-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QOfNGxPD+qAKLlvcyfyJ4lOcDnrOQomMCn1ZcXWWMnPN8Jgm2xRePr3vfw8hCS5p Kqn1e1RWEV0s9Af4H97Drg== 0000909518-03-000675.txt : 20030908 0000909518-03-000675.hdr.sgml : 20030908 20030908151151 ACCESSION NUMBER: 0000909518-03-000675 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 14 CONFORMED PERIOD OF REPORT: 20030908 ITEM INFORMATION: Other events FILED AS OF DATE: 20030908 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ARMSTRONG WORLD INDUSTRIES INC CENTRAL INDEX KEY: 0000007431 STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS PRODUCTS, NEC [3089] IRS NUMBER: 230366390 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-02116 FILM NUMBER: 03885950 BUSINESS ADDRESS: STREET 1: 2500 COLUMBIA AVE CITY: LANCASTER STATE: PA ZIP: 17603 BUSINESS PHONE: 7173970611 MAIL ADDRESS: STREET 1: 2500 COLUMBIA AVE CITY: LANCASTER STATE: PA ZIP: 17603 FORMER COMPANY: FORMER CONFORMED NAME: ARMSTRONG CORK CO DATE OF NAME CHANGE: 19800611 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ARMSTRONG HOLDINGS INC /PA/ CENTRAL INDEX KEY: 0001109304 STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS PRODUCTS, NEC [3089] IRS NUMBER: 233033414 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 333-32530 FILM NUMBER: 03885951 BUSINESS ADDRESS: STREET 1: 2500 COLUMBIA AVE CITY: LANCASTER STATE: PA ZIP: 17603 BUSINESS PHONE: 7173970611 MAIL ADDRESS: STREET 1: 2500 COLUMBIA AVE CITY: LANCASTER STATE: PA ZIP: 17603 8-K 1 jd9-5_8k.txt ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT - September 8, 2003 (Date of Earliest Event Reported) ARMSTRONG WORLD INDUSTRIES, INC. ----------------------------------------------------- (Exact name of registrant as specified in its charter) Commission File No. 1-2116 Pennsylvania 23-0366390 ------------ ---------- (State of Incorporation) (I.R.S. Employer Identification No.) 2500 Columbia Avenue, Lancaster, PA 17603 ----------------------------------- ----- (Address of principal Zip Code executive offices) Registrant's telephone number, including area code: (717) 397-0611 ARMSTRONG HOLDINGS, INC. ---------------------------------------------------- (Exact name of registrant as specified in its charter) Commission File No. 333-32530 Pennsylvania 23-3033414 (State of Incorporation) (I.R.S. Employer Identification No.) 2500 Columbia Avenue, Lancaster, PA 17603 (Address of principal Zip Code executive offices) Registrant's telephone number, including area code: (717) 397-0611 ================================================================================ ITEM 5. OTHER EVENTS AND REQUIRED REGULATION FD DISCLOSURE. On September 5, 2003, Armstrong World Industries, Inc. ("AWI"), the operating subsidiary of Armstrong Holdings, Inc. ("Holdings"), filed with the U.S. Bankruptcy Court for the District of Delaware (the "Court") certain exhibits to its Fourth Amended Plan of Reorganization. AWI filed its plan of reorganization and a proposed Disclosure Statement with respect to such plan on May 23, 2003. A copy of the Fourth Amended Plan of Reorganization and a copy of the Disclosure Statement with respect to the Fourth Amended Plan of Reorganization, each as filed with the Court, and a copy of the press release issued by AWI with respect to this development were filed with the U.S. Securities and Exchange Commission as Exhibits 99.1, 99.2 and 99.3, respectively, to AWI's Current Report on Form 8-K dated May 23, 2003. The exhibits to the plan filed with the court by AWI include: (i) the form of the articles of incorporation and bylaws for AWI as it will be reorganized under the plan, (ii) the form of stockholder and registration rights agreement which AWI will enter into with the trust for the benefit of asbestos personal injury claimants which will be established under the plan and will become the holder of 65.57% of the common shares of AWI upon consummation of the plan, (iii) the form of warrant agreement with respect to the warrants to be issued under the plan to Holdings, (iv) the form of the indentures for the three issues of notes of reorganized AWI which may be issued under the plan, and (v) the form of the long-term incentive plan to be established for management of the reorganized company. In addition, certain other exhibits were filed, including a listing of the individuals who are expected to serve as directors of reorganized AWI upon consummation of the plan, a listing of the individuals who are expected to serve as trustees of the trust to be established under the plan and certain other material pertinent to the effectuation of the plan. Each of these matters is discussed in the Disclosure Statement. A copy of each of these exhibits is attached hereto as Exhibits 99.1, 99.2, 99.3, 99.4, 99.5, 99.6, 99.7, 99.8, 99.9, 99.10, 99.11, 99.12 and 99.13, respectively, and are incorporated by reference herein. As previously disclosed, the Court approved the Disclosure Statement with respect to the Fourth Amended Plan of Reorganization on June 2, 2003. On June 20, 2003, AWI began circulating the Disclosure Statement to AWI's creditors to solicit their votes on whether to approve the Fourth Amended Plan of Reorganization. On August 29, 2003, the Court approved an extension until 5:00 p.m. (Delaware time) on Friday, October 17, 2003 of the deadline for creditors of and claimants against AWI who are entitled to vote on AWI's proposed plan of reorganization to vote thereon. The voting deadline was previously September 22, 2003. A hearing on confirmation of AWI's proposed plan of reorganization is scheduled for November 17, 2003. The deadline for parties in interest to object to the plan was not extended and remains 4:00 p.m. (Delaware time) on Monday, September 22, 2003. If the plan is confirmed at or about the time of the scheduled hearing, AWI currently expects that the plan will become effective at or about the end of 2003. 2 ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (a) Financial Statements Not applicable. (b) Pro Forma Financial Information Not applicable (c) Exhibits. Exhibit No. Description ----------- ----------- 99.1 Form of Amended and Restated Articles of Incorporation of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.2 Form of Amended and Restated By-Laws of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.3 Form of Asbestos PI Trust Agreement of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.4 Claims Settlement Guidelines of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.5 Form of the New Long-Term Incentive Plan of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.6 Form of Warrant Agreement between Armstrong World Industries, Inc. and a warrant agent, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.7 Form of Plan Notes Indenture for Senior Notes due 2010 between Armstrong World Industries, Inc. and a trustee, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.8 Form of Plan Notes Indenture for Senior Notes due 2013 between Armstrong World Industries, Inc. and a trustee, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.9 Form of Stockholder and Registration Rights Agreement between Armstrong World Industries, Inc. and Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.10 Individuals Appointed as Asbestos PI Trustees, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.11 Individuals identified as the initial members of Board of Directors of Reorganized Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.12 Identity of Persons Entering into Management Agreements with Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 - None. 99.13 Form of Management Agreement of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 - None. 3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. ARMSTRONG WORLD INDUSTRIES, INC. By: /s/ Walter T. Gangl ------------------------------------ Name: Walter T. Gangl Title: Assistant Secretary ARMSTRONG HOLDINGS, INC. By: /s/ Walter T. Gangl ------------------------------------- Name: Walter T. Gangl Title: Deputy General Counsel and Assistant Secretary Dated: September 5, 2003 4 EXHIBIT INDEX Exhibit No. Description ----------- ----------- 99.1 Form of Amended and Restated Articles of Incorporation of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.2 Form of Amended and Restated By-Laws of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.3 Form of Asbestos PI Trust Agreement of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.4 Claims Settlement Guidelines of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.5 Form of the New Long-Term Incentive Plan of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.6 Form of Warrant Agreement between Armstrong World Industries, Inc. and a warrant agent, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.7 Form of Plan Notes Indenture for Senior Notes due 2010 between Armstrong World Industries, Inc. and a trustee, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.8 Form of Plan Notes Indenture for Senior Notes due 2013 between Armstrong World Industries, Inc. and a trustee, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.9 Form of Stockholder and Registration Rights Agreement between Armstrong World Industries, Inc. and Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.10 Individuals Appointed as Asbestos PI Trustees, as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.11 Individuals identified as the initial members of Board of Directors of Reorganized Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 99.12 Identity of Persons Entering into Management Agreements with Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 - None. 99.13 Form of Management Agreement of Armstrong World Industries, Inc., as filed with the U.S. Bankruptcy Court for the District of Delaware on September 5, 2003 - None. 5 EX-99 3 jd9-5ex99_1.txt 99.1 Exhibit 99.1 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------- ) EXHIBIT 1.13 AMENDED AND RESTATED ARTICLES OF INCORPORATION FORM OF AMENDED AND RESTATED ARTICLES OF INCORPORATION (SEPT. 5, 2003) ---------------------------------------------------------------------- AMENDED AND RESTATED ARTICLES OF INCORPORATION OF ARMSTRONG WORLD INDUSTRIES, INC. (THE "CORPORATION") FIRST: Name. The name of the Corporation is Armstrong World Industries, Inc. SECOND: Registered Office. The location and post office address of its registered office in this Commonwealth is 2500 Columbia Avenue, Lancaster, Lancaster County, Pennsylvania. THIRD: Purposes. The purpose or purposes for which the Corporation is incorporated under the Business Corporation Law of 1998 of the Commonwealth of Pennsylvania (the "PBCL") are to engage in, and do any lawful act concerning, any or all lawful business for which corporations may be incorporated under the PBCL, including, but not limited to, manufacturing, purchasing and selling a variety of interior furnishings, interior finish materials and related services for residential, commercial and institutional interiors, including resilient floors and carpeting, ceiling materials and ceiling systems, furniture and related accessory items; as well as insulation materials and industrial specialties; engaging in research and development, furnishing services, and acquiring, owning, using, and disposing of real property of any nature whatsoever. FOURTH: Duration. The term of its existence is perpetual. FIFTH: Authorized Shares. (A) The authorized shares of the Corporation shall be of two classes: 15,000,000 Preferred Shares without par value, which may be issued in series as hereinafter provided, and 200,000,000 Common Shares, par value $0.01 per share. (B) A description of each class of shares and a statement of the designations, voting rights, preferences, limitations and special rights granted to or imposed upon the shares of each class and of the authority vested in the Board of Directors of the Corporation to establish series of Preferred Shares and to set, and determine variations in, the designations, voting rights, preferences, limitations and special rights of the series of Preferred Shares are as follows: (i) The holders of Common Shares shall be entitled to receive dividends, when and as declared by the Board of Directors, out of assets legally available therefor. (ii) The holders of Common Shares shall have one vote per share. (iii) The Corporation may issue shares, option rights or securities having conversion or option rights, without first offering them to holders of Preferred Shares or Common Shares. (iv) The Board of Directors may in its discretion, at any time or from time to time, issue or cause to be issued all or any part of the authorized and unissued Common Shares for consideration of such character and value as the Board shall from time to time set or determine. (v) (a) Subject to paragraph (vii) of Article Sixth (H), the Board of Directors is hereby expressly authorized, at any time or from time to time, by resolution or resolutions adopted by the Board to divide any or all of the Preferred Shares into one or more series, and, before issuance of any of the shares thereof, to set and determine the number of shares and the designation of such series, so as to distinguish it from the shares of all other series and classes, and to set and determine the voting rights, preferences, limitations and special rights of the series of Preferred Shares, or of all series of Preferred Shares, all by amendment of these Articles without approval of the shareholders and otherwise in the manner, and to the fullest extent now or hereafter permitted, by the PBCL, including, but not limited to, providing in respect of a series of Preferred Shares, and providing for variations between different series of Preferred Shares, in the following respects: (1) the distinctive designation of such series and the number of shares that shall constitute such series, which number may be increased or decreased (but not below the number of shares thereof then outstanding) from time to time by the Board of Directors; (2) the annual or other dividend rate for such series, and the date or dates from which dividends shall commence to accrue and whether or not dividends shall accumulate; (3) the price or prices at which, and the terms and conditions on which, the shares of such series may be made redeemable; (4) the redemption or purchase, and sinking fund provisions, if any, for the redemption or purchase, of shares of such series; (5) the preferential amount or amounts payable upon shares of such series in the event of liquidation, dissolution, or winding up of the Corporation; (6) the voting powers and rights, if any, of shares of such series; (7) the terms and conditions, if any, upon which shares of such series may be converted or exchanged and the class or classes or series of shares of the Corporation or other securities into which such shares may be converted or exchanged; 2 (8) the relative seniority, priority or junior rank of such series as to dividends or assets with respect to any other classes or series of stock then or thereafter to be issued; and (9) such other terms, qualifications, privileges, limitations, options, restrictions, and special or relative rights and preferences, if any, of shares of such series as the Board of Directors may, at the time of such resolution or resolutions, lawfully set or determine under the laws of the Commonwealth of Pennsylvania. (b) Unless otherwise provided by law, the articles of incorporation or bylaws of the Corporation or in a resolution or resolutions establishing any particular series of Preferred Shares adopted pursuant to this Article Fifth, the aggregate number of authorized Preferred Shares Stock may be increased by an amendment of the articles of incorporation of the Corporation approved solely by the affirmative vote of the holders of a majority of the outstanding