION.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO MAXXIM MEDICAL, INC. OR A SUCCESSOR THEREOF
OR THE REGISTRAR FOR REGISTRATION OF TRANSFER OR EXCHANGE AND ANY NOTE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER ENTITY AS
HAS BEEN REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS HAS BEEN REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFER OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
AND NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
INTERESTS IN THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.06 OF THE
INDENTURE, DATED AS OF JULY 30, 1996 AMONG MAXXIM MEDICAL, INC., AS
ISSUER, AND MAXXIM MEDICAL, INC. (DELAWARE), MAXXIM ACQUISITION CO.,
FABRITEK LA ROMANA, INC., MAXXIM MEDICAL CANADA LIMITED, MEDICA B.V.,
AND MEDICA HOSPITAL SUPPLIES, N.V. AS GUARANTORS, AND FIRST UNION
NATIONAL BANK OF NORTH CAROLINA, AS TRUSTEE, PURSUANT TO WHICH THIS
NOTE WAS ISSUED.
GLOBAL NOTE
REPRESENTING 10 1/2% SENIOR SUBORDINATED NOTES DUE 2006
Maxxim Medical, Inc., a Texas corporation, for value received, hereby
promises to pay to CEDE & CO., or its registered assigns, the principal sum
indicated on Schedule A hereof, on August 1, 2006.
Interest Payment Dates: February 1 and August 1, commencing February 1,
1997.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
A-2
Unless the certificate of authentication hereon has been duly executed
by the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purposes.
IN WITNESS WHEREOF, Maxxim Medical, Inc. has caused this Note to be
duly executed under its corporate seal.
MAXXIM MEDICAL, INC.
By: _______________________________
Name:
Title:
[Corporate Seal]
Attest:______________________
Dated:______________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
FIRSTUNION NATIONAL BANK OF NORTH CAROLINA, as Trustee, certifies that this is
one of the Notes referred to in the Indenture.
By:
Authorized Signatory
A-3
REVERSE SIDE OF INITIAL GLOBAL NOTE
MAXXIM MEDICAL, INC.
GLOBAL NOTE
REPRESENTING 10 1/2% SENIOR SUBORDINATED NOTES DUE 2006
1. INDENTURE.
This Note is one of a duly authorized issue of debt securities of the
Company (as defined below) designated as its "10 1/2% Senior Subordinated Notes
Due 2006" (herein called the "Notes") limited in aggregate principal amount to
$100,000,000, issued under an indenture dated as of July 30, 1996 (as amended or
supplemented from time to time, the "Indenture") among the Company, as issuer,
and Maxxim Medical, Inc. (Delaware), Maxxim Acquisition Co., Fabritek La Romana,
Inc., Maxxim Medical Canada Limited, Medica B.V., and Medica Hospital Supplies,
N.V. as guarantors (collectively, the "Guarantors"), and First Union National
Bank of North Carolina, as trustee (the "Trustee," which term includes any
successor trustee under the Indenture). The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders of Notes are referred to the
Indenture and such Act for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Company, the Guarantors, the
Trustee and each Holder and of the terms upon which the Notes are, and are to
be, authenticated and delivered. The summary of the terms of this Note contained
herein does not purport to be complete and is qualified by reference to the
Indenture. To the extent permitted by applicable law, in the event of any
inconsistency between the terms of this Note and the terms of the Indenture, the
terms of the Indenture shall control. All capitalized terms used in this Note
which are not defined herein shall have the meanings assigned to them in the
Indenture.
The Indenture restricts, among other things, the Company's ability to
incur additional indebtedness and issue preferred stock, pay dividends or make
certain other restricted payments, incur liens to secure PARI PASSU or
subordinated indebtedness, sell stock of Subsidiaries, apply net proceeds from
certain asset sales, merge or consolidate with any other person, sell, assign,
transfer, lease, convey or otherwise dispose of substantially all of the assets
of the Company, enter into certain transactions with affiliates or incur
indebtedness that is subordinate in right of payment to any Senior Indebtedness
and senior in right of payment to the Notes. The Indenture permits, under
certain circumstances, the Company's Subsidiaries that are organized under the
laws of jurisdictions other than the United States of America, any state thereof
or the District of Columbia to be deemed Unrestricted Subsidiaries and thus not
subject to the restrictions of the Indenture.
2. PRINCIPAL AND INTEREST.
Maxxim Medical, Inc., a Texas corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay the principal amount set forth on
Schedule A of this Note to the Holder hereof on August 1, 2006.
A-4
The Company shall pay interest at a rate of 10 1/2% PER ANNUM, from
July 30, 1996 or from the most recent Interest Payment Date thereafter to which
interest has been paid or duly provided for, semiannually in arrears on February
1 and August 1 of each year, commencing on February 1, 1997, in cash, to the
Holder hereof until the principal amount hereof is paid or made available for
payment. The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, subject to certain exceptions provided in the
Indenture, be paid to the Person in whose name this Note (or the Note in
exchange or substitution for which this Note was issued) is registered at the
close of business on the Record Date for interest payable on such Interest
Payment Date. The Record Date for any interest payment is the close of business
on January 15 or July 15, as the case may be, whether or not a Business Day,
immediately preceding the Interest Payment Date on which such interest is
payable. Any such interest not so punctually paid or duly provided for
("Defaulted Interest") shall forthwith cease to be payable to the Holder on such
Record Date and shall be paid as provided in Section 2.11 of the Indenture.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
Each payment of interest in respect of an Interest Payment Date will
include interest accrued through the day before such Interest Payment Date. If
an Interest Payment Date falls on a day that is not a Business Day, the interest
payment to be made on such Interest Payment Date will be made on the next
succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as a result of
such delayed payment.
If this Note is exchanged in a Registered Exchange Offer prior to the
Record Date for the first Interest Payment Date following such exchange, accrued
and unpaid interest, if any, on this Note, up to but not including the date of
issuance of the New Note or New Notes issued in exchange for this Note, shall be
paid on the first Interest Payment Date for such New Note or New Notes to the
Holder or Holders of such New Note or New Notes on the first Record Date with
respect to such New Note or New Notes. If this Note is exchanged in a Registered
Exchange Offer subsequent to the Record Date for the first Interest Payment Date
following such exchange but on or prior to such Interest Payment Date, then any
such accrued and unpaid interest with respect to this Note and any accrued and
unpaid interest on the New Note or New Notes issued in exchange for this Note,
through the day before such Interest Payment Date, shall be paid on such
Interest Payment Date to the Holder of this Note on such Record Date.
To the extent lawful, the Company shall pay interest on overdue
principal, overdue premium, Defaulted Interest and overdue Liquidated Damages
(without regard to any applicable grace period) at the interest rate borne on
this Note. The Company's obligation pursuant to the previous sentence shall
apply whether such overdue amount is due at its Stated Maturity, as a result of
the Company's obligations pursuant to Section 3.05, Section 4.07 or Section 4.08
of the Indenture, or otherwise.
A-5
3. REGISTRATION RIGHTS; LIQUIDATED DAMAGES.
The Holder of this Note is entitled to the benefits of the Registration
Rights Agreement, dated July 30, 1996, among the Company and the Initial
Purchasers (the "Registration Rights Agreement"), which agreement is attached to
the Indenture as Exhibit J thereto. Such benefits include the right of the
Holder to receive Liquidated Damages in the event of a failure on the part of
the Company to comply with certain registration covenants, as provided in
Section 4 of the Registration Rights Agreement.
4. METHOD OF PAYMENT.
The Company, through the Paying Agent, shall pay interest on this Note
to the registered Holder of this Note, as provided above. The Holder must
surrender this Note to a Paying Agent to collect principal payments. The Company
will pay principal, premium, if any, and interest and Liquidated Damages, if
any, in money of the United States of America that at the time of payment is
legal tender for payment of all debts public and private. Principal, premium, if
any, and interest and Liquidated Damages, if any, shall be paid by check mailed
to the registered Holders at their registered addresses; PROVIDED that all
payments with respect to Notes the Holders of which have given wire transfer
instructions to the Company will be required to be made by wire transfer
immediately available funds to the accounts specified by the Holders thereof.
5. PAYING AGENT AND REGISTRAR.
Initially, the Trustee will act as Paying Agent and Registrar under the
Indenture. The Company may, upon written notice to the Trustee, appoint and
change any Paying Agent or Registrar. The Company or any of its Affiliates may
act as Paying Agent or Registrar, PROVIDED that if the Company or such Affiliate
is acting as Paying Agent, the Company or such Affiliate shall segregate all
funds held by it as Paying Agent and hold them in trust for the benefit of the
Holders or the Trustee.
6. NOTE GUARANTEES.
This Note is initially entitled to the benefits of the Note Guarantees
made by Maxxim Medical, Inc. (Delaware), Maxxim Acquisition Co., Fabritek La
Romana, Inc., Maxxim Medical Canada Limited, Medica B.V., and Medica Hospital
Supplies, N.V., and may thereafter be entitled to Note Guarantees made by other
Guarantors for the benefit of the Holders of Notes. Each present Guarantor has,
and each future Guarantor will, irrevocably and unconditionally, jointly and
severally, guarantee on a senior subordinated basis the punctual payment when
due, whether at Stated Maturity, by acceleration, in connection with a Change of
Control Offer, an Asset Sale Offer or redemption, or otherwise, of all
obligations of the Company under the Indenture and this Note, whether for
payment of principal of, premium, if any, interest or Liquidated Damages, if
any, on the Notes, expenses, indemnification or otherwise. A Guarantor shall be
released from its Note Guarantee upon the terms and subject to the conditions
set forth in the Indenture.
A-6
7. SUBORDINATION.
This Note and the Note Guarantees are subordinated in right of payment,
as set forth in the Indenture, to the prior payment in full of all existing and
future Senior Indebtedness. Each of the Company and the Guarantors agrees, and
each Holder by accepting a Note agrees, to the subordination provisions set
forth in the Indenture, authorizes the Trustee to give them effect and appoints
the Trustee as attorney-in-fact for such purpose.
8. REDEMPTION.
The Notes are not redeemable at the option of the Company prior to
August 1, 2001. Thereafter, the Notes will be subject to redemption at the
option of the Company, in whole or in part, on at least 30 calendar days' but
not more than 60 calendar days' prior notice, at the redemption prices
(expressed as percentages of principal amount) set forth below, plus accrued and
unpaid interest thereon, if any, and Liquidated Damages, if any, to the
applicable Redemption Date (subject to the right of each Holder of record on the
relevant Record Date to receive interest due on the relevant Interest Payment
Date), if redeemed during the twelve-month period beginning August 1 of the
years indicated below:
YEAR PERCENTAGE
2001 105.25%
2002 103.50%
2003 101.75%
2004 and thereafter 100.00%
The Notes are not subject to any sinking fund.
9. NOTICE OF REDEMPTION.
At least 30 calendar days but not more than 60 calendar days before a
Redemption Date, the Company shall deliver to the Trustee and send, by
first-class mail, postage prepaid, to Holders of Notes to be redeemed at the
addresses of such Holders as they appear in the Note Register, a notice of
redemption.
If less than all of the Notes are to be redeemed at any time, the Notes
to be redeemed shall be selected by the Trustee by such method as the Trustee
shall deem fair and appropriate and that complies with the requirements of the
principal national securities exchange, if any, on which the Notes are listed
or, if the Notes are not so listed, on a PRO RATA basis; PROVIDED that the
Trustee may select for redemption portions (equal to $1,000 or any integral
multiple thereof) of the principal of Notes that have denominations larger than
$1,000 (Notes in denominations of $1,000 or less may be redeemed only in whole).
