CROSS-REFERENCE TABLE

 

TIA Section			Indenture Section
310(a)(1)			7.10
(a)(2)			7.10
(a)(3)			N.A.
(a)(4)			N.A.
(a)(5)			7.08; 7.10
(b)			7.08; 7.10; 12.02
(c)			N.A.
311(a)			7.11
(b)			7.11
(c)			N.A.
312(a)			2.05
(b)			12.03
(c)			12.03
313(a)			7.06
(b)			7.06, 10.06
(c)			7.06; 12.02
(d)			7.06
314(a)			4.09; 4.19; 12.02
(b)			N.A.
(c)(1)			7.02; 12.04; 12.05
(c)(2)			7.02; 12.04; 12.05
(c)(3)			N.A.
(d)			10.06
(e)			12.05
(f)			N.A.
315(a)			7.01(b)
(b)			7.05
(c)			7.01
(d)			6.05; 7.01(c)
(e)			6.11
316(a)(last sentence)			2.09
(a)(1)(A)			6.02
(a)(1)(B)			6.04
(a)(2)			9.02
(b)			6.07
(c)			9.05
317(a)(1)			6.08
(a)(2)			6.09
(b)			2.04
318(a)			12.01
(c)			12.01

 

N.A. means Not Applicable

 

Note:                                      This Cross-Reference Table shall not, for any purpose, be deemed to be a part of the Indenture.

 

 

TABLE OF CONTENTS

 

		Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01.	Definitions	1
SECTION 1.02.	Other Definitions	28
SECTION 1.03.	Incorporation by Reference of TIA	29
SECTION 1.04.	Rules of Construction	30
ARTICLE TWO
THE NOTES
SECTION 2.01.	Form and Dating	30
SECTION 2.02.	Execution and Authentication	31
SECTION 2.03.	Registrar and Paying Agent	32
SECTION 2.04.	Paying Agent To Hold Assets in Trust	32
SECTION 2.05.	Holder Lists	33
SECTION 2.06.	Transfer and Exchange	33
SECTION 2.07.	Replacement Notes	34
SECTION 2.08.	Outstanding Notes	34
SECTION 2.09.	Treasury Notes	34
SECTION 2.10.	Temporary Notes	35
SECTION 2.11.	Cancellation	35
SECTION 2.12.	Defaulted Interest	35
SECTION 2.13.	CUSIP Number	35
SECTION 2.14.	Deposit of Moneys	36
SECTION 2.15.	Book-Entry Provisions for Global Notes	36
SECTION 2.16.	Special Transfer Provisions	37
SECTION 2.17.	Limitation on Ownership of Notes	40
ARTICLE THREE
REDEMPTION
SECTION 3.01.	Notices to Trustee	41
SECTION 3.02.	Selection of Notes To Be Redeemed	41
SECTION 3.03.	Notice of Redemption	41
SECTION 3.04.	Effect of Notice of Redemption	42
SECTION 3.05.	Deposit of Redemption Price	42
SECTION 3.06.	Notes Redeemed in Part	43

 

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		Page
ARTICLE FOUR
COVENANTS
SECTION 4.01.	Payment of Notes		43
SECTION 4.02.	Maintenance of Office or Agency		43
SECTION 4.03.	Corporate Existence		44
SECTION 4.04.	Payment of Taxes and Other Claims		44
SECTION 4.05.	Maintenance of Properties and Insurance		44
SECTION 4.06.	Compliance Certificate; Notice of Default		45
SECTION 4.07.	Compliance with Laws		45
SECTION 4.08.	Waiver of Stay, Extension or Usury Laws		45
SECTION 4.09.	Change of Control		46
SECTION 4.10.	Incurrence of Indebtedness and Issuance of Preferred Stock		48
SECTION 4.11.	Restricted Payments		50
SECTION 4.12.	Liens		54
SECTION 4.13.	Asset Sales		54
SECTION 4.14.	Transactions with Affiliates		58
SECTION 4.15.	Dividend and Other Payment Restrictions Affecting Subsidiaries		59
SECTION 4.16.	Additional Subsidiary Guarantees		61
SECTION 4.17.	Further Assurances		61
SECTION 4.18.	Reports to Holders		62
SECTION 4.19.	Designation of Restricted and Unrestricted Subsidiaries		63
SECTION 4.20.	Sale and Leaseback Transactions		64
SECTION 4.21.	Limitation on Issuances and Sales of Equity Interests in Wholly Owned Subsidiaries		64
SECTION 4.22.	Business Activities		65
SECTION 4.23.	Payments for Consent		65
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01.	Merger, Consolidation, or Sale of Assets		65
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01.	Events of Default		67
SECTION 6.02.	Acceleration		69
SECTION 6.03.	Other Remedies		69
SECTION 6.04.	Waiver of Past Defaults		70
SECTION 6.05.	Control by Majority		70
SECTION 6.06.	Limitation on Suits		70

 

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		Page
SECTION 6.07.	Rights of Holders To Receive Payment		71
SECTION 6.08.	Collection Suit by Trustee		71
SECTION 6.09.	Trustee May File Proofs of Claim		71
SECTION 6.10.	Priorities		71
SECTION 6.11.	Undertaking for Costs		72
SECTION 6.12.	Appointment and Authorization of Wilmington Trust Company as Second Lien Agent		72
ARTICLE SEVEN
TRUSTEE
SECTION 7.01.	Duties of Trustee		73
SECTION 7.02.	Rights of Trustee		74
SECTION 7.03.	Individual Rights of Trustee		76
SECTION 7.04.	Trustee’s Disclaimer		76
SECTION 7.05.	Notice of Default		76
SECTION 7.06.	Reports by Trustee to Holders		76
SECTION 7.07.	Compensation and Indemnity		77
SECTION 7.08.	Replacement of Trustee		78
SECTION 7.09.	Successor Trustee by Merger, Etc.		78
SECTION 7.10.	Eligibility; Disqualification		79
SECTION 7.11.	Preferential Collection of Claims Against Casella		79
SECTION 7.12.	Second Lien Agent		79
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01.	Termination of Casella’s Obligations		79
SECTION 8.02.	Legal Defeasance and Covenant Defeasance		81
SECTION 8.03.	Conditions to Legal Defeasance or Covenant Defeasance		82
SECTION 8.04.	Application of Trust Money		83
SECTION 8.05.	Repayment to Casella		84
SECTION 8.06.	Reinstatement		84
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01.	Without Consent of Holders		84
SECTION 9.02.	With Consent of Holders		86
SECTION 9.03.	[Reserved]		87
SECTION 9.04.	Compliance with TIA		87
SECTION 9.05.	Revocation and Effect of Consents		87

 

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		Page
SECTION 9.06.	Notation on or Exchange of Notes		88
SECTION 9.07.	Trustee and Second Lien Agent To Sign Amendments, Etc.		88
ARTICLE TEN
RANKING OF LIENS; COLLATERAL AND SECURITY
SECTION 10.01.	Relative Rights		89
SECTION 10.02.	Security Documents		90
SECTION 10.03.	Second Lien Agent		91
SECTION 10.04.	Authorization of Actions To Be Taken		92
SECTION 10.05.	Release of Second-Priority Liens		93
SECTION 10.06.	Filing, Recording and Opinions		94
SECTION 10.07.	Powers Exercisable by Receiver or Trustee		95
SECTION 10.08.	No Impairment of the Security Interests		95
SECTION 10.09.	Notes, Subsidiary Guarantees and Other Second Lien Obligations Not Subordinated		95
ARTICLE ELEVEN
SUBSIDIARY GUARANTEE
SECTION 11.01.	Unconditional Guarantee		96
SECTION 11.02.	[Reserved]		97
SECTION 11.03.	Limitation on Guarantor Liability		97
SECTION 11.04.	Execution and Delivery of Subsidiary Guarantee		97
SECTION 11.05.	Release of a Guarantor		98
SECTION 11.06.	Waiver of Subrogation		99
SECTION 11.07.	Immediate Payment		99
SECTION 11.08.	No Set-Off		99
SECTION 11.09.	Guarantee Obligations Absolute		99
SECTION 11.10.	Guarantee Obligations Continuing		100
SECTION 11.11.	Guarantee Obligations Not Reduced		100
SECTION 11.12.	Guarantee Obligations Reinstated		100
SECTION 11.13.	Guarantee Obligations Not Affected		100
SECTION 11.14.	Waiver		102
SECTION 11.15.	No Obligation To Take Action Against Casella		102
SECTION 11.16.	Dealing with Casella and Others		102
SECTION 11.17.	Default and Enforcement		103
SECTION 11.18.	Amendment, Etc.		103
SECTION 11.19.	Acknowledgment		103
SECTION 11.20.	Costs and Expenses		103
SECTION 11.21.	No Merger or Waiver; Cumulative Remedies		103
SECTION 11.22.	Survival of Guarantee Obligations		103
SECTION 11.23.	Guarantee in Addition to Other Guarantee Obligations		104

 

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		Page
SECTION 11.24.	Severability		104
SECTION 11.25.	Successors and Assigns		104
ARTICLE TWELVE
MISCELLANEOUS
SECTION 12.01.	TIA Controls		104
SECTION 12.02.	Notices		104
SECTION 12.03.	Communications by Holders with Other Holders		106
SECTION 12.04.	Certificate and Opinion as to Conditions Precedent		106
SECTION 12.05.	Statements Required in Certificate or Opinion		106
SECTION 12.06.	Rules by Trustee, Paying Agent, Registrar		107
SECTION 12.07.	Legal Holidays		107
SECTION 12.08.	Governing Law		107
SECTION 12.09.	No Adverse Interpretation of Other Agreements		107
SECTION 12.10.	No Recourse Against Others		107
SECTION 12.11.	Successors		108
SECTION 12.12.	Duplicate Originals		108
SECTION 12.13.	Severability		108
SECTION 12.14.	Security Documents		108
SECTION 12.15.	Designation as Designated Senior Debt		108
Signatures			S-1
Exhibit A     -	Form of Note
Exhibit B     -	Form of Legends
Exhibit C     -	Form of Certificate To Be Delivered in Connection with Transfers to Non-QIB Accredited Investors
Exhibit D     -	Form of Certificate To Be Delivered in Connection with Transfers Pursuant to Regulation S
Exhibit E     -	Form of Notation of Subsidiary Guarantee

 

Note:                                            This Table of Contents shall not, for any purpose, be deemed to be part of the Indenture.

 

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INDENTURE dated as of July 9, 2009 among CASELLA WASTE SYSTEMS, INC., a Delaware corporation (“ Casella ”), as issuer, and each of the Guarantors named herein, as Guarantors, and WILMINGTON TRUST COMPANY, a Delaware banking corporation, as Trustee (the “ Trustee ”).

 

Casella has duly authorized the creation of an issue of 11% Senior Second Lien Notes due 2014 and, to provide therefor, Casella has duly authorized the execution and delivery of this Indenture.  All things necessary to make the Notes, when duly issued and executed by Casella and authenticated and delivered hereunder, the valid and binding obligations of Casella and to make this Indenture a valid and binding agreement of Casella have been done.

 

Each party hereto agrees as follows for the benefit of each other party and for the equal and ratable benefit of the Holders of the Notes:

 

ARTICLE ONE

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

SECTION 1.01.                                                      Definitions .

 

Set forth below are certain defined terms used in this Indenture.

 

“ Acquired Debt ” 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 or which is assumed by such specified Person at the time such specified Person acquires the assets of such other Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or selling its assets to, or becoming a Restricted Subsidiary of, such specified Person; and

 

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

 

“ Additional Interest ” has the meaning set forth in the Registration Rights Agreement.

 

“ Additional Notes ” means Notes (other than the Notes issued on the Issue Date and any exchange notes issued in exchange therefor pursuant to the Registration Rights Agreement) issued from time to time under this Indenture in accordance with the last paragraph of Section 2.01 hereof.

 

“ Affiliate ” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.

 

 

For purposes of this definition, “control,” as used with respect to any Person, 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.  For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” shall have correlative meanings.

 

“ Agent ” means any Registrar, Paying Agent or co-Registrar.

 

“ amend ” means amend, modify, supplement, restate or amend and restate, including successively; and “amending” and “amended” have correlative meanings.

 

“ asset ” means any asset or property, whether real, personal or other, tangible or intangible.

 

“ Asset Sale ” means:

 

(a)           the sale, lease, conveyance or other disposition of any assets, other than sales of inventory in the ordinary course of business consistent with past practices (such inventory to include solid waste, recyclables and other by-products of the wastestream collected by Casella and its Restricted Subsidiaries and sold to, or disposed of with, third parties in the ordinary course of business consistent with past practices); and

 

(b)           the issuance of Equity Interests by any of Casella’s Restricted Subsidiaries or the sale of Equity Interests in any of its Restricted Subsidiaries or the sale of Equity Interests held by Casella or its Restricted Subsidiaries in any of its Unrestricted Subsidiaries.