Common Shares. (c) All shares within each series of Preferred Shares shall be alike in every particular, except with respect to the dates from which dividends shall commence to accrue or with respect to other rights, powers or privileges which may vary among the holders of such shares based on the number of shares held or the duration of their shareholdings. (d) The Board of Directors may in its discretion, at any time or from time to time, issue or cause to be issued all or any part of the authorized and unissued Preferred Shares for consideration of such character and value as the Board of Directors shall from time to time set or determine. (vi) Notwithstanding the foregoing provisions of this Article Fifth, the Board of Directors shall not issue or cause to be issued nonvoting shares of the Corporation or warrants, rights or options to acquire nonvoting shares of the Corporation (to the extent that issuance of nonvoting equity securities is prohibited by a debtor corporation by section 1123(a)(6) of title 11 of the United States Code). (C) Any or all classes and series of shares of the Corporation, or any part thereof, may be represented by uncertificated shares to the extent determined by the Board of Directors, except that shares represented by a certificate that is issued and outstanding shall continue to be represented thereby until the certificate is surrendered to the Corporation. Within a reasonable time after the issuance or transfer of uncertificated shares, the Corporation shall send to the registered owner thereof a written notice containing the information required by law to be set forth or stated on share certificates. The rights and obligations of the holders of shares represented by certificates and the rights and obligations of the holders of uncertificated shares of the same class and series shall be identical. SIXTH: Management of the Corporation's Business and Affairs. (A) Commencing with the effective date of these Amended and Restated Articles of Incorporation (the "Effective Date"), the Board of Directors shall be composed of nine members and, thereafter, subject to paragraph (vii) of 3 Article Sixth (H) hereof, the Board of Directors shall have such number of members as shall be determined by or pursuant to the bylaws of the Corporation, provided (i) that, until the annual meeting of shareholders first held in calendar year 2006 (the "2006 Annual Meeting"), the number of members shall not be less than nine and (ii) no reduction in the number of members shall end the term of office of any director earlier than such term of office would otherwise end. Commencing with the Effective Date, the initial term of office of all directors shall extend from the Effective Date until the annual meeting of shareholders first held in 2005 (the "2005 Annual Meeting") and until the election at such annual meeting and the qualification of the director's successor or until his or her earlier disqualification, resignation, removal, death or incapacity. The term of office of any director elected by the shareholders or the Board of Directors, as permitted by law, to fill any vacancy on the Board of Directors occurring before the 2005 Annual Meeting shall extend until the 2005 Annual Meeting and until the election at such annual meeting and qualification of the director's successor or until his or her earlier disqualification, resignation, removal, death or incapacity. After the 2005 Annual Meeting, commencing in the case of each director upon his or her election at such annual meeting and qualification, the term of office of all directors shall extend until the next annual meeting of shareholders and the election at such annual meeting and qualification of the director's successor or until his or her earlier disqualification, resignation, removal, death or incapacity and the term of office of any director elected by the shareholders or the Board of Directors, as permitted by law, to fill any vacancy on the Board of Directors occurring after the 2005 Annual Meeting shall extend until the next annual meeting of shareholders and until the election at such annual meeting and qualification of the director's successor or until his or her earlier disqualification, resignation, removal, death or incapacity. (1) (B) In addition to the right of the Board of Directors under law to remove a director for cause, and subject to the voting rights of the holders of any series of Preferred Stock, directors whose term of office is scheduled to expire at the 2006 Annual Meeting may be removed from office before the expiration of their terms of office only (i) for Cause (as defined below) with the affirmative vote of the holders of a majority of the Common Shares present (in person or by proxy) at a meeting of shareholders at which a quorum is present or by the written consent in lieu of a meeting, as permitted by law, of the holders of a majority of the Common Shares or (ii) without Cause with the affirmative vote or written consent, as permitted by law, of the holders of 75% of the Common Shares. In addition to the right of the Board of Directors under law to remove a director for cause, and subject to the voting rights of the holders of any series of Preferred Shares, commencing with the 2006 Annual Meeting, directors may be removed from office before the expiration of their terms of office at any time, with or without cause, by the affirmative vote of the holders of a majority of the Common Shares present (in person or by proxy) at a meeting of shareholders at which a quorum is present or, as permitted by law, by the written consent in lieu of a meeting of the holders of a majority of the Common Shares. For purposes of this Article Sixth (B), "Cause" for the removal of a director shall mean conviction of a felony, any act of dishonesty in respect of the Corporation or a breach of fiduciary duty to the Corporation. With respect to the nomination of directors for election at the 2005 Annual Meeting, the provisions of Section 4B of the bylaws as in effect on the Effective Date shall apply. - -------------- (1) [The provisions hereof regarding the term of office of the initial directors as of the Effective Date, and related provisions, may be modified in order to comply with applicable listing standards as pertinent to the initial listing of the Common Shares.] 4 (C) With respect to the election of directors, each shareholder shall be entitled to cast for any candidate for election as a director only one vote per share and shareholders shall not be entitled to cumulate their votes and cast them in favor of one candidate or distribute them among any two or more candidates. (D) A director of the Corporation shall not be personally liable, as such, for monetary damage for any action taken by him or her unless he or she has breached or failed to perform the duties of his or her office under subchapter B of chapter 17 of the PBCL and the breach or failure to perform constitutes self-dealing, willful misconduct or recklessness, except as otherwise specifically provided by the PBCL. No amendment or repeal of this Article Sixth (D) shall apply to or have any effect on the liability or alleged liability of any person who is or was a director of the Corporation for or with respect to any act or omission occurring prior to the effective date of such amendment or repeal. If Pennsylvania law is amended to permit a Pennsylvania corporation to provide greater protection to persons who serve or have served as directors of the corporation from personal liability with respect to their service to the corporation as directors than provided by the terms of this Article Sixth (D), then such protection shall also apply to the person who serve or have served as directors of the Corporation and this Article Sixth (D) shall be construed to provide such greater protection. To the fullest extent permitted by law (including, without limitation, as permitted by section 1746 of the PBCL) from time to time in effect, the Corporation shall indemnify persons who, after the Effective Date, serve as its directors and officers and shall advance to them expenses incurred in defending or responding to claims, actions, investigations, inquiries and other proceedings and may, by provisions in its bylaws, by contract and by any other means permitted by law, establish reasonable procedures for the making of such indemnification and advancement of expenses and may further obligate itself to provide indemnification or to advance expenses to such persons and may set apart funds to provide for the payment thereof. To the fullest extent permitted by law (including, without limitation, as permitted by section 1746 of the PBCL) from time to time in effect, the Corporation may indemnify persons who before the Effective Date served as directors or officers of the Corporation and persons who, before or after the Effective Date, serve as its employees and agents and may advance to them expenses incurred in defending or responding to claims, actions, investigations, inquiries and other proceedings and may, by provisions in its bylaws, by contract and by any other means permitted by law, obligate itself to provide indemnification or to advance expenses to such persons and may set apart funds to provide for the payment thereof. Notwithstanding the foregoing provisions of this Article Sixth (D), if Pennsylvania law shall be amended so as to limit or reduce the indemnification which a Pennsylvania corporation may provide to its directors or officers from that in effect on the Effective Date, then, to the fullest extent permitted by law, such limitation or reduction shall not apply to or have any effect on the right to indemnity or advancement of expenses provided by this Article Sixth (D) to a person who served as a director or officer of the Corporation with respect to any act or omission occurring prior to the effective date of such amendment. (E) Commencing on the Effective Date, none of the provisions of Subchapters 25D, 25E, 25F, 25G and 25H of the PBCL (as in effect on such date) shall apply to the Corporation, except as may be required by law. 5 (F) Special meetings of shareholders may be called by the Board of Directors, by shareholders entitled to cast at least 20% of the votes that all shareholders generally are entitled to cast in the election of directors, by such holders of Preferred Shares as may be permitted to call a meeting of shareholders by provision of an amendment to the articles of incorporation of the Corporation adopted by the Board of Directors as provided by Article Fifth (B) hereof and by such officers of the Corporation or other persons as may be provided in the bylaws of the Corporation. (G) To the fullest extent and in the manner permitted by law, any action required or permitted to be taken at a meeting of shareholders or a class or series of shareholders may be taken without a meeting of the shareholders or of such class or series of shareholders upon the consent in writing signed by such shareholders who would have been entitled to vote the minimum number of votes that would be necessary to authorize the action at a meeting at which all the shareholders entitled to vote thereon were present and voting. (H) Commencing on the Effective Date and continuing until the Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust (the "Settlement Trust") first ceases to be the Beneficial Owner (as hereinafter defined) of at least 20% of the outstanding Common Shares of the Corporation, the following additional provisions shall apply to the management of the business and affairs of the Corporation: (i) Until the 2006 Annual Meeting, in addition to any requirements or limitations relating to the establishment or functions of a committee of the Board of Directors provided by law and to any requirements relating thereto established by the bylaws, the selection of the members of any committee of the Board of Directors shall require approval by the affirmative vote of at least all but one of the members of the Board of Directors (assuming no vacancies). (ii) The Board of Directors shall present to the shareholders nominations of candidates for election to the Board of Directors (or recommend the election of such candidates as nominated by others) such that, and shall take such other corporate actions as may be reasonably required to provide that, to the best knowledge of the Board of Directors, if such candidates are elected by the shareholders, at least a majority of the members of the Board of Directors shall be Independent Directors (as hereinafter defined). The Board of Directors shall only elect any person to fill a vacancy on the Board of Directors if, to the best knowledge of the Board of Directors, after such person's election at least a majority of the members of the Board of Directors shall be Independent Directors. The foregoing provisions of this paragraph shall not cause a director who, upon commencing his or her service as a member of the Board of Directors was determined by the Board of Directors to be an Independent Director but did not in fact qualify as such, or who by reason of any change in circumstances ceases to qualify as an Independent Director, from serving the remainder of the term as a director for which he or she was selected. Notwithstanding the foregoing provisions of this paragraph, no action of the Board of Directors shall be invalid by reason of the failure at any time of a majority of the members of the Board of Directors to be Independent Directors. For purposes hereof, "Independent Director" shall mean a director who (i) qualifies as an "independent director" within the meaning of the corporate governance listing standards from time to time adopted by the New York Stock Exchange or the Nasdaq Stock Market, whichever the Common Shares are listed for trading on at the time (or, if at any time the Common Shares are not listed on 6 either such market, as would be applicable if the Common Shares were then listed on the New York Stock Exchange) with respect to the composition of the board of directors of a listed company (without regard to any independence criteria applicable under such standards only to the members of a committee of the board of directors) and (ii) also satisfies the minimum requirements of director independence of Rule 10A-3(b)(1) under the Securities Exchange Act, as amended, as from time to time in effect (the "Exchange Act")), whether or not such director is a member of the audit committee. (iii) The Settlement Trust will not Transfer (as hereinafter defined), in one transaction or a series of related transactions, any Common Shares representing more than five percent of the outstanding Common Shares (or Voting Shares (as hereinafter defined) entitling the holders thereof to cast more than five percent of all the votes which the holders of all Voting Shares are entitled to cast in the election of directors of the Corporation) to any Person (a "Proposed Purchaser") who, after giving effect to the transaction or series of related transactions, would Beneficially Own Voting Shares entitling the holders thereof to cast more than 35% of the votes which the holders of all Voting Shares are entitled to cast in the election of directors of the Corporation or more of such votes than the Settlement Trust is entitled to cast, and the Corporation will not register or give effect to any such Transfer, unless (A) such Transfer is (1) pursuant to a bona fide public distribution made either under an effective registration statement under the Securities Act of 1933, as amended (and from time to time in effect), (2) in a transaction satisfying the requirements of Regulation S (and from time to time in effect) under such Act, (3) in a transaction satisfying the requirements of Rule 144 (as from time