If any Note is redeemed subsequent to a Record Date with respect to any Interest
Payment Date specified above and on or prior to such Interest Payment Date, then
any accrued interest will be paid on such Interest Payment Date to the Holder of
the Note on such Record Date. If money in an amount sufficient to pay the
Redemption Price of all Notes (or portions thereof) to be redeemed on the
Redemption Date is deposited with the Paying Agent on or before the applicable
Redemption Date and certain other conditions are satisfied, interest on the
Notes or portions thereof to be redeemed on the applicable Redemption Date will
cease to accrue.
A-7
10. REPURCHASE AT THE OPTION OF HOLDERS UPON CHANGE OF CONTROL.
Upon the occurrence of a Change of Control, each Holder shall have the
right in accordance with the terms hereof and the Indenture to require the
Company to purchase such Holder's Notes, in whole or in part, in a principal
amount that is an integral multiple of $1,000, pursuant to a Change of Control
Offer, at a purchase price in cash equal to 101% of the principal amount of such
Notes (or portions thereof) plus accrued and unpaid interest and Liquidated
Damages, if any, to the Change of Control Payment Date.
Within 30 calendar days following any Change of Control, the Company
shall send, or cause to be sent, by first-class mail, postage prepaid, a notice
regarding the Change of Control Offer to each Holder. The Holder of this Note
may elect to have this Note or a portion hereof in an authorized denomination
purchased by completing the form entitled "Option of Holder to Elect Purchase"
appearing below and tendering this Note pursuant to the Change of Control Offer.
Unless the Company defaults in the payment of the Change of Control Purchase
Price with respect thereto, all Notes or portions thereof accepted for payment
pursuant to the Change of Control Offer will cease to accrue interest from and
after the Change of Control Payment Date.
Prior to complying with the provisions of the Indenture governing
Change of Control Offers, but in any event within 30 calendar days following a
Change of Control, the Company shall either repay all outstanding Senior
Indebtedness or obtain the requisite consents, if any, under all agreements
governing outstanding Senior Indebtedness to permit the repurchase of Notes
required by the provisions of the Indenture governing Change of Control Offers.
11. REPURCHASE AT THE OPTION OF HOLDERS UPON ASSET SALE.
If at any time the Company or any Subsidiary engages in any Asset Sale,
as a result of which the aggregate amount of Excess Proceeds exceeds $5.0
million, the Company shall, within 30 calendar days of the date the amount of
Excess Proceeds exceeds $5.0 million, use the then-existing Excess Proceeds to
make an offer to purchase from all Holders of Notes, on a PRO RATA basis, Notes
in an aggregate principal amount equal in amount to the then-existing Excess
Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest thereon and Liquidated
Damages to the Asset Sale Purchase Date. Upon completion of an Asset Sale Offer
(including payment of the Asset Sale Purchase Price for accepted Notes), any
surplus Excess Proceeds that were the subject of such offer shall cease to be
Excess Proceeds, and the Company may then use such amounts for general corporate
purposes.
Within 30 calendar days of the date the amount of Excess Proceeds
exceeds $5.0 million, the Company shall send, or cause to be sent, by
first-class mail, postage prepaid, a notice regarding the Asset Sale Offer to
each Holder. The Holder of this Note may elect to have this Note or a portion
hereof in an authorized denomination purchased by completing the form entitled
"Option of Holder to Elect Purchase" appearing below and tendering this Note
pursuant to the Asset Sale Offer. Unless the Company defaults in the payment of
the Asset Sale Purchase Price with respect thereto, all Notes or portions
thereof selected for payment pursuant to the Asset Sale Offer will cease to
accrue interest from and after the Asset Sale Purchase Date.
A-8
12. THE GLOBAL NOTE.
So long as this Global Note is registered in the name of the Depositary
or its nominee, members of, or participants in, the Depositary ("Agent Members")
shall have no rights under the Indenture with respect to this Global Note held
on their behalf by the Depositary or the Trustee as its custodian, and the
Depositary may be treated by the Company, the Guarantors, the Trustee and any
agent of the Company, the Guarantors or the Trustee as the absolute owner of
this Global Note for all purposes. Notwithstanding the foregoing, nothing herein
shall (i) prevent the Company, the Guarantors, the Trustee or any agent of the
Company, the Guarantors or the Trustee, from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or (ii)
impair, as between the Depositary and its Agent Members, the operation of
customary practices governing the exercise of the rights of a Holder.
The Holder of this Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests in this Global Note through Agent Members, to take any action which a
Holder is entitled to take under the Indenture or the Notes.
Whenever, as a result of optional redemption by the Company, a Change
of Control Offer, an Asset Sale Offer, a Registered Exchange Offer or an
exchange for Certificated Notes, this Global Note is redeemed, repurchased or
exchanged in part, this Global Note shall be surrendered by the Holder thereof
to the Trustee who shall cause an adjustment to be made to Schedule A hereof so
that the principal amount of this Global Note will be equal to the portion not
redeemed, repurchased or exchanged and shall thereafter return this Global Note
to such Holder; PROVIDED that this Global Note shall be in a principal amount of
$1,000 or an integral multiple of $1,000.
13. THE REGISTERED EXCHANGE OFFER.
Any Initial Notes represented by this Global Note that are presented to
the Registrar for exchange pursuant to the Registered Exchange Offer (as defined
in the Registration Rights Agreement) shall be exchanged for a Global Note
representing New Notes of equal principal amount upon surrender of this Global
Note to the Registrar in accordance with the terms of the Registered Exchange
Offer and the Indenture.
A-9
14. TRANSFER AND EXCHANGE.
The transfer of this Note is subject to certain restrictions, including
those to which reference is made in the Private Placement Legend. A Holder may
transfer or exchange Notes as provided in the Indenture and subject to certain
limitations therein set forth. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any
taxes, fees and expenses required by law or permitted by the Indenture.
15. DENOMINATIONS.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof of principal amount.
16. DISCHARGE AND DEFEASANCE.
Subject to certain conditions, the Company at any time may terminate
some or all of the obligations of the Company and the Guarantors under the
Notes, the Note Guarantees and the Indenture if the Company irrevocably deposits
in trust with the Trustee cash or U.S. Government Obligations for the payment of
principal, premium, if any, interest and Liquidated Damages, if any, on the
Notes to redemption or maturity, as the case may be.
17. AMENDMENT, WAIVER.
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Notes may be amended with the written consent of the Holders of
at least a majority in principal amount of the outstanding Notes (which consent
may, but need not, be given in connection with any tender offer or exchange
offer for the Notes) and (ii) any Default and its consequences may be waived
with the written consent of the Holders of at least a majority in principal
amount of the outstanding Notes. Subject to certain exceptions set forth in the
Indenture, without the consent of any Holder, the Company and the Trustee may
amend the Indenture or the Notes (i) to evidence the succession of another
Person to the Company and the assumption by such successor of the covenants of
the Company under the Indenture and contained in the Notes; (ii) to add to the
covenants of the Company, for the benefit of the Holders of all of the Notes, or
to surrender any right or power conferred on the Company under the Indenture;
(iii) to add any additional Events of Default; (iv) to provide for
uncertificated Notes in addition to or in place of Certificated Notes; (v) to
evidence and provide for the acceptance of appointment under the Indenture of a
successor Trustee; (vi) to secure the Notes; (vii) to cure any ambiguity in the
Indenture, or to correct or supplement any provision in the Indenture which may
be inconsistent with any other provision therein or to add any other provisions
with respect to matters or questions arising under the Indenture, PROVIDED that
such actions shall not adversely affect the interests of the Holders of Notes in
any material respect; (viii) to comply with the requirements of the Commission
in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act; or (ix) to evidence the agreement or acknowledgment of a
Subsidiary that it is a Guarantor for all purposes under the Indenture
(including, without limitation, Article XI thereof).
A-10
18. DEFAULTS AND REMEDIES.
Under the Indenture, Events of Default include: (i) a default for 30
days in the payment when due of interest on, or Liquidated Damages with respect
to, the Notes (whether or not prohibited by the subordination provisions of the
Indenture); (ii) default in payment when due of the principal of or premium, if
any, on the Notes (whether or not prohibited by the subordination provisions of
the Indenture); (iii) failure by the Company to observe or perform certain
covenants, conditions, agreements or other provisions of the Indenture or this
Note (and, in the case of certain covenants, agreements or other provisions,
such failure has continued for 60 calendar days after written notice by the
Trustee or the Holders of at least 25% in principal amount of the Notes); (iv)
failure by the Company to consummate the merger of Maxxim Acquisition Co. with
and into Sterile Concepts on or prior to December 15, 1996; (v) default in the
payment of Indebtedness of the Company or any of its Subsidiaries at its final
maturity or acceleration of such Indebtedness in an amount in excess of $5.0
million in the aggregate; (vi) certain events of bankruptcy or insolvency with
respect to the Company or any of its Subsidiaries; (vii) certain undischarged
judgments in excess of $5.0 million in the aggregate; or (viii) the Note
Guarantee of any Guarantor being held in any judicial proceeding to be
unenforceable or invalid or ceasing for any reason to be in full force and
effect (other than in accordance with the terms of the Indenture) or any
Guarantor or any Person acting on behalf of any Guarantor denying or
disaffirming the Note Guarantee of such Guarantor
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Notes, subject to certain
limitations, may declare all the Notes to be immediately due and payable.
Certain events of bankruptcy or insolvency shall result in the Notes being
immediately due and payable upon the occurrence of such Events of Default
without any further act of the Trustee or any Holder.
Holders of Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Notes unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Notes may
direct the Trustee in its exercise of any trust or power under the Indenture.
The Holders of a majority in principal amount of the then outstanding Notes, by
written notice to the Trustee and the Company, may rescind any declaration of
acceleration and its consequences if the rescission would not conflict with any
judgment or decree, and if all existing Events of Default have been cured or
waived, except nonpayment of principal, interest, premium or Liquidated Damages
that has become due solely because of acceleration. No such recission shall
affect any subsequent Default or impair any right consequent thereto.
19. INDIVIDUAL RIGHTS OF TRUSTEE.
Subject to certain limitations imposed by the Trust Indenture Act, the
Trustee or any Paying Agent or Registrar, in its individual or any other
capacity, may become the owner or pledgee of Notes and may otherwise deal with
the Company, the Guarantors or their Affiliates with the same rights it would
have if it were not Trustee, Paying Agent or Registrar, as the case may be,
under the Indenture.
A-11
20. NO RECOURSE AGAINST CERTAIN OTHERS.
No director, officer, employee, incorporator or stockholder of the
Company or any Guarantor, as such, shall have any liability for any obligations
of the Company or such Guarantor under the Notes, the Note Guarantees or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation, solely by reason of its status as a director,
officer, employee, incorporator or stockholder of the Company or such Guarantor.
By accepting a Note, each Holder waives and releases all such liability (but
only such liability) as part of the consideration for issuance of such Note to
such Holder.
21. AUTHENTICATION.
This Note shall not be valid until the Trustee or an authenticating
agent manually signs the certificate of authentication on the other side of this
Note.
22. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with rights of survivorship and not as
tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
23. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of Notes. No representation is
made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
24. GOVERNING LAW.
THE INDENTURE, THE NOTE GUARANTEES AND THIS NOTE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE.
A-12
The Company will furnish to any Holder upon written request and without
charge to the Holder a copy of the Indenture which has in it the text of this
Note. Requests may be made to:
Maxxim Medical, Inc.
104 Industrial Blvd.
Sugar Land, Texas, 77478
Attention: Chief Operating Officer
A-13
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount at maturity of this Note shall be $____________.