 

Notwithstanding the preceding, the following shall not be deemed to be Asset Sales:

 

(1)           any single transaction or series of related transactions that: (x) involves assets having a fair market value of less than $5.0 million, or (y) results in net proceeds to Casella and its Restricted Subsidiaries of less than $5.0 million;

 

(2)           a transfer of assets between or among Casella and/or one or more of its Wholly Owned Restricted Subsidiaries;

 

(3)           an issuance of Equity Interests by, or a transfer of Equity Interests in, a Wholly Owned Restricted Subsidiary to Casella or to another Wholly Owned Restricted Subsidiary;

 

(4)           the sale, lease, conveyance or other disposition of the assets or Equity Interests of MERC for fair market value thereof to the extent of the aggregate Net Proceeds thereof of up to $15.0 million (it being understood that the sale, lease, conveyance or other disposition of the assets or Equity Interests of MERC to the extent the Net Proceeds thereof exceed $15.0 million shall constitute an Asset Sale with respect to such excess);

 

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(5)           disposals or replacements in the ordinary course of business of equipment that has become worn-out, obsolete or damaged or otherwise unsuitable for use in connection with the business of Casella and its Restricted Subsidiaries;

 

(6)           the sale or disposition of cash or Cash Equivalents;

 

(7)           the release, surrender or waiver of contract, tort or other claims of any kind as a result of the settlement of any litigation or threatened litigation;

 

(8)           the granting or existence of Liens (and foreclosure thereon) not prohibited by this Indenture; and

 

(9)           a Restricted Payment or a Permitted Investment that is not prohibited by Section 4.11.

 

“ Attributable Debt ” in respect of a Sale and Leaseback Transaction means, at the time of determination, the present value of the obligation of the lessee for net rental payments during the remaining term of the lease included in such Sale and Leaseback Transaction including any period for which such lease has been extended or may, at the option of the lessor, be extended.  Such present value shall be calculated using a discount rate equal to the rate of interest implicit in such transaction, determined in accordance with GAAP.

 

“ Bankruptcy Law ” means Title 11, U.S. Code or any similar Federal, state or foreign law for the relief of debtors.

 

“ Beneficial Owner ” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular “person” (as such term is used in Section 13(d)(3) of the Exchange Act), such “person” shall be deemed to have beneficial ownership of all securities that such “person” has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition.

 

“ Board of Directors ” means (1) in the case of a corporation, the board of directors and (2) in all other cases, a body performing substantially similar functions as a board of directors.

 

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

 

“ Business Day ” means any day other than a Saturday, Sunday or any other day on which banking institutions in the City of New York or the State of Delaware are required or authorized by law or other governmental action to be closed.

 

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“ Capital Lease Obligation ” means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at that time be required to be capitalized on a balance sheet in accordance with GAAP.

 

“ 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.

 

“ Casella ” means the party named as such in this Indenture until a successor replaces it pursuant to this Indenture and thereafter shall mean such successor corporation.

 

“ Cash Equivalents ” means:

 

(1)           a marketable obligation, maturing within one year after issuance thereof, issued, guaranteed or insured by the government of the United States of America or an instrumentality or agency thereof;

 

(2)           demand deposits, certificates of deposit, eurodollar time deposits, banker’s acceptances, in each case, maturing within one year after issuance thereof, and overnight bank deposits, in each case, issued by any lender under the Senior Credit Facility, or a U.S. national or state bank or trust company or a European, Canadian or Japanese bank having capital, surplus and undivided profits of at least $500.0 million and whose long-term unsecured debt has a rating of “A” or better by S&P or A2 or better by Moody’s or the equivalent rating by any other nationally recognized rating agency (provided that the aggregate face amount of all Investments in certificates of deposit or bankers’ acceptances issued by the principal offices of or branches of such non-lender European or Japanese banks located outside the United States shall not at any time exceed 33-1/3% of all Investments described in this definition);

 

(3)           open market commercial paper, maturing within 270 days after issuance thereof, which has a rating of A-2 or better by S&P or P-2 or better by Moody’s, or the equivalent rating by any other nationally recognized rating agency;

 

(4)           repurchase agreements and reverse repurchase agreements with a term not in excess of one year with any financial institution which has been elected a primary government securities dealer by the Federal Reserve Board or whose securities are rated AA- or better by S&P or Aa3 or better by Moody’s or the equivalent rating by any other nationally

 

4

 

recognized rating agency relating to marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency or instrumentality thereof and backed by the full faith and credit of the United States of America; and

 

(5)           shares of any money market mutual fund rated at least AAA or the equivalent thereof by S&P or at least Aaa or the equivalent thereof by Moody’s or any other mutual fund at least 95% of the assets of which consist of the type specified in clauses (1) through (4) above.

 

“ Cash Management Bank ” means any First Lien Lender or an Affiliate of a First Lien Lender (together with its successors and assigns) providing Cash Management Services to Casella or any Guarantor.

 

“ Cash Management Obligations ” means all obligations owing by Casella or any Guarantor to any Cash Management Bank in respect of any Cash Management Services (including, without limitation, indemnities, fees and interest thereon and all interest and fees that accrue on or after the commencement of any Insolvency or Liquidation Proceeding at the rate provided for in the respective documents governing the Cash Management Services, whether or not a claim for post-petition interest or fees is allowed or allowable in any such Insolvency or Liquidation Proceeding), now existing or hereafter incurred under, arising out of or in connection with such Cash Management Services, and the due performance and compliance by Casella or such Guarantor with the terms, conditions and agreements of such Cash Management Services.

 

“ Cash Management Services ” means treasury, depository, bank product and/or cash management services or any automated clearing house transfer services.

 

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

 

(1)           any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the Beneficial Owner, directly or indirectly, of securities representing 50% or more of the voting power of all Voting Stock of Casella; or

 

(2)           Continuing Directors shall cease to constitute at least a majority of the directors constituting the Board of Directors of Casella; or

 

(3)           the sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of Casella and its Restricted Subsidiaries taken as a whole to any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act); or

 

(4)           Casella consolidates with, or merges with or into, any Person, or any Person consolidates with, or merges with or into, Casella, in any such event pursuant to a transaction in which any of the outstanding Voting Stock of Casella is converted into or exchanged for cash, securities or other property, other than any such transaction where

 

5

 

the Voting Stock of Casella outstanding immediately prior to such transaction is converted into or exchanged for Voting Stock (other than Disqualified Capital Stock) of the surviving or transferee Person or the parent of such surviving or transferee Person representing a majority of the voting power of all Voting Stock of such surviving or transferee Person or the parent of such surviving or transferee Person immediately after giving effect to such issuance; or

 

(5)           the adoption by the stockholders of Casella of a plan or proposal for the liquidation or dissolution of Casella.

 

“ Collateral ” means all of the assets of Casella and the Guarantors, whether real, personal or mixed, with respect to which a Lien is granted (or purported to be granted) as security for any Second Lien Obligations (including proceeds and products thereof).

 

“ Commission ” means the United States Securities and Exchange Commission.

 

“ Consolidated EBITDA ” means, with respect to any Person, for any period, the sum (without duplication) of

 

(1)           Consolidated Net Income, and

 

(2)           to the extent Consolidated Net Income has been reduced thereby,

 

·                                           all income taxes of such Person and its Restricted Subsidiaries paid or accrued in accordance with GAAP for such period (other than income taxes attributable to extraordinary gains or losses or income taxes attributable to Asset Sales and other sales or dispositions outside the ordinary course of business to the extent that gains or losses from such transactions have been excluded from the computation of Consolidated Net Income),

 

·                                           Consolidated Interest Expense, and

 

·                                           Consolidated Non-cash Charges less any non-cash items increasing Consolidated Net Income for such period (except to the extent such non-cash item increasing Consolidated Net Income relates to a cash benefit for any future period),

 

all as determined on a consolidated basis for such Person and its Restricted Subsidiaries in accordance with GAAP.

 

“ Consolidated Fixed Charge Coverage Ratio ” means, with respect to any Person, the ratio of (x) Consolidated EBITDA of such Person during the four full fiscal quarters for which financial statements are available (the “ Four Quarter Period ”) ending on or prior to the Transaction Date to (y) Consolidated Fixed Charges of such Person for the Four Quarter Period.

 

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For purposes of this definition, “Consolidated EBITDA” and “Consolidated Fixed Charges” shall be calculated after giving effect on a pro forma basis in accordance with Regulation S-X under the Exchange Act to the incurrence, repayment or redemption of any Indebtedness of such Person or any of its Restricted Subsidiaries giving rise to the need to make such calculation and any incurrence, repayment or redemption of other Indebtedness, other than the incurrence, repayment or redemption of Indebtedness in the ordinary course of business for working capital purposes pursuant to working capital facilities, occurring during the Four Quarter Period or at any time subsequent to the last day of the Four Quarter Period and prior to the Transaction Date, as if such incurrence, repayment or redemption, as the case may be, occurred on the first day of the Four Quarter Period.

 

In addition, Investments (including any Designation of Unrestricted Subsidiaries), Revocations, acquisitions, dispositions, mergers and consolidations that have been made by Casella or any of its Restricted Subsidiaries during the Four Quarter Period or subsequent to the Four Quarter Period and on or prior to the Transaction Date shall be given effect on a pro forma basis in accordance with Regulation S-X under the Exchange Act, to the extent applicable, assuming that all such Investments, Revocations, acquisitions, dispositions, mergers and consolidations (and the reduction or increase of any associated Consolidated Fixed Charges and the change in Consolidated EBITDA, resulting therefrom) had occurred on the first day of the Four Quarter Period.  If, since the beginning of such period, any Person (that subsequently became a Restricted Subsidiary or was merged with or into Casella or any Restricted Subsidiary since the beginning of such period) shall have made any Investment, Revocation, acquisition, disposition, merger or consolidation that would have required adjustment pursuant to this definition, then the Consolidated Fixed Charge Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Investment, Revocation, acquisition, disposition, merger or consolidation had occurred at the beginning of the applicable Four Quarter Period.

 

If such Person or any of its Restricted Subsidiaries directly or indirectly Guarantees Indebtedness of a Person other than Casella or a Restricted Subsidiary, the preceding paragraph will give effect to the incurrence of such Guaranteed Indebtedness as if such Person or any Restricted Subsidiary of such Person had directly incurred or otherwise assumed such Guaranteed Indebtedness.

 

Furthermore, in calculating “Consolidated Fixed Charges” for purposes of determining the denominator (but not the numerator) of this “Consolidated Fixed Charge Coverage Ratio,”

 

(1)           interest on outstanding Indebtedness determined on a fluctuating basis as of the Transaction Date and which will continue to be so determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the weighted average rate of interest during the Four Quarter Period;

 

(2)           if interest on any Indebtedness actually incurred on the Transaction Date may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rates, then the interest rate in effect

 

7

 

on the Transaction Date will be deemed to have been in effect during the Four Quarter Period; and

 

(3)           notwithstanding clause (1) above, interest on Indebtedness determined on a fluctuating basis, to the extent such interest is covered by agreements relating to Hedging Obligations, shall be deemed to accrue at the weighted average rate per annum during the Four Quarter Period resulting after giving effect to the operation of such agreements.

 

“ Consolidated Fixed Charges ” means, with respect to any Person for any period, the sum, without duplication, of

 

(1)           Consolidated Interest Expense, plus

 

(2)           the amount of all dividend payments on any series of Preferred Stock of such Person and its Restricted Subsidiaries (other than dividends paid in Qualified Capital Stock and other than dividends paid to such Person or to a Restricted Subsidiary of such Person) paid, accrued or scheduled to be paid or accrued during such period ( provided that dividends paid by the increase in liquidation preference, or the issuance, of Disqualified Capital Stock shall be valued at the amount of such increase in liquidation preference or the value of the liquidation preference of such issuance, as applicable).

 

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

 

(1)           the aggregate of the interest expense of such Person and its Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP, including, without limitation,

 

·                                           any amortization of debt discount and amortization or write-off of deferred financing costs, excluding (x) the write-off of deferred financing costs as a result of the prepayments of Indebtedness on the Issue Date with the proceeds from the issuance and sale of the Notes and the Senior Credit Facility and (y) the amortization of deferred financing costs recorded as of the Issue Date in connection with the Notes and the Senior Credit Facility;

 

·                                           the net costs under Hedging Obligations;

 

·                                           all capitalized interest; and

 

·                                           the interest portion of any deferred payment obligation;

 

(2)           the interest component of Capital Lease Obligations and Attributable Debt paid, accrued and/or scheduled to be paid or accrued by such Person and its Restricted Subsidiaries during such period as determined on a consolidated basis in accordance with GAAP; and

 

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(3)           all interest on any Indebtedness of the type described in clause (a) or (b) of the concluding sentence of the first paragraph of the definition of “Indebtedness.”