to time in effect) under such Act, other than by reason of satisfying the provisions of Rule 144(k) thereof, or (4) is effected through "brokers' transactions" within the meaning of Section 4(4) of such Act or a transaction with a "market maker" as defined in Section 3(c)(38) of the Exchange Act, or (B) all other Common Shareholders are afforded the opportunity to participate in the transaction or series of transactions on the same terms (including, without limitation, the same type and amount of consideration per share) as the Settlement Trust, which requirement shall be deemed satisfied if the other Common Shareholders are provided an opportunity to sell the Voting Shares they own in accordance with the following provisions of this paragraph, or (C) in the case of a disposition of shares of Voting Shares by the Settlement Trust pursuant to a merger, consolidation, recapitalization or similar corporate transaction involving the Corporation, the material terms of the transaction have been approved by a majority of the Disinterested Directors (as defined in paragraph (v) of this Article Sixth (H)) or such vote of the holders of the Common Shares as is required by law, the articles of incorporation or the bylaws of the Corporation or applicable listing standards; provided, however, that, if the transaction would result in the Settlement Trust receiving a type or amount of consideration per share in respect of its shares that is different from the other Common Shareholders, the transaction has been approved by the affirmative vote of the holders of a majority of the Common Shares not Beneficially Owned by the Settlement Trust (in addition to approval by any other shareholder vote required). The entry by the Settlement Trust into a prepaid variable share forward contract or other derivative contract (such as those known as TRACES or SAILS) shall not constitute a Transfer of shares for purposes of this paragraph, even if it relates to Voting Shares entitling the holders thereof to cast more than five percent of all the votes which the holders of all Voting Shares are entitled to cast in the election of directors of the Corporation, to the extent such contract is a legitimate hedging transaction and neither such contract nor the settlement thereof will result in a counterparty becoming the Beneficial 7 Owner of Voting Shares entitling the holders thereof to cast more than 35% of the votes which the holders of all Voting Shares are entitled to cast in the election of directors of the Corporation or more of such votes than the Settlement Trust is entitled to cast). The terms and conditions of a Transfer by the Settlement Trust of Common Shares to a Proposed Purchaser will be deemed permitted by this paragraph if, in connection with such Transfer, the Proposed Purchaser shall have publicly undertaken to commence a tender offer in accordance with the Exchange Act and the applicable regulations thereunder, which shall be scheduled to close not later than 60 days after the Transfer of the Settlement Trust's shares (subject to any extension where required to satisfy conditions established by such tender offer), pursuant to which the other Common Shareholders will have the right to tender for purchase for the same type and amount of consideration per share available to the Settlement Trust in the Transfer, at each other Common Shareholder's option, a number of Common Shares equal to the product of (i) the total number of Common Shares owned by the other Common Shareholders and (ii) a fraction, the numerator of which shall be the number of Common Shares that the Settlement Trust proposes so to Transfer to the Proposed Purchaser and the denominator of which shall be the total number of Common Shares then owned by the Settlement Trust. For purposes hereof, (i) "Transfer" shall mean, directly or indirectly transfer, to sell, assign, donate, contribute, place in trust (including a voting trust), or otherwise voluntarily or involuntarily dispose of, (ii) "Voting Shares" shall mean shares of the Corporation, of any class or series, entitled to vote for the election of directors of the Corporation (including Common Shares), other than Preferred Shares entitled to vote for the election of directors who are to be elected only by the holders of a particular class or series of shares, or collectively by the holders of two or more classes or series of shares, and only in the event of an arrearage in payment of dividends on such class or series of shares and who constitute less than one-third of all the directors (assuming no vacancies on the Board of Directors), and (iii) "Beneficially Owned" or "Beneficial Ownership" shall have the meaning prescribed by Regulation 13D-G under the Exchange Act, as amended and from time to time in effect. (iv) The Corporation shall not, without the prior written approval of the Settlement Trust, adopt or maintain a shareholder rights plan, "poison pill" or similar plan (however designated) which provides some, but not all, holders of Common Shares, in the event of the acquisition by any person or group of persons acting in concert of Voting Shares (as defined in paragraph (iii) of Article Sixth (H) hereof) constituting more than a specified level of ownership of the Corporation and with or without additional conditions or exceptions (an "Acquiring Person"), the right to acquire securities of the Corporation or of any successor company, or of any controlling person thereof, on more favorable terms than available to the Acquiring Person, or which limits the voting or other rights or the Acquiring Person, or which is otherwise designed to, or has the effect of, similarly making acquisition of additional Voting Shares by an Acquiring Person more difficult or expensive than would be the case in the absence of such shareholder rights or similar plan by providing to other shareholders any right or benefit which the Acquiring Person is not accorded. (v) Any transaction between the Corporation or any Subsidiary (as hereinafter defined) and the Settlement Trust or any Affiliate (as hereinafter defined) thereof (other than a dividend or other distribution made to all shareholders pro rata to their shareholdings and otherwise on terms which are the same with respect to the Settlement Trust and all other participating shareholders), shall require review by and approval of a majority of the Disinterested Directors (as hereinafter defined), whether or not such review and 8 approval is required by law or applicable listing standards, subject to any exception from such review and approval for transactions of an immaterial nature determined under such criteria as have been approved in advance by a majority of the Disinterested Directors; provided, however, that, in the case of any transaction or series of related transactions involving the cancellation, retirement, disposition, conversion, exchange or reclassification of the shares of the Corporation, or any dividend, distribution or payment in respect of outstanding shares of the Corporation, pursuant to a merger, consolidation, recapitalization, reorganization or similar corporate transaction, which transaction would result in the Settlement Trust receiving any dividend, distribution, security, other property or payment that differs from that which would be received by all other holders of Common Shares, then the approval of the holders of a majority of the Common Shares not owned or controlled by the Settlement Trust shall be required (in addition to approval by any shareholder vote otherwise required, but approval of the Disinterested Directors shall not be required hereby). For the purposes hereof, (A) "Affiliate" (and "Affiliated") shall have the meaning ascribed to such term in Rule 12b-2 under the Exchange Act, as in effect on the Effective Date, (B) "Disinterested Directors" in respect of a transaction or potential transaction (or category of immaterial transactions) shall mean the directors of the Corporation who are not Affiliated with the Settlement Trust and who have no personal financial interest in the transaction (other than the same interest, if a shareholder of the Corporation, as the other shareholders of the Corporation) and (iii) "Subsidiary" shall mean any company controlled, directly or indirectly, by the Corporation. (vi) Sections 4 and 5 of Article II of the bylaws of the Corporation as in effect on the Effective Date shall not apply to the Settlement Trust and the Board of Directors shall not adopt any bylaw or take any other action that would eliminate, limit, regulate or subject to any condition or procedural requirement the submission of any matter by the Settlement Trust for consideration by the shareholders at a meeting or by written consent, including (without limitation) the nomination of candidates for election of directors; provided, however, that this provision shall not prevent the Board of Directors from taking any action regarding shareholder nominations or shareholder proposals applicable to shareholders generally (even though also applicable to the Settlement Trust on a basis no more restrictive than any other shareholder) if such action is required by the Exchange Act or a regulation issued thereunder or by listing standards of the market on which the Common Shares are listed for trading and the Corporation cannot comply with such requirement by taking any action that does not restrict the Settlement Trust or is less restrictive on the Settlement Trust. (vii) The Corporation shall not without the prior, written consent of the Trust (in addition to any shareholder vote required under applicable law): (a) authorize any new class of shares (i.e., other than the Common Shares or Conventional Preferred Shares); (b) issue any Preferred Shares, other than Conventional Preferred Shares (as hereinafter defined); (c) [before the fifth anniversary of the Effective Date,] implement any stock option, restricted stock, stock bonus or stock purchase plan, or any similar plan or arrangement, pursuant to which any one or more of the officers, directors or employees of, or consultants to, the Corporation or any of its Subsidiaries, or any person who is the Beneficial Owner of 5% or more of the Voting Shares, may acquire shares of the Corporation, except: 9 (1) as permitted by the Long-Term Incentive Plan of the Corporation adopted on or about the Effective Date, (2) for a dividend reinvestment plan or any plan or arrangement whereby any dividend, distribution, offer, issuance or sale of options, warrants, subscription rights or other equity interests is offered or made to shareholders of the Corporation generally, substantially in proportion to their shareholdings, or (3) where options or shares are to be issued to a person not previously employed by the Corporation, as an inducement to such person's entering into an employment or consulting contract with the Corporation. "Conventional Preferred Shares" shall mean Preferred Shares which satisfy all of the following requirements: (a) the Preferred Shares are not convertible into, exchangeable for or exercisable to acquire Common Shares or any other class or series of shares of the Corporation, except that Preferred Shares shall be Conventional Preferred Shares if, but only if, they may be convertible into, exchangeable for or exercisable (1) only at a fixed conversion, exchange or exercise ratio or price (except that such conversion, exchange or exercise ratio or price may be subject to anti-dilution adjustments that are conventional for publicly-offered, investment-grade convertible preferred shares), (2) only at a conversion, exchange or exercise price (or ratio equivalent to a price) that, in the good faith judgment of the Board of Directors based on the advice of a nationally recognized investment banking firm, represents a premium to the market price of the Common Shares at the time of issuance of such Preferred Shares, and (3) only to acquire the number of Common Shares that (together with any other Preferred Shares to be issued in any related transaction), at the time of issuance of such Preferred Shares, would represent not more than 20% of the sum of the total number of Common Shares outstanding at the time of issuance of such Preferred Shares plus the number of Common Shares that would be issued upon exercise in full of such conversion, exchange or acquisition rights of such Preferred Shares; (b) the Preferred Shares are not entitled to participate in dividends or distributions with the Common Shares or to dividends or distributions based on earnings or other results of operations of the Company (except insofar as earnings or results of operations may affect the amount legally available for the payment of dividends); (c) the Preferred Shares and are not entitled to vote in the election of directors or vote on or consent to any other matter, except to vote on or consent to the election of not more than two directors in the event of an arrearage in the payment of preferred dividends thereon for a period of not less than 180 days and to vote on or consent to any amendment to the articles of incorporation of the Corporation that would adversely affect the rights, powers or privileges of such Preferred Shares or a merger, consolidation or other similar corporate transaction that would have the effect of leaving the Preferred Shares outstanding and amending the rights, powers or privileges of such Preferred Shares as established by the articles of incorporation of the Corporation in a way that would adversely affect such rights, powers or privileges, and 10 (d) the Preferred Shares do not have, in the good faith judgment of the Board of Directors approved by the affirmative vote of three-fourths of the members of the Board of Directors based on the advice of a nationally recognized investment banking firm and after consultation with the Settlement Trust, other rights, powers or privileges which are not customary for publicly-offered, investment-grade preferred shares. (viii) Any amendment or repeal of the bylaws of the Corporation by the Board of Directors permitted by Article Eighth (B) hereof, and any change in the number of members of the Board of Directors permitted by Article Sixth (A) hereof to be made by the Board of Directors as provided pursuant to the bylaws of the Corporation, shall require the affirmative vote of at least 75% of the Board of Directors (assuming no vacancy on the Board of Directors); provided, however, that, without the prior written consent of the Settlement Trust, the Board may not increase the number of members of the Board of Directors to be more than nine at any time when the holders of Preferred Shares (of one or more series) are permitted to elect one or more directors. (ix) Any amendment of the articles of incorporation of the Corporation, other than an amendment permitted without a vote of the shareholders in accordance with Article Fifth (B) hereof, and any action by the Board of Directors of the Corporation to establish or issue any series of Preferred Shares as permitted by Article Fifth (B) hereof shall require the affirmative vote of at least 75% of the Board of Directors (assuming no vacancy on the Board of Directors). SEVENTH: Amendment of Articles of Incorporation: The articles of incorporation of the Corporation may be amended, modified or repealed and new provisions adopted as permitted by law, except that the provisions of Articles Sixth (A), (B), (F), (G) and (H) and this Article Seventh of these Amended and Restated Articles of Incorporation may be amended, modified or repealed, and any inconsistent provision may be adopted, only with the affirmative vote or written consent, as permitted by law, of the holders of 80% of the Common Shares. EIGHTH: Effective Time; Bylaws. (A) These Amended and Restated Articles of Incorporation shall become effective upon filing with the Office of the Secretary of State of the Commonwealth of Pennsylvania [at _:__ _.m. on _________, __, 200_ ]. (B) The bylaws of the Corporation adopted by the sole shareholder of the Corporation before the effective time of these Amended and Restated Articles of Incorporation and by their terms effective upon the effectiveness hereof shall be the bylaws of the Corporation commencing on the effectiveness hereof and may thereafter be amended, to the extent provided by such bylaws, by the shareholders or (to the fullest extent permitted by law, including, without limitation, with respect to the matters referred to in section 1504(b) of the PBCL) by the Board of Directors (subject, however, to the power of the shareholders to adopt, amend and repeal bylaws). 