Sealy Mattress Company*

Reconciliation and tie between Trust Indenture Act
of 1939 and Indenture, dated as of May 29, 2009

 

Trust Indenture
Act Section		Indenture Section
§ 310(a)(1)		608
(a)(2)		608
(a)(5)		608
(b)		609
§ 312(a)		701
(b)		702
(c)		702
§ 313(a)		703
(b)(1)		102, 1402
(b)(2)		102, 1402
(c)(1)		102, 703
(c)(2)		102, 703
§ 314(a)		103, 105, 106, 1009
(a)(4)		1008
(b)		1402
(c)(1)		102
(c)(2)		102
(c)(3)		N/A
(d)		1402
(e)		103
(f)		N/A
§ 315(a)		601
(b)		602
(c)		601
(d)		601
(e)		601, 603
§ 316(a)(last sentence)		101 (“Outstanding”)
(a)(1)(A)		502, 512
(a)(1)(B)		513
(b)		508
(c)		104(d)
§ 317(a)(1)		503
(a)(2)		504
(b)		1003
§ 318(a)		111

 

*                                          This reconciliation and tie shall not, for any purpose, be deemed to be a part of this Indenture.

 

 

TABLE OF CONTENTS (1)

 

		Page
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101.	Definitions	1
SECTION 102.	Compliance Certificates and Opinions	28
SECTION 103.	Form of Documents Delivered to Trustee	29
SECTION 104.	Acts of Holders	29
SECTION 105.	Notices, Etc., to Trustee, Company, Any Guarantor and Agent	30
SECTION 106.	Notice to Holders; Waiver	30
SECTION 107.	Effect of Headings and Table of Contents	31
SECTION 108.	Successors and Assigns	31
SECTION 109.	Separability Clause	31
SECTION 110.	Benefits of Indenture	31
SECTION 111.	Governing Law	31
SECTION 112.	Communication by Holders of Notes with Other Holders of Notes	31
SECTION 113.	Legal Holidays	31
SECTION 114.	No Personal Liability of Directors, Officers, Employees and Stockholders	31
SECTION 115.	Trust Indenture Act Controls	32
SECTION 116.	Counterparts	32
SECTION 117.	USA Patriot Act	32
SECTION 118.	Intercreditor Agreement Governs	32
SECTION 119.	Waiver of Jury Trial	32
SECTION 120.	Force Majeure	32
ARTICLE TWO
NOTE FORMS
SECTION 201.	Forms Generally	33
SECTION 202.	Form of Trustee’s Certificate of Authentication	33
SECTION 203.	Restrictive Legends	34
SECTION 204.	[INTENTIONALLY DELETED]	35
ARTICLE THREE
THE NOTES
SECTION 301.	Title and Terms	35
SECTION 302.	Denominations	36
SECTION 303.	Execution, Authentication, Delivery and Dating	36
SECTION 304.	Temporary Notes	37
SECTION 305.	Registration, Registration of Transfer and Exchange	37
SECTION 306.	Mutilated, Destroyed, Lost and Stolen Notes	38

 

(1)                                   This table of contents shall not, for any purpose, be deemed to be a part of this Indenture.

 

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		Page
SECTION 307.	Payment of Interest; Interest Rights Preserved	38
SECTION 308.	Persons Deemed Owners	39
SECTION 309.	Cancellation	39
SECTION 310.	Computation of Interest	40
SECTION 311.	[INTENTIONALLY DELETED]	40
SECTION 312.	Book-Entry and Transfer Provisions	40
SECTION 313.	[INTENTIONALLY DELETED]	47
SECTION 314.	[INTENTIONALLY DELETED]	47
SECTION 315.	CUSIP Numbers	47
SECTION 316.	Issuance of Additional Notes	47
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401.	Satisfaction and Discharge of Indenture	47
SECTION 402.	Application of Trust Money	49
ARTICLE FIVE
REMEDIES
SECTION 501.	Events of Default	49
SECTION 502.	Acceleration of Maturity; Rescission and Annulment	51
SECTION 503.	Collection of Indebtedness and Suits for Enforcement by Trustee	52
SECTION 504.	Trustee May File Proofs of Claim	52
SECTION 505.	Trustee May Enforce Claims Without Possession of Notes	53
SECTION 506.	Application of Money Collected	53
SECTION 507.	Limitation on Suits	53
SECTION 508.	Unconditional Right of Holders to Receive Principal, Premium and Interest	54
SECTION 509.	Restoration of Rights and Remedies	54
SECTION 510.	Rights and Remedies Cumulative	54
SECTION 511.	Delay or Omission Not Waiver	54
SECTION 512.	Control by Holders	55
SECTION 513.	Waiver of Past Defaults	55
SECTION 514.	Waiver of Stay or Extension Laws	55
ARTICLE SIX
THE TRUSTEE
SECTION 601.	Duties of the Trustee	55
SECTION 602.	Notice of Defaults	56
SECTION 603.	Certain Rights of Trustee	56
SECTION 604.	Trustee Not Responsible for Recitals or Issuance of Notes	58
SECTION 605.	May Hold Notes	58
SECTION 606.	Money Held in Trust	58
SECTION 607.	Compensation and Reimbursement	58
SECTION 608.	Corporate Trustee Required; Eligibility	59
SECTION 609.	Resignation and Removal; Appointment of Successor	59
SECTION 610.	Acceptance of Appointment by Successor	60
SECTION 611.	Merger, Conversion, Consolidation or Succession to Business	60
SECTION 612.	Appointment of Authenticating Agent	61

 

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		Page
ARTICLE SEVEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701.	Company to Furnish Trustee Names and Addresses	62
SECTION 702.	Disclosure of Names and Addresses of Holders	62
SECTION 703.	Reports by Trustee	62
ARTICLE EIGHT
MERGER, CONSOLIDATION OR SALE OF ALL OR SUBSTANTIALLY ALL ASSETS
SECTION 801.	Company May Consolidate, Etc., Only on Certain Terms	62
SECTION 802.	Subsidiary Guarantors May Consolidate, Etc., Only on Certain Terms	63
SECTION 803.	Successor Substituted	64
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901.	Amendments or Supplements Without Consent of Holders	65
SECTION 902.	Amendments, Supplements or Waivers with Consent of Holders	66
SECTION 903.	Execution of Amendments, Supplements or Waivers	67
SECTION 904.	Effect of Amendments, Supplements or Waivers	67
SECTION 905.	Conformity with Trust Indenture Act	67
SECTION 906.	Reference in Notes to Supplemental Indentures	67
SECTION 907.	Notice of Supplemental Indentures	67
ARTICLE TEN
COVENANTS
SECTION 1001.	Payment of Principal, Premium, if Any, and Interest	67
SECTION 1002.	Maintenance of Office or Agency	67
SECTION 1003.	Money for Notes Payments to Be Held in Trust	68
SECTION 1004.	Corporate Existence	69
SECTION 1005.	Payment of Taxes and Other Claims	69
SECTION 1006.	Maintenance of Properties	69
SECTION 1007.	Insurance	69
SECTION 1008.	Statement by Officers as to Default	70
SECTION 1009.	Reports and Other Information	70
SECTION 1010.	Limitation on Restricted Payments	71
SECTION 1011.	Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock	76
SECTION 1012.	Limitation on Liens	80
SECTION 1013.	Limitations on Transactions with Affiliates	81
SECTION 1014.	Limitations on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries	82
SECTION 1015.	Limitation on Guarantees of Indebtedness by Restricted Subsidiaries	83
SECTION 1016.	[ INTENTIONALLY DELETED ]	85
SECTION 1017.	Change of Control	85
SECTION 1018.	Asset Sales	86
SECTION 1019.	Waiver of Certain Covenants	90
SECTION 1020.	Further Assurances and After-Acquired Property	90
SECTION 1021.	Information Regarding Collateral	90

 

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		Page
SECTION 1022.	Impairment of Security Interest	91
ARTICLE ELEVEN
REDEMPTION OF NOTES
SECTION 1101.	Right of Redemption	91
SECTION 1102.	Applicability of Article	92
SECTION 1103.	Election to Redeem; Notice to Trustee	92
SECTION 1104.	Selection by Trustee of Notes to Be Redeemed	92
SECTION 1105.	Notice of Redemption	92
SECTION 1106.	Deposit of Redemption Price	93
SECTION 1107.	Notes Payable on Redemption Date	93
SECTION 1108.	Notes Redeemed in Part	94
ARTICLE TWELVE
GUARANTEES
SECTION 1201.	Guarantees	94
SECTION 1202.	Severability	95
SECTION 1203.	Restricted Subsidiaries	95
SECTION 1204.	Ranking of Guarantee	95
SECTION 1205.	Limitation of Guarantors’ Liability	96
SECTION 1206.	Contribution	96
SECTION 1207.	Subrogation	96
SECTION 1208.	Reinstatement	96
SECTION 1209.	Release of a Guarantor	96
SECTION 1210.	Benefits Acknowledged	97
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301.	Company’s Option to Effect Legal Defeasance or Covenant Defeasance	97
SECTION 1302.	Legal Defeasance and Discharge	97
SECTION 1303.	Covenant Defeasance	97
SECTION 1304.	Conditions to Legal Defeasance or Covenant Defeasance	98
SECTION 1305.	Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions	99
SECTION 1306.	Reinstatement	99
ARTICLE FOURTEEN
SECURITY
SECTION 1401.	Collateral and Security Documents	100
SECTION 1402.	Recordings and Opinions	100
SECTION 1403.	Release of Collateral	101
SECTION 1404.	Certificates of the Trustee	102
SECTION 1405.	Suits to Protect the Collateral	102
SECTION 1406.	Authorization of Receipt of Funds by the Trustee Under the Security Documents	102
SECTION 1407.	Purchase Protected	102
SECTION 1408.	Powers Exercisable by Receiver or Trustee	103

 

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		Page
SECTION 1409.	Release upon Termination of the Company’s Obligations	103
SECTION 1410.	Notes Collateral Agent	103
SECTION 1411.	Designations	106
SECTION 1412.	Compensation and Indemnification	107
SECTION 1413.	Intercreditor Agreement, Security Agreement, Pledge Agreement and Other Security Documents	107
ARTICLE FIFTEEN
RANKING OF NOTE LIENS
SECTION 1501.	Relative Rights	107

 

v

 

EXHIBITS

 

EXHIBIT A — Form of Note

EXHIBIT B — Form of Certificate of Transfer

EXHIBIT C — Form of Certificate of Exchange

EXHIBIT D — Form of Certificate from Acquiring Institutional Investor

EXHIBIT E — Form of Supplemental Indenture

EXHIBIT F — Form of Incumbency Certificate

 

vi

 

INDENTURE, dated as of May 29, 2009 (this “Indenture”), among SEALY MATTRESS COMPANY, an Ohio corporation (the “Company”), having its principal office at One Office Parkway, Trinity, North Carolina 27230, the Company’s ultimate parent corporation, SEALY CORPORATION, a Delaware corporation (“Parent”), the Company’s direct parent corporation, SEALY MATTRESS CORPORATION, a Delaware corporation (“Holdings”), and certain of the Company’s direct and indirect Domestic Subsidiaries, each named in the signature pages hereto (each, a “Subsidiary Guarantor” and, together with Parent and Holdings, collectively, the “Guarantors”), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association, as trustee (in such capacity, the “Trustee”) and as collateral agent (in such capacity, the “Notes Collateral Agent”).