 

“ Consolidated Net Income ” means, with respect to any Person (such Person, for purposes of this definition, the “ Referent Person ”), for any period, the net income (or loss) of the Referent Person and its Restricted Subsidiaries for such period on a consolidated basis, determined in accordance with GAAP; provided that there shall be excluded from such net income (loss), to the extent otherwise included therein, without duplication,

 

(1)           after-tax gains or losses on Asset Sales or other asset sales outside the ordinary course of business or abandonments or reserves relating thereto;

 

(2)           after-tax extraordinary gains or extraordinary losses determined in accordance with GAAP;

 

(3)           the net income (but not loss) of any Restricted Subsidiary of the Referent Person to the extent that the declaration of dividends or similar distributions by that Restricted Subsidiary of that income is restricted;

 

(4)           the net income or loss of any Person that is not a Restricted Subsidiary of the Referent Person except to the extent of cash dividends or distributions paid to the Referent Person or to a Wholly Owned Restricted Subsidiary of the Referent Person (subject, in the case of a dividend or distribution paid to a Restricted Subsidiary, to the limitation contained in clause (3) above);

 

(5)           any restoration to income of any contingency reserve, except to the extent that provision for such reserve was made out of Consolidated Net Income accrued at any time following the Issue Date;

 

(6)           the net income of any Person earned prior to the date it becomes a Restricted Subsidiary of the Referent Person or is merged or consolidated with the Referent Person or any Restricted Subsidiary of the Referent Person;

 

(7)           in the case of a successor to the Referent Person by consolidation or merger or as a transferee of the Referent Person’s assets, any earnings of the successor corporation prior to such consolidation, merger or transfer of assets;

 

(8)           gains or losses from the cumulative effect of any change in accounting principles, methods or interpretations;

 

(9)           the write-off of deferred financing costs as a result of the prepayments of Indebtedness on the Issue Date with the proceeds from the issuance and sale of the Notes and the Senior Credit Facility; and

 

(10)         gains or losses from the extinguishment of Indebtedness.

 

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“ Consolidated Non-cash Charges ” means, with respect to any Person, for any period, the aggregate depreciation, amortization and other non-cash charges of such Person and its Restricted Subsidiaries reducing the Consolidated Net Income of such Person and its Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP (excluding any such charges to the extent requiring an accrual of or a reserve for cash charges for any future period, but not excluding non-cash charges for closure, capping or post-closure obligations with respect to any landfills to the extent such obligations are not payable prior to the Maturity Date).

 

“ Continuing Director ” means, as of any date of determination, any member of the Board of Directors of Casella who:

 

(1)           was a member of such Board of Directors on the date of this Indenture; or

 

(2)           was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board at the time of such nomination or election.

 

“ Corporate Trust Office ” means the corporate trust office of the Trustee located at Rodney Square North, 1100 North Market Street, Wilmington, DE 19890-1600, Attention: Corporate Trust Department, or such other office, designated by the Trustee by written notice to Casella, at which at any particular time its corporate trust business shall be administered.

 

“ Coverage Ratio Exception ” has the meaning set forth in the first paragraph of Section 4.10.

 

“ Custodian ” means any receiver, trustee, assignee, liquidator, sequestrator or similar official under any Bankruptcy Law.

 

“ Default ” means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.

 

“ Deposit Account Control Agreement ” means the Deposit Account Control Agreement dated on or about the Issue Date among Casella, Bank of America, N.A., as first lien collateral agent, the Trustee, as collateral agent for the benefit of the Second Lien Secured Parties (as defined therein), Bank of America, N.A, as control agent, and Bank of America, N.A., as bank.

 

“ Depository ” means The Depository Trust Company, New York, New York, or a successor thereto registered under the Exchange Act or other applicable statute or regulation.

 

“ Discharge of First Lien Obligations ” means, subject to any reinstatement of First Lien Obligations in accordance with the Intercreditor Agreement (and subject to Sections 5.6 and 6.5 thereof), (a) payment in full in cash of the principal of and interest (including interest accruing on or after the commencement of any Insolvency or Liquidation Proceeding at the rate provided for in the respective First Lien Document, whether or not such interest would be

 

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allowed in any such Insolvency or Liquidation Proceeding) and premium, if any, on all Indebtedness under the First Lien Documents and termination of all commitments of the First Lien Lenders to lend or otherwise extend credit under the First Lien Documents, (b) payment in full in cash of all other First Lien Obligations (including letter of credit reimbursement obligations) that are due and payable or otherwise accrued and owing at or prior to the time such principal, interest, and premium are paid (other than Cash Management Obligations and Secured Hedging Obligations so long as arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made), and (c) termination or cash collateralization (in an amount and manner, and on terms, reasonably satisfactory to the First Lien Agent) of all letters of credit issued under the First Lien Credit Documents.

 

“ Disinterested Director ” means, with respect to any transaction or series of related transactions, a member of the Board of Directors of Casella who (1) does not have any material direct or indirect financial interest in or with respect to such transaction or series of related transactions and (2) is not an Affiliate, officer, director or employee of any Person (other than Casella or any Restricted Subsidiary) who has any direct or indirect financial interest in or with respect to such transaction or series of related transactions.

 

“ Disqualified Capital Stock ” means any class or series of Capital Stock of any Person that by its terms or otherwise is

 

(1)           required to be redeemed or is redeemable at the option of the holder of such class or series of Capital Stock at any time on or prior to the date that is 91 days after the Stated Maturity of the principal of the Notes; or

 

(2)           convertible into or exchangeable at the option of the holder thereof for Capital Stock referred to in clause (1) above or Indebtedness having a scheduled maturity on or prior to the date that is 91 days after the Stated Maturity of the principal of the Notes.

 

Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Capital Stock solely because the holders of the Capital Stock have the right to require the issuer thereof to repurchase such Capital Stock upon the occurrence of a “change of control” or “asset sale” will not constitute Disqualified Capital Stock if such requirement only becomes operative after compliance with such terms applicable to the Notes, including the purchase of any Notes tendered pursuant thereto.

 

“ 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).

 

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, or any successor statute or statutes thereto.

 

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“ Existing Indebtedness ” means Indebtedness of Casella and its Restricted Subsidiaries in existence on the Issue Date (after giving effect to the use of proceeds from the offering of the Notes on the Issue Date and the initial borrowings under the Senior Credit Facility as described in the Offering Memorandum under the caption “Use of Proceeds”) other than Indebtedness under the Senior Credit Facility and Indebtedness owed to Casella or any of its Subsidiaries, until such amounts are repaid.

 

“ First Lien Agent ” means the administrative agent under the Senior Credit Facility, which is Bank of America, N.A. on the Issue Date.

 

“ First Lien Credit Documents ” means the Senior Credit Facility, the other Loan Documents (as defined in the Senior Credit Facility) and each of the other agreements, documents and instruments providing for or evidencing any other First Lien Obligation and any other document or instrument executed or delivered at any time in connection with any First Lien Obligation (including any intercreditor or joinder agreement among holders of First Lien Obligations but excluding Secured Hedge Agreements and the documents governing the Cash Management Obligations), to the extent such are effective at the relevant time, as each may be amended, modified, restated, supplemented, replaced or refinanced from time to time.

 

“ First Lien Documents ” means the First Lien Credit Documents, the Secured Hedge Agreements and any and all documents governing the Cash Management Obligations.

 

“ First Lien Lenders ” means the “Lenders” from time to time party to, and as defined in, the Senior Credit Facility, together with their respective successors and assigns; provided that the term “First Lien Lender” shall in any event also include each agent, letter of credit issuer and swingline lender under the Senior Credit Facility, including, without limitation, the “L/C Issuer”, the “Swingline Lender” and any “Agent” under (and each as defined in) the Senior Credit Facility.

 

“ First Lien Obligations ” means (i) all Obligations under (and as defined in) the Senior Credit Facility and under any other document relating to the Senior Credit Facility, (ii) all Secured Hedging Obligations and (iii) all Cash Management Obligations; provided that the aggregate principal amount of, without duplication, revolving credit loans, letters of credit, term loans, other loans, notes or similar instruments (excluding, in any event, Cash Management Obligations and Secured Hedging Obligations) provided for under the Senior Credit Facility or any other document relating to the Senior Credit Facility (or any refinancing thereof) in excess of the amount permitted under clause (1) of the definition of “Permitted Debt” and any interest relating to such excess amount, shall not constitute First Lien Obligations for purposes of this Indenture.  “First Lien Obligations” shall in any event include (a) all interest (other than interest on such excess amount) accrued or accruing, or which would accrue, absent commencement of an Insolvency or Liquidation Proceeding (and the effect of provisions such as Section 502(b)(2) of the Bankruptcy Code), on or after the commencement of an Insolvency or Liquidation Proceeding in accordance with the rate specified in the relevant First Lien Document, whether or not the claim for such interest is allowed or allowable as a claim in such Insolvency or Liquidation Proceeding, (b) any and all fees and expenses (including attorneys’ and/or financial consultants’ fees and

 

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expenses) incurred by the First Lien Agent and the First Lien Secured Parties on or after the commencement of an Insolvency or Liquidation Proceeding, whether or not the claim for fees and expenses is allowed or allowable under Section 502 or 506(b) of the Bankruptcy Code or any other provision of the Bankruptcy Code or any similar federal, state or foreign law for the relief of debtors as a claim in such Insolvency or Liquidation Proceeding, and (c) all obligations and liabilities of Casella and each Guarantor under each First Lien Document to which it is a party which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due and payable (but in any event not including any obligations excluded pursuant to the proviso in the preceding sentence).

 

“ First Lien Secured Parties ” has the meaning given to the term “First-Lien Creditors” in the Intercreditor Agreement.

 

“ First-Priority Liens ” means all Liens that secure the First Lien Obligations.

 

“ Foreign Subsidiary ” means any Restricted Subsidiary of Casella organized under the laws of any jurisdiction other than the United States of America or any State thereof or the District of Columbia.

 

“ Four Quarter Period ” has the meaning set forth in the definition of “Consolidated Fixed Charge Coverage Ratio.”

 

“ Freely Tradable” has the meaning set forth in the Registration Rights Agreement.

 

“ GAAP ” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, in effect on the date of this Indenture.

 

“ Global Note ” shall mean one or more IAI Global Notes, Regulation S Global Notes and 144A Global Notes.

 

“ GreenFiber ” means US GreenFiber LLC, a Delaware limited liability company.

 

“ Guarantee ” means a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business, direct or indirect, in any manner including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof, of all or any part of any Indebtedness.

 

“ Guarantors ” means:

 

(1)           each borrower (other than Casella) or guarantor under the Senior Credit Facility as of the Issue Date; and

 

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(2)           each other Subsidiary of Casella that executes a Subsidiary Guarantee in accordance with the provisions of this Indenture;

 

and their respective successors and assigns, and in each case, until such Person is released from its Subsidiary Guarantee in accordance with the provisions of this Indenture.

 

“ Hedge Bank ” means any Person that is a First Lien Lender or an Affiliate of a First Lien Lender at the time it enters into a Secured Hedge Agreement, in its capacity as a party thereto, and such Person’s successors and assigns.

 

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

 

(1)           interest rate swap agreements, interest rate cap agreements and interest rate collar agreements, foreign currency collar agreements, foreign currency hedging agreements or foreign currency swap agreements or other similar arrangements or agreements; and

 

(2)           forward contracts, commodity swap agreements, commodity option agreements or other similar agreements or arrangements.

 

“ Holder ” or “ Noteholder ” means the registered holder of any Note.

 

“ IAI Global Note ” means a permanent global security in the form of Exhibit A hereto bearing the legend in Exhibit B and the Private Placement Legend and deposited with or on behalf of and registered in the name of the Depository or its nominee, issued in a denomination equal to the outstanding principal amount of the Notes initially sold to the Initial Purchasers as set forth in the Offering Memorandum.

 

“incur” means to directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to any Indebtedness and “incurrence” shall have a correlative meaning.  For the avoidance of doubt, the accrual of interest, accretion or amortization of original issue discount and increase in the liquidation preference of Preferred Stock in lieu of payment of cash dividends thereon shall not be an incurrence; provided , in each such case, that the amount thereof is included in Consolidated Fixed Charges of Casella as accrued in the respective period.  For the avoidance of doubt, Existing Indebtedness shall be deemed to have been incurred prior to the date of this Indenture.

 

“ Indebtedness ” means, with respect to any specified Person, any indebtedness of such Person, whether or not contingent:

 

(1)           in respect of borrowed money;

 

(2)           evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof);

 

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(3)           in respect of banker’s acceptances;

 

(4)           representing Capital Lease Obligations;

 

(5)           representing the balance deferred and unpaid of the purchase price of any property, except any such balance that constitutes an accrued expense or trade payable;

 

(6)           representing any Hedging Obligations;

 

(7)           representing any Disqualified Capital Stock of such Person and any Preferred Stock issued by a Restricted Subsidiary of such Person; or

 

(8)           in respect of Attributable Debt,

 

if and to the extent any of the preceding items (other than letters of credit, Hedging Obligations, Disqualified Capital Stock and Preferred Stock) would appear as a liability upon a balance sheet of the specified Person prepared in accordance with GAAP.  In addition, the term “Indebtedness” includes (a) all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person), and (b) to the extent not otherwise included, the Guarantee by such Person of any Indebtedness of any other Person.