11 EX-99 4 jd9-5ex99_2.txt 99.2 Exhibit 99.2 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------- ) EXHIBIT 1.14 AMENDED AND RESTATED BY-LAWS FORM OF BYLAWS OF REORGANIZED ARMSTRONG (SEPT. 5, 2003) ------------------------------------------------------- BYLAWS of ARMSTRONG WORLD INDUSTRIES, INC. (A Pennsylvania corporation) -------------------------- As in effect on [________, 200_] -------------------------- ARTICLE I Certain Definitions; Principal Office; Notices to the Corporation ----------------------------------------------------------------- Section 1. Certain Definitions. Unless the context otherwise requires, the following terms when used herein shall have the following meanings: (a) "ARTICLES" shall mean the articles of incorporation of the Corporation, as from time to time amended and in effect in accordance with law, and shall include any amendment determining the designation, voting rights, preferences, limitations and special rights of Preferred Shares of the Corporation made by the Board as permitted by law, as then in effect. (b) "BENEFICIAL OWNERSHIP" shall have the same meaning as provided by Regulation 13D-G under the Exchange Act, as from time to time in effect (and any successor regulation). (c) "BOARD" shall mean the Board of Directors of the Corporation as constituted in accordance with Article III of the Bylaws. (d) "BYLAWS" shall mean the Bylaws of the Corporation as from time to time amended and in effect in accordance with law. References in the Bylaws to "herein," "hereof" or "hereto," or any like reference, shall refer to the Bylaws (as amended and in effect from time to time) as a whole and not to any specific Article, Section, subsection, paragraph, sentence or clause of the Bylaws unless explicitly provided. (e) "CORPORATION" shall mean Armstrong World Industries, Inc., the Pennsylvania corporation incorporated by the filing of articles of incorporation with the Secretary of State of the Commonwealth of Pennsylvania on December 30, 1891. (f) "EFFECTIVE TIME" shall mean the effective time of these bylaws as provided by Article XI hereof. (g) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended and as the same may be amended from time to time (and any successor statute). (h) "INDEPENDENT DIRECTOR" shall mean a director who (i) qualifies as an "independent director" within the meaning of the corporate governance listing standards from time to time adopted by the NYSE or Nasdaq, whichever market the Common Shares are listed for trading on at the time (or, if at any time the Common Shares are not listed for trading on either such market, as would be applicable if the Common Shares were then listed on the NYSE) with respect to the composition of the board of directors of a listed company (without regard to any independence criteria applicable under such standards only to the members of a committee of the board of directors) and (ii) also satisfies the minimum requirements of director independence of Rule 10A-3(b)(1) under the Exchange Act (as from time to time in effect), whether or not such director is a member of the audit committee. (i) "NYSE" shall mean the New York Stock Exchange. (j) "NASDAQ" shall mean the Nasdaq Stock Market. (k) "SUBSIDIARY" shall mean any company controlled, directly or indirectly, by the Corporation. (l) "WHOLE BOARD" shall mean the number of members of the Board at any time if there were then no vacancies on the Board. Section 2. Principal Office; Notices to the Corporation. The principal office of the Corporation shall be at such location in Lancaster, Pennsylvania as the Board of Directors shall from time to time determine. All notices to the Corporation required or permitted by the Bylaws may be addressed to the principal office of the Corporation and shall be marked to the attention of the Secretary unless otherwise provided herein. ARTICLE II Shareholders' Meetings ---------------------- Section 1. Annual Meetings of Shareholders. An annual meeting of shareholders shall be held in each year on such date and at such time as may be set by the Board (or by an officer of the Corporation authorized to do so by the Board) for the purpose of electing directors and the transaction of such other business as may properly come before the meeting; provided, however, that (i) this section shall not require an annual meeting of shareholders during calendar year 2004 and (ii) an annual meeting of shareholders during calendar year 2005 shall be held not later than June 30, 2005. (1) - ---------------- (1) [This, and related, provisions may be modified in order to comply with applicable listing standards as pertinent to the initial listing of the Common Shares.] 2 Section 2. Special Meetings of Shareholders. Special meetings of the shareholders may be called at any time by the Board (or by an officer of the Corporation authorized to do so by the Board ). A special meeting of the shareholders may also be called by the holders of at least 20% of the votes that all shareholders are entitled to cast at the particular meeting. In addition, a special meeting of the holders of Preferred Shares or any series thereof for the purpose of electing directors who may be elected by such holders or taking any other action that such holders may take, as provided by the Articles, may be called as provided in the Articles. At any time, upon written request of any person or persons entitled to call and who have duly called a special meeting, it shall be the duty of the Secretary to set the date of the meeting, if such date has not been set by the Board, on a day not more than sixty days after the receipt of the request, and to give due notice of such meeting to the shareholders. If the Secretary shall neglect or refuse to set the date of the meeting and give notice thereof, the person or persons calling the meeting may do so. Section 3. Place and Notice of Meetings of Shareholders. All meetings of shareholders shall be held at the principal office of the Corporation unless the Board (or an officer of the Corporation authorized to do so by the Board )shall decide otherwise, in which case such meetings may be held at such location within or without the Commonwealth of Pennsylvania as the Board may from time to time direct. Written notice of the place, day, and hour of all meetings of shareholders and, in the case of a special meeting, of the general nature of the business to be transacted at the meeting, shall be given to each shareholder of record entitled to vote at the particular meeting either personally or by sending a copy of the notice through the mail or by overnight courier to the address of the shareholder appearing on the books of the Corporation or supplied by such shareholder to the Corporation for the purpose of notice or by other means including electronic means permitted by law. Except as otherwise provided by the Bylaws or by law, such notice shall be given at least 10 days before the date of the meeting by the President, Vice President, or Secretary. A waiver in writing of any written notice required to be given, signed by the person entitled to such notice, whether before or after the time stated, shall be deemed equivalent to the giving of such notice. Attendance of a person, either in person or by proxy, at any meeting shall constitute a waiver of notice of such meeting, except where a person attends a meeting for the express purpose of objecting to the transaction of any business because the meeting was not lawfully called or convened. Section 4. -A. Nominations by Shareholders of Candidates for Election as Directors. In addition to the nomination by the Board of candidates for election to the Board as hereinafter provided, candidates may be nominated by any shareholder of the Corporation entitled to notice of, and to vote at, any 3 meeting called for the election of directors. Subject to the last sentence of Article Sixth (B) of the Articles and to paragraph (vi) of Article Sixth (H) of the Articles, nominations, other than those made by or on behalf of the Board, shall be made in writing and shall be received by the Secretary of the Corporation not later than (i) with respect to an election of directors to be held at an annual meeting of shareholders, (A) for the annual meeting of shareholders to be first held in calendar year 2005, (the "2005 ANNUAL MEETING"), by January 15, 2005 and (B) for all other annual meetings of shareholders, 90 days prior to the anniversary date of the immediately preceding annual meeting of shareholders (provided that, if the date of the annual meeting of shareholders is more than 30 days before or after the anniversary date of the immediately preceding annual meeting of shareholders, the shareholder nomination shall be received within 15 days after the public announcement by the Corporation of the date of the annual meeting of shareholders, and (ii), with respect to an election of directors to be held at a special meeting of shareholders, the close of business on the 15th day following the date on which notice of such meeting is first given to shareholders or public disclosure of the meeting is first made, whichever is earlier. Such nomination shall contain the following information to the extent known to the notifying shareholder: (a) the name, age, business address, and residence address of each proposed nominee and of the notifying shareholder; (b) the principal occupation of each proposed nominee; (c) a representation that the notifying shareholder intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice; (d) the class and total number of shares of the Corporation that are beneficially owned by the notifying shareholder and by the proposed nominee and, if such shares are not owned solely and directly by the notifying shareholder and the proposed nominee, the manner of beneficial ownership; (e) a description of all arrangements or understandings between the notifying shareholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the notifying shareholder; (f) such other information regarding each nominee proposed by such shareholder as would be required to be included in a proxy statement filed with the Securities and Exchange Commission pursuant to Regulation 14A under the Exchange Act had the nominee been nominated, or intended to be nominated, by the Board of Directors; and (g) the consent of each nominee to serve as a director of the Corporation if so elected. The Corporation may request any such proposed nominee to furnish such other information as may reasonably be required by the Corporation to determine the qualifications of the proposed nominee to serve as a director of the Corporation. Within 15 days following the receipt by the Secretary of a shareholder notice of nomination pursuant hereto, the Nominating and Governance Committee shall instruct the Secretary of the Corporation to advise the notifying shareholder of any deficiencies in the notice as determined by the Committee. The notifying shareholder shall cure such deficiencies within 15 days after receipt of such advice. No persons shall be eligible for election as a director of the Corporation unless nominated in accordance with the Bylaws. Nominations not made in accordance with the Bylaws may, in the discretion of the presiding officer at the meeting and with the advice of the nominating and governance committee of the Board, be disregarded by the presiding officer and, upon his or her instructions, all votes cast for each such nominee may be disregarded; the determinations of the presiding officer at the meeting with respect to such matters shall be conclusive and binding upon all shareholders of the Corporation for all purposes. 4 - B. Certain Nominations for the 2005 Annual Meeting and to Fill Certain Vacancies. Subject to the mandatory requirements of applicable law, notwithstanding anything to the contrary in the foregoing provisions of Section 4-A of this Article, each of the two individuals identified on Schedule 6.3 of the Stockholder and Registration Rights Agreement between the Corporation and the Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust, dated as of the Effective Date (or his successor as a director, if he did not serve for his full initial term until the 2005 Annual Meeting) shall be considered nominated for election as a director at the 2005 Annual Meeting (if such individual is available and willing to serve as a director). Notwithstanding anything to the contrary in paragraph (c) of Section 9 of Article III hereof, if such individuals (or their successors) are not recommended by the nominating and governance committee and nominated the Board for election as directors at the 2005 Annual Meeting, then the candidate of the nominating and governance committee and nominee of the Board for the position on the Board held by either of such individuals (or his successor as a director, if he did not serve for his full initial term) shall (in addition to any other approval required by law, the Articles or the Bylaws) be subject to approval of each of such individuals if he is then a director or, if he is not then a director, shall be subject to approval by a majority of the other directors of the Corporation at such time, other than any director who is an "affiliated person" of the Trust within the meaning of Rule 10A-3 under the Exchange Act. In addition, with respect to the filling of any vacancy on the Board arising before the 2006 Annual Meeting by reason of the death, disability, resignation, removal or disqualification of either of such two identified individuals (or his successor as selected in accordance with the immediately preceding sentence or Section 3 of Article III hereof), the nomination of an individual to fill such vacancy shall be subject to the same approval as required for a nomination referred to in the immediately preceding sentence. Section 5. Advance Notice of Other Matters to be Presented by Shareholders. At any annual meeting or special meeting of shareholders, only such business as is properly brought before the meeting in accordance with this paragraph may be transacted. Subject to paragraph (vi) of Article Sixth (H) of the Articles, to be properly brought before any meeting, any proposed business must be either (a) specified in the notice of the meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (b) otherwise properly brought before the meeting by or at the direction of the Board of Directors, or (c) if brought before the meeting by a shareholder, then (1) written notification of such proposed business must have been received by the Secretary of the Corporation from a shareholder of record on the record date for the determination of shareholders entitled to vote at such meeting not later than (i), with respect to business to be proposed at an annual meeting of shareholders, (A) for the first annual meeting of shareholders held after the 5 Effective Time, not more than 20 days after the public announcement by the Corporation of the date of the annual meeting