 

RECITALS OF THE COMPANY

 

The Company has duly authorized the creation of an issue of 10.875% Senior Secured Notes due 2016 issued on the date hereof (the “Notes”) of substantially the tenor and amount hereinafter set forth, and to provide therefor the Company has duly authorized the execution and delivery of this Indenture.  As used herein, “Notes” shall include any Additional Notes that are issued pursuant to this Indenture unless the context otherwise requires.

 

Each Guarantor has duly authorized its Guarantee of the Notes and to provide therefor each Guarantor has duly authorized the execution and delivery of this Indenture.

 

All things necessary have been done to make the Notes, when executed by the Company and authenticated and delivered hereunder and duly issued by the Company, the valid and legally binding obligations of the Company and to make this Indenture a valid and legally binding agreement of the Company, in accordance with their and its terms.

 

All things necessary have been done to make the Guarantees, upon execution and delivery of this Indenture, the valid obligations of each Guarantor and to make this Indenture a valid and legally binding agreement of each Guarantor, in accordance with their and its terms.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders, as follows:

 

ARTICLE ONE

DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION

 

SECTION 101.                                        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;

 

(b)                                  all other terms used herein which are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein, and the terms “cash transaction” and “self-liquidating paper”, as used in TIA Section 311, shall have the meanings assigned to them in the rules of the Commission adopted under the Trust Indenture Act;

 

(c)                                   all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP (as herein defined); and

 

 

(d)                                  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.

 

“144A Global Note” means a Global Note substantially in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of, and registered in the name of, the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the Notes sold in reliance on Rule 144A.

 

“ABL Asset Sale Offer” has the meaning set forth in Section 1018.

 

“ABL Collateral” has the meaning assigned to the term “ABL Priority Collateral” in the Intercreditor Agreement.

 

“ABL Secured Parties” has the meaning assigned to the term “ABL Claimholders” in the Intercreditor Agreement.”

 

“Acquired Indebtedness” means, with respect to any specified Person,

 

(1)                                   Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Restricted 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 Restricted Subsidiary of such specified Person, and

 

(2)                                   Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

 

“Act”, when used with respect to any Holder, has the meaning specified in Section 104 of this Indenture.

 

“Additional Convertible Notes” means (a) any additional convertible notes (other than the Convertible Notes) issued after the original issuance of the Convertible Notes that are substantially similar to the Convertible Notes and are secured by any of the Collateral with Pari Passu Lien Priority relative to the Convertible Notes and with respect to which the holders (or a trustee or agent on behalf of such holders) shall have executed a supplement to the Intercreditor Agreement agreeing to be bound thereby on the same terms applicable to the holders of Convertible Notes and (b) any Management Notes.

 

“Additional Notes” has the meaning set forth in Section 316.

 

“Adjusted Net Assets” has the meaning specified in Section 1206 of this Indenture.

 

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.  For purposes of this definition, “control” (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.

 

“Affiliate Transaction” has the meaning specified in Section 1013 of this Indenture.

 

“After-Acquired Property” means any property of the Company or any Guarantor acquired after the Issue Date that is intended to secure the Obligations under this Indenture and the Notes pursuant to this Indenture and the Security Documents.

 

“Agent” means any Note Registrar, co-registrar, Paying Agent or additional paying agent.

 

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(i)                                    foreclosures on assets;

 

(j)                                    sales of accounts receivable, or participations therein, in connection with any Receivables Facility; and

 

(k)                                 any financing transaction with respect to property built or acquired by the Company or any Restricted Subsidiary after the Issue Date, including, without limitation, sale leasebacks and asset securitizations permitted by this Indenture.

 

“Asset Sale Offer” has the meaning specified in Section 1018 of this Indenture.

 

“Asset Sale Proceeds Account” means one or more deposit accounts or securities accounts holding the proceeds of any sale or disposition of Notes Collateral.

 

“Authenticating Agent” has the meaning specified in Section 612 of this Indenture.

 

“Bank Collateral Agent” means JPMorgan Chase Bank, N.A., in its capacity as collateral agent under the Credit Agreement, and any successor thereto in such capacity.

 

“Bank Lenders” means the lenders or holders of Indebtedness issued under the Credit Agreement.

 

“Bankruptcy Law” means Title 11, United States Bankruptcy Code of 1978, as amended, or any similar United States federal or state law relating to bankruptcy, insolvency, receivership, winding-up, liquidation, reorganization or relief of debtors or any amendment to, succession to or change in any such law.

 

“Board of Directors” means, with respect to any Person, either the board of directors of such Person or any duly authorized committee of such board.

 

“Board Resolution” means, with respect to any Person, a copy of a resolution certified by the Secretary or an Assistant Secretary of such Person to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification, and, if required by this Indenture, delivered to the Trustee.

 

“Borrowing Base” means, as of any date, an amount equal to the sum of (x) 85% of the book value of the accounts receivable and (y) 65% of the book value of the inventory, in each case of the Company and the Guarantors on a consolidated basis as of the end of the most recently completed fiscal quarter preceding such date for which internal financial statements are available.

 

“Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in The City of New York are authorized or obligated by law, regulation or executive order to close.

 

“Capital Stock” means:

 

(1)                                 in the case of a corporation, corporate stock,

 

(2)                                 in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock,

 

(3)                                 in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited), and

 

(4)                                 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.

 

4

 

“Capitalized 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 and reflected as a liability on a balance sheet (excluding the footnotes thereto) in accordance with GAAP.

 

“Cash Equivalents” means:

 

(1)                                   United States dollars,

 

(2)                                   pounds sterling,

 

(3)                                   (a) euro, or any national currency of any participating member state in the European Union or (b) in the case of any Foreign Subsidiary that is a Restricted Subsidiary, such local currencies held by them from time to time in the ordinary course of business,

 

(4)                                   securities issued or directly and fully and unconditionally guaranteed or insured by the United States government or any agency or instrumentality thereof the securities of which are unconditionally guaranteed as a full faith and credit obligation of such government with maturities of 24 months or less from the date of acquisition,

 

(5)                                   certificates of deposit, time deposits and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in each case with any commercial bank having capital and surplus in excess of $500.0 million,

 

(6)                                   repurchase obligations for underlying securities of the types described in clauses (4) and (5) above, entered into with any financial institution meeting the qualifications specified in clause (5) above,

 

(7)                                   commercial paper rated at least P-2 by Moody’s or at least A-2 by S&P and in each case maturing within 12 months after the date of creation thereof,

 

(8)                                   investment funds investing 95% of their assets in securities of the types described in clauses (1) through (7) above,

 

(9)                                   readily marketable direct obligations issued by any state of the United States of America or any political subdivision thereof having one of the two highest rating categories obtainable from either Moody’s or S&P with maturities of 24 months or less from the date of acquisition, and

 

(10)                             Indebtedness or preferred stock issued by Persons with a rating of “A” or higher from S&P or “A2” or higher from Moody’s with maturities of 12 months or less from the date of acquisition.

 

Notwithstanding the foregoing, Cash Equivalents shall include amounts denominated in currencies other than those set forth in clauses (1) through (3) above; provided that such amounts are converted into any currency listed in clauses (1) through (3) above, as promptly as practicable and in any event within ten Business Days following the receipt of such amounts.

 

“Change of Control” means the occurrence of any of the following:

 

(1)                                   the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of the Company and its Subsidiaries, taken as a whole, to any Person other than a Permitted Holder; or

 

(2)                                   the Company becomes aware of (by way of a report or any other filing pursuant Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision),

 

5

 

including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than the Permitted Holders, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) of 50% or more of the total voting power of the Voting Stock of the Company or any of its direct or indirect parents.

 

“Change of Control Offer” has the meaning specified in Section 1017 of this Indenture.

 

“Change of Control Payment” has the meaning specified in Section 1017 of this Indenture.

 

“Change of Control Payment Date” has the meaning specified in Section 1017 of this Indenture.

 

“Clearstream” means Clearstream Banking, Société Anonyme, and its successors.

 

“Collateral” means all the assets and properties subject to the Liens created by the Security Documents.

 

“Commission” means the 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.

 

“Common Stock” means, with respect to any Person, any and all shares, interests, participations and other equivalents (however designated, whether voting or non-voting) of such Person’s common stock, whether now outstanding or issued after the date of this Indenture, and includes, without limitation, all series and classes of such common stock.

 

“Company” means the Person named as the “Company” in the first paragraph of this Indenture, until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Person.

 

“Company Request” or “Company Order” means a written request or order signed in the name of the Company by its Chairman, its President, any Vice President, its Treasurer or an Assistant Treasurer, and delivered to the Trustee.

 

“consolidated” or “Consolidated” means, with respect to any Person, such Person consolidated with its Restricted Subsidiaries, and shall not include any Unrestricted Subsidiary.

 

“Consolidated Depreciation and Amortization Expense” means with respect to any Person for any period, the total amount of depreciation and amortization expense, including the amortization of deferred financing fees, of such Person and its Restricted Subsidiaries for such period on a consolidated basis and otherwise determined in accordance with GAAP.