 

The amount of any Indebtedness outstanding as of any date shall be:

 

(1)           the accreted value thereof, in the case of any Indebtedness issued with original issue discount;

 

(2)           the maximum fixed price upon the mandatory redemption or repurchase (including upon the option of the holder), in the case of Disqualified Capital Stock of such Person;

 

(3)           the maximum voluntary or involuntary liquidation preferences plus accrued and unpaid dividends, in the case of Preferred Stock of a Restricted Subsidiary of such Person; and

 

(4)           the principal amount thereof, together with any interest thereon that is more than 30 days past due and any premium thereon if such Indebtedness is redeemable at the option of the holder, in the case of any other Indebtedness.

 

“ Indenture ” means this Indenture, as amended or supplemented from time to time in accordance with the terms hereof.

 

“ Initial Purchasers ” means Banc of America Securities LLC, J.P. Morgan Securities Inc., Calyon Securities (USA), Inc. and Comerica Securities, Inc.

 

“ Insolvency or Liquidation Proceeding ” means (a) any voluntary or involuntary case or proceeding under the Bankruptcy Code with respect to Casella or any Guarantor, (b) any

 

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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 Casella or any Guarantor or with respect to a material portion of its respective assets, (c) any liquidation, dissolution, reorganization or winding up of Casella or any Guarantor, whether voluntary or involuntary and whether or not involving insolvency or bankruptcy or (d) any assignment for the benefit of creditors or any other marshalling of assets and liabilities of Casella or any Guarantor.

 

“ Insurance Subsidiary ” means a Wholly Owned Restricted Subsidiary of Casella organized and operated as a captive insurance subsidiary under the laws of any State of the United States.

 

“ Intellectual Property Security Agreement ” means the Second Lien Intellectual Property Security Agreement dated on or about the Issue Date among Casella, each of the guarantors party thereto from time to time and the Trustee, as collateral agent for the benefit of the Secured Parties (as defined therein).

 

“ Intercreditor Agreement ” means the Intercreditor Agreement dated on or about the Issue Date among the Second Lien Agent, the First Lien Agent, the Trustee, Casella and each other Guarantor party thereto from time to time, as such agreement may be amended, restated, supplemented or otherwise modified from time to time.

 

“ interest ” means, with respect to the Notes, interest and any Additional Interest on the Notes.

 

“ 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 forms of direct or indirect loans (including guarantees of Indebtedness or other obligations), advances or capital contributions, purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP.  “Investment” excludes (1) extensions of trade credit by Casella and its Restricted Subsidiaries on commercially reasonable terms in accordance with normal trade practices of Casella or such Restricted Subsidiary, as the case may be, and (2) any purchase, redemption or other acquisition or retirement for value of any Capital Stock of Casella or any warrants, options or other rights to purchase or acquire any such Capital Stock.  If Casella or any Restricted Subsidiary of Casella sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary of Casella such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary of Casella, Casella shall be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Equity Interests of such Restricted Subsidiary not sold or disposed of in an amount determined as provided in the penultimate paragraph of Section 4.11.  The amount of any Investment shall be the original cost of such Investment, without any adjustments for increases or decreases in value, or

 

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write-ups, write-downs or write-offs with respect to such Investment but less all cash distributions constituting a return of capital.

 

“ Issue Date ” means July 9, 2009, the date of original issuance of the Notes.

 

“ 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 (other than an operating lease), 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.

 

“ Maturity Date ” means July 15, 2014.

 

“ MERC ” means Maine Energy Recovery Corporation, Limited Partnership, a limited partnership formed under the laws of Maine.

 

“ Moody’s ” means Moody’s Investors Service, Inc. or any successor thereto.

 

“ Net Proceeds ” means the aggregate cash proceeds received by Casella or any of its Restricted Subsidiaries in respect of any Asset Sale, net of (a) the direct costs relating to such Asset Sale, including, without limitation, (i) legal, accounting and investment banking fees, and sales commissions, (ii) any relocation expenses incurred as a result thereof, and (iii) taxes paid or payable as a result thereof, in each case after taking into account any available tax credits or deductions and any tax sharing arrangements, (b) amounts required to be applied to the repayment of Indebtedness, other than subordinated Indebtedness, secured by a prior or senior Lien on the specific asset or assets being financed that were the subject of such Asset Sale, which Lien is permitted by this Indenture, (c) if the assets subject to such Asset Sale were financed by industrial revenue bonds or solid waste disposal bonds, amounts required to be applied to the repayment of such bonds (or to the repayment of Indebtedness funded by such bonds) with the proceeds of such disposition by the terms of such bonds or such Indebtedness and (d) appropriate amounts to be provided by Casella or any Restricted Subsidiary, as the case may be, as a reserve required in accordance with GAAP against any adjustment in the sale price of such asset or assets or liabilities associated with such Asset Sale and retained by Casella or any Restricted Subsidiary, as the case may be, after such Asset Sale, including, without limitation, pensions and other postemployment benefit liabilities, liabilities related to environmental matters and liabilities under any indemnification obligations associated with such Asset Sale, all as reflected in an Officer’s Certificate delivered to the Trustee; provided , however , that any amounts remaining after adjustments, revaluations or liquidations of such reserves shall constitute Net Proceeds.

 

“ Non-U.S. Person ” has the meaning assigned to such term in Regulation S.

 

“ Notes ” means, collectively, Casella’s 11% Senior Second Lien Notes due 2014 (including exchange notes issued therefor pursuant to the Registration Rights Agreement) issued

 

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in accordance with Section 2.02 (whether on the Issue Date or thereafter) treated as a single class of securities under this Indenture, as amended or supplemented from time to time in accordance with the terms of this Indenture.

 

“ Obligations ” means, with respect to any Indebtedness, the principal, premium, if any, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing such Indebtedness.

 

“ Offering Memorandum ” means the offering memorandum of Casella and the Guarantors dated July 1, 2009 relating to the Notes issued on the Issue Date.

 

“ Officer ” means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Chief Financial Officer, the Controller, or the Secretary of such Person.

 

“ Officer’s Certificate ” means a certificate conforming to the provisions of Section 12.05 signed on behalf of Casella by any one of the following:  the Chief Executive Officer, the President, the Vice President-Finance, the Chief Financial Officer, Treasurer, Controller or the Secretary of Casella and delivered to the Trustee.

 

“ 144A Global Note ” means a permanent global security in registered form representing the aggregate principal amount of Notes sold in reliance on Rule 144A under the Securities Act.

 

“ Opinion of Counsel ” means a written opinion conforming to the provisions of Section 12.05 from legal counsel who is reasonably acceptable to the Trustee.  The counsel may be an employee of or counsel to Casella, a Guarantor or the Trustee.

 

“ Permitted Business ” means the business of Casella and its Restricted Subsidiaries conducted on the Issue Date and businesses ancillary or reasonably related thereto, which, for purposes hereof, shall include the business conducted by GreenFiber and businesses ancillary or reasonably related thereto.

 

“ Permitted Investments ” means:

 

(1)           any Investment in Cash Equivalents;

 

(2)           any Investment in Casella or any Guarantor;

 

(3)           any Investment by Casella or any of its Restricted Subsidiaries in a Person, if as a result of such Investment:

 

(a)           such Person becomes a Guarantor; or

 

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(b)           such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, Casella or a Guarantor;

 

(4)           any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with the provisions of Section 4.13 or any transaction not constituting an Asset Sale by reason of the $5.0 million threshold contained in clause (1) of the definition thereof; provided that non-cash consideration received in an Asset Sale or an exchange or swap of assets shall be pledged as Collateral under the Security Documents to the extent the assets subject to such Asset Sale or exchange or swap of assets constituted Collateral, with the Lien on such Collateral securing the Notes being of the same priority with respect to the Notes as the Lien on the assets disposed of;

 

(5)           any Investment acquired in exchange for the issuance of, or acquired with the net cash proceeds of any substantially concurrent issuance and sale of, Qualified Capital Stock; provided that no such issuance or sale shall increase the Basket;

 

(6)           loans and advances in the ordinary course of business to employees, officers or directors of Casella or any of its Restricted Subsidiaries in an aggregate amount, when taken together with all other Investments made pursuant to this clause (6) since the date of this Indenture, not to exceed $2.0 million at any one time outstanding;

 

(7)           Hedging Obligations permitted by clause (6) of the second paragraph of Section 4.10;

 

(8)           Investments in securities of trade creditors or customers received in settlement of obligations or upon the bankruptcy or insolvency of such trade creditors or customers pursuant to any plan of reorganization or similar arrangement;

 

(9)           other Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (9) since the date of this Indenture, not exceeding $15.0 million at any one time outstanding; and

 

(10)         Investments in an Insurance Subsidiary having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (10) since the date of this Indenture, not exceeding $20.0 million at any one time outstanding.

 

The amount of Investments outstanding at any time pursuant to clause (9) above shall be deemed to be reduced, without duplication:

 

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(a)                                   upon the disposition or repayment of or return on any Investment made pursuant to clause (9) above, by an amount equal to the return of capital with respect to such Investment to Casella or any of its Restricted Subsidiaries (to the extent not included in the computation of Consolidated Net Income), less the cost of the disposition of such Investment and net of taxes;

 

(b)                                  upon a redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, by an amount equal to the lesser of (x) the fair market value of Casella’s proportionate interest in such Subsidiary immediately following such redesignation, and (y) the aggregate amount of Investments in such Subsidiary that increased (and did not previously decrease) the amount of Investments outstanding pursuant to clause (9) above; and

 

(c)                                   upon the making of an Investment in a Person that was not a Restricted Subsidiary of Casella immediately prior to the making of such Investment but that subsequently becomes a Restricted Subsidiary of Casella, by an amount equal to the lesser of (x) the fair market value of Casella’s proportionate interest in such Subsidiary immediately following such redesignation, and (y) the aggregate amount of Investments in such Subsidiary that increased (and did not previously decrease) the amount of Investments outstanding pursuant to clause (9) above.

 

“ Permitted Liens ” means:

 

(1)                                   Liens on the Collateral securing:

 

(a)                                   the Notes, the Subsidiary Guarantees thereof and other Obligations under this Indenture and in respect thereof and any obligations owing to the Trustee or the Second Lien Agent under this Indenture or the Security Documents; or

 

(b)                                  the First Lien Obligations;

 

(2)                                   Liens in favor of Casella or any Restricted Subsidiary;

 

(3)                                   Liens on property of a Person existing at the time such Person is merged with or into or consolidated with Casella or any Restricted Subsidiary of Casella; provided that such Liens were in existence prior to the contemplation of such merger or consolidation and do not extend to any assets other than those of the Person merged into or consolidated with Casella or its Restricted Subsidiary;

 

(4)                                   Liens on property existing at the time of acquisition thereof by Casella or any Restricted Subsidiary of Casella; provide d that such Liens were in existence prior to the contemplation of such acquisition and do not extend to any assets other than the property so acquired;

 

(5)                                   Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business;

 

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(6)                                   Liens to secure Indebtedness permitted by clause (3) of the second paragraph of Section 4.10; provided that no such Liens shall extend to any asset other than the specified asset being financed and additions and improvements thereon;

 

(7)                                   Liens existing on the date of this Indenture and continuation statements with respect to such Liens filed in accordance with the provisions of the Uniform Commercial Code or similar state commercial codes;

 

(8)                                   judgment Liens not giving rise to an Event of Default so long as such Lien is adequately bonded and any appropriate legal proceedings which may have been duly initiated for the review of such judgment shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired;

 

(9)                                   Liens securing Permitted Refinancing Indebtedness which is incurred to refinance any Indebtedness which has been secured by a Lien permitted under this Indenture and which has been incurred in accordance with the provisions of this Indenture; provided that such Liens (a) are not materially less favorable to the Holders and are not materially more favorable to the lienholders with respect to such Liens than the Liens in respect of the Indebtedness being refinanced and (b) do not extend to or cover any property or assets of Casella or any of its Restricted Subsidiaries not securing the Indebtedness so refinanced;

 

(10)                             Liens upon specific items of inventory or 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;

 

(11)                             Liens securing reimbursement obligations with respect to letters of credit which encumber documents and other property relating to such letters of credit and products and proceeds thereof;

 

(12)                             Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded, provided that any reserve or other appropriate provision as shall be required in conformity with GAAP shall have been made therefor;

 

(13)                             Liens securing Hedging Obligations;

 

(14)                             deposits or pledges made in connection with, or to secure payment of, workmen’s compensation, unemployment insurance, old age pensions or other social security obligations;

 

(15)                             Liens of carriers, warehousemen, mechanics and materialmen, and other like liens incurred in the ordinary course of business;

 

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(16)                             Liens on any landfill acquired after the Issue Date securing reasonable royalty or similar payments (determined by reference to volume or weight utilized) due to the seller of such landfill as a consequence of such acquisition; and

 

(17)                             other Liens incurred in the ordinary course of business of Casella or any Restricted Subsidiary of Casella with respect to obligations that do not exceed $5.0 million at any one time outstanding.