of shareholders, and (B) for all other annual meetings of shareholders, 90 days prior to the anniversary date of the immediately preceding annual meeting of shareholders (provided, that, if the date of the annual meeting of shareholders is more than 30 days before or after the anniversary date of the immediately preceding annual meeting of shareholders, the notification must have been received within 15 days after the public announcement by the Corporation of the date of the annual meeting of shareholders) and (ii) with respect to business to be proposed at a special meeting of shareholders, the close of business on the 15th day following the date on which notice of such meeting is first given to shareholders or public disclosure of the meeting is made, whichever is earlier. Such shareholder notification shall set forth the nature of and reasons for the proposal in reasonable detail and, as to the shareholder giving notification, (1) the name and address of such shareholder and (2) the class and series of all shares of the Corporation that are beneficially owned by such shareholder. Within 15 days following receipt by the Secretary of a shareholder notification of proposed business pursuant hereto, the Corporation shall advise the shareholder of any deficiencies in the notification. The notifying shareholder may cure such deficiencies within 15 days after receipt of such advice, failing which the shareholder's notification shall be deemed invalid. Section 6. Quorum for Shareholder Meetings. At any meeting of the stockholders, the presence, in person or by proxy, of stockholders entitled to cast at least a majority of the votes which all shareholders are entitled to cast upon a matter shall constitute a quorum for the transaction of business upon such matter, and the stockholders present at a duly organized meeting can continue to do business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum. If a meeting cannot be organized because a quorum has not attended, those present may, except as otherwise provided by law, adjourn the meeting to such time and place as they may determine, but in the case of any meeting called for the election of directors, those who attend the second of such adjourned meetings, although less than a quorum, shall nevertheless constitute a quorum for the purpose of electing directors. Section 7. Votes Per Share. Except as otherwise provided in the Articles or by law, every stockholder of record shall have the right, at every stockholders' meeting, to one vote for every share standing in his name on the books of the Corporation. Except as may be explicitly provided for by the Articles with respect to the election of one or more directors by holders of one or more series of Preferred Stock, in the election of directors stockholders shall be entitled to cast for any candidate for election as a director only one vote per share and shall not be entitled to cumulate their votes and cast them for one candidate or distribute them among any two or more candidates. Section 8. Proxies. Every stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act for him by proxy. A proxy may be submitted to the Secretary by a stockholder in writing, by telephone, electronically or any other means permitted by law. 6 Section 9. Required Vote for Shareholder Action. Except in respect of the election of directors (as to which a plurality vote shall be required as provided by Article III of the Bylaws) and subject to Section 11 of this Article II, all questions submitted to the stockholders and all actions by the stockholders shall be decided by the affirmative vote of the shareholders present, in person or by proxy, entitled to cast at least a majority of the votes which all shareholders present are entitled to vote on the matter, unless otherwise provided by the Articles, the Bylaws or by law. For purposes of this section, in the event that a holder of shares of a class or series that is entitled to vote on a matter is present in person or by proxy at a meeting but is not permitted by reason of a legal disability or by a contractual restriction or otherwise to vote the shares such holder holds on such matter, the shares held by such holder and not so permitted to be voted shall nevertheless be considered entitled to vote and present for purposes of determining the number of votes required for stockholder action. Section 10. Ballots; Judges of Election. Elections for directors need not be by ballot except on demand made by a stockholder at the election and before the voting begins. In advance of any meeting of stockholders, the Board may appoint judges of election who need not be stockholders to act at such meeting or any adjournment thereof, and if such appointment is not made, the chairman of any such meeting may, and on request of any stockholder or his proxy shall, make such appointment at the meeting. The number of judges shall be one or three and, if appointed at a meeting on request of one or more stockholders or their proxies, the majority of the shares present and entitled to vote shall determine whether one or three judges are to be appointed. No person who is a candidate for office shall act as a judge. In case any person appointed as judge fails to appear or fails or refuses to act, the vacancy may be filled by appointment made by the Board in advance of the convening of the meeting or at the meeting by the person or officer acting as chairman of the meeting. On request of the chairman of the meeting or of any stockholder or his proxy, the judges shall make a report in writing of any challenge or question or matter determined by them and execute a certificate of any fact found by them. Section 11. Action Without a Meeting. To the fullest extent and in the manner permitted by law, any action required or permitted to be taken at a meeting of the stockholders or of a class or series of stockholders may be taken without a meeting of the stockholders or of such class or series of stockholders upon the consent in writing signed by such stockholders who would have been entitled to vote the minimum number of votes that would be necessary to authorize the action at a meeting at which all the stockholders entitled to vote thereon were present and voting. The consents shall be filed with the Secretary. ARTICLE III The Board of Directors ---------------------- Section 1. Authority of the Board of Directors. Except as otherwise provided by law and subject to the provisions of the Articles and the Bylaws, all powers vested by law in the Corporation may be exercised by or under the 7 authority of, and the business and affairs of the Corporation shall be managed under the direction of, a Board of Directors which shall be constituted as provided by law, the Articles and the Bylaws. Section 2. Number Of Directors. In accordance with the Articles, commencing with the Effective Time, the Board shall consist of nine members and, thereafter until the first annual meeting held during calendar 2006 (the "2006 ANNUAL MEETING"), the Board shall consist of not less than nine members. After the 2006 Annual Meeting, subject to the provisions of law, the Articles and the Bylaws, the Board shall consist of not fewer than seven nor more than eleven individuals, the exact number to be set from time to time by the Board pursuant to a resolution adopted by the affirmative vote of a majority of the Board, plus such number of additional individuals as may be elected by the holders of Preferred Shares in accordance with the Articles and the Bylaws, provided that no reduction in the number of members shall end the term of office of any director earlier than such term of office would otherwise end and provided, further, that, for so long as the Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust Beneficially Owns Voting Shares (as defined in paragraph (iii) of Article Sixth (H) of the Articles (as in effect at the Effective Time)) entitling the holders thereof to cast more than 20% of the votes which the holders of all Voting Shares are entitled to cast in the election of directors, any increase in the number of members of the Board above eleven shall be subject to the prior written consent of such trust. Section 3. Vacancies. Vacancies on the Board (including any vacancy created by an increase in the size of the Board) may be filled by action of the shareholders or the Board, as provided by and subject to applicable law and the Articles. With respect to any vacancy on the Board occurring prior to the 2006 Annual Meeting by reason of the death, disability, resignation, removal or disqualification of either of the two initial directors of the Corporation as of the Effective Date who are identified on Schedule 6.3 of the Stockholder and Registration Rights Agreement between the Corporation and the Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust, dated as of the Effective Date, or the successor to such individual as a director selected in accordance with the following provisions of this sentence or nominated for election at the 2005 Annual Meeting in accordance with the provisions of Section 4-B of Article II hereof, the nomination of such individual for election by the shareholders or for election by the Board to fill the vacancy shall be subject to the approval required by the last sentence of Section 4-B of Article II hereof. Section 4. Annual Organizational Meeting of the Board. The Board shall hold an annual organizational meeting immediately following the annual meeting of the shareholders at the place thereof, without notice in addition to the notice of the annual meeting of shareholders, or at such other time as soon as practicable after such meeting as the Board shall determine and shall at the annual organizational meeting elect a President, a Secretary and a Treasurer of the Corporation and such other officers of the Corporation as shall be provided by the Bylaws or determined by the Board to be appropriate, shall establish the standing committees of the Board provided by the Bylaws and may take such other action as the Board determines to be appropriate. Officers of the Corporation and standing and other committees of the Board may also be elected at any other time by the Board. 8 Section 5. Other Meetings of the Board. All meetings of the Board, other than the annual organizational meeting, shall be held at the principal office of the Corporation unless the Board (or the person or persons entitled to call and calling the meeting) shall decide otherwise, in which case such meetings may be held at such location within or without the Commonwealth of Pennsylvania as the Board (or the person or persons entitled to call and calling the meeting) may from time to time direct. Regular meetings of the Board shall be held at such time (and place) in accordance with such schedule as the Board shall have determined in advance and no further notice of regular meetings of the Board shall be required. The Independent Directors shall meet periodically without any member of management present and, except as the Independent Directors may otherwise determine, without any other director present to consider the overall performance of management and the performance of the role of the Independent Directors in the governance of the Corporation; such meetings shall be held in connection with a regularly scheduled meeting of the Board except as the Independent Directors shall otherwise determine. Special meetings of the Board may be called by the Chairman of the Board (if any), a Vice Chairman of the Board (if any), the President or by any two or more directors by giving written notice at least two Business Days in advance of the day and hour of the meeting to each director (unless it is determined by the Chairman of the Board (if any), a Vice Chairman of the Board (if any) or the President to be exigent under the circumstances for the protection of the interests of the Corporation that the Board meet earlier, in which case no less than twenty-four hours notice shall be given), either personally or by facsimile, or other means including electronic means permitted by law. Attendance at any meeting of the Board shall be a waiver of notice thereof, unless such lack of notice is protested at the outset of the meeting. If all the members of the Board are present at any meeting, no notice of the meeting shall be required. For purposes hereof, written notice shall include notice provided by e-mail or in other electronic form as long as a documentary copy of such electronic notice may be made. Section 6. Quorum. A majority of the members of the Whole Board shall constitute a quorum for the transaction of business but, if at any meeting a quorum shall not be present, the meeting may adjourn by a majority of those present until such time, from time to time, until a quorum shall be present. Section 7. Telephonic Participation. Directors may participate in a meeting of the Board or a committee thereof by conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. Section 8. Chair and Vice Chair of the Board. The Board may, by resolution adopted by a majority of the Whole Board, at any time designate one of its members as Chair of the Board. The Chairman of the Board shall preside at the meetings of the Board, shall be responsible for the orderly conduct by the 9 Board of its oversight of the business and affairs of the Corporation and its other duties as provided by law, the Articles and the Bylaws and shall have such other authority and responsibility as the Board may designate. The Board may, by resolution adopted by the Board, at any time also designate one or more of its members as Vice Chair of the Board. A Vice Chair of the Board shall assist the Chairman in the conduct of his duties, including by presiding at meetings of the Board in the absence of the Chair of the Board, and shall have such other authority and responsibility as the Board may designate. A Chair or Vice Chair of the Board shall not be considered an officer of the Corporation unless otherwise provided by the Board. Section 9. Committees of the Board. The Board may, by resolution adopted by a majority of the Whole Board, at any time designate one or more committees, each committee to consist of one or more of the directors of the Corporation, except as otherwise provided by the Bylaws. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. Subject to the following provisions of this section, any such committee to the extent provided in such resolution shall have and may exercise any or all of the authority and responsibility of the Board in the management of the business and affairs of the Corporation, except at otherwise provided by law, the Articles or the Bylaws. Except as otherwise provided by the Articles, the Bylaws or action of the Board, a quorum for action by a committee shall be a majority of the members (assuming no vacancy) and action by vote of a majority of the members at a meeting duly called at which a quorum is present shall constitute action by the committee. Each committee shall keep a record of its actions and all material actions taken by a committee on behalf of the Board shall be reported to the full Board periodically. In all other respects, the Board may, by resolution adopted by a majority of the Whole Board, establish rules of procedure for a committee, including designating a member of a committee as its chair. In the absence of the designation by the Board of the chair of a committee or the adoption by the Board of rules of procedure for a committee, the committee shall adopt its own rules of procedure and elect its chair. The Board shall establish standing committees of the Board as provided by the following provisions of this section. (a) Audit Committee. The audit committee shall be composed of at least three members of the Board, each of whom shall be an Independent Director, shall not, in relation to the Corporation, be an "affiliated person" as defined in Rule 10A-3 under the Exchange Act (as from time to time in effect) and shall meet such other qualifications for membership on the audit committee as are from time to time required by the listing standards of the NYSE or Nasdaq applicable to the Corporation. The audit committee shall assist the Board in overseeing the Corporation's financial reporting and shall have such authority and responsibility as is provided in the committee's charter (as hereinafter provided for) and, subject thereto, as is normally incident to the functioning of the audit committee of a publicly-traded company and shall perform the other functions provided to be performed by it by the Bylaws and such other functions as are from time to time assigned to it by the Board. 