 

“Consolidated Interest Expense” means, with respect to any Person for any period, the sum, without duplication, of:

 

(a)                                   consolidated interest expense of such Person and its Restricted Subsidiaries for such period, to the extent such expense was deducted in computing Consolidated Net Income (including amortization of original issue discount resulting from the issuance of Indebtedness at less than par, non-cash interest payments (but excluding any non-cash interest expense attributable to the movement in the mark to market valuation of Hedging Obligations or other derivative instruments pursuant to Financial Accounting Standards Board Statement No.133 “Accounting for Derivative Instruments and Hedging Activities”), the interest component of Capitalized Lease Obligations and net payments, if any, pursuant to interest rate Hedging

 

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Obligations, and excluding amortization of deferred financing fees and any expensing of bridge or other financing fees), and

 

(b)                                  consolidated capitalized interest of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, less

 

(c)                                   interest income for such period.

 

“Consolidated Net Income” means, with respect to any Person for any period, the aggregate of the Net Income, of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, and otherwise determined in accordance with GAAP; provided , however , that:

 

(1)                                   any net after-tax extraordinary, non-recurring or unusual gains or losses (less all fees and expenses relating thereto) or expenses (including, without limitation, relating to severance, relocation and new product introductions) shall be excluded,

 

(2)                                   the Net Income for such period shall not include the cumulative effect of a change in accounting principles during such period,

 

(3)                                   any net after-tax income (loss) from disposed or discontinued operations and any net after-tax gains or losses on disposal of disposed or discontinued operations shall be excluded,

 

(4)                                   any net after-tax gains or losses (less all fees and expenses relating thereto) attributable to asset dispositions other than in the ordinary course of business, as determined in good faith by the Board of Directors of the Company, shall be excluded,

 

(5)                                   the Net Income for such period of any Person that is not a Subsidiary, or is an Unrestricted Subsidiary, or that is accounted for by the equity method of accounting, shall be excluded; provided that Consolidated Net Income of the Company shall be increased by the amount of dividends or distributions or other payments that are actually paid in cash (or to the extent converted into cash) to the referent Person or a Restricted Subsidiary thereof in respect of such period,

 

(6)                                   solely for the purpose of determining the amount available for Restricted Payments under Section 1010(a)(4)(C), the Net Income for such period of any Restricted Subsidiary (other than any Guarantor) shall be excluded if the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of its Net Income is not at the date of determination wholly permitted without any prior governmental approval (which has not been obtained) or, directly or indirectly, by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule, or governmental regulation applicable to such Restricted Subsidiary or its stockholders, unless such restriction with respect to the payment of dividends or in similar distributions has been legally waived, provided that Consolidated Net Income of the Company shall be increased by the amount of dividends or other distributions or other payments actually paid in cash (or to the extent converted into cash) to the Company or a Restricted Subsidiary thereof in respect of such period, to the extent not already included therein,

 

(7)                                   the effect of the adjustments resulting from the application of purchase accounting in relation to any acquisition that is consummated after the Issue Date, net of taxes, shall be excluded,

 

(8)                                   any net after-tax income (loss) from the early extinguishment of Indebtedness or Hedging Obligations or other derivative instruments shall be excluded,

 

(9)                                   any impairment charge or asset write-off pursuant to Financial Accounting Standards Board Statement No. 142 and No. 144 and the amortization of intangibles arising pursuant to No. 141 shall be excluded, and

 

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(10)                           any non-cash compensation expense recorded from grants of stock appreciation or similar rights, stock options or other rights to officers, directors or employees shall be excluded.

 

Notwithstanding the foregoing, for the purpose of Section 1010 only (other than clause (a)(4)(C)(4) thereof), there shall be excluded from Consolidated Net Income any income arising from any sale or other disposition of Restricted Investments made by the Company and the Restricted Subsidiaries, any repurchases and redemptions of Restricted Investments from the Company and the Restricted Subsidiaries, any repayments of loans and advances which constitute Restricted Investments by the Company or any Restricted Subsidiary, any sale of the stock of an Unrestricted Subsidiary or any distribution or dividend from an Unrestricted Subsidiary, in each case only to the extent such amounts increase the amount of Restricted Payments permitted under such covenant pursuant to clause (a)(4)(C)(4) thereof.

 

“Consolidated Senior Secured Debt Ratio” means, as of any date of determination, the ratio of (1) the sum of Lenders Debt plus the aggregate amount outstanding under any Receivables Facility plus the aggregate principal amount of the Notes plus the aggregate principal amount (or accreted value) of any Other Pari Passu Lien Obligations to (2) the Company’s EBITDA for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such event for which such calculation is being made shall occur, in each case with such pro forma adjustments as are appropriate and consistent with the pro forma adjustment provisions set forth in the definition of “Fixed Charge Coverage Ratio.”

 

“Contingent Obligations” means, with respect to any Person, any obligation of such Person guaranteeing any leases, dividends or other obligations that do not constitute Indebtedness (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent,

 

(1)                                 to purchase any such primary obligation or any property constituting direct or indirect security therefor,

 

(2)                                 to advance or supply funds:

 

(A)                               for the purchase or payment of any such primary obligation, or

 

(B)                                 to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, or

 

(3)                                 to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.

 

“Convertible Notes” means $177,132,000 aggregate principal amount of Parent and the Company’s 8% convertible senior secured third lien notes due July 2016; provided that the covenants and other material terms in the Convertible Notes are consistent with (i) the description of the Convertible Notes contained in the Offering Memorandum and (ii) the description of notes contained in the prospectus supplement filed by Parent and the Company on May 27, 2009 relating to the offering of the Convertible Notes.

 

“Convertible Notes Collateral Agent” means The Bank of New York Mellon Trust Company, N.A., in its capacity as “Collateral Agent” under the indenture governing the Convertible Notes and under the security documents related thereto, and any successor thereto in such capacity.

 

“Convertible Notes Secured Parties” means the trustee under the indenture governing the Convertible Notes, the Convertible Notes Collateral Agent, each holder of Convertible Notes or any Additional Convertible Notes and each other holder of, or obligee in respect of, any obligations in respect of the Convertible Notes outstanding at such time, collectively.

 

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“Corporate Trust Office” means the principal corporate trust office of the Trustee, at which at any particular time its corporate trust business shall be administered, which office at the date of execution of this Indenture is located at The Bank of New York Mellon Trust Company, N.A., 10161 Centurion Parkway, Jacksonville, Florida 32256, except that with respect to presentation of the Notes for payment or for registration of transfer or exchange, such term shall mean the office or agency of the Trustee at which, at any particular time, its corporate agency business shall be conducted.

 

“Corporation” includes corporations, associations, companies and business trusts.

 

“Covenant Defeasance” has the meaning specified in Section 1303 of this Indenture.

 

“Credit Agreement” means the Credit Agreement dated as of May 13, 2009 among the Company, the Guarantors, the various lenders and agents party thereto and J.P. Morgan Chase Bank, N.A. as administrative agent, together with any amendments, supplements, modifications, extensions, renewals, restatements or refundings thereof and any indentures or credit facilities or commercial paper facilities with banks or other institutional lenders or investors that replace, refund or refinance any part of the loans, notes, other credit facilities or commitments thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount borrowable thereunder, alters the maturity thereof or adds Restricted Subsidiaries as additional borrowers or guarantors thereunder and whether by the same or any other agent, lender or group of lenders.

 

 “Credit Facilities” means, with respect to the Company, one or more debt facilities, including, without limitation, the Credit Agreement or commercial paper facilities with banks or other institutional lenders or investors or indentures providing for revolving credit loans, term loans, receivables financing, including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against receivables, letters of credit or other long-term indebtedness, including any guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions, renewals, restatements or refundings thereof and any indentures or credit facilities or commercial paper facilities with banks or other institutional lenders or investors that replace, refund or refinance any part of the loans, notes, other credit facilities or commitments thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount borrowable thereunder or alters the maturity therof.

 

“Custodian” means the Trustee, as custodian with respect to the Notes in global form, or any successor entity thereto.

 

“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 specified in Section 307 of this Indenture.

 

“Definitive Note” means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 312 hereof, substantially in the form of Exhibit A hereto except that such Note shall not bear the Global Note Legend and shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.

 

“Depositary” means The Depository Trust Company (“DTC”), its nominees and their respective successors.

 

“Designated Non-cash Consideration” means the fair market value of non-cash consideration received by the Company or a Restricted Subsidiary in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an Officers’ Certificate, setting forth the basis of such valuation, executed by an executive vice president and the principal financial officer of the Company, less the amount of cash or Cash Equivalents received in connection with a subsequent sale of such Designated Non-cash Consideration.

 

“Designated Preferred Stock” means preferred stock of the Company or any parent thereof (in each case other than Disqualified Stock) that is issued for cash (other than to a Guarantor or a Restricted Subsidiary)

 

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and is so designated as Designated Preferred Stock, pursuant to an Officers’ Certificate executed by an executive vice president and the principal financial officer of the Company or the applicable parent thereof, as the case may be, on the issuance date thereof, the cash proceeds of which are excluded from the calculation set forth in clause (a)(4)(C) of Section 1010.

 

“Discharge of ABL Obligations” means the date on which the Lenders Debt has been paid in full, in cash, all commitments to extend credit thereunder shall have been terminated and the Lenders Debt is no longer secured by the ABL Collateral and Notes Collateral; provided that the Discharge of ABL Obligations shall not be deemed to have occurred in connection with a refinancing of such Lenders Debt with Indebtedness secured by such ABL Collateral on a first-priority basis under an agreement that has been designated in writing by the administrative agent under the Credit Facility so refinancing the Credit Agreement and the Trustee in accordance with the terms of the Intercreditor Agreement.

 

“Disqualified Stock” means, with respect to any Person, any Capital Stock of such Person which, by its terms, or by the terms of any security into which it is convertible or for which it is putable or exchangeable, or upon the happening of any event, matures or is mandatorily redeemable, other than as a result of a change of control or asset sale, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, other than as a result of a change of control or asset sale, in whole or in part, in each case prior to the date 91 days after the earlier of the maturity date of the Notes or the date the Notes are no longer outstanding; provided , however , that if such Capital Stock is issued to any plan for the benefit of employees of the Company or its Subsidiaries or by any such plan to such employees, such Capital Stock shall not constitute Disqualified Stock solely because it may be required to be repurchased by the Company or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations.

 

“Domestic Subsidiary” means, with respect to any Person, any Restricted Subsidiary of such Person other than a Foreign Subsidiary.