The following decreases/increase in the principal amount in denominations of
$1,000 or integral multiples thereof at maturity of this Note have been made:
<TABLE>
<CAPTION>
Total Principal
Amount at Notation
Decrease in Increase in Maturity Made by
Date of Principal Principal Following such or on
Decrease/ Amount at Amount at Decrease/ Behalf of
INCREASE MATURITY MATURITY INCREASE TRUSTEE
<S> <C> <C> <C> <C>
============ =========== =========== ============= =========
============ =========== =========== ============= =========
============ =========== =========== ============= =========
============ =========== =========== ============= =========
============ =========== =========== ============= =========
============ =========== =========== ============= =========
============ =========== =========== ============= =========
============ =========== =========== ============= =========
</TABLE>
A-14
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED ____________________ hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
- -----------------------------------------
- --------------------------------------------------------------------------------
(Please print name and address of transferee)
- ------------------------------------------------------------------------------
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ________________________________ Attorney to
transfer this Note on the Security Register, with full power of substitution.
Dated: _______________
- ----------------------------- --------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
A-15
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
[_] In connection with the Change of Control Offer made pursuant to Section
4.07 of the Indenture, the undersigned hereby elects to have
[_] the entire principal amount
[_] $________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note
repurchased by the Company. The undersigned hereby directs the Trustee
or Paying Agent to pay it or __________________________ an amount in
cash equal to 101% of the principal amount indicated in the preceding
sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Change of Control Payment Date.
|_| In connection with the Asset Sale Offer made pursuant to Section 4.08
of the Indenture, the undersigned hereby elects to have
|_| the entire principal amount
|_| $_________ ($1,000 in principal amount or an integral multiple thereof)
of this Note
repurchased by the Company. The undersigned hereby directs the Trustee
or Paying Agent to pay it or __________________________ an amount in
cash equal to 100% of the principal amount indicated in the preceding
sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Asset Sale Purchase Date.
Dated: _______________
- ----------------------------- --------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing must correspond to the Name as written
upon the face of this Note in every particular, without alteration or any change
whatsoever.
A-16
[Execution Copy]
EXHIBIT B
FORM OF INITIAL CERTIFICATED NOTE
FACE OF INITIAL CERTIFICATED NOTE
MAXXIM MEDICAL, INC.
No. ____ CUSIP No. 57777GAB1
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND THIS NOTE MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT OR IN ACCORDANCE WITH AN APPLICABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (SUBJECT TO
THE DELIVERY OF SUCH EVIDENCE, IF ANY, REQUIRED UNDER THE INDENTURE
PURSUANT TO WHICH THIS NOTE IS ISSUED) AND IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER JURISDICTION.
10 1/2% SENIOR SUBORDINATED NOTE DUE 2006
Maxxim Medical, Inc., a Texas corporation, for value received,
hereby promises to pay to ________, or its registered assigns, the principal
amount of ______, on August 1, 2006.
Interest Payment Dates: February 1 and August 1, commencing
February 1, 1997.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this
Note set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly
executed by the Trustee referred to on the reverse hereof by manual signature,
this Note shall not be entitled to any benefit under the Indenture or be valid
or obligatory for any purposes.
IN WITNESS WHEREOF, Maxxim Medical, Inc. has caused this Note
to be duly executed under its corporate seal.
MAXXIM MEDICAL, INC.
By: ___________________________
Name:
Title:
[Corporate Seal]
Attest:______________________
Dated:______________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
FIRSTUNION NATIONAL BANK OF NORTH CAROLINA,
as Trustee, certifies that this is
one of the Notes referred to in the Indenture.
By:
Authorized Signatory
B-2
REVERSE SIDE OF INITIAL CERTIFICATED NOTE
MAXXIM MEDICAL, INC.
10 1/2% SENIOR SUBORDINATED NOTE DUE 2006
1. INDENTURE.
This Note is one of a duly authorized issue of debt securities
of the Company (as defined below) designated as its "10 1/2% Senior Subordinated
Notes Due 2006" (herein called the "Notes") limited in aggregate principal
amount to $100,000,000, issued under an indenture dated as of July 30, 1996 (as
amended or supplemented from time to time, the "Indenture") among the Company,
as issuer, and Maxxim Medical, Inc. (Delaware), Maxxim Acquisition Co., Fabritek
La Romana, Inc., Maxxim Medical Canada Limited, Medica B.V., and Medica Hospital
Supplies, N.V. as guarantors (collectively, the "Guarantors"), and First Union
National Bank of North Carolina, as trustee (the "Trustee," which term includes
any successor trustee under the Indenture). The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders of Notes are referred to the
Indenture and such Act for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Company, the Guarantors, the
Trustee and each Holder and of the terms upon which the Notes are, and are to
be, authenticated and delivered. The summary of the terms of this Note contained
herein does not purport to be complete and is qualified by reference to the
Indenture. To the extent permitted by applicable law, in the event of any
inconsistency between the terms of this Note and the terms of the Indenture, the
terms of the Indenture shall control. All capitalized terms used in this Note
which are not defined herein shall have the meanings assigned to them in the
Indenture.
The Indenture restricts, among other things, the Company's
ability to incur additional indebtedness and issue preferred stock, pay
dividends or make certain other restricted payments, incur liens to secure PARI
PASSU or subordinated indebtedness, sell stock of Subsidiaries, apply net
proceeds from certain asset sales, merge or consolidate with any other person,
sell, assign, transfer, lease, convey or otherwise dispose of substantially all
of the assets of the Company, enter into certain transactions with affiliates or
incur indebtedness that is subordinate in right of payment to any Senior
Indebtedness and senior in right of payment to the Notes. The Indenture permits,
under certain circumstances, the Company's Subsidiaries that are organized under
the laws of jurisdictions other than the United States of America, any state
thereof or the District of Columbia to be deemed Unrestricted Subsidiaries and
thus not subject to the restrictions of the Indenture.
2. PRINCIPAL AND INTEREST.
Maxxim Medical, Inc., a Texas corporation (such corporation,
and its successors and assigns under the Indenture hereinafter referred to,
being herein called the "Company"), promises to pay the principal amount set
forth on Schedule A of this Note to the Holder hereof on August 1, 2006.
B-3
The Company shall pay interest at a rate of 10 1/2% PER ANNUM,
from July 30, 1996 or from the most recent Interest Payment Date thereafter to
which interest has been paid or duly provided for, semiannually in arrears on
February 1 and August 1 of each year, commencing on February 1, 1997, in cash,
to the Holder hereof until the principal amount hereof is paid or made available
for payment. The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, subject to certain exceptions provided in the
Indenture, be paid to the Person in whose name this Note (or the Note in
exchange or substitution for which this Note was issued) is registered at the
close of business on the Record Date for interest payable on such Interest
Payment Date. The Record Date for any interest payment is the close of business
on January 15 or July 15, as the case may be, whether or not a Business Day,
immediately preceding the Interest Payment Date on which such interest is
payable. Any such interest not so punctually paid or duly provided for
("Defaulted Interest") shall forthwith cease to be payable to the Holder on such
Record Date and shall be paid as provided in Section 2.11 of the Indenture.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
Each payment of interest in respect of an Interest Payment
Date will include interest accrued through the day before such Interest Payment
Date. If an Interest Payment Date falls on a day that is not a Business Day, the
interest payment to be made on such Interest Payment Date will be made on the
next succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as a result of
such delayed payment.
If this Note is exchanged in a Registered Exchange Offer prior
to the Record Date for the first Interest Payment Date following such exchange,
accrued and unpaid interest, if any, on this Note, up to but not including the
date of issuance of the New Note or New Notes issued in exchange for this Note,
shall be paid on the first Interest Payment Date for such New Note or New Notes
to the Holder or Holders of such New Note or New Notes on the first Record Date
with respect to such New Note or New Notes. If this Note is exchanged in a
Registered Exchange Offer subsequent to the Record Date for the first Interest
Payment Date following such exchange but on or prior to such Interest Payment
Date, then any such accrued and unpaid interest with respect to this Note and
any accrued and unpaid interest on the New Note or New Notes issued in exchange
for this Note, through the day before such Interest Payment Date, shall be paid
on such Interest Payment Date to the Holder of this Note on such Record Date.
To the extent lawful, the Company shall pay interest on
overdue principal, overdue premium, Defaulted Interest and overdue Liquidated
Damages (without regard to any applicable grace period) at the interest rate
borne on this Note. The Company's obligation pursuant to the previous sentence
shall apply whether such overdue amount is due at its Stated Maturity, as a
result of the Company's obligations pursuant to Section 3.05, Section 4.07 or
Section 4.08 of the Indenture, or otherwise.
B-4
3. REGISTRATION RIGHTS; LIQUIDATED DAMAGES.
The Holder of this Note is entitled to the benefits of the
Registration Rights Agreement, dated July 30, 1996, among the Company and the
Initial Purchasers (the "Registration Rights Agreement"), which agreement is
attached to the Indenture as Exhibit J thereto. Such benefits include the right
of the Holder to receive Liquidated Damages in the event of a failure on the
part of the Company to comply with certain registration covenants, as provided
in Section 4 of the Registration Rights Agreement.
4. METHOD OF PAYMENT.
The Company, through the Paying Agent, shall pay interest on
this Note to the registered Holder of this Note, as provided above. The Holder
must surrender this Note to a Paying Agent to collect principal payments. The
Company will pay principal, premium, if any, and interest and Liquidated
Damages, if any, in money of the United States of America that at the time of
payment is legal tender for payment of all debts public and private. Principal,
premium, if any, and interest and Liquidated Damages, if any, shall be paid by
check mailed to the registered Holders at their registered addresses; PROVIDED
that all payments with respect to Notes the Holders of which have given wire
transfer instructions to the Company will be required to be made by wire
transfer immediately available funds to the accounts specified by the Holders
thereof.
5. PAYING AGENT AND REGISTRAR.
Initially, the Trustee will act as Paying Agent and Registrar
under the Indenture. The Company may, upon written notice to the Trustee,
appoint and change any Paying Agent or Registrar. The Company or any of its
Affiliates may act as Paying Agent or Registrar, PROVIDED that if the Company or
such Affiliate is acting as Paying Agent, the Company or such Affiliate shall
segregate all funds held by it as Paying Agent and hold them in trust for the
benefit of the Holders or the Trustee.
6. NOTE GUARANTEES.
This Note is initially entitled to the benefits of the Note
Guarantees made by Maxxim Medical, Inc. (Delaware), Maxxim Acquisition Co.,
Fabritek La Romana, Inc., Maxxim Medical Canada Limited, Medica B.V., and Medica
Hospital Supplies, N.V., and may thereafter be entitled to Note Guarantees made
by other Guarantors for the benefit of the Holders of Notes. Each present
Guarantor has, and each future Guarantor will, irrevocably and unconditionally,
jointly and severally, guarantee on a senior subordinated basis the punctual
payment when due, whether at Stated Maturity, by acceleration, in connection
with a Change of Control Offer, an Asset Sale Offer or redemption, or otherwise,
of all obligations of the Company under the Indenture and this Note, whether for
payment of principal of, premium, if any, interest or Liquidated Damages, if
any, on the Notes, expenses, indemnification or otherwise. A Guarantor shall be
released from its Note Guarantee upon the terms and subject to the conditions
set forth in the Indenture.
B-5
7. SUBORDINATION.
This Note and the Note Guarantees are subordinated in right of
payment, as set forth in the Indenture, to the prior payment in full of all
existing and future Senior Indebtedness. Each of the Company and the Guarantors
agrees, and each Holder by accepting a Note agrees, to the subordination
provisions set forth in the Indenture, authorizes the Trustee to give them
effect and appoints the Trustee as attorney-in-fact for such purpose.