10 (b) Management Development and Compensation Committee. The management development and compensation committee shall be composed of at least three members of the Board, each of whom shall be an Independent Director and shall meet such other qualifications as may be necessary to qualify as a non-employee director under Rule 16b-3 under the Exchange Act (as from time to time in effect) and as an outside director under Section 162(m) of the Internal Revenue Code of 1986, as amended (and as from time to time in effect). No member of the committee shall be eligible to participate in any compensation plan or program of the Corporation or any Subsidiary of the Corporation that is administered or overseen by the committee. The management development and compensation committee shall assist the Board in overseeing the compensation of the Corporation's officers, the Corporation's employee stock option or other equity-based compensation plans and programs and the Corporation's management compensation policies and shall have such authority and responsibility as is provided in the committee's charter (as hereinafter provided for) and, subject thereto and subject to other direction of the Board, as is normally incident to the functioning of the management compensation committee of a publicly-traded company and shall perform the other functions provided to be performed by it by the Bylaws and such other functions as are from time to time assigned to it by the Board. Unless reviewed and, if necessary, approved by the committee, the Corporation shall not cause or permit any Subsidiary of the Corporation to pay or grant any compensation to any officer or employee of the Corporation which, if paid or granted by the Corporation, would require review or approval of the committee. (c) Nominating and Governance Committee. The nominating and governance committee shall be composed of at least three members of the Board, each of whom shall be an Independent Director and the appointment of each of whom shall require the affirmative vote of a majority of the Independent Directors at the time. The nominating and governance committee (i) shall have authority and responsibility to recommend to the Board for approval the candidates to be recommended by the Board to the shareholders for election as directors of the Corporation or to be elected by the Board to fill a vacancy on the Board, who shall be such as to cause, if such candidates are elected, the composition of the Board to satisfy the requirements of the Articles regarding director independence and the requirements of this section, (ii) shall advise the Board on its policies and procedures for carrying out its responsibilities and on the Corporation's policies and procedures respecting shareholder participation in corporate governance and (iii) shall have such authority and responsibility as is provided in the committee's charter (as hereinafter provided for) and, subject thereto and subject to other direction of the Board, as is normally incident to the functioning of the nominating or governance committee of a publicly-traded company and (iv) shall perform the other functions provided to be performed by it by the Bylaws and such other functions as are from time to time assigned to it by the Board. 11 (d) Committee Charters. The Board, by majority vote of the Whole Board, shall approve a charter describing the purposes, functions and responsibilities of each standing committee of the Board. Each standing committee of the Board shall prepare and recommend to the Board for its approval the committee's charter and shall, at least annually, review and report to the Board on the adequacy thereof. In addition to and without limiting the provisions of paragraphs (a) through (c) of this section, each standing committee of the Board shall have the authority and responsibility provided by its Board-approved charter, subject to further action by the Board, and no further authorization of the Board shall be necessary for actions by a committee within the scope of its charter. Any other committee of the Board may likewise prepare and recommend to the Board a charter for the committee and shall have the authority and responsibility provided by its Board-approved charter. (e) Committee Advisors and Resources. Each standing committee of the Board shall have the authority to retain, at the Corporation's expense, such legal and other counsel and advisors as it determines to be necessary or appropriate to carry out its responsibilities within the scope of its charter. Each other committee of the Board shall have like authority to the extent provided by its charter or otherwise authorized by the Board. The Corporation shall pay the compensation of the independent auditor of the Corporation for all audit services, as approved by the Audit Committee, without need for further authorization. Section 10. Director Compensation. The Board may set the compensation of directors as permitted by law. ARTICLE IV Officers -------- Section 1. Officers Generally. The Board shall designate a President, one or more Vice Presidents, a Treasurer, a Secretary and a General Counsel and shall designate an officer as chief financial officer and an officer as chief accounting officer and may designate such other officers, with such titles, authority and responsibility (including Assistant Vice Presidents, Assistant Treasurers and Assistant Secretaries), as the Board considers appropriate for the conduct of the business and affairs of the Corporation. Any two or more offices may be held by the same individual. Unless sooner removed by the Board, all officers shall hold office until the next annual meeting of the Board and until their successors shall have been elected. Any officer may be removed from office at any time, with or without cause, by action of the Board. Section 2. President. The President shall be the chief executive officer of the Corporation, shall have general supervision of the business and affairs and all other officers of the Corporation (except that, if there is a 12 Chairman of the Board or a Vice Chairman of the Board who is considered an officer of the Corporation, the President shall play only such supervisory role with respect thereto as is provided by the Board) and, subject to the direction of the Board, shall have the authority and responsibility customary to such office. The President shall preside at all meetings of the shareholders and, in the absence of a Chairman of the Board (if any) or Vice Chairman of the Board and except as otherwise provided by the Board, at all meetings of the Board at which the President is present. Section 3. Vice Presidents; Operation or Division Presidents. The Board may elect one or more Vice Presidents, with such further titles (including designation as President of a division or operation of the Corporation) and with such authority and responsibility as the Board may determine. In the absence or disability of the President, his duties shall be performed by one or more Vice Presidents or Operation or Division Presidents as designated by the Board. Section 4. Chief Financial Officer; Controller. The Board shall designate an officer as the chief financial officer of the Corporation, who shall have general supervision of the financial affairs of the Corporation, such other authority and responsibility as the Board may designate and, subject to the direction of the Board, the authority and responsibility customary to such office. In the absence or disability of the chief financial officer, his or her duties may be performed by any other officer designated by him or her, by the President or by the Board. The Board shall also designate an officer as the Controller of the Corporation, who shall be the chief accounting officer of the Corporation (and may be the same as or different from the chief financial officer). The Controller shall have general supervision of the books and accounts of the Corporation, such other authority and responsibility as the Board may designate and, subject to the direction of the Board, the authority and responsibility customary to such office. In the absence or disability of the chief accounting officer, his or her duties may be performed by any other officer designated by him or her, by the President or by the Board. Section 5. Treasurer. The Treasurer (who may be the same as or different from the chief financial officer and/or the chief accounting officer) shall have supervision and custody of all funds and securities of the Corporation and keep or cause to be kept accurate accounts of all money received or payments made by the Corporation, and shall have such other authority and responsibility as provided by the Bylaws or as the Board may designate and, subject to the direction of the Board, the authority and responsibility customary to such office. The Treasurer shall be ex-officio, and have the authority and responsibility of, an Assistant Secretary. Section 6. General Counsel. The Board shall designate a General Counsel for the Corporation, who shall be the Corporation's chief legal officer and shall have general supervision of the legal affairs of the Corporation and such other authority and responsibility as the Board may designate and, subject to the direction of the Board, the authority and responsibility customary to such office. 13 Section 7. Secretary. The Secretary shall have custody of the minutes of the meetings of the Board, its committees and the stockholders, of the Articles as amended and the Bylaws as amended and such other records of the Corporation as respect its existence and authority to conduct business, shall have such other authority and responsibility as provided by the Bylaws or as the Board may designate and, subject thereto, the authority and responsibility customary to such office. The Secretary shall send out notices of meetings of the Board and stockholders as required by law or the Bylaws. The Secretary shall attend and keep the minutes of the Board except as the Board may otherwise designate. The Secretary shall be ex-officio, and have the authority and responsibility of, an Assistant Treasurer. Section 8. Assistant Treasurers; Assistant Secretaries. In the absence or disability of the Secretary, his or her duties may be performed by an Assistant Secretary. In the absence or disability of the Treasurer, his or her duties may be performed by an Assistant Treasurer. Such assistant officers shall also have such authority and responsibility as may be assigned to them by the Board. Section 9. Bonded Officers and Employees. Such officers and employees of the Corporation as the Board shall determine shall give bond for the faithful discharge of their duties in such form and for such amount and with such surety or sureties as the Board shall require. The expense of procuring such bonds shall be borne by the Corporation. ARTICLE V Limitation on Directors' Personal Liability; Indemnification of Directors, -------------------------------------------------------------------------- Officers, Employees and Agents ------------------------------ Section 1. Limitation on Directors' Personal Liability. A director of the Corporation shall not be personally liable for monetary damages for any action taken or failure to take any action unless the director has breached or failed to perform the duties of his or her office under Subchapter B of Chapter 17 of the Pennsylvania Business Corporation Law of 1988, as amended, and such breach or failure to perform constitutes self-dealing, willful misconduct or recklessness; provided, however, that the foregoing provision shall not eliminate or limit the liability of a director (i) for any responsibility or liability of such director pursuant to any criminal statute, or (ii) for any liability of a director for the payment of taxes pursuant to local, state or federal law. Section 2. Indemnification of Directors, Officers, Employees and Agents. (a) Indemnification of Directors and Officers. The Corporation shall indemnify to the full extent permitted by law any person made, or threatened to be made, a party to or 14 otherwise involved in (as a witness or otherwise) an action, suit or proceeding (whether civil, criminal, administrative, legislative or investigative, and whether by or in the right of the Company or otherwise asserted) by reason of the fact that the person (i) is or was a director or officer of the Corporation or (ii) while a director or officer of the Corporation, either (A) serves or served as a director, officer, partner, member, trustee, employee or agent of any subsidiary of the Corporation or other related enterprise at the request of the Corporation or in connection with a related employee benefit plan of the Corporation, any subsidiary of the Corporation or any such enterprise, (B) serves or served as a director, officer, partner, member, trustee, employee or agent of any other unrelated enterprise (including any charitable organization) in furtherance of the interests of, and at the specific written request of the Corporation, or in connection with a related employee benefit plan of such enterprise, against any expenses, judgments, fines, and amounts paid in settlement actually and reasonably incurred in defending or responding to any such pending or threatened action, suit or proceeding (including any incurred in connection with any actions brought by or in the right of the Corporation). A resolution or other action by the Corporation or subsidiary electing, nominating or proposing a person to a position referred to in this subsection 2(a) shall constitute a specific written request of the Corporation sufficient for the purposes of this Section. Upon written request of a person claiming to be entitled to indemnification hereunder and specifying the expenses, judgments, fines and amounts paid in settlement against which indemnity is sought, the Corporation shall, as soon as practicable and in any event within 90 days of its receipt of such request, make a determination, in such manner as is required by law, as to the entitlement of such person to indemnification against such expenses as provided by this subsection 2(a). Such a determination, however, shall not be conclusive as to such person's entitlement to indemnification pursuant to this subsection 2(a) and such person may seek to enforce an entitlement to indemnification pursuant to this subsection 2(a) by appropriate proceedings in any court of competent jurisdiction by showing that, notwithstanding such determination, such person satisfied the standard of conduct required by law to be satisfied in order for such person to be entitled to indemnification from the Corporation as permitted by law. (b) Advancement of Expenses. Expenses reasonably incurred by a person referred to in subsection 2(a) above in defending or responding to a civil, criminal, administrative, legislative or investigative action, suit