 

“EBITDA” means, with respect to any Person for any period, the Consolidated Net Income of such Person for such period plus (without duplication):

 

(a)                                   provision for taxes based on income or profits, plus franchise or similar taxes, of such Person for such period deducted in computing Consolidated Net Income, plus

 

(b)                                  Consolidated Interest Expense of such Person for such period to the extent the same was deducted in calculating such Consolidated Net Income, plus

 

(c)                                   Consolidated Depreciation and Amortization Expense of such Person for such period to the extent such depreciation and amortization were deducted in computing Consolidated Net Income, plus

 

(d)                                  any expenses or charges related to any Equity Offering, Permitted Investment, acquisition, disposition, recapitalization or Indebtedness permitted to be incurred by this Indenture (whether or not successful), including such fees, expenses or charges related to the offering of the Notes and the Credit Facilities, and deducted in computing Consolidated Net Income, plus

 

(e)                                   the amount of any restructuring charge deducted in such period in computing Consolidated Net Income, including any one-time costs incurred in connection with acquisitions after the Issue Date, plus

 

(f)                                     any other non-cash charges reducing Consolidated Net Income for such period, excluding any such charge that represents an accrual or reserve for a cash expenditure for a future period, plus

 

(g)                                  the amount of any minority interest expense deducted in calculating Consolidated Net Income (less the amount of any cash dividends paid to the holders of such minority interests), plus

 

(h)                                  any net gain or loss resulting from currency exchange risk Hedging Obligations, plus

 

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(i)                                      the amount of management, monitoring, consulting and advisory fees and related expenses paid to Kohlberg Kravis Roberts & Co. L.P. or any of its Affiliates, plus

 

(j)                                      expenses related to the implementation of enterprise resource planning system, less

 

(k)                                   non-cash items increasing Consolidated Net Income of such Person for such period, excluding any items which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period.

 

“EMU” means economic and monetary union as contemplated in the Treaty on European Union.

 

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock, but excluding any debt security that is convertible into, or exchangeable for, Capital Stock.

 

“Equity Offering” means any public or private sale of Common Stock or preferred stock of the Company or any of its direct or indirect parents (excluding Disqualified Stock), other than

 

(1)                                   public offerings with respect to the Company’s or any direct or indirect parent’s Common Stock registered on Form S-8;

 

(2)                                   any such public or private sale that constitutes an Excluded Contribution; and

 

(3)                                   any sales to Parent or any of its Subsidiaries.

 

“euro” means the single currency of participating member states of the EMU.

 

“Euroclear” means Euroclear Bank S.A./N.V., as operator of the Euroclear system.

 

“Event of Default” has the meaning specified in Section 501 of this Indenture.

 

“Excess ABL Proceeds” has the meaning specified in Section 1018 of this Indenture.

 

“Excess Proceeds” has the meaning specified in Section 1018 of this Indenture.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder.

 

“Excluded Assets” means the collective reference to (i) any interest in real property if the greater of the cost and the book value of such interest is less than $1,000,000; (ii) any property or asset only to the extent and for so long as the grant of a security interest in such property or asset is prohibited by any applicable law or requires a consent not obtained of any governmental authority pursuant to applicable law; (iii) any right, title or interest in any permit, license or contract held by the Company or any Guarantor or to which the Company or any Guarantor is a party or any of its right, title or interest thereunder, in each case only to the extent and for so long as the terms of such permit, license or contract validly prohibits the creation by the Company or a Guarantor, as applicable, of a security interest in such permit, license or contract in favor of the Notes Collateral Agent (after giving effect to Section 9-406, 9-407, 9-408 or 9-409 of the Uniform Commercial Code (or any successor provisions) of any relevant jurisdiction or any other applicable law (including Title 11 of the United States Code) or principles of equity); (iv) Capital Stock of a Person that constitutes a Subsidiary (other than a Wholly Owned Subsidiary) the pledge of which would violate a contractual obligation to the owners of the other Capital Stock of such Person that is binding on or relating to such Capital Stock; (v) any equipment or real property (and proceeds thereof) of the Company or any Guarantor that is subject to a purchase money Lien or Capitalized Lease Obligation permitted under this Indenture to the extent the documents relating to such purchase money Lien or Capitalized Lease Obligation would not permit such equipment or real property (and proceeds thereof) to be subject to the Liens created under the Security Documents; provided that immediately upon the ineffectiveness, lapse or termination of any such restriction, such equipment or real property shall cease to be an Excluded Asset; (vi) assets of the Company or any Guarantor located

 

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outside of the United States to the extent a Lien on such assets cannot be created and perfected under United States federal or state law; and (vii) After-Acquired Property subject to Permitted Liens described in clause (8) or (9) of the definition of “Permitted Liens” so long as the documents governing such Permitted Liens do not permit any other Liens on such After-Acquired Property; provided , however , that Excluded Assets shall not include (a) any proceeds, substitutions or replacements of any Excluded Assets referred to above (unless such proceeds, substitutions or replacements would constitute Excluded Assets) or (b) any asset which secures obligations with respect to the Lenders Debt.

 

“Excluded Contribution” means net cash proceeds, marketable securities or Qualified Proceeds received by the Company from:

 

(a)                                   contributions to its common equity capital, and

 

(b)                                  the sale (other than to a Subsidiary of the Company or to any management equity plan or stock option plan or any other management or employee benefit plan or agreement of the Company) of Capital Stock (other than Disqualified Stock and Designated Preferred Stock) of the Company,

 

in each case designated as Excluded Contributions pursuant to an Officers’ Certificate executed by an executive vice president and the principal financial officer of the Company on the date such capital contributions are made or the date such Equity Interests are sold, as the case may be, which are excluded from the calculation set forth in Section 1010(a)(4)(C).

 

“Existing Indebtedness” means Indebtedness of the Company or the Restricted Subsidiaries in existence on the Issue Date, plus interest accruing thereon.

 

“Fixed Charge Coverage Ratio” means, with respect to any Person for any period, the ratio of EBITDA of such Person for such period to the Fixed Charges of such Person for such period.  In the event that the Company or any Restricted Subsidiary incurs, assumes, guarantees, redeems, retires or extinguishes any Indebtedness (other than reductions in amounts outstanding under revolving facilities unless accompanied by a corresponding termination of commitment) or issues or redeems Disqualified Stock or preferred stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to 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 or redemption of Indebtedness, or such issuance, redemption, retirement or extinguishment of Disqualified Stock or preferred stock, as if the same had occurred at the beginning of the applicable four-quarter period.

 

For purposes of making the computation referred to above, Investments, acquisitions, dispositions, mergers, consolidations and disposed operations (as determined in accordance with GAAP) that have been made by such Person or any Restricted Subsidiary thereof during the four-quarter reference period or subsequent to such reference period and on or prior to or simultaneously with the Calculation Date shall be calculated on a pro forma basis assuming that all such Investments, acquisitions, dispositions, mergers, consolidations and disposed operations (and the change in any associated fixed charge obligations and the change in EBITDA resulting therefrom) had occurred on the first day of the four-quarter reference period.  If since the beginning of such period any other Person (that subsequently became a Restricted Subsidiary or was merged with or into such Person or any Restricted Subsidiary thereof since the beginning of such period) shall have made any Investment, acquisition, disposition, merger, consolidation or disposed operation that would have required adjustment pursuant to this definition, then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Investment, acquisition, disposition, merger, consolidation or disposed operation had occurred at the beginning of the applicable four-quarter period.

 

For purposes of this definition, whenever pro forma effect is to be given to a transaction, the pro forma calculations shall be made in good faith by a responsible financial or accounting officer of the Company.  If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedging Obligations applicable to such Indebtedness).  Interest on a Capitalized Lease

 

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(b)                                obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely 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 issuers thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such Government Securities or a specific payment of principal of or interest on any such Government Securities held by such custodian for the account of the holder of such depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Securities or the specific payment of principal of or interest on the Government Securities evidenced by such depository receipt.

 

“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 or other obligations.

 

“Guarantee” means the guarantee by any Guarantor of the Company’s obligations under this Indenture.

 

“Guarantors” means Parent, Holdings and all Restricted Subsidiaries that are Domestic Subsidiaries as of the Issue Date and any other Subsidiary of the Company that executes a supplemental indenture to this Indenture providing for a guarantee of payment of the Notes.

 

“Hedging Obligations” means, with respect to any Person, the obligations of such Person under:

 

(1)                                 currency exchange, interest rate or commodity swap agreements, currency exchange, interest rate or commodity cap agreements and currency exchange, interest rate or commodity collar agreements and

 

(2)                                 other agreements or arrangements designed to protect such Person against fluctuations in currency exchange, interest rates or commodity prices.

 

“Holder” means a holder of Notes.

 

“Holdings Guaranty” means the Guarantee by Holdings of the Company’s obligations with respect to the Notes, including any Guarantee entered into after the Issue Date.

 

“IAI Global Note” means a Global Note substantially in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of the Depositary or its nominee that will initially be issued in a denomination equal to the outstanding principal amount of the Notes sold to Institutional Accredited Investors.

 

“incur” has the meaning specified in Section 1011 of this Indenture.

 

“incurrence” has the meaning specified in Section 1011 of this Indenture.

 

“Indebtedness” means, with respect to any Person,

 

(a)                                 any indebtedness (including principal and premium) of such Person, whether or not contingent:

 

(1)                                   in respect of borrowed money;

 

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(2)                                   evidenced by bonds, notes, debentures or similar instruments or letters of credit or bankers’ acceptances (or, without double counting, reimbursement agreements in respect thereof);

 

(3)                                   representing the balance deferred and unpaid of the purchase price of any property (including Capitalized Lease Obligations), except any such balance that constitutes a trade payable or similar obligation to a trade creditor, in each case accrued in the ordinary course of business; or

 

(4)                                   representing any Hedging Obligations,

 

if and to the extent that any of the foregoing Indebtedness (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet (excluding the footnotes thereto) of such Person prepared in accordance with GAAP;

 

(b)                                to the extent not otherwise included, any obligation by such Person to be liable for, or to pay, as obligor, guarantor or otherwise, on the Indebtedness of another Person, other than by endorsement of negotiable instruments for collection in the ordinary course of business; and

 

(c)                                 to the extent not otherwise included, Indebtedness of another Person secured by a Lien on any asset owned by such Person, whether or not such Indebtedness is assumed by such Person;

 

provided, however, that Contingent Obligations incurred in the ordinary course of business shall be deemed not to constitute Indebtedness; and obligations under or in respect of Receivables Facilities shall not be deemed to constitute Indebtedness.