 

“ Permitted Refinancing Indebtedness ” means any Indebtedness of Casella or any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to refinance other Indebtedness of Casella or any of its Restricted Subsidiaries; provided that:

 

(1)                                   the principal amount (or accreted value, if applicable) or liquidation preference of such Permitted Refinancing Indebtedness does not exceed the principal amount of (or accreted value, if applicable), plus accrued interest and premium, if any, on the Indebtedness, or the liquidation preference, plus accrued dividends and premium, if any, on the Preferred Stock, so refinanced (plus the amount of reasonable expenses incurred in connection therewith);

 

(2)                                   such Permitted Refinancing Indebtedness has a final maturity date, or mandatory redemption date, later than the final maturity date, or mandatory redemption date as applicable, of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness or Preferred Stock being refinanced;

 

(3)                                   if the Indebtedness being refinanced is subordinated in right of payment to the Notes or the Subsidiary Guarantees, such Permitted Refinancing Indebtedness is subordinated in right of payment to the Notes or the Subsidiary Guarantees, as applicable, on terms at least as favorable to the Holders of Notes as those contained in the documentation governing the Indebtedness being refinanced;

 

(4)                                   if the Indebtedness being refinanced ranks pari passu with the Notes or the Subsidiary Guarantees, such Permitted Refinancing Indebtedness ranks pari passu with, or is subordinated in right of payment to, the Notes or the Subsidiary Guarantees, as applicable;

 

(5)                                   Preferred Stock shall be refinanced only with Preferred Stock; and

 

(6)                                   the obligor(s) on the Permitted Refinancing Indebtedness thereof shall include only obligor(s) on such Indebtedness being refinanced, Casella and/or one or more of the Guarantors.

 

“ Person ” means an individual, partnership, corporation, limited liability company, firm, association, joint stock company, unincorporated organization, trust, bank, trust company, land trust, business trust or other enterprise, joint venture or a governmental agency or political subdivision thereof or other entity.

 

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“ Pledge Agreement ” means the Second Lien Pledge Agreement dated on or about the Issue Date among Casella, each of the guarantors from time to time party thereto and the Trustee, as collateral agent for the benefit of the Secured Parties (as defined therein).

 

“ Preferred Stock ” of any Person means any Capital Stock of such Person that has preferential rights to any other Capital Stock of such Person with respect to dividends or redemption or upon liquidation.

 

“ Private Placement Legend ” means the legends initially set forth on the Notes in the form set forth in Exhibit B .

 

“ Public Equity Offering ” means any underwritten public offering of common stock of Casella.

 

“ Purchase Money Obligations ” means Indebtedness of Casella or any of its Restricted Subsidiaries incurred for the purpose of financing all or any part of the purchase price, or the cost of construction or improvement, of any assets to be used in the business of Casella or such Restricted Subsidiary; provided, however, that (1) the aggregate amount of such Indebtedness shall not exceed such purchase price or cost, (2) such Indebtedness shall be incurred no later than 180 days after the acquisition of such assets or such construction or improvement and (3) such Indebtedness shall not be secured by any assets of Casella or any of its Restricted Subsidiaries other than the assets so acquired, constructed or improved.

 

“ Qualified Capital Stock ” means any Capital Stock of Casella that is not Disqualified Capital Stock.

 

“ Qualified Institutional Buyer ” or “ QIB ” shall have the meaning specified in Rule 144A under the Securities Act.

 

“ Record Date ” means the applicable Record Date specified in the Notes; provided that if any such date is not a Business Day, the Record Date shall be the first day immediately preceding such specified day that is a Business Day.

 

“ Redemption Date ,” when used with respect to any Note to be redeemed, means the date fixed for such redemption pursuant to this Indenture and the Notes.

 

“ Redemption Price ,” when used with respect to any Note to be redeemed, means the price fixed for such redemption, payable in immediately available funds, pursuant to this Indenture and the Notes.

 

“ refinance ” means to extend, refinance, renew, replace, defease or refund, including successively; and “refinancing” and “refinanced” shall have correlative meanings.

 

“ Registration Rights Agreement ” means (i) the Registration Rights Agreement dated as of the Issue Date among Casella, the Guarantors and the Initial Purchasers and (ii) any

 

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other registration rights agreement entered into in connection with an issuance of Additional Notes in a private offering after the Issue Date.

 

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

 

“ Regulation S Global Note ” means a permanent global security in registered form representing the aggregate principal amount of Notes sold in reliance on Regulation S under the Securities Act.

 

“ Responsible Officer ” means, when used with respect to the Trustee, any officer in the Corporate Trust Department of the Trustee to whom any corporate trust matter is referred because of such officer’s knowledge of and familiarity with the particular subject and shall also mean any officer who shall have direct responsibility for the administration of this Indenture.

 

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

 

“ Restricted Security ” means a Note that constitutes a “Restricted Security” within the meaning of Rule 144(a)(3) under the Securities Act; provided , however , that the Trustee shall be entitled to request and conclusively rely on an Opinion of Counsel with respect to whether any Note constitutes a Restricted Security.

 

“ Restricted Subsidiary ” of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary.

 

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

 

“ S&P ” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., or any successor thereto.

 

“ Sale and Leaseback Transaction ” means an arrangement relating to property now owned or hereafter acquired whereby Casella or a Restricted Subsidiary of Casella transfers such property to a Person and Casella or a Restricted Subsidiary of Casella leases it from such Person.

 

“ Second Lien Agent ” means Wilmington Trust Company, as collateral agent for the benefit of the Trustee and Holders of the Notes.

 

“ Second Lien Obligations ” means all Indebtedness and other Obligations with respect to the Notes issued under this Indenture and the Subsidiary Guarantees thereof.  “Second Lien Obligations” shall in any event include (a) all interest accrued or accruing, or which would accrue, absent commencement of an Insolvency or Liquidation Proceeding (and the effect of provisions such as Section 502(b)(2) of the Bankruptcy Code), on or after the commencement of an Insolvency or Liquidation Proceeding in accordance with the rate specified in this Indenture, whether or not the claim for such interest is allowed or allowable as a claim in such Insolvency or Liquidation Proceeding, (b) any and all fees and expenses (including attorneys’ and/or

 

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financial consultants’ fees and expenses) incurred by the Second Lien Agent and the Holders on or after the commencement of an Insolvency or Liquidation Proceeding, whether or not the claim for fees and expenses is allowed or allowable under Section 502 or 506(b) of the Bankruptcy Code or any other provision of the Bankruptcy Code or any similar federal, state or foreign law for the relief of debtors as a claim in such Insolvency or Liquidation Proceeding, and (c) all obligations and liabilities of Casella and each Guarantor under this Indenture, the Notes or the Subsidiary Guarantees which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due and payable.

 

“ Second-Priority Liens ” means all Liens on the Collateral that secure the Second Lien Obligations.

 

“ Secured Hedge Agreements ” means each agreement that governs Hedging Obligations by and between Casella or any Guarantor, on the one hand, and any Hedge Bank from time to time, but only to the extent such agreement is permitted under the Senior Credit Facility and constitutes an “Obligation” (as such term is defined under the Senior Credit Facility); provided, however, that such Hedging Obligations shall not, solely by virtue of constituting an “Obligation” (as so defined), also constitute Indebtedness under the Senior Credit Facility.

 

“ Secured Hedging Obligations ” means (i) obligations (including obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities, whether now existing or hereafter arising (including, without limitation, indemnities, fees and interest thereon and all interest and fees that accrue on or after the commencement of any Insolvency or Liquidation Proceeding at the rate provided for in the respective Secured Hedge Agreement, whether or not a claim for post-petition interest or fees is allowed in any such Insolvency or Liquidation Proceeding), of Casella or any Guarantor owing to any Hedge Bank, now existing or hereafter incurred under, or arising out of or in connection with, any Secured Hedge Agreement (including all such obligations and Indebtedness under any guarantee of any such Secured Hedge Agreement to which Casella or such Guarantor is a party) and (ii) all performance and compliance obligations by Casella or any Guarantor under any Secured Hedge Agreement.

 

“ Security Agreement ” means the Second Lien Security Agreement dated on or about the Issue Date among Casella, each of the guarantors from time to time party thereto and the Trustee, as collateral agent for the benefit of the Secured Parties (as defined therein).

 

“ Security Documents ” means (i) the Intercreditor Agreement, (ii) the Security Agreement, (iii) the Pledge Agreement, (iv) the Intellectual Property Security Agreement and (v) the other security agreements, pledge agreements, mortgages, deeds of trust, collateral assignments, control agreements and related agreements (including, without limitation, financing statements under the UCC) granting a security interest in any assets of any Person to secure the Second Lien Obligations as each may be amended, restated, supplemented or otherwise modified from time to time.

 

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“ Securities Act ” means the Securities Act of 1933, as amended, or any successor statute or statutes thereto.

 

“ Senior Credit Facility ” means the Second Amended and Restated Credit Agreement, dated on or about the Issue Date, among Casella, the Guarantors, Bank of America, N.A., as administrative agent, and the lenders and other agents party thereto, including any notes, guarantees, collateral and security documents (including mortgages, pledge agreements and other security arrangements), instruments and agreements executed in connection therewith, and in each case as amended or refinanced from time to time, including any agreement or agreements extending the maturity of, refinancing or otherwise restructuring (including increasing the amount of borrowings or other Indebtedness outstanding or available to be borrowed thereunder) all or any portion of the Indebtedness under such agreement, and any successor or replacement agreement or agreements with the same or any other borrowers, agents, creditors, lenders or group of creditors or lenders.

 

“ Senior Subordinated Notes ” means Casella’s 9.75% Senior Subordinated Notes due 2013 outstanding on the Issue Date.

 

“ Significant Subsidiary ” means (1) 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 Act, as such Regulation is in effect on the date hereof or (2) any Restricted Subsidiary that, when aggregated with all other Restricted Subsidiaries that are not otherwise Significant Subsidiaries and as to which any event described in clause (7), (8) or (9) of Section 6.01 has occurred and is continuing, would constitute a Significant Subsidiary under clause (1) of this definition.

 

“ Specified Assets ” means K-C International Ltd., the brokerage business of Casella Recycling LLC (f/k/a KTI Recycling of New England Inc.), U.S. GreenFiber, LLC, KTI New Jersey Fibers, Inc., Atlantic Coast Fibers, Inc., Casella RTG Investors Co. LLC and RecycleRewards, Inc. (the parent company of RecycleBank, LLC), and the companies and assets comprising the FCR operating segment, or the successors of the foregoing only with respect to the businesses conducted by the foregoing on the date of this Indenture.

 

“ Stated Maturity ” means, with respect to any installment of interest or principal on any Indebtedness, the date on which such payment of interest or principal is scheduled to be paid in the documentation governing such Indebtedness, and shall not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.

 

“ Subsidiary ” means, with respect to any Person:

 

(1)                                   any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees

 

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thereof is at the time 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 (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are such Person or of one or more Subsidiaries of such Person (or any combination thereof).

 

“ Subsidiary Guarantee ” means the Guarantee by each Guarantor of Casella’s payment obligations under this Indenture and the Notes, executed pursuant to this Indenture.

 

“ TIA ” means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb), as amended, as in effect on the date of the execution of this Indenture until such time as this Indenture is qualified under the TIA, and thereafter as in effect on the date on which this Indenture is qualified under the TIA, except as otherwise provided in Section 9.04.

 

“ Transaction Date ” means the date of the transaction giving rise to the need to calculate the Consolidated Fixed Charge Coverage Ratio.

 

“ transfer ” means to sell, assign, transfer, lease (other than pursuant to an operating lease entered into in the ordinary course of business), convey or otherwise dispose of, including by Sale and Leaseback Transaction, consolidation, merger or otherwise.

 

“ Trustee ” means the party named as such in this Indenture until a successor replaces it in accordance with the provisions of this Indenture and thereafter means such successor.

 

“ Uniform Commercial Code ” or “ UCC ” means the Uniform Commercial Code as in effect in the applicable jurisdiction.

 

“ Unrestricted Subsidiary ” of any Person means

 

·                   any Subsidiary of such Person that at the time of determination has been designated an Unrestricted Subsidiary, and has not been redesignated a Restricted Subsidiary, in accordance with Section 4.19; and

 

·                   any Subsidiary of such Unrestricted Subsidiary.

 

“ U.S. Government Obligations ” means direct obligations of, and obligations guaranteed by, the United States of America for the payment of which the full faith and credit of the United States of America is pledged and which are not callable or redeemable at the issuer’s option.

 

“ U.S. Legal Tender ” means such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts.

 

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“ Voting Stock ” of any Person as of any date means the Capital Stock of such Person that is entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees of such Person.

 

“ Weighted Average Life to Maturity ” means, when applied to any Indebtedness or Disqualified Capital Stock at any date, the number of years obtained by dividing:

 

(1)                                   the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal or liquidation preference, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by

 

(2)                                   the then outstanding principal amount or liquidation preference of such Indebtedness or Disqualified Capital Stock.

 

“ Wholly Owned Restricted Subsidiary ” of any Person means a Restricted Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares) shall at the time be owned by such Person and/or by one or more Wholly Owned Restricted Subsidiaries of such Person.

 

SECTION 1.02.                                                      Other Definitions .