or proceeding shall be paid by the Corporation in advance of the final disposition of the action, 15 suit or proceeding upon receipt of an undertaking by or on behalf of such person to repay such amount to the extent it shall ultimately be determined that such person is not entitled to be indemnified by the Corporation against such expenses or, in the case of a criminal action in which a judgment has been entered against such person, the Board of Directors so determines. (c) Indemnification of Employees and Agents. The Corporation may, upon authorization by the board of directors, the President or any other officer designated by the board of directors, indemnify, or agree to indemnify, and advance expenses to any person who is or was an employee or agent of the Corporation or any subsidiary of the Corporation to the same extent (or any lesser extent) to which it may indemnify and advance expenses to a director or officer of the Corporation in accordance with subsection 2(b) above. (d) Non-Exclusivity. The right to indemnification and advancement of expenses conferred in this Section shall not be deemed exclusive of any other rights to which any person indemnified may be entitled under any agreement, vote of stockholders or directors or otherwise, the Corporation having the express authority to enter such agreements or make other provision for the indemnification of and advancement of expenses to any or all of its representatives as the Board of Directors deems appropriate, including corporate policies and the creation of one or more funds or equivalent guarantees for indemnity payments and or expense advancements to present or future indemnified persons. (e) Continuing Contractual Rights. The right to indemnification and the advancement of expenses provided in this Section shall be a contract right, shall continue as to a person who has ceased to serve in the capacities described herein, and shall inure to the benefit of the heirs, executors and administrators of such person. Expenses reasonably incurred by a person in successfully enforcing a right to indemnification or advancement of expenses provided to such person by, or as permitted by, this Section 2 shall be paid by the Corporation. Section 3. No Retroactive Amendment. No amendment, alteration or repeal of this Article V, nor the adoption of any provision inconsistent with this Article V, shall adversely affect any limitation on the personal liability of a director or officer, or the rights of a person to indemnification and advancement of expenses, existing at the time of such amendment, modification or repeal, or the adoption of such an inconsistent provision. 16 ARTICLE VI Seal ---- The Corporation shall have a seal that shall contain the words "Armstrong World Industries, Inc." and may be affixed to documents of the Corporation as prima facie evidence of the act of the Corporation to the extent provided by law. ARTICLE VII Share Certificates and Transfers -------------------------------- Section 1. Form of Share Certificates. Shares of the Corporation may be represented by certificates or may be uncertificated, but shareholders shall be entitled to receive share certificates representing their shares as provided by law. Share certificates shall be in such form as the Board may from time to time determine and shall be signed by the President or one of the Vice Presidents and countersigned by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary and embossed with the seal of the Corporation or, if not so signed and sealed, shall bear the engraved or printed facsimile signatures of the officers authorized to sign and the engraved or printed facsimile of the seal of the Corporation. The death, incapacity, resignation or removal of an officer who signed or whose facsimile signature appears on a share certificate shall not affect the validity of the share certificate. Section 2. Transfers of Record. The shares of the Corporation shall, upon the surrender and cancellation of the certificate or certificates representing the same, be transferred upon the books of the Corporation at the request of the holder thereof, named in the surrendered certificate or certificates, in person or by his legal representatives or by his attorney duly authorized by written power of attorney filed with the Corporation or its transfer agent. In case of loss or destruction of a certificate of stock, another may be issued in lieu thereof in such manner and upon such terms as the Board shall authorize. Section 3. Record Dates. The Board of Directors may set a time, not more than 90 days prior to the date of any meeting of the shareholders, or the date set for the payment of any dividend or distribution or the date for the allotment of rights, or the date when any change or conversion or exchange of shares stock will be made or go into effect, as a record date for the determination of the shareholders entitled to notice of, or to vote at, any such meeting, or entitled to receive payment of any such dividend or distribution, or to receive any such allotment of rights, or to exercise the rights in respect to any such change, conversion, or exchange of shares of the Corporation. In such case, only such shareholders as shall be shareholders of record on the date so set shall be entitled to notice of, or to vote at, such meeting, or to receive payment of such dividend or distribution, or to receive such allotment of rights, or exercise such rights, as the case may be, notwithstanding any transfer of shares of the Corporation on the books of the Corporation after any record date set as aforesaid. 17 ARTICLE VIII Fiscal Year; Financial Statements --------------------------------- The fiscal year of the Corporation shall end on the 31st day of December. Without limiting any other financial reporting obligation the Corporation may have, the Board shall mail or otherwise cause to be sent to the stockholders, within 120 days after the close of each fiscal year, financial statements which shall include a balance sheet as of the end of such year, together with a statement of income and expense for such year, prepared so as to present fairly the financial condition and results of its operations of the Corporation in accordance with generally accepted accounting principles. Such financial statements shall have been audited in accordance with generally accepted auditing standards by a firm of independent certified public accountants and shall be accompanied by such firm's opinion as to the fairness of the presentation thereof. ARTICLE IX Amendments ---------- Section 1. Amendment Generally. The Bylaws, as from time to time in effect, may be amended, modified or repealed, in whole or in part, at any time and from time to time in any respect by either (i) the shareholders, by the affirmative vote of the holders of a majority of the outstanding shares entitled to vote on the matter, or (ii) by the Board, by the affirmative vote of a majority of the Whole Board, in either case except as otherwise provided by law or by the Articles or by Section 2 of this Article of the Bylaws (as in effect at the Effective Time). Section 2. Certain Amendments. Commencing on the Effective Time and continuing for so long as any shareholder Beneficially Owns at least 20% of the Common Shares (but terminating at such time as no shareholder Beneficially Owns at least 20% of the Common Shares), the Board shall not, without the affirmative vote of the holders of 80% of the Common Shares outstanding, repeal, or adopt any amendment of the Bylaws that would modify or be inconsistent with, the following provisions of these Bylaws: (i) the definition of "Independent Directors" in Section 1(h) of Article I (as in effect at the Effective Time), (ii) Section 2 of Article II (as in effect at the Effective Time) insofar as such section permits the holder or holders of a at least 20% of the votes that all shareholders are entitled to cast to call a special meeting of the stockholders to vote on a matter, (iii) Section 11 of Article II (as in effect at the Effective Time) governing action by the stockholders by written consent in lieu of a meeting, (iv) Sections 3 and 9 of Article III (as in effect at the Effective Time) insofar as such sections relate to the selection of directors to fill vacancies before the 2006 Annual Meeting or the nomination of individuals for election of directors at the 2005 Annual Meeting, (iv) Section 2 of Article III insofar as it relates to the Trust's consent rights with respect to increases of the size of the Board above eleven members, and (v) Section 10(c) of Article III insofar as such section provides that appointment of members of the nominating and governance committee will require the affirmative vote of a majority of the Independent Directors, and (vi) any provision of section of this Article IX (as in effect at the Effective Time). 18 ARTICLE X Effective Time -------------- The foregoing Bylaws have been adopted before the Effective Time by action of the sole stockholder of the Corporation and shall be effective upon the filing with the office of the Secretary of State of the Commonwealth of Pennsylvania of Amended and Restated Article of Incorporation of the Corporation and the effectiveness of such Amended and Restated Articles of Incorporation in accordance with law on [________, 200_] (2) (the "EFFECTIVE TIME"). - ------------------------- (2) [The date to be inserted herein shall be the Effective Date of the Fourth Amended Plan of Reorganization of the Corporation.] EX-99 5 mv9-5ex99_3.txt 99.3 Exhibit 99.3 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------) Exhibit 1.23 FORM OF ASBESTOS PI TRUST AGREEMENT ARMSTRONG WORLD INDUSTRIES, INC. ASBESTOS PERSONAL INJURY SETTLEMENT TRUST AGREEMENT This Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust Agreement ("PI TRUST AGREEMENT"), dated the date set forth on the signature page hereof and effective as of the Effective Date, is entered into by Armstrong World Industries, Inc. ("AWI," the "SETTLOR," or the "DEBTOR"), the Debtor and debtor-in-possession in Case No. 00-4471 (RJN) in the United States Bankruptcy Court for the District of Delaware as Settlor; the Legal Representative for Asbestos-Related Future Claimants ("FUTURE CLAIMANTS' REPRESENTATIVE"); the Official Committee of Asbestos Creditors ("ACC"); and the Trustees ("TRUSTEES") and the members of the PI Trust Advisory Committee ("TAC") identified on the signature page hereof and appointed at Confirmation pursuant to Armstrong World Industries, Inc. First Amended Plan of Reorganization under Chapter 11 of the United States Bankruptcy Code, dated March 14, 2003 ("PLAN"), as such Plan may be amended, modified or supplemented from time to time. All capitalized terms not otherwise defined herein shall have their respective meanings as set forth in the Plan, and such definitions are incorporated herein by reference. All capitalized terms not defined herein or defined in the Plan, but defined in the Bankruptcy Code or Rules, shall have the meanings ascribed to them by the Bankruptcy Code and Rules, and such definitions are incorporated herein by reference. WHEREAS, at the time of the entry of the order for relief in the Chapter 11 case, AWI was named as a defendant in actions involving personal injury ("PI") or death claims caused by exposure to asbestos-containing products for which AWI, its predecessors, successors and assigns have legal liability ("ASBESTOS PERSONAL INJURY CLAIMS" as defined in the Plan); and WHEREAS, AWI has reorganized under the provisions of Chapter 11 of the Bankruptcy Code in a case pending in the United States Bankruptcy Court for the District of Delaware, known as In re Armstrong World Industries, Inc., Debtor, Case No. 00-4471 (RJN); and WHEREAS, the Plan has been confirmed by the Bankruptcy Court; and WHEREAS, the Plan provides, inter alia, for the creation of the Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust ("PI TRUST"); and WHEREAS, pursuant to the Plan, the PI Trust is to use its assets and income to satisfy all Asbestos Personal Injury Claims; and WHEREAS, it is the intent of AWI, the Trustees, the ACC, the TAC, and the Future Claimants' Representative that the PI Trust be administered, maintained, and operated at all times through mechanisms that provide reasonable assurance that the PI Trust will satisfy all Asbestos Personal Injury Claims pursuant to the AWI Corporation Asbestos Personal Injury Trust Distribution Procedures ("TDP") that are attached hereto as Exhibit 1 in substantially the same manner, and in strict compliance with the terms of this PI Trust Agreement; and WHEREAS, pursuant to the Plan, the PI Trust is intended to qualify as a "qualified settlement fund" within the meaning of section 1.468B-1 et seq. of the Treasury Regulations promulgated under section 468B of the Internal Revenue Code ("IRC"); and WHEREAS, the Bankruptcy Court has determined that the PI Trust and the Plan satisfy all the prerequisites for an injunction pursuant to section 524(g) of the Bankruptcy Code, and such injunction has been entered in connection with the Confirmation Order; NOW, THEREFORE, it is hereby agreed as follows: Exhibit 1.23-1 SECTION 1 AGREEMENT OF TRUST 1.1 CREATION AND NAME. AWI as Settlor hereby creates a trust known as the "Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust," which is the PI Trust provided for and referred to in the Plan. The Trustees of the PI Trust may transact the business and affairs of the PI Trust in the name of the PI Trust. 1.2 PURPOSE. The purpose of the PI Trust is to assume the liabilities of AWI, its predecessors and successors in interest, for all Asbestos Personal Injury Claims (as defined in the Plan), and to use the PI Trust's assets and income to pay the holders of all Asbestos Personal Injury Claims in accordance with this PI Trust Agreement and the TDP in such a way that such holders of Asbestos Personal Injury Claims are treated fairly, equitably and reasonably in light of the limited assets available to satisfy such claims, and to otherwise comply in all respects with the requirements of a trust set forth in section 524(g)(2)(B) of the Bankruptcy Code. 1.3 TRANSFER OF ASSETS. Pursuant to the Plan, the PI Trust Share (as defined in the Plan) has been transferred and assigned to the PI Trust to settle and discharge all Asbestos Personal Injury Claims. Pursuant to the Plan, AWI, its successors in interest thereto, from and after the Effective Date ("REORGANIZED AWI") and others may also transfer and assign additional assets to the PI Trust from time to time (the "PI TRUST ASSETS"). In all events, the PI Trust Assets will be transferred to the PI Trust free and clear of any liens or other claims by AWI, Reorganized AWI, any creditor, or other entity. AWI, Reorganized AWI, and any other transferors shall also execute and deliver such documents to the PI Trust as the Trustees reasonably request to transfer and assign the PI Trust Assets to the PI Trust. 