 

“Indenture” means this instrument as originally executed and 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, including, for all purposes of this Indenture and any such supplemental indenture, the provisions of the Trust Indenture Act that are deemed to be part of and govern this instrument and any such supplemental indenture, respectively.

 

“Independent Financial Advisor” means an accounting, appraisal, investment banking firm or consultant to Persons engaged in Similar Businesses of nationally recognized standing that is, in the good faith judgment of the Company, qualified to perform the task for which it has been engaged.

 

“Indirect Participant” means a Person who holds a beneficial interest in a Global Note through a Participant.

 

“Initial Lien” has the meaning specified in Section 1012 of this Indenture.

 

“Initial Purchasers” means J.P. Morgan Securities Inc., Citigroup Global Markets Inc., Goldman, Sachs & Co., Credit Suisse Securities (USA) Inc., KKR Capital Markets LLC and Mizuho Securities USA Inc.

 

“Insolvency or Liquidation Proceeding” means:

 

(a)                                 any voluntary or involuntary case or proceeding under the Bankruptcy Law with respect to the Company or any Guarantor;

 

(b)                                any other voluntary or involuntary insolvency, reorganization or bankruptcy case or proceeding, or any receivership, liquidation, reorganization or other similar case or proceeding with respect to the Company or any Guarantor or with respect to a material portion of their respective assets;

 

(c)                                 any composition of liabilities or similar arrangement relating to the Company or any Guarantor, whether or not under a court’s jurisdiction or supervision;

 

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(d)                                any liquidation, dissolution, reorganization or winding up of the Company or any Guarantor, whether voluntary or involuntary, whether or not under a court’s jurisdiction or supervision, and whether or not involving insolvency or bankruptcy; or

 

(e)                                 any general assignment for the benefit of creditors or any other marshalling of assets and liabilities of the Company or any Guarantor.

 

“Institutional Accredited Investor” means an institution that is an “accredited investor” as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act, who are not also QIBs.

 

“Intercreditor Agreement” means the intercreditor agreement dated as of the Issue Date among the Bank Collateral Agent, the Trustee, the Notes Collateral Agent, the Convertible Notes Collateral Agent, the Company and each Guarantor, as it may be amended from time to time in accordance with this Indenture.

 

“Interest Payment Date” means the Stated Maturity of an installment of interest on the Notes.

 

“Investments” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans (including guarantees), advances or capital contributions (excluding accounts receivable, trade credit, advances to customers, commission, travel and similar advances to officers and employees, in each case made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities issued by any other Person and investments that are required by GAAP to be classified on the balance sheet (excluding the footnotes) of the Company in the same manner as the other investments included in this definition to the extent such transactions involve the transfer of cash or other property.  For purposes of the definition of “Unrestricted Subsidiary” and Section 1010,

 

(1)                                 “Investments” shall include the portion (proportionate to the Company’s equity interest in such Subsidiary) of the fair market value of the net assets of a Subsidiary of the Company at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided , however , that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Company shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary in an amount (if positive) equal to:

 

(x)                                    the Company’s “Investment” in such Subsidiary at the time of such redesignation less

 

(y)                                  the portion (proportionate to the Company’s equity interest in such Subsidiary) of the fair market value of the net assets of such Subsidiary at the time of such redesignation; and

 

(2)                                 any property transferred to or from an Unrestricted Subsidiary shall be valued at its fair market value at the time of such transfer, in each case as determined in good faith by the Company.

 

“Issue Date” means May 29, 2009.

 

“Junior Lien Priority” means, relative to specified Indebtedness, having a junior Lien priority on specified Collateral and either subject to the Intercreditor Agreement on a basis that is no more favorable than the provisions applicable to the holders of Convertible Notes (in the case of ABL Collateral) or the holders of Lenders Debt (in the case of Notes Collateral) or subject to intercreditor agreements providing holders of Indebtedness with Junior Lien Priority at least the same rights and obligations as the holders of Convertible Notes (in the case of ABL Collateral) or the holders of Lenders Debt (in the case of the Notes Collateral) have pursuant to the Intercreditor Agreement as to the specified Collateral.  For the avoidance of doubt, Indebtedness in respect of the Convertible Notes and Additional Convertible Notes has Junior Lien Priority.

 

“Legal Defeasance” has the meaning specified in Section 1302 of this Indenture.

 

“Lenders Debt” means any (i) Indebtedness outstanding from time to time under the Credit Agreement, (ii) any Indebtedness which has a first-priority security interest in the ABL Collateral (subject to Permitted

 

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Liens) and (iii) all cash management Obligations and Hedging Obligations incurred with any Bank Lender (or their affiliates).

 

“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction; provided that in no event shall an operating lease be deemed to constitute a Lien.

 

 “Management Group” means at any time, the Chairman of the Board, any President, any Executive Vice President or Vice President, any Managing Director, any Treasurer and any Secretary or other executive officer of any of Parent, the Company or any Subsidiary of any such company at such time.

 

“Management Notes” means up to $25,000,000 aggregate principal amount of 8% convertible senior secured third lien notes due 2016 of the Company, having terms and conditions that are not less favorable to the Company than the Convertible Notes and with respect to which the holders (or a trustee or agent on behalf of such holders) shall have executed a supplement to the Intercreditor Agreement agreeing to be bound thereby on the same terms applicable to the holders of Convertible Notes.

 

“Maturity”, when used with respect to any Note, means the date on which the principal of such Note or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, notice of redemption or otherwise.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Net Income” means, with respect to any Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of preferred stock dividends.

 

“Net Proceeds” means the aggregate cash proceeds received by the Company, a Guarantor or any Restricted Subsidiary in respect of any Asset Sale, including, without limitation, any cash received upon the sale or other disposition of any Designated Non-cash Consideration received in any Asset Sale, net of the direct costs relating to such Asset Sale and the sale or disposition of such Designated Non-cash Consideration, including, without limitation, legal, accounting and investment banking fees, and brokerage and sales commissions, any relocation expenses incurred as a result thereof, taxes paid or payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements), amounts required to be applied to the repayment of principal, premium, if any, and interest on Indebtedness secured by a Lien permitted under this Indenture on assets that do not constitute Collateral required (other than required by Section 1018(b)) to be paid as a result of such transaction and any deduction of appropriate amounts to be provided by the Company as a reserve in accordance with GAAP against any liabilities associated with the asset disposed of in such transaction and retained by the Company after such sale or other disposition thereof, including, without limitation, pension and other post-employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations associated with such transaction.

 

“Non-Conforming Plan of Reorganization” means any plan of reorganization that grants any Noteholder Secured Party any right or benefit, directly or indirectly, which right or benefit is prohibited at such time by the provisions of the Intercreditor Agreement.

 

“Non-U.S. Person” means a Person who is not a U.S. Person.

 

“Note Register” and “Note Registrar” have the respective meanings specified in Section 305.

 

“Noteholder Secured Parties” means, collectively, the Senior Secured Noteholder Secured Parties and the Convertible Notes Secured Parties.

 

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“Notes” has the meaning stated in the first recital of this Indenture and more particularly means any Notes authenticated and delivered under this Indenture.  The Notes, including the Additional Notes, shall be treated as a single class for all purposes of this Indenture, and unless the context otherwise requires, all references to the Notes shall include any Additional Notes.

 

“Notes Collateral” has the meaning assigned to the term “Senior Secured Notes Priority Collateral” in the Intercreditor Agreement.

 

“Notes Collateral Agent” means The Bank of New York Mellon Trust Company, N.A., in its capacity as “Collateral Agent” under this Indenture and under the Security Documents, and any successor thereto in such capacity.

 

“Obligations” means any principal, interest (including any interest accruing subsequent to the filing of a petition in bankruptcy, reorganization or similar proceeding at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable state, federal or foreign law), penalties, fees, indemnifications, reimbursements (including, without limitation, reimbursement obligations with respect to letters of credit and banker’s acceptances), damages and other liabilities, and guarantees of payment of such principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities, payable under the documentation governing any Indebtedness.

 

“Offering Memorandum” means the Offering Memorandum dated May 15, 2009 relating to the Notes.

 

“Officer” means the Chairman of the Board of Directors, the Chief Executive Officer, the President, any Executive Vice President, Senior Vice President or Vice President, the Treasurer or the Secretary of the Company.

 

“Officers’ Certificate” means a certificate signed on behalf of the Company by two Officers of the Company, one of whom must be the principal executive officer, the principal financial officer, or the principal accounting officer of the Company that meets the requirements set forth in this Indenture.

 

“Opinion of Counsel” means, with respect to any Person, a written opinion reasonably acceptable to the Trustee from legal counsel.  The counsel may be counsel for such Person, including an employee of such Person.

 

“Other Pari Passu Lien Obligations” means any Additional Notes and any other Indebtedness having Pari Passu Lien Priority relative to the Notes with respect to the Notes Collateral, either Pari Passu Lien Priority, Junior Lien Priority or no Lien with respect to the ABL Collateral and substantially identical terms as the Notes (other than issue price, interest rate, yield and redemption terms) and any Indebtedness that refinances or refunds (or successive refinancings and refundings) any Notes or Additional Notes and all obligations with respect to such Indebtedness; provided that such Indebtedness may (a) contain terms and covenants that are, in the reasonable opinion of the Company, less restrictive to the Company and the Restricted Subsidiaries than the terms and covenants under the Notes; provided that such Indebtedness has Pari Passu Lien Priority relative to the Notes; and (b) contain terms and covenants that are more restrictive to the Company and its Restricted Subsidiaries than the terms and covenants under the Notes so long as prior to or substantially simultaneously with the issuance of any such Indebtedness the Notes and this Indenture are amended to contain any such more restrictive terms and covenants; provided , further , that such Indebtedness shall have a Stated Maturity date that is the same as or later than that of the Notes.