 

Term		Defined in Section
“Affiliate Transaction”		4.14
“Alternate Offer”		4.09
“Asset Sale Offer”		4.13
“Asset Sale Offer Amount”		4.13
“Asset Sale Payment”		4.13
“Asset Sale Payment Date”		4.13
“Basket”		4.11
“Change of Control Offer”		4.09
“Change of Control Payment”		4.09
“Change of Control Payment Date”		4.09

 

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Term		Defined in Section
“Covenant Defeasance”		8.02
“Designation”		4.19
“Event of Default”		6.01
“Excess Proceeds”		4.13
“Guarantee Obligations”		11.01
“Institutional Accredited Investor”		2.16
“Legal Defeasance”		8.02
“Pari Passu Debt”		4.13
“Participants”		2.15
“Paying Agent”		2.03
“Payment Default”		6.01
“Permitted Debt”		4.10
“Physical Notes”		2.01
“Registrar”		2.03
“Replacement Assets”		4.13
“Restricted Payments”		4.11
“Revocation”		4.19
“Senior Subordinated Notes Indenture”		12.15
“Surviving Person”		5.01

 

SECTION 1.03.                                                      Incorporation by Reference of TIA .

 

Whenever this Indenture refers to a provision of the TIA, such provision is incorporated by reference in, and made a part of, this Indenture.  The following TIA terms used in this Indenture have the following meanings:

 

“ indenture securities ” means the Notes.

 

“ indenture security holder ” means a Holder or a Noteholder.

 

“ indenture to be qualified ” means this Indenture.

 

“ indenture trustee ” or “ institutional trustee ” means the Trustee.

 

“ obligor ” on the indenture securities means Casella, any Guarantor or any other obligor on the Notes.

 

All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by Commission rule and not otherwise defined herein have the meanings assigned to them therein.

 

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SECTION 1.04.                   Rules of Construction .

 

Unless the context otherwise requires:

 

(1)            a term has the meaning assigned to it;

 

(2)            an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

 

(3)            “or” is not exclusive;

 

(4)            words in the singular include the plural, and words in the plural include the singular;

 

(5)            provisions apply to successive events and transactions;

 

(6)            “herein,” “hereof” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision; and

 

(7)            the words “including,” “includes” and similar words shall be deemed to be followed by “without limitation.”

 

ARTICLE TWO

 

THE NOTES

 

SECTION 2.01.                   Form and Dating .

 

The Notes and the Trustee’s certificate of authentication shall be substantially in the form of Exhibit A hereto.  The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage.  Casella shall approve the form of the Notes and any notation, legend or endorsement on them.  Each Note shall be dated the date of its issuance and show the date of its authentication.  Each Note shall have an executed Subsidiary Guarantee from each of the Guarantors endorsed thereon substantially in the form of Exhibit E .

 

The terms and provisions contained in the Notes and the Subsidiary Guarantees shall constitute, and are hereby expressly made, a part of this Indenture and, to the extent applicable, Casella, the Guarantors and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby.

 

Notes offered and sold in reliance on Rule 144A and Notes offered and sold in reliance on Regulation S shall be issued initially in the form of one or more Global Notes, substantially in the form set forth in Exhibit A , deposited with the Trustee, as custodian for the Depository, duly executed by Casella (and having an executed Subsidiary Guarantee from each of the

 

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Guarantors endorsed thereon) and authenticated by the Trustee as hereinafter provided and shall bear the legends set forth in Exhibit B .  Each Global Note shall represent such of the outstanding Notes as shall be specified therein and shall provide that it shall represent the aggregate amount of outstanding Notes from time to time endorsed thereon and that the aggregate amount of outstanding Notes represented thereby may from time to time be increased or decreased, as appropriate, to reflect exchanges, redemptions and transfers of interests.  Any endorsement of a Global Note to reflect the amount of any increase or decrease in the amount of outstanding Notes represented thereby shall be made by the Trustee in accordance with written instructions given by the Holder thereof as required by Section 2.06 hereof.

 

Notes issued in exchange for interests in a Global Note pursuant to Section 2.16 may be issued in the form of permanent certificated Notes in registered form in substantially the form set forth in Exhibit A (the “ Physical Notes ”).

 

Additional Notes ranking pari   passu with the Notes issued on the Issue Date may be created and issued from time to time by Casella without notice to or consent of the Holders and shall be consolidated with and form a single class with the Notes issued on the Issue Date and shall have the same terms as to status, redemption or otherwise as the Notes issued on the Issue Date (other than issue date, issue price, initial interest payment date and initial interest record date); provided that Casella’s ability to issue Additional Notes shall be subject to Casella’s compliance with Sections 4.10 and 4.12 hereof.

 

SECTION 2.02.                   Execution and Authentication .

 

One Officer of Casella (who shall have been duly authorized by all requisite corporate actions) shall sign the Notes for Casella by manual or facsimile signature.

 

If an Officer whose signature is on a Note or Subsidiary Guarantee, as the case may be, was an Officer at the time of such execution but no longer holds that office at the time the Trustee authenticates the Note, the Note shall nevertheless be valid.

 

A Note shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Note.  The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.

 

The Trustee shall authenticate Notes for original issue on the Issue Date in the aggregate principal amount of $180,000,000 upon a written order of Casella in the form of an Officer’s Certificate which shall be in a form reasonably acceptable to the Trustee.  In addition, the Trustee shall authenticate Additional Notes thereafter in unlimited amount (so long as not otherwise prohibited by the terms of this Indenture, including without limitation, Sections 4.10 and 4.12) for original issue upon a written order of Casella in the form of an Officer’s Certificate which shall be in a form reasonably acceptable to the Trustee.  Each such Officer’s Certificate shall specify the amount of Notes to be authenticated and the date on which the Notes are to be authenticated.

 

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The Trustee may appoint an authenticating agent reasonably acceptable to Casella to authenticate Notes.  Unless otherwise provided in the appointment, an authenticating agent may authenticate Notes whenever the Trustee may do so.  Each reference in this Indenture to authentication by the Trustee includes authentication by such agent.  An authenticating agent has the same rights as an Agent to deal with Casella and Affiliates of Casella.

 

The Notes shall be issuable only in registered form without coupons in denominations of $2,000 and integral multiples of $1,000 in excess thereof.

 

SECTION 2.03.                   Registrar and Paying Agent .

 

Casella shall maintain an office or agency where (a) Notes may be presented or surrendered for registration of transfer or for exchange (“ Registrar ”), (b) Notes may be presented or surrendered for payment (“ Paying Agent ”) and (c) notices and demands to or upon Casella in respect of the Notes and this Indenture may be served.  Casella may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided , however , that no such designation or rescission shall in any manner relieve Casella of its obligation to maintain an office or agency for such purposes.  Casella may act as its own Registrar or Paying Agent, except that for the purposes of Articles Three and Eight and Sections 4.09 and 4.13, neither Casella nor any Affiliate of Casella shall act as Paying Agent.  The Registrar shall keep a register of the Notes and of their transfer and exchange.  Casella, upon notice to the Trustee, may have one or more co-Registrars and one or more additional paying agents reasonably acceptable to the Trustee.  The term “Paying Agent” includes any additional paying agent.  Casella initially appoints the Trustee as Registrar and Paying Agent until such time as the Trustee has resigned or a successor has been appointed.

 

Casella shall enter into an appropriate agency agreement with any Agent not a party to this Indenture, which agreement shall implement the provisions of this Indenture that relate to such Agent.  Casella shall notify the Trustee, in advance, of the name and address of any such Agent.  If Casella fails to maintain a Registrar or Paying Agent, the Trustee shall act as such.

 

SECTION 2.04.                   Paying Agent To Hold Assets in Trust.

 

Casella shall require each Paying Agent other than the Trustee to agree in writing that each Paying Agent shall hold in trust for the benefit of Holders or the Trustee all assets held by the Paying Agent for the payment of principal of, or interest on, the Notes (whether such assets have been distributed to it by Casella or any other obligor on the Notes), and shall notify the Trustee of any Default by Casella (or any other obligor on the Notes) in making any such payment.  Casella at any time may require a Paying Agent to distribute all assets held by it to the Trustee and account for any assets disbursed and the Trustee may at any time during the continuance of any payment Default, upon written request to a Paying Agent, require such Paying Agent to distribute all assets held by it to the Trustee and to account for any assets distributed.  Upon

 

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distribution to the Trustee of all assets that shall have been delivered by Casella to the Paying Agent, the Paying Agent shall have no further liability for such assets.

 

SECTION 2.05.                   Holder Lists .

 

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders.  If the Trustee is not the Registrar, Casella shall furnish to the Trustee at least two (2) Business Days prior to each Interest Payment Date and at such other times as the Trustee may request in writing a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders, which list may be conclusively relied upon by the Trustee.

 

SECTION 2.06.                   Transfer and Exchange .

 

When Notes are presented to the Registrar or a co-Registrar with a request to register the transfer of such Notes or to exchange such Notes for an equal principal amount of Notes of other authorized denominations, the Registrar or co-Registrar shall register the transfer or make the exchange as requested if its requirements for such transaction are met; provided , however , that the Notes surrendered for transfer or exchange shall be duly endorsed or accompanied by a written instrument of transfer in form satisfactory to Casella, which Casella shall confirm to the Registrar or co-Registrar in writing, and the Registrar or co-Registrar, duly executed by the Holder thereof or his or her attorney duly authorized in writing.  To permit registrations of transfers and exchanges, Casella shall prepare and execute new Notes if such transfer or exchange is permitted hereunder and the Trustee shall, upon written order of Casella in the form of an Officer’s Certificate, which shall be in a form reasonably acceptable to the Trustee, authenticate Notes.  No service charge shall be made for any registration of transfer or exchange, but Casella may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith.

 

The Registrar or co-Registrar shall not be required to register the transfer of or exchange of any Note (i) during a period beginning at the opening of business 15 days before the mailing of a notice of redemption of Notes and ending at the close of business on the day of such mailing, (ii) selected for redemption in whole or in part pursuant to Article Three, except the unredeemed portion of any Note being redeemed in part, and (iii) during a Change of Control Offer, an Alternate Offer or an Asset Sale Offer if such Note is tendered pursuant to such Change of Control Offer, Alternate Offer or Asset Sale Offer and not withdrawn.

 

Any Holder of a beneficial interest in a Global Note shall, by acceptance of such beneficial interest, agree that transfers of beneficial interests in such Global Notes may be effected only through a book-entry system maintained by the Holder of such Global Note (or its agent), and that ownership of a beneficial interest in the Note shall be required to be reflected in a book-entry system.

 

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SECTION 2.07.                   Replacement Notes .

 

If a mutilated Note is surrendered to the Trustee or if the Holder of a Note claims that the Note has been lost, destroyed or wrongfully taken, Casella shall issue and, upon written order of Casella in the form of an Officer’s Certificate, which shall be in a form reasonably acceptable to the Trustee, the Trustee shall authenticate a replacement Note if the Trustee’s requirements are met.  Such Holder must provide an indemnity bond or other indemnity, sufficient in the judgment of both Casella and the Trustee, to protect Casella, the Trustee or any Agent from any loss which any of them may suffer if a Note is replaced.  Casella may charge such Holder for its reasonable out-of-pocket expenses in replacing a Note pursuant to this Section 2.07, including reasonable fees and expenses of counsel and of the Trustee.

 

Every replacement Note is an additional obligation of Casella and every replacement Subsidiary Guarantee shall constitute an additional obligation of the Guarantor thereof.

 

SECTION 2.08.                   Outstanding Notes .

 

Notes outstanding at any time are all the Notes that have been authenticated by the Trustee except those cancelled by it, those delivered to it for cancellation and those described in this Section as not outstanding.  A Note does not cease to be outstanding because Casella, the Guarantors or any of their respective Affiliates holds the Note (subject to the provisions of Section 2.09).

 

If a Note is replaced pursuant to Section 2.07 (other than a mutilated Note surrendered for replacement), it ceases to be outstanding unless a Responsible Officer of the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.  A mutilated Note ceases to be outstanding upon surrender of such Note and replacement thereof pursuant to Section 2.07.

 

If the principal amount of any Note is considered paid under Section 4.01, it ceases to be outstanding and interest ceases to accrue.  If on a Redemption Date or the Maturity Date the Trustee or Paying Agent (other than Casella or an Affiliate thereof) holds U.S. Legal Tender or U.S. Government Obligations sufficient to pay all of the principal and interest due on the Notes payable on that date, then on and after that date such Notes cease to be outstanding and interest on them ceases to accrue.

 

SECTION 2.09.                   Treasury Notes .

 

In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by Casella or any of its Affiliates shall be disregarded, except that, for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that a Responsible Officer of the Trustee actually knows are so owned shall be disregarded.

 

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SECTION 2.10.                   Temporary Notes .