8. REDEMPTION.
The Notes are not redeemable at the option of the Company
prior to August 1, 2001. Thereafter, the Notes will be subject to redemption at
the option of the Company, in whole or in part, on at least 30 calendar days'
but not more than 60 calendar days' prior notice, at the redemption prices
(expressed as percentages of principal amount) set forth below, plus accrued and
unpaid interest thereon, if any, and Liquidated Damages, if any, to the
applicable Redemption Date (subject to the right of each Holder of record on the
relevant Record Date to receive interest due on the relevant Interest Payment
Date), if redeemed during the twelve-month period beginning August 1 of the
years indicated below:
YEAR PERCENTAGE
2001 105.25%
2002 103.50%
2003 101.75%
2004 and thereafter 100.00%
The Notes are not subject to any sinking fund.
9. NOTICE OF REDEMPTION.
At least 30 calendar days but not more than 60 calendar days
before a Redemption Date, the Company shall deliver to the Trustee and send, by
first-class mail, postage prepaid, to Holders of Notes to be redeemed at the
addresses of such Holders as they appear in the Note Register, a notice of
redemption.
If less than all of the Notes are to be redeemed at any time,
the Notes to be redeemed shall be selected by the Trustee by such method as the
Trustee shall deem fair and appropriate and that complies with the requirements
of the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not so listed, on a PRO RATA basis; PROVIDED that
the Trustee may select for redemption portions (equal to $1,000 or any integral
multiple thereof) of the principal of Notes that have denominations larger than
$1,000 (Notes in denominations of $1,000 or less may be redeemed only in whole).
If any Note is redeemed subsequent to a Record Date with respect to any Interest
Payment Date specified above and on or prior to such Interest Payment Date, then
any accrued interest will be paid on such Interest Payment Date to the Holder of
the Note on such Record Date. If money in an amount sufficient to pay the
Redemption Price of all Notes (or portions thereof) to be redeemed on the
Redemption Date is deposited with the Paying Agent on or before the applicable
Redemption Date and certain other conditions are satisfied, interest on the
Notes or portions thereof to be redeemed on the applicable Redemption Date will
cease to accrue.
B-6
10. REPURCHASE AT THE OPTION OF HOLDERS UPON CHANGE OF CONTROL.
Upon the occurrence of a Change of Control, each Holder shall
have the right in accordance with the terms hereof and the Indenture to require
the Company to purchase such Holder's Notes, in whole or in part, in a principal
amount that is an integral multiple of $1,000, pursuant to a Change of Control
Offer, at a purchase price in cash equal to 101% of the principal amount of such
Notes (or portions thereof) plus accrued and unpaid interest and Liquidated
Damages, if any, to the Change of Control Payment Date.
Within 30 calendar days following any Change of Control, the
Company shall send, or cause to be sent, by first-class mail, postage prepaid, a
notice regarding the Change of Control Offer to each Holder. The Holder of this
Note may elect to have this Note or a portion hereof in an authorized
denomination purchased by completing the form entitled "Option of Holder to
Elect Purchase" appearing below and tendering this Note pursuant to the Change
of Control Offer. Unless the Company defaults in the payment of the Change of
Control Purchase Price with respect thereto, all Notes or portions thereof
accepted for payment pursuant to the Change of Control Offer will cease to
accrue interest from and after the Change of Control Payment Date.
Prior to complying with the provisions of the Indenture
governing Change of Control Offers, but in any event within 30 calendar days
following a Change of Control, the Company shall either repay all outstanding
Senior Indebtedness or obtain the requisite consents, if any, under all
agreements governing outstanding Senior Indebtedness to permit the repurchase of
Notes required by the provisions of the Indenture governing Change of Control
Offers.
11. REPURCHASE AT THE OPTION OF HOLDERS UPON ASSET SALE.
If at any time the Company or any Subsidiary engages in any
Asset Sale, as a result of which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Company shall, within 30 calendar days of the date the amount
of Excess Proceeds exceeds $5.0 million, use the then-existing Excess Proceeds
to make an offer to purchase from all Holders of Notes, on a PRO RATA basis,
Notes in an aggregate principal amount equal in amount to the then-existing
Excess Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest thereon and Liquidated
Damages to the Asset Sale Purchase Date. Upon completion of an Asset Sale Offer
(including payment of the Asset Sale Purchase Price for accepted Notes), any
surplus Excess Proceeds that were the subject of such offer shall cease to be
Excess Proceeds, and the Company may then use such amounts for general corporate
purposes.
Within 30 calendar days of the date the amount of Excess
Proceeds exceeds $5.0 million, the Company shall send, or cause to be sent, by
first-class mail, postage prepaid, a notice regarding the Asset Sale Offer to
each Holder. The Holder of this Note may elect to have this Note or a portion
hereof in an authorized denomination purchased by completing the form entitled
"Option of Holder to Elect Purchase" appearing below and tendering this Note
pursuant to the Asset Sale Offer. Unless the Company defaults in the payment of
the Asset Sale Purchase Price with respect thereto, all Notes or portions
thereof selected for payment pursuant to the Asset Sale Offer will cease to
accrue interest from and after the Asset Sale Purchase Date.
B-7
12. THE REGISTERED EXCHANGE OFFER.
Any Initial Notes (including this Note) that are presented to
the Registrar for exchange pursuant to the Registered Exchange Offer (as defined
in the Registration Rights Agreement) shall be exchanged for New Notes of equal
principal amount upon surrender of such Notes to the Registrar in accordance
with the terms of the Registered Exchange Offer and the Indenture.
13. TRANSFER AND EXCHANGE.
The transfer of this Note is subject to certain restrictions,
including those to which reference is made in the Private Placement Legend. A
Holder may transfer or exchange Notes as provided in the Indenture and subject
to certain limitations therein set forth. The Registrar may require a Holder,
among other things, to furnish appropriate endorsements or transfer documents
and to pay any taxes, fees and expenses required by law or permitted by the
Indenture. The Registrar need not register the transfer or exchange of
Certificated Notes or portions thereof selected for redemption (except, in the
case of a Certificated Note to be redeemed in part, the portion of such
Certificated Note not to be redeemed) or any Certificated Notes for a period of
15 calendar days before a selection of Notes to be redeemed.
14. DENOMINATIONS.
The Notes are issuable only in registered form without coupons
in denominations of $1,000 and integral multiples thereof of principal amount;
PROVIDED that Initial Certificated Notes originally purchased by or transferred
to Institutional Accredited Investors shall be subject to a minimum denomination
of $250,000.
15. DISCHARGE AND DEFEASANCE.
Subject to certain conditions, the Company at any time may
terminate some or all of the obligations of the Company and the Guarantors under
the Notes, the Note Guarantees and the Indenture if the Company irrevocably
deposits in trust with the Trustee cash or U.S. Government Obligations for the
payment of principal, premium, if any, interest and Liquidated Damages, if any,
on the Notes to redemption or maturity, as the case may be.
16. AMENDMENT, WAIVER.
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Notes may be amended with the written consent of the
Holders of at least a majority in principal amount of the outstanding Notes
(which consent may, but need not, be given in connection with any tender offer
or exchange offer for the Notes) and (ii) any Default and its consequences may
be waived with the written consent of the Holders of at least a majority in
principal amount of the outstanding Notes. Subject to certain exceptions set
forth in the Indenture, without the consent of any Holder, the Company and the
Trustee may amend the Indenture or the Notes (i) to evidence the succession of
another Person to the Company and the assumption by such successor of the
covenants of the Company under the Indenture and contained in the Notes; (ii) to
add to the covenants of the Company, for the benefit of the Holders of all of
the Notes, or to surrender any right or power conferred on the Company under the
Indenture; (iii) to add any additional Events of Default; (iv) to provide for
uncertificated Notes in addition to or in place of Certificated Notes; (v) to
evidence and provide for the acceptance of appointment under the Indenture of a
successor Trustee; (vi) to secure the Notes; (vii) to cure any ambiguity in the
Indenture, or to correct or supplement any provision in the Indenture which may
be inconsistent with any other provision therein or to add any other provisions
with respect to matters or questions arising under the Indenture, PROVIDED that
such actions shall not adversely affect the interests of the Holders of Notes in
any material respect; (viii) to comply with the requirements of the Commission
in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act; or (ix) to evidence the agreement or acknowledgment of a
Subsidiary that it is a Guarantor for all purposes under the Indenture
(including, without limitation, Article XI thereof).
B-8
17. DEFAULTS AND REMEDIES.
Under the Indenture, Events of Default include: (i) a default
for 30 days in the payment when due of interest on, or Liquidated Damages with
respect to, the Notes (whether or not prohibited by the subordination provisions
of the Indenture); (ii) default in payment when due of the principal of or
premium, if any, on the Notes (whether or not prohibited by the subordination
provisions of the Indenture); (iii) failure by the Company to observe or perform
certain covenants, conditions, agreements or other provisions of the Indenture
or this Note (and, in the case of certain covenants, agreements or other
provisions, such failure has continued for 60 calendar days after written notice
by the Trustee or the Holders of at least 25% in principal amount of the Notes);
(iv) failure by the Company to consummate the merger of Maxxim Acquisition Co.
with and into Sterile Concepts on or prior to December 15, 1996; (v) default in
the payment of Indebtedness of the Company or any of its Subsidiaries at its
final maturity or acceleration of such Indebtedness in an amount in excess of
$5.0 million in the aggregate; (vi) certain events of bankruptcy or insolvency
with respect to the Company or any of its Subsidiaries; (vii) certain
undischarged judgments in excess of $5.0 million in the aggregate; or (viii) the
Note Guarantee of any Guarantor being held in any judicial proceeding to be
unenforceable or invalid or ceasing for any reason to be in full force and
effect (other than in accordance with the terms of the Indenture) or any
Guarantor or any Person acting on behalf of any Guarantor denying or
disaffirming the Note Guarantee of such Guarantor
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in principal amount of the Notes, subject to
certain limitations, may declare all the Notes to be immediately due and
payable. Certain events of bankruptcy or insolvency shall result in the Notes
being immediately due and payable upon the occurrence of such Events of Default
without any further act of the Trustee or any Holder.
B-9
Holders of Notes may not enforce the Indenture or the Notes
except as provided in the Indenture. The Trustee may refuse to enforce the
Indenture or the Notes unless it receives reasonable indemnity or security.
Subject to certain limitations, Holders of a majority in principal amount of the
Notes may direct the Trustee in its exercise of any trust or power under the
Indenture. The Holders of a majority in principal amount of the then outstanding
Notes, by written notice to the Trustee and the Company, may rescind any
declaration of acceleration and its consequences if the rescission would not
conflict with any judgment or decree, and if all existing Events of Default have
been cured or waived, except nonpayment of principal, interest, premium or
Liquidated Damages that has become due solely because of acceleration. No such
recission shall affect any subsequent Default or impair any right consequent
thereto.
18. INDIVIDUAL RIGHTS OF TRUSTEE.
Subject to certain limitations imposed by the Trust Indenture
Act, the Trustee or any Paying Agent or Registrar, in its individual or any
other capacity, may become the owner or pledgee of Notes and may otherwise deal
with the Company, the Guarantors or their Affiliates with the same rights it
would have if it were not Trustee, Paying Agent or Registrar, as the case may
be, under the Indenture.
19. NO RECOURSE AGAINST CERTAIN OTHERS.
No director, officer, employee, incorporator or stockholder of
the Company or any Guarantor, as such, shall have any liability for any
obligations of the Company or such Guarantor under the Notes, the Note
Guarantees or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation, solely by reason of its status as
a director, officer, employee, incorporator or stockholder of the Company or
such Guarantor. By accepting a Note, each Holder waives and releases all such
liability (but only such liability) as part of the consideration for issuance of
such Note to such Holder.
20. AUTHENTICATION.
This Note shall not be valid until the Trustee or an
authenticating agent manually signs the certificate of authentication on the
other side of this Note.
21. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder or
an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with rights of survivorship and not as
tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
B-10
22. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of Notes. No representation is
made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
23. GOVERNING LAW.
THE INDENTURE, THE NOTE GUARANTEES AND THIS NOTE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE.
The Company will furnish to any Holder upon written request
and without charge to the Holder a copy of the Indenture which has in it the
text of this Note. Requests may be made to:
Maxxim Medical, Inc.
104 Industrial Blvd.
Sugar Land, Texas, 77478
Attention: Chief Operating Officer
B-11
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED ____________________ hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
- -----------------------------------------
- ------------------------------------------------------------------------------
(Please print name and address of transferee)
- ------------------------------------------------------------------------------
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ________________________________ Attorney to
transfer this Note on the Security Register, with full power of substitution.
Dated: _______________
- ----------------------------- --------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
B-12
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
|_| In connection with the Change of Control Offer made pursuant to Section
4.07 of the Indenture, the undersigned hereby elects to have
|_| the entire principal amount
|_| $________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note
repurchased by the Company. The undersigned hereby directs the Trustee
or Paying Agent to pay it or __________________________ an amount in
cash equal to 101% of the principal amount indicated in the preceding
sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Change of Control Payment Date.
|_| In connection with the Asset Sale Offer made pursuant to Section 4.08
of the Indenture, the undersigned hereby elects to have
|_| the entire principal amount
|_| $________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note
repurchased by the Company. The undersigned hereby directs the Trustee
or Paying Agent to pay it or __________________________ an amount in
cash equal to 100% of the principal amount indicated in the preceding
sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Asset Sale Purchase Date.
Dated: _______________
- ----------------------------- --------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing must correspond to the Name as written
upon the face of this Note in every particular, without alteration or any change
whatsoever.
B-13
<PAGE>
[Execution Copy]
EXHIBIT C
FORM OF NEW GLOBAL NOTE
FACE OF NEW GLOBAL NOTE
MAXXIM MEDICAL, INC.
No. ____ CUSIP No.
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO MAXXIM MEDICAL, INC. OR A SUCCESSOR THEREOF
OR THE REGISTRAR FOR REGISTRATION OF TRANSFER OR EXCHANGE AND ANY NOTE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER ENTITY AS
HAS BEEN REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS HAS BEEN REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFER OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, AND
NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE.
GLOBAL NOTE
REPRESENTING 10 1/2% SENIOR SUBORDINATED NOTES DUE 2006
Maxxim Medical, Inc., a Texas corporation, for value received,
hereby promises to pay to CEDE & CO., or its registered assigns, the principal
sum indicated on Schedule A hereof, on August 1, 2006.
Interest Payment Dates: February 1 and August 1, commencing
February 1, 1997.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Note
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly
executed by the Trustee referred to on the reverse hereof by manual signature,
this Note shall not be entitled to any benefit under the Indenture or be valid
or obligatory for any purposes.
C-2
IN WITNESS WHEREOF, Maxxim Medical, Inc. has caused this Note to
be duly executed under its corporate seal.
MAXXIM MEDICAL, INC.
By: __________________________________________
Name:
Title:
[Corporate Seal]
Attest:______________________
Dated:_______________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
FIRST UNION NATIONAL BANK OF NORTH CAROLINA,
as Trustee, certifies that this is one of
the Notes referred to in the Indenture.
By:__________________________
Authorized Signatory
C-3
REVERSE SIDE OF NEW GLOBAL NOTE
MAXXIM MEDICAL, INC.
GLOBAL NOTE
REPRESENTING 10 1/2% SENIOR SUBORDINATED NOTES DUE 2006
1. INDENTURE.
This Note is one of a duly authorized issue of debt securities of
the Company (as defined below) designated as its "10 1/2% Senior Subordinated
Notes Due 2006" (herein called the "Notes") limited in aggregate principal
amount to $100,000,000, issued under an indenture dated as of July 30, 1996 (as
amended or supplemented from time to time, the "Indenture") among the Company,
as issuer, and Maxxim Medical, Inc. (Delaware), Maxxim Acquisition Co., Fabritek
La Romana, Inc., Maxxim Medical Canada Limited, Medica B.V., and Medica Hospital
Supplies, N.V. as guarantors (collectively, the "Guarantors"), and First Union
National Bank of North Carolina, as trustee (the "Trustee," which term includes
any successor trustee under the Indenture). The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders of Notes are referred to the
Indenture and such Act for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Company, the Guarantors, the
Trustee and each Holder and of the terms upon which the Notes are, and are to
be, authenticated and delivered. The summary of the terms of this Note contained
herein does not purport to be complete and is qualified by reference to the
Indenture. To the extent permitted by applicable law, in the event of any
inconsistency between the terms of this Note and the terms of the Indenture, the
terms of the Indenture shall control. All capitalized terms used in this Note
which are not defined herein shall have the meanings assigned to them in the
Indenture.
The Indenture restricts, among other things, the Company's
ability to incur additional indebtedness and issue preferred stock, pay
dividends or make certain other restricted payments, incur liens to secure PARI
PASSU or subordinated indebtedness, sell stock of Subsidiaries, apply net
proceeds from certain asset sales, merge or consolidate with any other person,
sell, assign, transfer, lease, convey or otherwise dispose of substantially all
of the assets of the Company, enter into certain transactions with affiliates or
incur indebtedness that is subordinate in right of payment to any Senior
Indebtedness and senior in right of payment to the Notes. The Indenture permits,
under certain circumstances, the Company's Subsidiaries that are organized under
the laws of jurisdictions other than the United States of America, any state
thereof or the District of Columbia to be deemed Unrestricted Subsidiaries and
thus not subject to the restrictions of the Indenture.
2. PRINCIPAL AND INTEREST.
Maxxim Medical, Inc., a Texas corporation (such corporation, and
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Company"),
C-4
promises to pay the principal amount set forth on Schedule A of this Note to the
Holder hereof on August 1, 2006.
The Company shall pay interest at a rate of 10 1/2% PER ANNUM,
from July 30, 1996 or from the most recent Interest Payment Date thereafter to
which interest has been paid or duly provided for, semiannually in arrears on
February 1 and August 1 of each year, commencing on February 1, 1997, in cash,
to the Holder hereof until the principal amount hereof is paid or made available
for payment. The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, subject to certain exceptions provided in the
Indenture, be paid to the Person in whose name this Note (or the Note in
exchange or substitution for which this Note was issued) is registered at the
close of business on the Record Date for interest payable on such Interest
Payment Date. The Record Date for any interest payment is the close of business
on January 15 or July 15, as the case may be, whether or not a Business Day,
immediately preceding the Interest Payment Date on which such interest is
payable. Any such interest not so punctually paid or duly provided for
("Defaulted Interest") shall forthwith cease to be payable to the Holder on such
Record Date and shall be paid as provided in Section 2.11 of the Indenture.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
Each payment of interest in respect of an Interest Payment Date
will include interest accrued through the day before such Interest Payment Date.
If an Interest Payment Date falls on a day that is not a Business Day, the
interest payment to be made on such Interest Payment Date will be made on the
next succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as a result of
such delayed payment.
If this Note is issued pursuant to a Registered Exchange Offer on
or prior to the Record Date for the first Interest Payment Date following such
exchange, accrued and unpaid interest, if any, on the equivalent principal
amount of the Initial Note in exchange for which this Note was issued, up to but
not including the date of issuance of this Note, shall be paid on the first
Interest Payment Date for this Note to the Holder of this Note on the first
Record Date with respect to this Note. If this Note is issued pursuant to a
Registered Exchange Offer subsequent to the Record Date for the first Interest
Payment Date following such exchange but on or prior to such Interest Payment
Date, then any such accrued and unpaid interest with respect to the equivalent
principal amount of the Initial Note in exchange for which this Note was issued
and any accrued and unpaid interest on this Note through the day before such
Interest Payment Date shall be paid on such Interest Payment Date to the Holder
of such Initial Note on such Record Date.
To the extent lawful, the Company shall pay interest on overdue
principal, overdue premium, Defaulted Interest and overdue Liquidated Damages
(without regard to any applicable grace period) at the interest rate borne on
this Note. The Company's obligation pursuant to the previous sentence shall
apply whether such overdue amount is due at its Stated Maturity, as a result of
the Company's obligations pursuant to Section 3.05, Section 4.07 or Section 4.08
of the Indenture, or otherwise.
C-5
3. METHOD OF PAYMENT.
The Company, through the Paying Agent, shall pay interest on this
Note to the registered Holder of this Note, as provided above. The Holder must
surrender this Note to a Paying Agent to collect principal payments. The Company
will pay principal, premium, if any, and interest and Liquidated Damages, if
any, in money of the United States of America that at the time of payment is
legal tender for payment of all debts public and private. Principal, premium, if
any, and interest and Liquidated Damages, if any, shall be paid by check mailed
to the registered Holders at their registered addresses; PROVIDED that all
payments with respect to Notes the Holders of which have given wire transfer
instructions to the Company will be required to be made by wire transfer
immediately available funds to the accounts specified by the Holders thereof.
4. PAYING AGENT AND REGISTRAR.
Initially, the Trustee will act as Paying Agent and Registrar
under the Indenture. The Company may, upon written notice to the Trustee,
appoint and change any Paying Agent or Registrar. The Company or any of its
Affiliates may act as Paying Agent or Registrar, PROVIDED that if the Company or
such Affiliate is acting as Paying Agent, the Company or such Affiliate shall
segregate all funds held by it as Paying Agent and hold them in trust for the
benefit of the Holders or the Trustee.
5. NOTE GUARANTEES.
This Note is initially entitled to the benefits of the Note
Guarantees made by Maxxim Medical, Inc. (Delaware), Maxxim Acquisition Co.,
Fabritek La Romana, Inc., Maxxim Medical Canada Limited, Medica B.V., and Medica
Hospital Supplies, N.V., and may thereafter be entitled to Note Guarantees made
by other Guarantors for the benefit of the Holders of Notes. Each present
Guarantor has, and each future Guarantor will, irrevocably and unconditionally,
jointly and severally, guarantee on a senior subordinated basis the punctual
payment when due, whether at Stated Maturity, by acceleration, in connection
with a Change of Control Offer, an Asset Sale Offer or redemption, or otherwise,
of all obligations of the Company under the Indenture and this Note, whether for
payment of principal of, premium, if any, interest or Liquidated Damages, if
any, on the Notes, expenses, indemnification or otherwise. A Guarantor shall be
released from its Note Guarantee upon the terms and subject to the conditions
set forth in the Indenture.
6. SUBORDINATION.
This Note and the Note Guarantees are subordinated in right of
payment, as set forth in the Indenture, to the prior payment in full of all
existing and future Senior Indebtedness. Each of the Company and the Guarantors
agrees, and each Holder by accepting a Note agrees, to the subordination
provisions set forth in the Indenture, authorizes the Trustee to give them
effect and appoints the Trustee as attorney-in-fact for such purpose.
C-6
7. REDEMPTION.
The Notes are not redeemable at the option of the Company prior
to August 1, 2001. Thereafter, the Notes will be subject to redemption at the
option of the Company, in whole or in part, on at least 30 calendar days' but
not more than 60 calendar days' prior notice, at the redemption prices
(expressed as percentages of principal amount) set forth below, plus accrued and
unpaid interest thereon, if any, and Liquidated Damages, if any, to the
applicable Redemption Date (subject to the right of each Holder of record on the
relevant Record Date to receive interest due on the relevant Interest Payment
Date), if redeemed during the twelve-month period beginning August 1 of the
years indicated below:
YEAR PERCENTAGE
---- ----------
2001 105.25%
2002 103.50%
2003 101.75%
2004 and thereafter 100.00%
The Notes are not subject to any sinking fund.