 

“Outstanding”, when used with respect to Notes, means, as of the date of determination, all Notes theretofore authenticated and delivered under this Indenture, except:

 

(i)                                      Notes theretofore cancelled by the Trustee or delivered to the Trustee for cancellation;

 

(ii)                                   Notes, or portions thereof, for whose payment or redemption money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in

 

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trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Notes; provided that, if such Notes are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made;

 

(iii)                              Notes, except to the extent provided in Sections 1302 and 1303, with respect to which the Company has effected Legal Defeasance and/or Covenant Defeasance as provided in Article Thirteen; and

 

(iv)                             Notes which have been paid pursuant to Section 306 or in exchange for or in lieu of which other Notes have been authenticated and delivered pursuant to this Indenture, other than any such Notes in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Notes are held by a bona fide purchaser in whose hands the Notes are valid obligations of the Company;

 

provided , however , that in determining whether the Holders of the requisite principal amount of Outstanding Notes have given any request, demand, authorization, direction, consent, notice or waiver hereunder, and for the purpose of making the calculations required by TIA Section 313, Notes owned by the Company or any other obligor upon the Notes or any Affiliate of the Company or such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in making such calculation or in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Notes which a Responsible Officer of the Trustee actually knows to be so owned shall be so disregarded.

 

“Parent Guaranty” means the Guarantee by Parent of the Company’s obligations with respect to the notes, including any Guarantee entered into after the Issue Date.

 

“Pari Passu Lien Priority” means, relative to specified Indebtedness, having equal Lien priority on specified Collateral and either subject to the Intercreditor Agreement on a substantially identical basis as the holders of such specified Indebtedness or subject to intercreditor agreements providing holders of the Indebtedness intended to have Pari Passu Lien Priority with substantially the same rights and obligations that the holders of such specified Indebtedness have pursuant to the Intercreditor Agreement as to the specified Collateral.

 

“Participant” means, with respect to the Depositary, Euroclear or Clearstream, a Person who has an account with the Depositary, Euroclear or Clearstream, respectively (and, with respect to DTC, shall include Euroclear and Clearstream).

 

“Paying Agent” means any Person (including the Company acting as Paying Agent) authorized by the Company to pay the principal of (and premium, if any) or interest on any Notes on behalf of the Company.

 

“Permitted Asset Swap” means the concurrent purchase and sale or exchange of Related Business Assets or a combination of Related Business Assets and cash or Cash Equivalents between the Company or any of its Restricted Subsidiaries and another Person; provided , that any cash or Cash Equivalents received must be applied in accordance with Section 1018.

 

“Permitted Holders” means Kohlberg Kravis Roberts & Co.  L.P., its Affiliates and the Management Group.

 

“Permitted Investments” means:

 

(a)                                 any Investment in the Company or any Restricted Subsidiary;

 

(b)                                any Investment in cash and Cash Equivalents;

 

(c)                                 any Investment by the Company or any Restricted Subsidiary of the Company in a Person that is engaged in a Similar Business if as a result of such Investment;

 

(1)                                   such Person becomes a Restricted Subsidiary, or

 

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(2)                                   such Person, in one transaction or a series of related transactions, is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary;

 

(d)                                any Investment in securities or other assets not constituting cash or Cash Equivalents and received in connection with an Asset Sale made pursuant to Section 1018, or any other disposition of assets not constituting an Asset Sale;

 

(e)                                 any Investment existing on the Issue Date;

 

(f)                                   advances to employees not in excess of $10.0 million outstanding at any one time, in the aggregate;

 

(g)                                any Investment acquired by the Company or any Restricted Subsidiary

 

(1)                                   in exchange for any other Investment or accounts receivable held by the Company or any such Restricted Subsidiary in connection with or as a result of a bankruptcy, workout, reorganization or recapitalization of the Company of such other Investment or accounts receivable or

 

(2)                                   as a result of a foreclosure by the Company or any Restricted Subsidiary with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;

 

(h)                                Hedging Obligations permitted under Section 1011(b)(11);

 

(i)                                    loans and advances to officers, directors and employees for business-related travel expenses, moving expenses and other similar expenses, in each case incurred in the ordinary course of business;

 

(j)                                    any Investment in a Similar Business having an aggregate fair market value, taken together with all other Investments made pursuant to this clause (j) that are at that time outstanding (without giving effect to the sale of an Unrestricted Subsidiary to the extent the proceeds of such sale do not consist of cash and/or marketable securities), not to exceed the greater of (x) $40.0 million and (y) 4.0% of Total Assets at the time of such Investment (with the fair market value of each Investment being measured at the time made and without giving effect to subsequent changes in value);

 

(k)                                 Investments the payment for which consists of Equity Interests of the Company, or any of its direct or indirect parents (exclusive of Disqualified Stock); provided , however , that such Equity Interests shall not increase the amount available for Restricted Payments under Section 1010(a)(C);

 

(l)                                    guarantees of Indebtedness permitted under Section 1011;

 

(m)                              any transaction to the extent it constitutes an investment that is permitted and made in accordance with Section 1013(b) (except transactions described in clauses (2), (6), (7) and (11) thereof);

 

(n)                                Investments consisting of purchases and acquisitions of inventory, supplies, material or equipment or the licensing or contribution of intellectual property pursuant to joint marketing arrangements with other Persons;

 

(o)                                additional Investments having an aggregate fair market value, taken together with all other Investments made pursuant to this clause (o) that are at that time outstanding (without giving effect to the sale of an Unrestricted Subsidiary to the extent the proceeds of such sale do not consist of cash and/or marketable securities), not to exceed the greater of (x) $15.0 million and (y) 1.5% of Total Assets at the

 

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time of such Investment (with the fair market value of each Investment being measured at the time made and without giving effect to subsequent changes in value); and

 

(p)                                  Investments relating to any special purpose wholly-owned subsidiary of the Company organized in connection with a Receivables Facility that, in the good faith determination of the Board of Directors of the Company, are necessary or advisable to effect such Receivables Facility.

 

“Permitted Liens” means, with respect to any Person:

 

(1)                                   pledges or deposits by such Person under workmen’s compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person or deposits of cash or U.S.  government bonds to secure surety or appeal bonds to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, in each case incurred in the ordinary course of business;

 

(2)                                   Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens, in each case for sums not yet due or being contested in good faith by appropriate proceedings or other Liens arising out of judgments or awards against such Person with respect to which such Person shall then be proceeding with an appeal or other proceedings for review;

 

(3)                                   Liens for taxes, assessments or other governmental charges not yet due or payable or subject to penalties for nonpayment or which are being contested in good faith by appropriate proceedings;

 

(4)                                   Liens in favor of issuers of performance and surety bonds or bid bonds or with respect to other regulatory requirements or letters of credit issued pursuant to the request of and for the account of such Person in the ordinary course of its business;

 

(5)                                   minor survey exceptions, minor encumbrances, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real properties or Liens incidental, to the conduct of the business of such Person or to the ownership of its properties which were not incurred in connection with Indebtedness and which do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;

 

(6)                                   (A) Liens securing Senior Indebtedness permitted to be incurred pursuant to Section 1011(a) hereof; provided that any such Indebtedness has Pari Passu Lien Priority relative to the Notes; provided further that at the time of incurrence and after giving pro forma effect thereto, the Consolidated Senior Secured Debt Ratio would be no greater than 2.75 to 1.0 and (B) Liens securing Indebtedness pursuant to Section 1011(b)(5) hereof; provided that Liens securing Indebtedness incurred pursuant to Section 1011(b)(5) are solely on acquired property or the assets of the acquired entity;

 

(7)                                   Liens existing on the Issue Date (other than Liens in favor of secured parties under the Credit Agreement and Convertible Notes);

 

(8)                                   Liens on property or shares of stock of a Person at the time such Person becomes a Subsidiary; provided , however , such Liens are not created or incurred in connection with, or in contemplation of, such other Person becoming such a subsidiary; provided , further , however , that such Liens may not extend to any other property owned by the Company or any Restricted Subsidiary;

 

(9)                                   Liens on property at the time the Company or a Restricted Subsidiary acquired the property, including any acquisition by means of a merger or consolidation with or into the Company or any Restricted Subsidiary; provided , however , that such Liens are not created or incurred in connection with, or in contemplation of, such acquisition; provided , further , however, that the Liens may not extend to any other property owned by the Company or any Restricted Subsidiary;

 

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(10)                             Liens securing Indebtedness or other obligations of a Restricted Subsidiary owing to the Company or another Restricted Subsidiary permitted to be incurred in accordance with Section 1011 hereof;

 

(11)                             Liens securing Hedging Obligations so long as the related Indebtedness is, and is permitted under this Indenture to be, secured by a Lien on the same property securing such Hedging Obligations;

 

(12)                             Liens on specific items of inventory of other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;

 

(13)                             leases and subleases of real property granted to others in the ordinary course of business so long as such leases and subleases are subordinate in all respects to the Liens granted and evidenced by the Security Documents and do not materially interfere with the ordinary conduct of the business of the Company or any of the Restricted Subsidiaries;

 

(14)                             Liens arising from Uniform Commercial Code financing statement filings regarding operating leases entered into by the Company and its Restricted Subsidiaries in the ordinary course of business;

 

(15)                             Liens in favor of the Company or any Guarantor;

 

(16)                             Liens on equipment of the Company or any Restricted Subsidiary granted in the ordinary course of business to the Company’s client at which such equipment is located;

 

(17)                             Liens on accounts receivable and related assets incurred in connection with a Receivables Facility;

 

(18)                             Liens to secure any refinancing, refunding, extension, renewal or replacement (or successive refinancing, refunding, extensions, renewals or replacements) as a whole, or in part, of any Indebtedness secured by any Lien referred to in the foregoing clauses (6)(B), (7), (8), (9), (10), (11) and (15); provided , however , that (x) such new Lien shall be limited to all or part of the same property that secured the original Lien (plus improvements on such property), (y) the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (A) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clauses (6)(B), (7), (8), (9), (10), (11) and (15) at the time the original Lien became a Permitted Lien under this Indenture, and (B) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing, refunding, extension, renewal or replacement and (z) the new Lien has no greater priority and the holders of the Indebtedness secured by such Lien have no greater intercreditor rights relative to the Notes and Holders thereof than the original Liens and the related Indebtedness;

 

(19)                             other Liens securing obligations incurred in the ordinary course of business which obligations do not exceed $50.0 million at any one time outstanding; provided that if such Liens attach to Collateral, such Liens have Pari Passu Lien Priority relative to the Notes;

 

(20)                             Liens securing Indebtedness Incurred pursuant to Section 1011(b)(1) hereof; provided that (1) any such Liens on Notes Collateral shall rank junior in priority to the Liens on the Notes Collateral securing the Notes and (2) the holder of such Lien either (x) is subject to an intercreditor agreement consistent with the Intercreditor Agreement on the same basis as the ABL Secured Parties or (y) is or agrees to become bound by the terms of the Intercreditor Agreement on the same basis as the ABL Secured Parties;

 

(21)                             Liens securing the Notes outstanding on the Issue Date, Refinancing Indebtedness with respect to such Notes, the Parent Guaranty, the Holdings Guaranty and the Subsidiary Guarantees relating thereto and any obligations with respect to such Notes, Refinancing Indebtedness, Parent Guaranty, Holdings Guaranty and Subsidiary Guarantees;

 

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“Redemption Date”, when used with respect to any Note to be redeemed, in whole or in part, means the date fixed for such redemption by or pursuant to this Indenture.