 

Until definitive Notes are ready for delivery, Casella may prepare and the Trustee shall, upon written order of Casella in the form of an Officer’s Certificate, which shall be in a form reasonably acceptable to the Trustee, authenticate temporary Notes.  Temporary Notes shall be substantially in the form of definitive Notes but may have variations that Casella considers appropriate for temporary Notes.  Without unreasonable delay, Casella shall prepare and the Trustee shall, upon written order of Casella in the form of an Officer’s Certificate, which shall be in a form reasonably acceptable to the Trustee, authenticate definitive Notes in exchange for temporary Notes.  Until such exchange, temporary Notes shall be entitled to the same rights, benefits and privileges as definitive Notes.  Notwithstanding the foregoing, so long as the Notes are represented by a Global Note, such Global Note may be in typewritten form.

 

SECTION 2.11.                   Cancellation .

 

Casella at any time may deliver Notes to the Trustee for cancellation.  The Registrar and the Paying Agent shall forward to the Trustee any Notes surrendered to them for transfer, exchange or payment.  The Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent (other than Casella or a Subsidiary), and no one else, shall cancel and, at the written direction of Casella, shall dispose of all Notes surrendered for transfer, exchange, payment or cancellation in accordance with its customary procedures.  Subject to Section 2.07, Casella may not issue new Notes to replace Notes that it has paid or delivered to the Trustee for cancellation.  If Casella or any Guarantor shall acquire any of the Notes, such acquisition shall not operate as a redemption or satisfaction of the Indebtedness represented by such Notes unless and until the same are surrendered to the Trustee for cancellation pursuant to this Section 2.11.

 

SECTION 2.12.                   Defaulted Interest .

 

If Casella defaults in a payment of interest on the Notes, it shall, unless the Trustee fixes another record date pursuant to Section 6.10, pay the defaulted interest, plus (to the extent lawful) any interest payable on the defaulted interest, in any lawful manner.  Casella may pay the defaulted interest to the persons who are Holders on a subsequent special record date, which date shall be the fifteenth day next preceding the date fixed by Casella for the payment of defaulted interest or the next succeeding Business Day if such date is not a Business Day.  At least 15 days before any such subsequent special record date, Casella shall mail to each Holder, with a copy to the Trustee, a notice that states the subsequent special record date, the payment date and the amount of defaulted interest, and interest payable on such defaulted interest, if any, to be paid.

 

SECTION 2.13.                   CUSIP Number .

 

Casella in issuing the Notes may use a “CUSIP” number, and if so, the Trustee shall use the CUSIP number in notices of redemption or exchange as a convenience to Holders; provided , however , that any such notice may state that no representation is made as to the correctness or accuracy of the CUSIP number printed in the notice or on the Notes, and that reliance

 

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may be placed only on the other identification numbers printed on the Notes.  Casella will promptly notify the Trustee of any change in the CUSIP numbers.

 

SECTION 2.14.                   Deposit of Moneys .

 

Prior to 10:00 a.m. New York City time on each Interest Payment Date, Maturity Date, Redemption Date, Change of Control Payment Date and Asset Sale Offer Payment Date, Casella shall have deposited with the Paying Agent in immediately available funds money sufficient to make cash payments, if any, due on such Interest Payment Date, Maturity Date, Redemption Date, Change of Control Payment Date and Asset Sale Offer Payment Date, as the case may be, in a timely manner which permits the Paying Agent to remit payment to the Holders on such Interest Payment Date, Maturity Date, Redemption Date, Change of Control Payment Date and Asset Sale Offer Payment Date, as the case may be.

 

SECTION 2.15.                   Book-Entry Provisions for Global Notes .

 

(a)            The Global Notes initially shall (i) be registered in the name of the Depository or the nominee of such Depository, (ii) be delivered to the Trustee as custodian for such Depository and (iii) bear legends as set forth in Exhibit B .

 

Members of, or participants in, the Depository (“ Participants ”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by the Depository, or the Trustee as its custodian, or under the Global Note, and the Depository may be treated by Casella, the Trustee and any agent of Casella or the Trustee as the absolute owner of the Global Note for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall prevent Casella, the Trustee or any agent of Casella or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depository or impair, as between the Depository and Participants, the operation of customary practices governing the exercise of the rights of a Holder of any Note.

 

(b)            Transfers of Global Notes shall be limited to transfers in whole, but not in part, to the Depository, its successors or their respective nominees.  Physical Notes shall be issued to all beneficial owners in exchange for their beneficial interests in Global Notes only if (i) the Depository notifies Casella that it is unwilling or unable to continue as Depository for any Global Note and a successor Depository is not appointed by Casella, with a copy to the Trustee, within 90 days of such notice or (ii) an Event of Default has occurred and is continuing and the Registrar has received a written request from the Depository to issue Physical Notes.

 

(c)            In connection with any transfer or exchange of a portion of the beneficial interest in a Global Note to beneficial owners pursuant to paragraph (b) of this Section 2.15 upon written order of Casella to do so, the Registrar shall (if one or more Physical Notes are to be issued) reflect on its books and records the date and a decrease in the principal amount of such Global Note in an amount equal to the principal amount of the beneficial interest in the Global Note to be transferred, and Casella shall prepare and execute the applicable Notes if such transfer is permitted hereunder, and the Trustee shall, upon written order of Casella in the form of an Officer’s

 

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Certificate, which shall be in a form reasonably acceptable to the Trustee, authenticate and deliver, one or more Physical Notes of authorized denominations in an aggregate principal amount equal to the principal amount of the beneficial interest in the Global Note so transferred.

 

(d)            In connection with the transfer of a Global Note as an entirety to beneficial owners pursuant to paragraph (b) of this Section 2.15, such Global Note shall be deemed to be surrendered to the Trustee for cancellation, and (i) Casella shall prepare and execute, (ii) the Guarantors shall execute notations of Subsidiary Guarantees on and (iii) the Trustee shall, upon written order of Casella in the form of an Officer’s Certificate, which shall be in a form reasonably acceptable to the Trustee, authenticate and deliver, to each beneficial owner identified by the Depository in exchange for its beneficial interest in such Global Note, an equal aggregate principal amount of Physical Notes of authorized denominations.

 

(e)            Any Physical Note constituting a Restricted Security delivered in exchange for an interest in a Global Note pursuant to paragraph (b) or (c) of this Section 2.15 shall, except as otherwise provided by Section 2.16, bear the Private Placement Legend.

 

(f)             The Holder of any Global Note may grant proxies and otherwise authorize any Person, including Participants and Persons that may hold interests through Participants, to take any action which a Holder is entitled to take under this Indenture or the Notes.

 

SECTION 2.16.                   Special Transfer Provisions .

 

(a)            Transfers to Non-QIB Institutional Accredited Investors and Non-U.S. Persons .  The following provisions shall apply with respect to the registration of any proposed transfer of a Restricted Security to any “accredited investor” as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act (an “ Institutional Accredited Investor ”) which is not a QIB or to any Non-U.S. Person:

 

(i)             the Registrar shall register the transfer of any Restricted Security, whether or not such Note bears the Private Placement Legend, if (x) the requested transfer is after the date the Notes become Freely Tradable or (y) (1) in the case of a transfer to an Institutional Accredited Investor which is not a QIB (excluding Non-U.S. Persons), the proposed transferee has delivered to the Registrar a certificate substantially in the form of Exhibit C hereto and, if requested by Casella, an opinion of counsel reasonably satisfactory to Casella that an exemption from registration under the Securities Act is available for such transfer and (2) in the case of a transfer to a Non-U.S. Person, the proposed transferor has delivered to the Registrar a certificate substantially in the form of Exhibit D hereto;

 

(ii)            if the proposed transferee is a Participant and the Notes to be transferred consist of Physical Notes which after transfer are to be evidenced by an interest in the IAI Global Note or Regulation S Global Note, as the case may be, upon receipt by the Registrar of the Physical Note and (x) written instructions given in accordance with the Depository’s and the Registrar’s procedures and (y) the appropriate certificate, if any, required

 

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by clause (y) of paragraph (i) above, the Registrar shall register the transfer and reflect on its books and records the date and an increase in the principal amount of the IAI Global Note or Regulation S Global Note, as the case may be, in an amount equal to the principal amount of Physical Notes to be transferred, and the Registrar shall cancel the Physical Notes so transferred; and

 

(iii)           if the proposed transferor is a Participant seeking to transfer an interest in a Global Note, upon receipt by the Registrar of (x) written instructions given in accordance with the Depository’s and the Registrar’s procedures and (y) the appropriate certificate, if any, required by clause (y) of paragraph (i) above, the Registrar shall register the transfer and reflect on its books and records the date and (A) a decrease in the principal amount of the Global Note from which such interests are to be transferred in an amount equal to the principal amount of the Notes to be transferred and (B) an increase in the principal amount of the IAI Global Note or the Regulation S Global Note, as the case may be, in an amount equal to the principal amount of the Notes to be transferred.

 

(b)            Transfers to QIBs .  The following provisions shall apply with respect to the registration of any proposed transfer of a Restricted Security to a QIB:

 

(i)             the Registrar shall register the transfer of any Restricted Security, whether or not such Note bears the Private Placement Legend, if (x) the requested transfer is after the date the Notes become Freely Tradable or (y) such transfer is being made by a proposed transferor who has checked the box provided for on the form of Note stating, or has otherwise advised Casella and the Registrar in writing, that the sale has been made in compliance with the provisions of Rule 144A to a transferee who has signed the certification provided for on the form of Note stating, or has otherwise advised Casella and the Registrar in writing, that it is purchasing the Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a QIB within the meaning of Rule 144A, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding Casella as it has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A;

 

(ii)            if the proposed transferee is a Participant and the Notes to be transferred consist of Physical Notes which after transfer are to be evidenced by an interest in the 144A Global Note, upon receipt by the Registrar of the Physical Note and written instructions given in accordance with the Depository’s and the Registrar’s procedures, the Registrar shall register the transfer and reflect on its book and records the date and an increase in the principal amount of the 144A Global Note in an amount equal to the principal amount of Physical Notes to be transferred, and the Registrar shall cancel the Physical Notes so transferred; and

 

(iii)           if the proposed transferor is a Participant seeking to transfer an interest in the IAI Global Note or the Regulation S Global Note, upon receipt by the Registrar of

 

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written instructions given in accordance with the Depository’s and the Registrar’s procedures, the Registrar shall register the transfer and reflect on its books and records the date and (A) a decrease in the principal amount of the IAI Global Note or the Regulation S Global Note, as the case may be, in an amount equal to the principal amount of the Notes to be transferred and (B) an increase in the principal amount of the 144A Global Note in an amount equal to the principal amount of the Notes to be transferred.

 

(c)            Restrictions on Transfer and Exchange of Global Notes .  Notwithstanding any other provisions of this Indenture, a Global Note may not be transferred as a whole except by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor Depository or a nominee of such successor Depository.

 

(d)            Private Placement Legend .  Upon the transfer, exchange or replacement of Notes not bearing the Private Placement Legend, the Holder shall be entitled to receive new Notes that do not bear the Private Placement Legend.  Upon the transfer, exchange or replacement of Notes bearing the Private Placement Legend, the Holder shall be entitled to receive only new Notes that bear the Private Placement Legend unless (i) there is delivered to the Trustee an Opinion of Counsel reasonably satisfactory to Casella and the Trustee to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act or (ii) such Note has been offered pursuant to an effective registration statement under the Securities Act.

 

(e)            General .  By its acceptance of any Note bearing the Private Placement Legend, each Holder of such a Note acknowledges the restrictions on transfer of such Note set forth in this Indenture and in the Private Placement Legend and agrees that it will transfer such Note only as provided in this Indenture.

 

The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.15 or this Section 2.16.  Casella shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable written notice to the Registrar.

 

The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note (including any transfers between or among Depository Participants or beneficial owners of interests in any Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

 

The Trustee shall have no responsibility for the actions or omissions of the Depository, or the accuracy of the books and records of the Depository.

 

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(f)             Neither the Registrar nor the Trustee shall be responsible for ascertaining whether any transfer of Notes complies with the transfer restrictions hereunder (including, without limitation, the restrictions in Section 2.16 hereof) or the registration provisions of or any exemptions from the Securities Act, applicable state securities laws or the applicable laws of any other jurisdiction; provided , that if a certificate is specifically required to be delivered to the Registrar or the Trustee by the express terms hereof, the Trustee or the Registrar shall be under a duty to receive and examine the same to determine whether or not the certificate substantially conforms on its face to the requirements of this Indenture and shall promptly notify the party delivering the same if such certificate does not comply with such terms.

 

(g)            In the event that any Note becomes Freely Tradeable and the Holder thereof desires to transfer such Note, Casella agrees to promptly take all reasonable actions requested by the Registrar or the Trustee to permit the transfer of such Note, including without limitation, making any applicable filings or submissions with the Depository and/or complying with any applicable procedures to obtain a non-restricted CUSIP number for any such Notes, if applicable.

 

SECTION 2.17.                   Limitation on Ownership of Notes .

 

Each Person that is a beneficial holder of Notes shall not knowingly acquire Notes such that, after giving effect thereto, such Person owns 10% or more of the consolidated debt of Casella for which relevant Subsidiaries of Casella are obligated (and to dispose of Notes or other debt of Casella to the extent such Person becomes aware of exceeding such threshold), if such ownership would require consent of any regulatory authority under applicable law or regulation governing solid waste operators and such consent has not been obtained.