8. NOTICE OF REDEMPTION.
At least 30 calendar days but not more than 60 calendar days
before a Redemption Date, the Company shall deliver to the Trustee and send, by
first-class mail, postage prepaid, to Holders of Notes to be redeemed at the
addresses of such Holders as they appear in the Note Register, a notice of
redemption.
If less than all of the Notes are to be redeemed at any time, the
Notes to be redeemed shall be selected by the Trustee by such method as the
Trustee shall deem fair and appropriate and that complies with the requirements
of the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not so listed, on a PRO RATA basis; PROVIDED that
the Trustee may select for redemption portions (equal to $1,000 or any integral
multiple thereof) of the principal of Notes that have denominations larger than
$1,000 (Notes in denominations of $1,000 or less may be redeemed only in whole).
If any Note is redeemed subsequent to a Record Date with respect to any Interest
Payment Date specified above and on or prior to such Interest Payment Date, then
any accrued interest will be paid on such Interest Payment Date to the Holder of
the Note on such Record Date. If money in an amount sufficient to pay the
Redemption Price of all Notes (or portions thereof) to be redeemed on the
Redemption Date is deposited with the Paying Agent on or before the applicable
Redemption Date and certain other conditions are satisfied, interest on the
Notes or portions thereof to be redeemed on the applicable Redemption Date will
cease to accrue.
9. REPURCHASE AT THE OPTION OF HOLDERS UPON CHANGE OF CONTROL.
Upon the occurrence of a Change of Control, each Holder shall
have the right in accordance with the terms hereof and the Indenture to require
the Company to purchase such
C-7
Holder's Notes, in whole or in part, in a principal amount that is an integral
multiple of $1,000, pursuant to a Change of Control Offer, at a purchase price
in cash equal to 101% of the principal amount of such Notes (or portions
thereof) plus accrued and unpaid interest and Liquidated Damages, if any, to the
Change of Control Payment Date.
Within 30 calendar days following any Change of Control, the
Company shall send, or cause to be sent, by first-class mail, postage prepaid, a
notice regarding the Change of Control Offer to each Holder. The Holder of this
Note may elect to have this Note or a portion hereof in an authorized
denomination purchased by completing the form entitled "Option of Holder to
Elect Purchase" appearing below and tendering this Note pursuant to the Change
of Control Offer. Unless the Company defaults in the payment of the Change of
Control Purchase Price with respect thereto, all Notes or portions thereof
accepted for payment pursuant to the Change of Control Offer will cease to
accrue interest from and after the Change of Control Payment Date.
Prior to complying with the provisions of the Indenture governing
Change of Control Offers, but in any event within 30 calendar days following a
Change of Control, the Company shall either repay all outstanding Senior
Indebtedness or obtain the requisite consents, if any, under all agreements
governing outstanding Senior Indebtedness to permit the repurchase of Notes
required by the provisions of the Indenture governing Change of Control Offers.
10. REPURCHASE AT THE OPTION OF HOLDERS UPON ASSET SALE.
If at any time the Company or any Subsidiary engages in any Asset
Sale, as a result of which the aggregate amount of Excess Proceeds exceeds $5.0
million, the Company shall, within 30 calendar days of the date the amount of
Excess Proceeds exceeds $5.0 million, use the then-existing Excess Proceeds to
make an offer to purchase from all Holders of Notes, on a PRO RATA basis, Notes
in an aggregate principal amount equal in amount to the then-existing Excess
Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest thereon and Liquidated
Damages to the Asset Sale Purchase Date. Upon completion of an Asset Sale Offer
(including payment of the Asset Sale Purchase Price for accepted Notes), any
surplus Excess Proceeds that were the subject of such offer shall cease to be
Excess Proceeds, and the Company may then use such amounts for general corporate
purposes.
Within 30 calendar days of the date the amount of Excess Proceeds
exceeds $5.0 million, the Company shall send, or cause to be sent, by
first-class mail, postage prepaid, a notice regarding the Asset Sale Offer to
each Holder. The Holder of this Note may elect to have this Note or a portion
hereof in an authorized denomination purchased by completing the form entitled
"Option of Holder to Elect Purchase" appearing below and tendering this Note
pursuant to the Asset Sale Offer. Unless the Company defaults in the payment of
the Asset Sale Purchase Price with respect thereto, all Notes or portions
thereof selected for payment pursuant to the Asset Sale Offer will cease to
accrue interest from and after the Asset Sale Purchase Date.
C-8
11. THE GLOBAL NOTE.
So long as this Global Note is registered in the name of the
Depositary or its nominee, members of, or participants in, the Depositary
("Agent Members") shall have no rights under the Indenture with respect to this
Global Note held on their behalf by the Depositary or the Trustee as its
custodian, and the Depositary may be treated by the Company, the Guarantors, the
Trustee and any agent of the Company, the Guarantors or the Trustee as the
absolute owner of this Global Note for all purposes. Notwithstanding the
foregoing, nothing herein shall (i) prevent the Company, the Guarantors, the
Trustee or any agent of the Company, the Guarantors or the Trustee, from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or (ii) impair, as between the Depositary and its Agent Members,
the operation of customary practices governing the exercise of the rights of a
Holder.
The Holder of this Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests in this Global Note through Agent Members, to take any action which a
Holder is entitled to take under the Indenture or the Notes.
Whenever, as a result of optional redemption by the Company, a
Change of Control Offer, an Asset Sale Offer or an exchange for Certificated
Notes, this Global Note is redeemed, repurchased or exchanged in part, this
Global Note shall be surrendered by the Holder thereof to the Trustee who shall
cause an adjustment to be made to Schedule A hereof so that the principal amount
of this Global Note will be equal to the portion not redeemed, repurchased or
exchanged and shall thereafter return this Global Note to such Holder; PROVIDED
that this Global Note shall be in a principal amount of $1,000 or an integral
multiple of $1,000.
12. TRANSFER AND EXCHANGE.
A Holder may transfer or exchange Notes as provided in the
Indenture and subject to certain limitations therein set forth. The Registrar
may require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes, fees and expenses required by law or
permitted by the Indenture.
13. DENOMINATIONS.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof of principal amount.
14. DISCHARGE AND DEFEASANCE.
Subject to certain conditions, the Company at any time may
terminate some or all of the obligations of the Company and the Guarantors under
the Notes, the Note Guarantees and the Indenture if the Company irrevocably
deposits in trust with the Trustee cash or U.S. Government Obligations for the
payment of principal, premium, if any, interest and Liquidated Damages, if any,
on the Notes to redemption or maturity, as the case may be.
C-9
15. AMENDMENT, WAIVER.
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Notes may be amended with the written consent of the Holders of
at least a majority in principal amount of the outstanding Notes (which consent
may, but need not, be given in connection with any tender offer or exchange
offer for the Notes) and (ii) any Default and its consequences may be waived
with the written consent of the Holders of at least a majority in principal
amount of the outstanding Notes. Subject to certain exceptions set forth in the
Indenture, without the consent of any Holder, the Company and the Trustee may
amend the Indenture or the Notes (i) to evidence the succession of another
Person to the Company and the assumption by such successor of the covenants of
the Company under the Indenture and contained in the Notes; (ii) to add to the
covenants of the Company, for the benefit of the Holders of all of the Notes, or
to surrender any right or power conferred on the Company under the Indenture;
(iii) to add any additional Events of Default; (iv) to provide for
uncertificated Notes in addition to or in place of Certificated Notes; (v) to
evidence and provide for the acceptance of appointment under the Indenture of a
successor Trustee; (vi) to secure the Notes; (vii) to cure any ambiguity in the
Indenture, or to correct or supplement any provision in the Indenture which may
be inconsistent with any other provision therein or to add any other provisions
with respect to matters or questions arising under the Indenture, PROVIDED that
such actions shall not adversely affect the interests of the Holders of Notes in
any material respect; (viii) to comply with the requirements of the Commission
in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act; or (ix) to evidence the agreement or acknowledgment of a
Subsidiary that it is a Guarantor for all purposes under the Indenture
(including, without limitation, Article XI thereof).
16. DEFAULTS AND REMEDIES.
Under the Indenture, Events of Default include: (i) a default for
30 days in the payment when due of interest on, or Liquidated Damages with
respect to, the Notes (whether or not prohibited by the subordination provisions
of the Indenture); (ii) default in payment when due of the principal of or
premium, if any, on the Notes (whether or not prohibited by the subordination
provisions of the Indenture); (iii) failure by the Company to observe or perform
certain covenants, conditions, agreements or other provisions of the Indenture
or this Note (and, in the case of certain covenants, agreements or other
provisions, such failure has continued for 60 calendar days after written notice
by the Trustee or the Holders of at least 25% in principal amount of the Notes);
(iv) failure by the Company to consummate the merger of Maxxim Acquisition Co.
with and into Sterile Concepts on or prior to December 15, 1996; (v) default in
the payment of Indebtedness of the Company or any of its Subsidiaries at its
final maturity or acceleration of such Indebtedness in an amount in excess of
$5.0 million in the aggregate; (vi) certain events of bankruptcy or insolvency
with respect to the Company or any of its Subsidiaries; (vii) certain
undischarged judgments in excess of $5.0 million in the aggregate; or (viii) the
Note Guarantee of any Guarantor being held in any judicial proceeding to be
unenforceable or invalid or ceasing for any reason to be in full force and
effect (other than in accordance with the terms of the Indenture) or any
Guarantor or any Person acting on behalf of any Guarantor denying or
disaffirming the Note Guarantee of such Guarantor
C-10
If an Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in principal amount of the Notes, subject to certain
limitations, may declare all the Notes to be immediately due and payable.
Certain events of bankruptcy or insolvency shall result in the Notes being
immediately due and payable upon the occurrence of such Events of Default
without any further act of the Trustee or any Holder.
Holders of Notes may not enforce the Indenture or the Notes
except as provided in the Indenture. The Trustee may refuse to enforce the
Indenture or the Notes unless it receives reasonable indemnity or security.
Subject to certain limitations, Holders of a majority in principal amount of the
Notes may direct the Trustee in its exercise of any trust or power under the
Indenture. The Holders of a majority in principal amount of the then outstanding
Notes, by written notice to the Trustee and the Company, may rescind any
declaration of acceleration and its consequences if the rescission would not
conflict with any judgment or decree, and if all existing Events of Default have
been cured or waived, except nonpayment of principal, interest, premium or
Liquidated Damages that has become due solely because of acceleration. No such
recission shall affect any subsequent Default or impair any right consequent
thereto.
17. INDIVIDUAL RIGHTS OF TRUSTEE.
Subject to certain limitations imposed by the Trust Indenture
Act, the Trustee or any Paying Agent or Registrar, in its individual or any
other capacity, may become the owner or pledgee of Notes and may otherwise deal
with the Company, the Guarantors or their Affiliates with the same rights it
would have if it were not Trustee, Paying Agent or Registrar, as the case may
be, under the Indenture.
18. NO RECOURSE AGAINST CERTAIN OTHERS.
No director, officer, employee, incorporator or stockholder of
the Company or any Guarantor, as such, shall have any liability for any
obligations of the Company or such Guarantor under the Notes, the Note
Guarantees or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation, solely by reason of its status as
a director, officer, employee, incorporator or stockholder of the Company or
such Guarantor. By accepting a Note, each Holder waives and releases all such
liability (but only such liability) as part of the consideration for issuance of
such Note to such Holder.
19. AUTHENTICATION.
This Note shall not be valid until the Trustee or an
authenticating agent manually signs the certificate of authentication on the
other side of this Note.
20. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with rights of survivorship and not as
tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
C-11
21. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of Notes. No representation is
made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
22. GOVERNING LAW.
THE INDENTURE, THE NOTE GUARANTEES AND THIS NOTE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE.