 

“Redemption Price”, when used with respect to any Note to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture.

 

 “Refinancing Indebtedness” has the meaning specified in Section 1011 of this Indenture.

 

“Refunding Capital Stock” has the meaning specified in Section 1010 of this Indenture.

 

“Regular Record Date” has the meaning specified in Section 301 of this Indenture.

 

“Regulation S” means Regulation S under the Securities Act.

 

“Regulation S Global Note” means a Global Note substantially in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of the Depositary or its nominee, issued in a denomination equal to the outstanding principal amount of the Notes sold in reliance on Rule 903 of Regulation S.

 

“Related Business Assets” means assets (other than cash or Cash Equivalents) used or useful in a Similar Business, provided that any assets received by the Company or a Restricted Subsidiary in exchange for assets transferred by the Company or a Restricted Subsidiary shall not be deemed to be Related Business Assets if they consist of securities of a Person, unless upon receipt of the securities of such Person, such Person would become a Restricted Subsidiary.

 

“Responsible Officer”, when used with respect to the Trustee, means any vice president, any assistant treasurer, any trust officer or assistant trust officer, or any other officer of the Trustee customarily performing functions similar to those performed by any of the above-designated officers, and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.

 

“Restricted Global Note” means a Global Note bearing the Private Placement Legend.

 

“Restricted Investment” means an Investment other than a Permitted Investment.

 

“Restricted Payments” has the meaning specified in Section 1010 of this Indenture.

 

“Restricted Period” means the 40-day distribution compliance period as defined in Regulation S.

 

“Restricted Subsidiary” means, at any time, any direct or indirect Subsidiary of the Company (including any Foreign Subsidiary) that is not then an Unrestricted Subsidiary; provided , however , that upon the occurrence of an Unrestricted Subsidiary ceasing to be an Unrestricted Subsidiary, such Subsidiary shall be included in the definition of “Restricted Subsidiary.”

 

“Retired Capital Stock” has the meaning specified in Section 1010 of this Indenture.

 

“Rule 144” means Rule 144 promulgated under the Securities Act.

 

“Rule 144A” means Rule 144A under the Securities Act.

 

“Rule 903” means Rule 903 promulgated under the Securities Act.

 

“Rule 904” means Rule 904 promulgated under the Securities Act.

 

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“S&P” means Standard and Poor’s Ratings Group.

 

“Securities Act” means the Securities Act of 1933 and the rules and regulations of the Commission promulgated thereunder.

 

“Security Agreement” means the security agreement dated as of the Issue Date among the Notes Collateral Agent, the Company and the Guarantors as the same may be amended or supplemented from time to time in accordance with its terms.

 

“Security Documents” means the security agreements, pledge agreements, mortgages, deeds of trust, deeds to secure debt, collateral assignments, control agreements and related agreements (including, without limitation, finance statements under the Uniform Commercial Code of the relevant states), as amended, supplemented, restated, renewed, refunded, replaced, restructured, repaid, refinanced or otherwise modified from time to time, creating the security interests in the Collateral as contemplated by this Indenture.

 

“Senior Indebtedness” means:

 

(1)                                   all Indebtedness of the Company or any Guarantor outstanding under the Credit Agreement (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization of the Company or any Guarantor, regardless of whether or not a claim for post-filing interest is allowed in such proceedings);

 

(2)                                   all Hedging Obligations (and guarantees thereof) permitted to be incurred under the terms of this Indenture;

 

(3)                                   any other Indebtedness of the Company or any Guarantor permitted to be incurred under the terms of this Indenture, unless the instrument under which such Indebtedness is incurred expressly provides that it is on a parity with or subordinated in right of payment to the Notes or any Subsidiary Guarantee; and

 

(4)                                   all Obligations with respect to the items listed in the preceding clauses (1), (2) and (3).

 

“Senior Indebtedness” of any guarantor of the Notes, including the Guarantors, has a correlative meaning.

 

“Senior Secured Noteholder Secured Parties” means, collectively, the Trustee, the Notes Collateral Agent, each Holder, each other holder of, or obligee in respect of any Obligations in respect of the Notes and holders of Other Pari Passu Lien Obligations and each Authorized Representative (as defined in the Security Agreement) thereto.

 

“Senior Subordinated Notes” means the Company’s 8.25% Senior Subordinated Notes due 2014 outstanding on the Issue Date.

 

“Significant Subsidiary” means any Restricted Subsidiary that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such regulation is in effect on the date hereof.

 

“Similar Business” means any business conducted or proposed to be conducted by the Company and its Restricted Subsidiaries on the date of this Indenture or any business that is similar, reasonably related, incidental or ancillary thereto.

 

“Special Record Date” for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 307.

 

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“Stated Maturity”, when used with respect to any Note or any installment of principal thereof or interest thereon, means the date specified in such Notes as the fixed date on which the principal of such Notes or such installment of principal or interest is due and payable.

 

“Subordinated Indebtedness” means:

 

(a)                                   with respect to the Company, any Indebtedness of the Company which is by its terms subordinated in right of payment to the Notes, and

 

(b)                                  with respect to any Guarantor, any Indebtedness of such Guarantor which is by its terms subordinated in right of payment to the Guarantee of such Guarantor.

 

“Subsidiary” means, with respect to any Person,

 

(1)                                   any corporation, association, or other business entity (other than a partnership, joint venture, limited liability company or similar 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 of determination owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof and

 

(2)                                   any partnership, joint venture, limited liability company or similar entity of which;

 

(x)                                    more than 50% of the capital accounts, distribution rights, total equity and voting interests or general or limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof whether in the form of membership, general, special or limited partnership or otherwise, and

 

(y)                                  such Person or any Restricted Subsidiary of such Person is a controlling general partner or otherwise controls such entity.

 

“Subsidiary Guarantee” means the guarantee by any Subsidiary Guarantor of the Company’s obligations under this Indenture.

 

“Subsidiary Guarantor” all of the Company’s direct and indirect Domestic Subsidiaries existing on the Issue Date and any other Subsidiary of the Company that executes a supplemental indenture to this Indenture providing for a guarantee of payment of the Notes.

 

“Successor Company” has the meaning specified in Section 801 of this Indenture.

 

“Successor Person” has the meaning specified in Section 802 of this Indenture.

 

“Third Lien Indebtedness” means any Indebtedness (other than Convertible Notes, but including any Additional Convertible Notes) that is secured by the Collateral with Pari Passu Lien Priority relative to the Convertible Notes or is secured by some of the Collateral with Pari Passu Lien Priority relative to the Convertible Notes and is not secured by the balance of the Collateral and with respect to which the holders (or a trustee or agent on behalf of such holders) shall have executed a supplement to the Intercreditor Agreement agreeing to be bound thereby on the same terms applicable to the holders of Convertible Notes.

 

“Third Lien Indebtedness Secured Parties” means each holder of Third Lien Indebtedness and each other holder of, or obligee in respect of, any obligations in respect of Third Lien Indebtedness outstanding at such time.

 

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 “Total Assets” means the total assets of the Company and the Restricted Subsidiaries, as shown on the most recent balance sheet of the Company.

 

“Treasury Rate” means, as of any redemption date, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two business days prior to the redemption date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to April 15, 2012; provided , however , that if the period from the redemption date to April 15, 2012, is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used.

 

“Trust Indenture Act” or “TIA” means the Trust Indenture Act of 1939 as in force at the date as of which this Indenture was executed, except as provided in Section 905.

 

“Trustee” means the Person named as the “Trustee” in the first paragraph of this Indenture until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean such successor Trustee.

 

“Unrestricted Global Note” means a Global Note that does not bear and is not required to bear the Private Placement Legend.

 

“Unrestricted Subsidiary” means:

 

(1)                                   any Subsidiary of the Company which at the time of determination is an Unrestricted Subsidiary (as designated by the Board of Directors of the Company, as provided below), and

 

(2)                                   any Subsidiary of an Unrestricted Subsidiary.

 

The Board of Directors of the Company may designate any Subsidiary of the Company (including any existing Subsidiary and any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Equity Interests or Indebtedness of, or owns or holds any lien on, any property of, the Company or any Subsidiary of the Company (other than any Subsidiary of the Subsidiary to be so designated), provided that

 

(a)                                   any Unrestricted Subsidiary must be an entity of which shares of the Capital Stock or other Equity Interests (including partnership interests) entitled to cast at least a majority of the votes that may be cast by all shares or Equity Interests having ordinary voting power for the election of directors or other governing body are owned, directly or indirectly, by the Company,

 

(b)                                  such designation complies with Section 1010, and

 

(c)                                   each of the Subsidiary to be so designated and its Subsidiaries has not at the time of designation, and does not thereafter, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable with respect to any Indebtedness pursuant to which the lender has recourse to any of the assets of the Company or any Restricted Subsidiary.

 

The Board of Directors of the Company may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that, immediately after giving effect to such designation no Default or Event of Default shall have occurred and be continuing and either:

 

(1)                                   the Company could incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test described under Section 1011(a), or

 

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(2)                                   the Fixed Charge Coverage Ratio for the Company and its Restricted Subsidiaries would be greater than such ratio for the Company and its Restricted Subsidiaries immediately prior to such designation, in each case on a pro forma basis taking into account such designation.

 

Any such designation by the Board of Directors of the Company shall be notified by the Company to the Trustee by promptly filing with the Trustee a copy of the Board Resolution giving effect to such designation and an Officers’ Certificate certifying that such designation complied with the foregoing provisions.

 

“U.S. Person” means a U.S. Person as defined in Rule 902(k) promulgated under the Securities Act.

 

“Vice President”, when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title “vice president”.