 

Casella and the Guarantors will use commercially reasonable efforts to obtain, as promptly as possible, all consents, permit modifications, exemptions or other relief under any applicable laws or regulations governing solid waste operators that limit the ownership of debt of Casella or any of its Subsidiaries, or requires a permit modification or other consent in connection with a change in the ownership of debt of Casella or any of its Subsidiaries, such that such limitation or requirement shall not apply to changes in the ownership of the debt outstanding under the Senior Credit Facility or represented by the Notes and the Subsidiary Guarantees.  To the extent that Casella and the Guarantors are unable to obtain any such consent, permit modification, exemption or relief after use of commercially reasonable efforts, Casella and each Guarantor will use commercially reasonable efforts to obtain the consent, permit modification, exemption or other relief necessary for any Person that is a beneficial holder or potential beneficial holder of Notes to exceed any applicable debt ownership level under any such applicable law or regulation promptly following written request by such Person that is a beneficial holder or potential beneficial holder (provided that such Person that is a beneficial holder or potential beneficial holder would qualify as an eligible or suitable holder under such law or regulation); provided, however, that nothing in this paragraph shall affect the provisions of the prior paragraph requiring a beneficial holder to dispose of Notes or other debt if such consent has not been obtained and the failure to have such consent would constitute a violation of applicable law or regulation.

 

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ARTICLE THREE

 

REDEMPTION

 

SECTION 3.01.                   Notices to Trustee .

 

If Casella elects to redeem Notes pursuant to Section 5 or Section 6 of the Notes, it shall notify the Trustee in writing of the Redemption Date, the Redemption Price and the principal amount of Notes to be redeemed.  Casella shall give notice of redemption to the Paying Agent and Trustee at least 30 days but not more than 60 days before the Redemption Date (unless a shorter notice shall be agreed to by the Trustee in writing), together with an Officer’s Certificate stating that such redemption will comply with the conditions contained herein.

 

SECTION 3.02.                   Selection of Notes To Be Redeemed .

 

If less than all of the Notes are to be redeemed at any time, the Trustee will select Notes for redemption as follows:

 

·               if the Notes are listed on a national securities exchange, in compliance with the requirements of the principal national securities exchange on which the Notes are listed; or

 

·               if the Notes are not so listed, on a pro rata basis or on as nearly a pro rata basis as practicable (subject, to the extent the Notes are then represented by one or more global notes registered in the name of or held by The Depository Trust Company or its nominee, to the procedures of The Depository Trust Company).

 

No Notes of $2,000 or less shall be redeemed in part.

 

SECTION 3.03.                   Notice of Redemption .

 

At least 30 days but not more than 60 days before a Redemption Date, Casella shall mail a notice of redemption by first class mail, postage prepaid, to each Holder whose Notes are to be redeemed at its registered address.  At Casella’s request, the Trustee shall forward in Casella’s name and at Casella’s expense any notice of redemption prepared by Casella to each applicable Holder.  Each notice for redemption shall identify the Notes (including the CUSIP number) to be redeemed and shall state:

 

(1)            the Redemption Date;

 

(2)            the Redemption Price and the amount of accrued interest, if any, to be paid;

 

(3)            the name and address of the Paying Agent;

 

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(4)            that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price plus accrued interest, if any;

 

(5)            that, unless Casella defaults in making the redemption payment, interest on Notes called for redemption ceases to accrue on and after the Redemption Date, and the only remaining right of the Holders of such Notes is to receive payment of the Redemption Price upon surrender to the Paying Agent of the Notes redeemed;

 

(6)            if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the Redemption Date, and upon surrender of such Note, a new Note or Notes in aggregate principal amount equal to the unredeemed portion thereof will be issued;

 

(7)            if fewer than all the Notes are to be redeemed, the identification of the particular Notes (or portion thereof) to be redeemed, as well as the aggregate principal amount of Notes to be redeemed and the aggregate principal amount of Notes to be outstanding after such partial redemption; and

 

(8)            the Section of the Notes pursuant to which the Notes are to be redeemed.

 

The notice, if mailed in a manner herein provided, shall be conclusively presumed to have been given, whether or not the Holder receives such notice.  In any case, failure to give such notice by mail or any defect in the notice to the Holder of any Note designated for redemption in whole or in part shall not affect the validity of the proceedings for the redemption of any other Note.  Notices of redemption may not be conditional.

 

SECTION 3.04.                   Effect of Notice of Redemption .

 

Once notice of redemption is mailed in accordance with Section 3.03, Notes called for redemption become due and payable on the Redemption Date and at the Redemption Price plus accrued interest, if any.  Upon surrender to the Trustee or Paying Agent, such Notes called for redemption shall be paid at the Redemption Price (which shall include accrued interest thereon to the Redemption Date), but installments of interest, the maturity of which is on or prior to the Redemption Date, shall be payable to Holders of record at the close of business on the relevant Record Dates.  In addition, if the Redemption Date is on or after a Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is registered at the close of business on such Record Date.  On and after the Redemption Date interest shall cease to accrue on Notes or portions thereof called for redemption.

 

SECTION 3.05.                   Deposit of Redemption Price .

 

On or before 10:00 a.m. New York time on the Redemption Date, Casella shall deposit with the Paying Agent U.S. Legal Tender sufficient to pay the Redemption Price plus accrued interest, if any, of all Notes to be redeemed on that date.

 

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If Casella complies with the preceding paragraph, then, unless Casella defaults in the payment of such Redemption Price plus accrued interest, if any, interest on the Notes to be redeemed will cease to accrue on and after the applicable Redemption Date, whether or not such Notes are presented for payment.

 

SECTION 3.06.                   Notes Redeemed in Part .

 

If any Note is to be redeemed in part only, the notice of redemption that relates to such Note shall state the portion of the principal amount thereof to be redeemed.  A new Note or Notes in principal amount equal to the unredeemed portion of the original Note or Notes shall be issued in the name of the Holder thereof upon cancellation of the original Note or Notes.

 

ARTICLE FOUR

 

COVENANTS

 

SECTION 4.01.                   Payment of Notes .

 

Casella shall pay the principal of (and premium, if any) and interest on the Notes in the manner provided in the Notes, Registration Rights Agreement and this Indenture.  An installment of principal of or interest on the Notes shall be considered paid on the date it is due if the Trustee or Paying Agent (other than Casella or an Affiliate thereof) holds on that date U.S. Legal Tender designated for and sufficient to pay the installment.  Interest on the Notes will be computed on the basis of a 360-day year comprised of twelve 30-day months.

 

Casella shall pay interest on overdue principal (including, without limitation, post petition interest in a proceeding under any Bankruptcy Law), and overdue interest, to the extent lawful, at the same rate per annum borne by the Notes.

 

SECTION 4.02.                   Maintenance of Office or Agency .

 

Casella shall maintain the office or agency required under Section 2.03.  Casella shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency.  If at any time Casella shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the address of the Trustee set forth in Section 12.02.

 

Casella may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations.  Casella will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

 

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Casella hereby initially designates Wilmington Trust Company’s Corporate Trust Office as such office of Casella in accordance with Section 2.03.

 

SECTION 4.03.                   Corporate Existence .

 

Except as otherwise permitted by Article Five, Casella shall do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the corporate, partnership or other existence of each of its Restricted Subsidiaries in accordance with the respective organizational documents of each such Restricted Subsidiary and the rights (charter and statutory) and material franchises of Casella and each of its Restricted Subsidiaries; provided , however , that Casella shall not be required to preserve any such right, franchise or corporate existence with respect to each such Restricted Subsidiary if the loss thereof would not, individually or in the aggregate, have a material adverse effect on the business, financial condition or results of operations of Casella and its Restricted Subsidiaries taken as a whole.

 

SECTION 4.04.                   Payment of Taxes and Other Claims .

 

Each of Casella and the Guarantors shall, and shall cause each of the respective Subsidiaries to, pay or discharge or cause to be paid or discharged, before the same shall become delinquent, (a) all material taxes, assessments and governmental charges levied or imposed upon it or any of its respective Subsidiaries or upon the income, profits or property of it or any of its respective Subsidiaries and (b) all lawful claims for labor, materials and supplies which, in each case, if unpaid, might by law become a material liability or Lien upon the property of it or any of its Restricted Subsidiaries; provided , however , that Casella and the Guarantors shall not be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge or claim whose amount the applicability or validity is being contested in good faith by appropriate proceedings and for which appropriate provision has been made.

 

SECTION 4.05.                   Maintenance of Properties and Insurance .

 

(a)            Casella shall cause all material properties owned by or leased by it or any of its Restricted Subsidiaries used or useful to the conduct of its business or the business of any of its Restricted Subsidiaries to be maintained and kept in normal condition, repair and working order and supplied with all necessary equipment and shall cause to be made all repairs, renewals, replacements, and betterments thereof, all as in its judgment may be necessary, so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided , however , that nothing in this Section 4.05 shall prevent Casella or any of its Restricted Subsidiaries from discontinuing the use, operation or maintenance of any of such properties, or disposing of any of them, if such discontinuance or disposal is, in the judgment of the Board of Directors of Casella or any such Restricted Subsidiary desirable in the conduct of the business of Casella or any such Restricted Subsidiary, and if such discontinuance or disposal would not, individually or in the aggregate, have a material adverse effect on the ability of Casella or the Guarantors to perform each of their respective obligations hereunder; provided , further , that nothing in this Section 4.05 shall prevent Casella or any of its Restricted Subsidiaries

 

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from discontinuing or disposing of any properties to the extent otherwise permitted by this Indenture.

 

(b)            Casella shall maintain, and shall cause its Restricted Subsidiaries to maintain, insurance with responsible carriers against such risks and in such amounts, and with such deductibles, retentions, self-insured amounts and co-insurance provisions, as are customarily carried by similar businesses of similar size, including property and casualty loss, workers’ compensation and interruption of business insurance.

 

SECTION 4.06.                   Compliance Certificate; Notice of Default .

 

(a)            Casella shall deliver to the Trustee, within 120 days after the close of each fiscal year (which on the date hereof is April 30), an Officer’s Certificate stating that a review of the activities of Casella and its Subsidiaries has been made under the supervision of the signing Officers with a view to determining whether Casella and each Guarantor has kept, observed, performed and fulfilled its obligations under this Indenture and further stating, as to each such Officer signing such certificate, that to the best of such Officer’s knowledge, Casella and each Guarantor during such preceding fiscal year has kept, observed, performed and fulfilled each and every such covenant and no Default occurred during such year and at the date of such certificate there is no Default that has occurred and is continuing or, if such signers do know of such Default, the certificate shall describe its status with particularity.  The Officer’s Certificate shall also notify the Trustee should Casella elect to change the manner in which it fixes its fiscal year end.

 

(b)            Casella shall deliver to the Trustee as soon as possible and in any event within five days after Casella becomes aware of the occurrence of any Default an Officer’s Certificate specifying the Default and describing its status with particularity and the action proposed to be taken thereto.

 

SECTION 4.07.                   Compliance with Laws .

 

Casella shall comply, and shall cause each of its Subsidiaries to comply, with all applicable statutes, rules, regulations, orders and restrictions of the United States, all states and municipalities thereof, and of any governmental department, commission, board, regulatory authority, bureau, agency and instrumentality of the foregoing, in respect of the conduct of their respective businesses and the ownership of their respective properties, except, in any such case, to the extent the failure to so comply would not, individually or in the aggregate, have a material adverse effect on the business, financial condition or results of operations of Casella and its Restricted Subsidiaries taken as a whole.

 

SECTION 4.08.                   Waiver of Stay, Extension or Usury Laws .

 

Each of Casella and each Guarantor covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law that would

 

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prohibit or forgive Casella or such Guarantor from paying all or any portion of the principal of and/or interest on the Notes or the Subsidiary Guarantee of any such Guarantor as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Indenture, and (to the extent that it may lawfully do so) each hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

 

SECTION 4.09.                   Change of Control .

 

If a Change of Control occurs, each Holder of Notes will have the right to require Casella to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of that Holder’s Notes pursuant to a Change of Control Offer (the “ Change of Control Offer ”).  In the Change of Control Offer, Casella will offer to pay an amount in cash (the “ Change of Control Payment ”) equal to 101% of the aggregate principal amount of Notes repurchased, plus accrued and unpaid interest thereon, if any, to the date of purchase.  Within 30 days following any Change of Control, Casella will mail a notice to each Holder describing the transaction or transactions that constitute the Change of Control and offering to repurchase Notes on the date (the “ Change of Control Payment Date ”) specified in such notice, which date shall be a Business Day no earlier than 30 days and no later than 60 days from the date such notice is mailed, pursuant to the procedures required by this Indenture and described in such notice.  Such notice shall state:

 

(1)            that the Change of Control Offer is being made pursuant to this Section 4.09 and that all Notes tendered and not withdrawn will be accepted for payment;

 

(2)            the purchase price (including the amount of accrued interest) and the Change of Control Payment Date;

 

(3)