The Company will furnish to any Holder upon written request and
without charge to the Holder a copy of the Indenture which has in it the text of
this Note. Requests may be made to:
Maxxim Medical, Inc.
104 Industrial Blvd.
Sugar Land, Texas, 77478
Attention: Chief Operating Officer
C-12
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount at maturity of this Note shall be $___________. The
following decreases/increase in the principal amount in denominations of $1,000
or integral multiples thereof at maturity of this Note have been made:
Total Principal
Amount at Notation
Decrease in Increase in Maturity Made by
Date of Principal Principal Following such or on
Decrease/ Amount at Amount at Decrease/ Behalf of
Increase Maturity Maturity Increase Trustee
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
- ------------ ----------- ----------- ------------- ---------
C-13
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED ___________________________ hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please print name and address of transferee)
- --------------------------------------------------------------------------------
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ________________________________ Attorney to
transfer this Note on the Security Register, with full power of substitution.
Dated: _______________
- ----------------------------- -----------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
C-14
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
|_| In connection with the Change of Control Offer made pursuant to
Section 4.07 of the Indenture, the undersigned hereby elects to have
|_| the entire principal amount
|_| $________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note
repurchased by the Company. The undersigned hereby directs the Trustee
or Paying Agent to pay it or __________________________ an amount in
cash equal to 101% of the principal amount indicated in the preceding
sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Change of Control Payment Date.
|_| In connection with the Asset Sale Offer made pursuant to Section 4.08 of
the Indenture, the undersigned hereby elects to have
|_| the entire principal amount
|_| $________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note
repurchased by the Company. The undersigned hereby directs the Trustee
or Paying Agent to pay it or __________________________ an amount in
cash equal to 100% of the principal amount indicated in the preceding
sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Asset Sale Purchase Date.
Dated: _______________
- ----------------------------- -----------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing must correspond to the Name as written
upon the face of this Note in every particular, without alteration or any change
whatsoever.
C-15
<PAGE>
[Execution Copy]
EXHIBIT D
FORM OF NEW CERTIFICATED NOTE
FACE OF NEW CERTIFICATED NOTE
MAXXIM MEDICAL, INC.
No. __ CUSIP No.
10 1/2% SENIOR SUBORDINATED NOTE DUE 2006
Maxxim Medical, Inc., a Texas corporation, for value received,
hereby promises to pay to__________, or its registered assigns, the principal
amount of __________, on August 1, 2006.
Interest Payment Dates: February 1 and August 1, commencing
February 1, 1997.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly
executed by the Trustee referred to on the reverse hereof by manual signature,
this Note shall not be entitled to any benefit under the Indenture or be valid
or obligatory for any purposes.
IN WITNESS WHEREOF, Maxxim Medical, Inc. has caused this Note to be
duly executed under its corporate seal.
MAXXIM MEDICAL, INC.
By: __________________________________________
Name:
Title:
[Corporate Seal]
Attest:______________________
Dated:______________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
FIRST UNION NATIONAL BANK OF NORTH CAROLINA, as Trustee, certifies that this is
one of the Notes referred to in the Indenture.
By:
Authorized Signatory
D-2
REVERSE SIDE OF NEW CERTIFICATED NOTE
MAXXIM MEDICAL, INC.
10 1/2% SENIOR SUBORDINATED NOTE DUE 2006
1. INDENTURE.
This Note is one of a duly authorized issue of debt securities of
the Company (as defined below) designated as its "10 1/2% Senior Subordinated
Notes Due 2006" (herein called the "Notes") limited in aggregate principal
amount to $100,000,000, issued under an indenture dated as of July 30, 1996 (as
amended or supplemented from time to time, the "Indenture") among the Company,
as issuer, and Maxxim Medical, Inc. (Delaware), Maxxim Acquisition Co., Fabritek
La Romana, Inc., Maxxim Medical Canada Limited, Medica B.V., and Medica Hospital
Supplies, N.V. as guarantors (collectively, the "Guarantors"), and First Union
National Bank of North Carolina, as trustee (the "Trustee," which term includes
any successor trustee under the Indenture). The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders of Notes are referred to the
Indenture and such Act for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Company, the Guarantors, the
Trustee and each Holder and of the terms upon which the Notes are, and are to
be, authenticated and delivered. The summary of the terms of this Note contained
herein does not purport to be complete and is qualified by reference to the
Indenture. To the extent permitted by applicable law, in the event of any
inconsistency between the terms of this Note and the terms of the Indenture, the
terms of the Indenture shall control. All capitalized terms used in this Note
which are not defined herein shall have the meanings assigned to them in the
Indenture.
The Indenture restricts, among other things, the Company's ability
to incur additional indebtedness and issue preferred stock, pay dividends or
make certain other restricted payments, incur liens to secure PARI PASSU or
subordinated indebtedness, sell stock of Subsidiaries, apply net proceeds from
certain asset sales, merge or consolidate with any other person, sell, assign,
transfer, lease, convey or otherwise dispose of substantially all of the assets
of the Company, enter into certain transactions with affiliates or incur
indebtedness that is subordinate in right of payment to any Senior Indebtedness
and senior in right of payment to the Notes. The Indenture permits, under
certain circumstances, the Company's Subsidiaries that are organized under the
laws of jurisdictions other than the United States of America, any state thereof
or the District of Columbia to be deemed Unrestricted Subsidiaries and thus not
subject to the restrictions of the Indenture.
2. PRINCIPAL AND INTEREST.
Maxxim Medical, Inc., a Texas corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"),
D-3
promises to pay the principal amount set forth on Schedule A of this Note to the
Holder hereof on August 1, 2006.
The Company shall pay interest at a rate of 10 1/2% PER ANNUM, from
July 30, 1996 or from the most recent Interest Payment Date thereafter to which
interest has been paid or duly provided for, semiannually in arrears on February
1 and August 1 of each year, commencing on February 1, 1997, in cash, to the
Holder hereof until the principal amount hereof is paid or made available for
payment. The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, subject to certain exceptions provided in the
Indenture, be paid to the Person in whose name this Note (or the Note in
exchange or substitution for which this Note was issued) is registered at the
close of business on the Record Date for interest payable on such Interest
Payment Date. The Record Date for any interest payment is the close of business
on January 15 or July 15, as the case may be, whether or not a Business Day,
immediately preceding the Interest Payment Date on which such interest is
payable. Any such interest not so punctually paid or duly provided for
("Defaulted Interest") shall forthwith cease to be payable to the Holder on such
Record Date and shall be paid as provided in Section 2.11 of the Indenture.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
Each payment of interest in respect of an Interest Payment Date will
include interest accrued through the day before such Interest Payment Date. If
an Interest Payment Date falls on a day that is not a Business Day, the interest
payment to be made on such Interest Payment Date will be made on the next
succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as a result of
such delayed payment.
If this Note is issued pursuant to a Registered Exchange Offer on or
prior to the Record Date for the first Interest Payment Date following such
exchange, accrued and unpaid interest, if any, on the equivalent principal
amount of the Initial Note in exchange for which this Note was issued, up to but
not including the date of issuance of this Note, shall be paid on the first
Interest Payment Date for this Note to the Holder of this Note on the first
Record Date with respect to this Note. If this Note is issued pursuant to a
Registered Exchange Offer subsequent to the Record Date for the first Interest
Payment Date following such exchange but on or prior to such Interest Payment
Date, then any such accrued and unpaid interest with respect to the equivalent
principal amount of the Initial Note in exchange for which this Note was issued
and any accrued and unpaid interest on this Note through the day before such
Interest Payment Date shall be paid on such Interest Payment Date to the Holder
of such Initial Note on such Record Date.
To the extent lawful, the Company shall pay interest on overdue
principal, overdue premium, Defaulted Interest and overdue Liquidated Damages
(without regard to any applicable grace period) at the interest rate borne on
this Note. The Company's obligation pursuant to the previous sentence shall
apply whether such overdue amount is due at its Stated Maturity, as a result of
the Company's obligations pursuant to Section 3.05, Section 4.07 or Section 4.08
of the Indenture, or otherwise.
D-4
3. METHOD OF PAYMENT.
The Company, through the Paying Agent, shall pay interest on this
Note to the registered Holder of this Note, as provided above. The Holder must
surrender this Note to a Paying Agent to collect principal payments. The Company
will pay principal, premium, if any, and interest and Liquidated Damages, if
any, in money of the United States of America that at the time of payment is
legal tender for payment of all debts public and private. Principal, premium, if
any, and interest and Liquidated Damages, if any, shall be paid by check mailed
to the registered Holders at their registered addresses; PROVIDED that all
payments with respect to Notes the Holders of which have given wire transfer
instructions to the Company will be required to be made by wire transfer
immediately available funds to the accounts specified by the Holders thereof.
4. PAYING AGENT AND REGISTRAR.
Initially, the Trustee will act as Paying Agent and Registrar under
the Indenture. The Company may, upon written notice to the Trustee, appoint and
change any Paying Agent or Registrar. The Company or any of its Affiliates may
act as Paying Agent or Registrar, PROVIDED that if the Company or such Affiliate
is acting as Paying Agent, the Company or such Affiliate shall segregate all
funds held by it as Paying Agent and hold them in trust for the benefit of the
Holders or the Trustee.
5. NOTE GUARANTEES.
This Note is initially entitled to the benefits of the Note
Guarantees made by Maxxim Medical, Inc. (Delaware), Maxxim Acquisition Co.,
Fabritek La Romana, Inc., Maxxim Medical Canada Limited, Medica B.V., and Medica
Hospital Supplies, N.V., and may thereafter be entitled to Note Guarantees made
by other Guarantors for the benefit of the Holders of Notes. Each present
Guarantor has, and each future Guarantor will, irrevocably and unconditionally,
jointly and severally, guarantee on a senior subordinated basis the punctual
payment when due, whether at Stated Maturity, by acceleration, in connection
with a Change of Control Offer, an Asset Sale Offer or redemption, or otherwise,
of all obligations of the Company under the Indenture and this Note, whether for
payment of principal of, premium, if any, interest or Liquidated Damages, if
any, on the Notes, expenses, indemnification or otherwise. A Guarantor shall be
released from its Note Guarantee upon the terms and subject to the conditions
set forth in the Indenture.
6. SUBORDINATION.
This Note and the Note Guarantees are subordinated in right of
payment, as set forth in the Indenture, to the prior payment in full of all
existing and future Senior Indebtedness. Each of the Company and the Guarantors
agrees, and each Holder by accepting a Note agrees, to the subordination
provisions set forth in the Indenture, authorizes the Trustee to give them
effect and appoints the Trustee as attorney-in-fact for such purpose.
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7. REDEMPTION.
The Notes are not redeemable at the option of the Company prior to
August 1, 2001. Thereafter, the Notes will be subject to redemption at the
option of the Company, in whole or in part, on at least 30 calendar days' but
not more than 60 calendar days' prior notice, at the redemption prices
(expressed as percentages of principal amount) set forth below, plus accrued and
unpaid interest thereon, if any, and Liquidated Damages, if any, to the
applicable Redemption Date (subject to the right of each Holder of record on the
relevant Record Date to receive interest due on the relevant Interest Payment
Date), if redeemed during the twelve-month period beginning August 1 of the
years indicated below:
YEAR PERCENTAGE
2001 105.25%
2002 103.50%
2003 101.75%
2004 and thereafter 100.00%
The Notes are not subject to any sinking fund.
8. NOTICE OF REDEMPTION.
At least 30 calendar days but not more than 60 calendar days before
a Redemption Date, the Company shall deliver to the Trustee and send, by
first-class mail, postage prepaid, to Holders of Notes to be redeemed at the
addresses of such Holders as they appear in the Note Register, a notice of
redemption.