 

“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.

 

“Weighted Average Life to Maturity” means, when applied to any Indebtedness, Disqualified Stock or preferred stock, as the case may be, at any date, the quotient obtained by dividing:

 

(1)                                   the sum of the products of the number of years from the date of determination to the date of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Disqualified Stock or preferred stock multiplied by the amount of such payment, by

 

(2)                                   the sum of all such payments.

 

“Wholly Owned Restricted Subsidiary” means any Wholly-Owned Subsidiary that is a Restricted Subsidiary.

 

 “Wholly Owned Subsidiary” of any Person means a Subsidiary of such Person, 100% 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.

 

SECTION 102.                     Compliance Certificates and Opinions .

 

Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee an Officers’ Certificate stating that all conditions precedent, if any, provided for in this Indenture (including any covenant compliance with which constitutes a condition precedent) relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.

 

Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than pursuant to Section 1008(a)) shall include:

 

(1)                                   a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;

 

(2)                                   a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

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(3)                                   a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(4)                                   a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.

 

SECTION 103.                     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 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 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 stating that the information with respect to such factual matters is in the possession of the Company, unless such 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.

 

SECTION 104.                     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 agents 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 conclusive in favor of the Trustee and the Company, 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 a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof.  Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of authority.  The fact 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 that the Trustee deems sufficient.

 

(c)                                   The principal amount and serial numbers of Notes held by any Person, and the date of holding the same, shall be proved by the Note Register.

 

(d)                                  If the Company shall solicit from the Holders any request, demand, authorization, direction, notice, consent, waiver or other Act, the Company may, at its option, by or pursuant to a Board Resolution, fix in advance a record date for the determination of Holders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other Act, but the Company shall have no obligation to do so.  Notwithstanding TIA

 

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Section 316(c), such record date shall be the record date specified in or pursuant to such Board Resolution, which shall be a date not earlier than the date 30 days prior to the first solicitation of Holders generally in connection therewith and not later than the date such solicitation is completed.  If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders of record at the close of business on such record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of Outstanding Notes have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other Act, and for that purpose the Outstanding Notes shall be computed as of such record date; provided that no such authorization, agreement or consent by the Holders on such record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than eleven months after the record date.  Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Note shall bind every future Holder of the same Note and the Holder of every Note issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee, the Company or any Guarantor in reliance thereon, whether or not notation of such action is made upon such Note.

 

SECTION 105.                     Notices, Etc., to Trustee, Company, Any Guarantor and Agent .

 

Any request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with,

 

(1)                                   the Trustee by any Holder or by the Company or any Guarantor shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing (which may be via facsimile) to or with the Trustee at The Bank of New York Mellon Trust Company, N.A., 10161 Centurion Parkway, Jacksonville, Florida 32256, Attention: Corporate Trust Administration Division, or

 

(2)                                   the Company or any Guarantor by the Trustee or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if made, given, furnished or delivered in writing and mailed, first-class postage prepaid, or delivered by recognized overnight courier, to the Company or such Guarantor addressed to it at the address of its principal office specified in the first paragraph, Attention: General Counsel, or at any other address previously furnished in writing to the Trustee by the Company or such Guarantor.

 

SECTION 106.                     Notice to Holders; Waiver .

 

Where this Indenture provides for notice of any event to Holders by the Company or the Trustee, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at his address as it appears in the Note Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice.  In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders.  Notices given by publication shall be deemed given on the first date on which publication is made and notices given by first-class mail, postage prepaid, shall be deemed given five calendar days after mailing.

 

In case by reason of the suspension of or irregularities in regular mail service or by reason of any other cause, it shall be impracticable to mail notice of any event to Holders when such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to the Trustee shall be deemed to be a sufficient giving of such notice for every purpose hereunder.

 

Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice.  Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

 

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SECTION 107.                     Effect of Headings and Table of Contents .

 

The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.

 

SECTION 108.                     Successors and Assigns .

 

All agreements of the Company in this Indenture and the Notes will bind its successors.  All agreements of the Trustee in this Indenture will bind its successors.  All agreements of each Guarantor in this Indenture will bind its successors, except as otherwise provided in Section 1209 hereof.  The provisions of Article Fourteen relating to the Notes Collateral Agent shall inure to the benefit of such Notes Collateral Agent.

 

SECTION 109.                     Separability Clause .

 

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 110.                     Benefits of Indenture .

 

Nothing in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto, any Paying Agent, any Notes Registrar and their successors hereunder, the Holders and, with respect to any provisions hereof relating to the subordination of the Notes or the rights of holders of Senior Indebtedness, the holders of Senior Indebtedness, any benefit or any legal or equitable right, remedy or claim under this Indenture.

 

SECTION 111.                     Governing Law .

 

This Indenture, the Notes and any Guarantee shall be governed by and construed in accordance with the laws of the State of New York.  This Indenture is subject to the provisions of the Trust Indenture Act that are referred to herein or are otherwise required to be part of this Indenture and shall, to the extent applicable, be governed by such provisions.

 

SECTION 112.                     Communication by Holders of Notes with Other Holders of Notes .

 

Holders may communicate pursuant to Trust Indenture Act Section 312(b) with other Holders with respect to their rights under this Indenture or the Notes.  The Company, the Trustee, the Notes Registrar and anyone else shall have the protection of Trust Indenture Act Section 312(c).

 

SECTION 113.                     Legal Holidays .

 

In any case where any Interest Payment Date, Redemption Date or Stated Maturity or Maturity of any Note shall not be a Business Day, then (notwithstanding any other provision of this Indenture or of the Notes) payment of principal (or premium, if any) or interest need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the Interest Payment Date, Redemption Date, or at the Stated Maturity or Maturity; provided that no interest shall accrue for the period from and after such Interest Payment Date, Redemption Date, Stated Maturity or Maturity, as the case may be.

 

SECTION 114.                     No Personal Liability of Directors, Officers, Employees and Stockholders .

 

No director, officer, employee, incorporator or stockholder of the Company or any Guarantor or any of their parent companies shall have any liability for any obligations of the Company or the Guarantors under the Notes, the Guarantees or this Indenture or for any claim based on, in respect of, or by reason of such obligations or their creation.  Each Holder by accepting a Note and the related Guarantee waives and releases all such liability.  The waiver and release are part of the consideration for issuance of the Notes and the Guarantees.  Such waiver may

 

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not be effective to waive liabilities under the federal securities laws and it is the view of the Commission that such a waiver is against public policy.

 

SECTION 115.                     Trust Indenture Act Controls .

 

If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the provision required by the TIA shall control.  If any provision of this Indenture modifies or excludes any provision of the TIA that may be so modified or excluded, the latter provision shall be deemed to apply to this Indenture as so modified or excluded, as the case may be.

 

SECTION 116.                     Counterparts .

 

This Indenture may be executed in any number of counterparts, each of which shall be original; but such counterparts shall together constitute but one and the same instrument.

 

SECTION 117.                     USA Patriot Act .

 

The parties hereto acknowledge that in accordance with Section 326 of the USA Patriot Act the Trustee and Agents, like all financial institutions and in order to help fight the funding of terrorism and money laundering, are required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account.  The parties to this Indenture agree that they will provide the Trustee and the Agents with such information as they may request in order to satisfy the requirements of the USA Patriot Act.

 

SECTION 118.                     Intercreditor Agreement Governs .

 

Reference is made to the Intercreditor Agreement.  Each Holder, by its acceptance of a Note, (a) consents to the subordination of Liens provided for in the Intercreditor Agreement, (b) agrees that it will be bound by and will take no actions contrary to the provisions of the Intercreditor Agreement and (c) authorizes and instructs the Trustee and Notes Collateral Agent to enter into the Intercreditor Agreement as Trustee and Notes Collateral Agent, respectively, and on behalf of such Holder.  The foregoing provisions are intended as an inducement to the lenders under the Credit Agreement to extend credit and such lenders are intended third party beneficiaries of such provisions and the provisions of the Intercreditor Agreement.

 

SECTION 119.                     Waiver of Jury Trial .

 

EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.

 

SECTION 120.                     Force Majeure .

 

In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

 

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This is one of the Notes referred to in the within-mentioned Indenture.

 

				THE BANK OF NEW YORK MELLON TRUST
				COMPANY, N.A.,
				as Trustee
Dated:
				By
					Authorized Signatory

 

SECTION 203.                                        Restrictive Legends .

 

Each Restricted Global Note, Definitive Note and Regulation S Global Note shall bear the following legend set forth below (the “Private Placement Legend”) on the face thereof:

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) THAT IS ONE YEAR IN THE CASE OF RULE 144A NOTES, AND 40 DAYS IN THE CASE OF REGULATION S NOTES AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

 

Each Global Note shall also bear the following legend on the face thereof:

 

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UNLESS THIS CERTIFICATE IS PRESENTED, BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL BECAUSE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 312 OF THE INDENTURE.

 

Each Note issued hereunder that has more than a de minimis about of original issue discount for U.S. Federal Income Tax purposes shall bear a legend in substantially the following form:

 

THIS NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE.  A HOLDER MAY OBTAIN THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO MATURITY FOR SUCH NOTES BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION TO THE ISSUER AT THE FOLLOWING ADDRESS:  SEALY MATTRESS COMPANY, ONE OFFICE PARKWAY, TRINITY, NORTH CAROLINA 27370, ATTENTION: GENERAL COUNSEL.

 

SECTION 204.                                        [INTENTIONALLY DELETED] .

 

ARTICLE THREE

 

THE NOTES

 

SECTION 301.                                        Title and Terms .

 

The aggregate principal amount of Notes which may be authenticated and issued under this Indenture is not limited; provided , however , that any Additional Notes issued under this Indenture are issued in accordance with Sections 303 and 1011 hereof, as part of the same series as the Notes.

 

The Notes shall be known and designated as the “10.875% Senior Secured Notes due 2016” of the Company.  The Stated Maturity of the Notes shall be April 15, 2016, and the Notes shall bear interest at the rate of 10.875% per annum from May 29, 2009, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, payable on October 15, 2009 and semi-annually thereafter on April 15 and October 15 in each year and at said Stated Maturity, until the principal thereof is paid or duly provided for and to the Person in whose name the Note (or any predecessor Note) is registered at the close of business on the April 1 and October 1 immediately preceding such Interest Payment Date (each, a “Regular Record Date&rdqu