If less than all of the Notes are to be redeemed at any time, the
Notes to be redeemed shall be selected by the Trustee by such method as the
Trustee shall deem fair and appropriate and that complies with the requirements
of the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not so listed, on a PRO RATA basis; PROVIDED that
the Trustee may select for redemption portions (equal to $1,000 or any integral
multiple thereof) of the principal of Notes that have denominations larger than
$1,000 (Notes in denominations of $1,000 or less may be redeemed only in whole).
If any Note is redeemed subsequent to a Record Date with respect to any Interest
Payment Date specified above and on or prior to such Interest Payment Date, then
any accrued interest will be paid on such Interest Payment Date to the Holder of
the Note on such Record Date. If money in an amount sufficient to pay the
Redemption Price of all Notes (or portions thereof) to be redeemed on the
Redemption Date is deposited with the Paying Agent on or before the applicable
Redemption Date and certain other conditions are satisfied, interest on the
Notes or portions thereof to be redeemed on the applicable Redemption Date will
cease to accrue.
9. REPURCHASE AT THE OPTION OF HOLDERS UPON CHANGE OF CONTROL.
Upon the occurrence of a Change of Control, each Holder shall have
the right in accordance with the terms hereof and the Indenture to require the
Company to purchase such
D-6
Holder's Notes, in whole or in part, in a principal amount that is an integral
multiple of $1,000, pursuant to a Change of Control Offer, at a purchase price
in cash equal to 101% of the principal amount of such Notes (or portions
thereof) plus accrued and unpaid interest and Liquidated Damages, if any, to the
Change of Control Payment Date.
Within 30 calendar days following any Change of Control, the Company
shall send, or cause to be sent, by first-class mail, postage prepaid, a notice
regarding the Change of Control Offer to each Holder. The Holder of this Note
may elect to have this Note or a portion hereof in an authorized denomination
purchased by completing the form entitled "Option of Holder to Elect Purchase"
appearing below and tendering this Note pursuant to the Change of Control Offer.
Unless the Company defaults in the payment of the Change of Control Purchase
Price with respect thereto, all Notes or portions thereof accepted for payment
pursuant to the Change of Control Offer will cease to accrue interest from and
after the Change of Control Payment Date.
Prior to complying with the provisions of the Indenture governing
Change of Control Offers, but in any event within 30 calendar days following a
Change of Control, the Company shall either repay all outstanding Senior
Indebtedness or obtain the requisite consents, if any, under all agreements
governing outstanding Senior Indebtedness to permit the repurchase of Notes
required by the provisions of the Indenture governing Change of Control Offers.
10. REPURCHASE AT THE OPTION OF HOLDERS UPON ASSET SALE.
If at any time the Company or any Subsidiary engages in any Asset
Sale, as a result of which the aggregate amount of Excess Proceeds exceeds $5.0
million, the Company shall, within 30 calendar days of the date the amount of
Excess Proceeds exceeds $5.0 million, use the then-existing Excess Proceeds to
make an offer to purchase from all Holders of Notes, on a PRO rata basis, Notes
in an aggregate principal amount equal in amount to the then-existing Excess
Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest thereon and Liquidated
Damages to the Asset Sale Purchase Date. Upon completion of an Asset Sale Offer
(including payment of the Asset Sale Purchase Price for accepted Notes), any
surplus Excess Proceeds that were the subject of such offer shall cease to be
Excess Proceeds, and the Company may then use such amounts for general corporate
purposes.
Within 30 calendar days of the date the amount of Excess Proceeds
exceeds $5.0 million, the Company shall send, or cause to be sent, by
first-class mail, postage prepaid, a notice regarding the Asset Sale Offer to
each Holder. The Holder of this Note may elect to have this Note or a portion
hereof in an authorized denomination purchased by completing the form entitled
"Option of Holder to Elect Purchase" appearing below and tendering this Note
pursuant to the Asset Sale Offer. Unless the Company defaults in the payment of
the Asset Sale Purchase Price with respect thereto, all Notes or portions
thereof selected for payment pursuant to the Asset Sale Offer will cease to
accrue interest from and after the Asset Sale Purchase Date.
D-7
11. TRANSFER AND EXCHANGE.
A Holder may transfer or exchange Notes as provided in the Indenture
and subject to certain limitations therein set forth. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes, fees and expenses required by law or permitted
by the Indenture. The Registrar need not register the transfer or exchange of
Certificated Notes or portions thereof selected for redemption (except, in the
case of a Certificated Note to be redeemed in part, the portion of such
Certificated Note not to be redeemed) or any Certificated Notes for a period of
15 calendar days before a selection of Notes to be redeemed.
12. DENOMINATIONS.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof of principal amount.
13. DISCHARGE AND DEFEASANCE.
Subject to certain conditions, the Company at any time may terminate
some or all of the obligations of the Company and the Guarantors under the
Notes, the Note Guarantees and the Indenture if the Company irrevocably deposits
in trust with the Trustee cash or U.S. Government Obligations for the payment of
principal, premium, if any, interest and Liquidated Damages, if any, on the
Notes to redemption or maturity, as the case may be.
14. AMENDMENT, WAIVER.
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Notes may be amended with the written consent of the Holders of
at least a majority in principal amount of the outstanding Notes (which consent
may, but need not, be given in connection with any tender offer or exchange
offer for the Notes) and (ii) any Default and its consequences may be waived
with the written consent of the Holders of at least a majority in principal
amount of the outstanding Notes. Subject to certain exceptions set forth in the
Indenture, without the consent of any Holder, the Company and the Trustee may
amend the Indenture or the Notes (i) to evidence the succession of another
Person to the Company and the assumption by such successor of the covenants of
the Company under the Indenture and contained in the Notes; (ii) to add to the
covenants of the Company, for the benefit of the Holders of all of the Notes, or
to surrender any right or power conferred on the Company under the Indenture;
(iii) to add any additional Events of Default; (iv) to provide for
uncertificated Notes in addition to or in place of Certificated Notes; (v) to
evidence and provide for the acceptance of appointment under the Indenture of a
successor Trustee; (vi) to secure the Notes; (vii) to cure any ambiguity in the
Indenture, or to correct or supplement any provision in the Indenture which may
be inconsistent with any other provision therein or to add any other provisions
with respect to matters or questions arising under the Indenture, PROVIDED that
such actions shall not adversely affect the interests of the Holders of Notes in
any material respect; (viii) to comply with the requirements of the Commission
in order to effect or maintain the qualification of the Indenture under the
D-8
Trust Indenture Act; or (ix) to evidence the agreement or acknowledgment of a
Subsidiary that it is a Guarantor for all purposes under the Indenture
(including, without limitation, Article XI thereof).
15. DEFAULTS AND REMEDIES.
Under the Indenture, Events of Default include: (i) a default for 30
days in the payment when due of interest on, or Liquidated Damages with respect
to, the Notes (whether or not prohibited by the subordination provisions of the
Indenture); (ii) default in payment when due of the principal of or premium, if
any, on the Notes (whether or not prohibited by the subordination provisions of
the Indenture); (iii) failure by the Company to observe or perform certain
covenants, conditions, agreements or other provisions of the Indenture or this
Note (and, in the case of certain covenants, agreements or other provisions,
such failure has continued for 60 calendar days after written notice by the
Trustee or the Holders of at least 25% in principal amount of the Notes); (iv)
failure by the Company to consummate the merger of Maxxim Acquisition Co. with
and into Sterile Concepts on or prior to December 15, 1996; (v) default in the
payment of Indebtedness of the Company or any of its Subsidiaries at its final
maturity or acceleration of such Indebtedness in an amount in excess of $5.0
million in the aggregate; (vi) certain events of bankruptcy or insolvency with
respect to the Company or any of its Subsidiaries; (vii) certain undischarged
judgments in excess of $5.0 million in the aggregate; or (viii) the Note
Guarantee of any Guarantor being held in any judicial proceeding to be
unenforceable or invalid or ceasing for any reason to be in full force and
effect (other than in accordance with the terms of the Indenture) or any
Guarantor or any Person acting on behalf of any Guarantor denying or
disaffirming the Note Guarantee of such Guarantor
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Notes, subject to certain
limitations, may declare all the Notes to be immediately due and payable.
Certain events of bankruptcy or insolvency shall result in the Notes being
immediately due and payable upon the occurrence of such Events of Default
without any further act of the Trustee or any Holder.
Holders of Notes may not enforce the Indenture or the Notes except
as provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Notes unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Notes may
direct the Trustee in its exercise of any trust or power under the Indenture.
The Holders of a majority in principal amount of the then outstanding Notes, by
written notice to the Trustee and the Company, may rescind any declaration of
acceleration and its consequences if the rescission would not conflict with any
judgment or decree, and if all existing Events of Default have been cured or
waived, except nonpayment of principal, interest, premium or Liquidated Damages
that has become due solely because of acceleration. No such recission shall
affect any subsequent Default or impair any right consequent thereto.
D-9
16. INDIVIDUAL RIGHTS OF TRUSTEE.
Subject to certain limitations imposed by the Trust Indenture Act,
the Trustee or any Paying Agent or Registrar, in its individual or any other
capacity, may become the owner or pledgee of Notes and may otherwise deal with
the Company, the Guarantors or their Affiliates with the same rights it would
have if it were not Trustee, Paying Agent or Registrar, as the case may be,
under the Indenture.
17. NO RECOURSE AGAINST CERTAIN OTHERS.
No director, officer, employee, incorporator or stockholder of the
Company or any Guarantor, as such, shall have any liability for any obligations
of the Company or such Guarantor under the Notes, the Note Guarantees or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation, solely by reason of its status as a director,
officer, employee, incorporator or stockholder of the Company or such Guarantor.
By accepting a Note, each Holder waives and releases all such liability (but
only such liability) as part of the consideration for issuance of such Note to
such Holder.
18. AUTHENTICATION.
This Note shall not be valid until the Trustee or an authenticating
agent manually signs the certificate of authentication on the other side of this
Note.
19. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with rights of survivorship and not as
tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
20. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of Notes. No representation is
made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
21. GOVERNING LAW.
THE INDENTURE, THE NOTE GUARANTEES AND THIS NOTE SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE.
D-10
The Company will furnish to any Holder upon written request and
without charge to the Holder a copy of the Indenture which has in it the text of
this Note. Requests may be made to:
Maxxim Medical, Inc.
104 Industrial Blvd.
Sugar Land, Texas, 77478
Attention: Chief Operating Officer
D-11
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED ___________________________ hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
- ----------------------------
|
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please print name and address of transferee)
- ------------------------------------------------------------------------------
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ________________________________ Attorney to
transfer this Note on the Security Register, with full power of substitution.
Dated: _______________
- ----------------------------- --------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
D-12
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
|_| In connection with the Change of Control Offer made pursuant to Section
4.07 of the Indenture, the undersigned hereby elects to have
|_| the entire principal amount
|_| $________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note
repurchased by the Company. The undersigned hereby directs the Trustee or
Paying Agent to pay it or __________________________ an amount in cash
equal to 101% of the principal amount indicated in the preceding sentence
plus accrued and unpaid interest and Liquidated Damages thereon, if any,
to the Change of Control Payment Date.
|_| In connection with the Asset Sale Offer made pursuant to Section 4.08 of
the Indenture, the undersigned hereby elects to have
|_| the entire principal amount
|_| $________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note
repurchased by the Company. The undersigned hereby directs the Trustee or
Paying Agent to pay it or __________________________ an amount in cash
equal to 100% of the principal amount indicated in the preceding sentence
plus accrued and unpaid interest and Liquidated Damages thereon, if any,
to the Asset Sale Purchase Date.
Dated: _______________
- ----------------------------- --------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing must correspond to the Name as written
upon the face of this Note in every particular, without alteration or any change
whatsoever.
D-13