1.4 ACCEPTANCE OF ASSETS AND ASSUMPTION OF LIABILITIES (a) In furtherance of the purposes of the PI Trust, the Trustees, on behalf of the PI Trust, hereby expressly accept the transfer and assignment to the PI Trust of the PI Trust Assets in the time and manner contemplated in the Plan. (b) In furtherance of the purposes of the PI Trust, the Trustees, on behalf of the PI Trust, expressly assume all liability for (i) all Asbestos Personal Injury Claims and (ii) all premiums, deductibles, retrospective premium adjustments, security or collateral arrangements, or any other charges, costs, fees, or expenses (if any) that become due to any insurer in connection with the Asbestos PI Insurance Asset (as such term is defined in the Plan) as a result of Asbestos Personal Injury Claims, asbestos-related personal injury claims against Entities insured under policies included in the Asbestos PI Insurance Asset by reason of vendor's endorsements, or under indemnity provisions of settlement agreements that AWI made with various insurers prior to the Commencement Date (as such term is defined in the Plan) to the extent that those indemnity provisions relate to Asbestos Personal Injury Claims. (c) No provision herein or in the TDP shall be construed to mandate distributions on any claims or other actions that would contravene the PI Trust's compliance with the requirements of a qualified settlement fund within the meaning of section 1.468B-1 et seq. of the Treasury Regulations promulgated under section 468B of the IRC. (d) AWI and Reorganized AWI shall be entitled to indemnification from the PI Trust for any expenses, costs, and fees (including attorneys' fees and costs, but excluding any such expenses, costs, and fees incurred prior to the Effective Date), judgments, settlements, or other liabilities arising from or incurred in connection with any action related to Asbestos Personal Injury Claims, including, but not limited to, indemnification or contribution for such claims prosecuted against Reorganized AWI. (e) Nothing in this PI Trust Agreement shall be construed in any way to limit the scope, enforceability, or effectiveness of the Section 524(g) injunction issued in connection with the Plan or the PI Trust's assumption of all liability for Asbestos Personal Injury Claims, subject to the provisions of Section 1.4(b) above. Exhibit 1.23-2 SECTION 2 POWERS AND TRUST ADMINISTRATION 2.1 POWERS. (a) The Trustees are and shall act as the fiduciaries to the PI Trust in accordance with the provisions of this PI Trust Agreement and the Plan. The Trustees shall, at all times, administer the PI Trust and the PI Trust Assets in accordance with the purposes set forth in Section 1.2 above. Subject to the limitations set forth in this PI Trust Agreement, the Trustees shall have the power to take any and all actions that, in the judgment of the Trustees, are necessary or proper to fulfill the purposes of the PI Trust, including, without limitation, each power expressly granted in this Section 2.1, any power reasonably incidental thereto, and any trust power now or hereafter permitted under the laws of the State of Delaware. (b) Except as required by applicable law or otherwise specified herein, the Trustees need not obtain the order or approval of any court in the exercise of any power or discretion conferred hereunder. (c) Without limiting the generality of Section 2.1(a) above, and except as limited below, the Trustees shall have the power to: (i) receive and hold the PI Trust Assets, vote the Reorganized AWI common stock, and exercise all rights with respect to, and sell, any securities issued by Reorganized AWI that are included in the PI Trust Assets, subject to any restrictions set forth in the Restated Certificate of Reorganized AWI; (ii) invest the monies held from time to time by the PI Trust; (iii) sell, transfer, or exchange any or all of the PI Trust Assets at such prices and upon such terms as the Trustees may consider proper, consistent with the other terms of this PI Trust Agreement; (iv) enter into leasing and financing agreements with third parties to the extent such agreements are reasonably necessary to permit the PI Trust to operate; (v) pay liabilities and expenses of the PI Trust, including, but not limited to, PI Trust expenses; (vi) establish such funds, reserves and accounts within the PI Trust estate, as deemed by the Trustees to be useful in carrying out the purposes of the PI Trust; (vii) sue and be sued and participate, as a party or otherwise, in any judicial, administrative, arbitrative, or other proceeding; (viii) establish, supervise and administer the PI Trust in accordance with the TDP and the terms thereof; (ix) appoint such officers and hire such employees and engage such legal, financial, accounting, investment, auditing and forecasting, and other consultants and agents as the business of the PI Trust requires, and delegate to such persons such powers and authorities as the fiduciary duties of the Trustees permit and as the Trustees, in their discretion, deem advisable or necessary in order to carry out the terms of this PI Trust; (x) pay employees, legal, financial, accounting, investment, auditing, and forecasting, and other consultants, advisors, and agents, including those engaged by the PI Trust in connection with its alternative dispute resolution activities, reasonable compensation; (xi) compensate the Trustees, the TAC members, and the Future Claimants' Representative as provided below, and their employees, legal, financial, accounting, investment and other advisors, consultants, independent contractors, and agents, and reimburse the Trustees, the TAC members and the Future Claimants' Exhibit 1.23-3 Representative all reasonable out-of-pocket costs and expenses incurred by such persons in connection with the performance of their duties hereunder; (xii) execute and deliver such instruments as the Trustees consider proper in administering the PI Trust; (xiii) enter into such other arrangements with third parties as are deemed by the Trustees to be useful in carrying out the purposes of the PI Trust, provided such arrangements do not conflict with any other provision of this PI Trust Agreement; (xiv) in accordance with Section 4.6 below, defend, indemnify and hold harmless (and purchase insurance indemnifying) (A) the Trustees and (B) the TAC, the Future Claimants' Representative, the officers and employees of the PI Trust, and any agents, advisors and consultants of the PI Trust, the TAC or the Future Claimants' Representative (the "ADDITIONAL INDEMNITEES"), to the fullest extent that a corporation or trust organized under the law of the PI Trust's situs is from time to time entitled to indemnify and/or insure its directors, trustees, officers, employees, agents, advisors and representatives; (xv) delegate any or all of the authority herein conferred with respect to the investment of all or any portion of the PI Trust Assets to any one or more reputable individuals or recognized institutional investment advisors or investment managers without liability for any action taken or omission made because of any such delegation, except as provided in Section 4.4 below; (xvi) consult with Reorganized AWI, the TAC and the Future Claimants' Representative at such times and with respect to such issues relating to the conduct of the PI Trust as the Trustees consider desirable; and (xvii) make, pursue (by litigation or otherwise), collect, compromise or settle, in the name of the PI Trust or the name of Reorganized AWI, any claim, right, action, or cause of action included in the PI Trust Assets including, but not limited to, insurance recoveries, before any court of competent jurisdiction; provided that settlement of actions before the Bankruptcy Court require the approval of the Bankruptcy Court after notice to Reorganized AWI. (d) The Trustees shall not have the power to guarantee any debt of other persons. (e) The Trustees shall give the TAC, the Future Claimants' Representative and Reorganized AWI prompt notice of any act performed or taken pursuant to Sections 2.1(c)(i), (iii), (vii), or (xv) above, and any act proposed to be performed or taken pursuant to Section 2.2(f) below. 2.2 GENERAL ADMINISTRATION. (a) The Trustees shall adopt and act in accordance with the PI Trust Bylaws. To the extent not inconsistent with the terms of this PI Trust Agreement, the PI Trust Bylaws shall govern the affairs of the PI Trust. In the event of an inconsistency between the PI Trust Bylaws and this PI Trust Agreement, the PI Trust Agreement shall govern. (b) The Trustees shall (i) timely file such income tax and other returns and statements and shall timely pay all taxes required to be paid, (ii) comply with all withholding obligations, as required under the applicable provisions of the IRC and of any state law and the regulations promulgated thereunder, (iii) meet without limitation all requirements necessary to qualify and maintain qualification of the PI Trust as a qualified settlement fund within the meaning of section 1.468B-1 et seq. of the Treasury Regulations promulgated under section 468B of the IRC, and (iv) take no action that could cause the PI Trust to fail to qualify as a qualified settlement fund within the meaning of section 1.468B-1 et seq. of the Treasury Regulations promulgated under section 468B of the IRC. (c) The Trustees shall timely account to the Bankruptcy Court as follows: Exhibit 1.23-4 (i) The Trustees shall cause to be prepared and filed with the Bankruptcy Court, as soon as available, and in any event within one hundred and twenty (120) days following the end of each fiscal year, an annual report containing financial statements of the PI Trust (including, without limitation, a balance sheet of the PI Trust as of the end of such fiscal year and a statement of operations for such fiscal year) audited by a firm of independent certified public accountants selected by the Trustees and accompanied by an opinion of such firm as to the fairness of the financial statements' presentation of the cash and investments available for the payment of claims and as to the conformity of the financial statements with generally accepted accounting principles. The Trustees shall provide a copy of such report to the TAC, the Future Claimants' Representative, and Reorganized AWI when such reports are filed with the Bankruptcy Court. (ii) Simultaneously with delivery of each set of financial statements referred to in Article 2.2(c)(i) above, the Trustees shall cause to be prepared and filed with the Bankruptcy Court a report containing a summary regarding the number and type of claims disposed of during the period covered by the financial statements. The Trustees shall provide a copy of such report to the TAC, the Future Claimants' Representatives, and Reorganized AWI when such report is filed. (iii) All materials required to be filed with the Bankruptcy Court by this Section 2.2(c) shall be available for inspection by the public in accordance with procedures established by the Bankruptcy Court and shall be filed with the Office of the United States Trustee for the District of Delaware. (d) The Trustees shall cause to be prepared as soon as practicable prior to the commencement of each fiscal year a budget and cash flow projections covering such fiscal year and the succeeding four fiscal years. The budget and cash flow projections shall include determining the Maximum Annual Payment pursuant to Section 2.4 of the TDP, and the Asbestos Personal Injury Claims Payment Ratio pursuant to Section 2.5 of the TDP. The Trustees shall provide a copy of the budget and cash flow projections to the TAC and the Future Claimants' Representative. (e) The Trustees shall consult with the TAC and the Future Claimants' Representative (i) on the general implementation and administration of the PI Trust; (ii) on the general implementation and administration of the TDP; and (iii) on such other matters as may be required under this PI Trust Agreement and the TDP. (f) The Trustees shall be required to obtain the consent of the TAC and the Future Claimants' Representative pursuant to the Consent Process set forth in Section 5.7(b) and 6.6(b) below, in addition to any other instances elsewhere enumerated, in order: (i) to change the Claims Payment Ratio described in Section 2.5 of the TDP in the event that the requirements for such a change as set forth in said provision have been met; (ii) to change the Scheduled Diseases, Disease Levels and/or Medical/Exposure Criteria set forth in Section 5.3(a)(3) of the TDP, and/or the Maximum Values set forth in Section 5.3(b)(4) and Section 5.4(a) of the TDP; (iii) to change the Payment Percentage described in Section 2.3 of the TDP as provided in Section 4.2 of the TDP; (iv) to establish and/or to change the Claims Materials to be provided holders of Asbestos Personal Injury Claims under Section 6.1 of the TDP; (v) to require that claimants provide additional kinds of medical and/or exposure evidence pursuant to Section 7.1 of the TDP; Exhibit 1.23-5 (vi) to change the form of release to be provided pursuant to Section 7.8 of the TDP; (vii) to terminate the PI Trust pursuant to Section 7.2 below; (viii) to settle the liability of any insurer under any insurance policy or legal action related thereto; (ix) to change the compensation of the members of the TAC, the Future Claimants' Representative or Trustees, other than to reflect cost-of-living increases or changes approved by the Bankruptcy Court as otherwise provided herein; (x) to take structural or other actions to minimize any tax on the PI Trust Assets; or (xi) to amend the PI Trust Bylaws in accordance with the terms thereof; (xii) to amend any provision of this PI Trust Agreement or the TDP in accordance with the terms thereof; (xiii) to appoint members of the Board of Directors of the Reorganized Debtor; or (xiv) to merge any asbestos claims resolution organization formed by the PI Trust with another asbestos claims resolution organization that is not specifically created by this PI Trust Agreement or the TDP, or to contract with another asbestos claims resolution organization or other entity that is not specifically created by this PI Trust Agreement or the TDP, or permit any other party to join in any asbestos claims resolution organization that is formed by the PI Trust pursuant to the PI Trust Agreement or the TDP; provided that such merger, contract or joinder shall not (a) subject Reorganized AWI or any successors in interest thereto, to any risk of having any PI Trust Claim asserted against it or them, or (b) otherwise jeopardize the validity or enforceability of the section 524(g) injunction; and provided further that the terms of such merger will require the surviving organization to make decisions about the allowability and value of claims in accordance with Section 2.1 of the TDP which requires that such decisions be based on the provisions of the TDP. (g) The Trustees shall meet with the TAC and the Future Claimants' Representative no less often than quarterly. The Trustees shall meet in the interim with the TAC and the Future Claimants' Representative when so requested by either. (h) The Trustees, upon notice from either the TAC or the Future Claimants' Representative, if practicable in view of pending business, shall at their next meeting with the TAC or the Future Claimants' Representative consider issues submitted by the TAC or the Future Claimants' Representative. (i) Periodically, but not less often than once a year, the Trustees shall make available to claimants and other interested parties the number of claims by disease levels that have been resolved both by individual review and by arbitration, as well as by trial, indicating the amounts of the awards and the averages of the awards by jurisdiction pursuant to Section 7.10 of the TDP. Exhibit 1.23-6 2.3 CLAIMS ADMINISTRATION. The Trustees shall promptly proceed to implement the TDP. SECTION 3 ACCOUNTS, INVESTMENTS, AND PAYMENTS 3.1 ACCOUNTS. The Trustees may, from time to time, create such accounts and reserves within the PI Trust estate as they may deem necessary, prudent, or useful in order to provide for the payment of expenses and payment of Asbestos Personal Injury Claims and may, with respect to any such account or reserve, restrict the use of monies therein. 3.2 INVESTMENTS. Investment of monies held in the PI Trust shall be administered in the manner in which individuals of ordinary prudence, discretion, and judgment would act in the management of their own affairs, subject to the following limitations and provisions: (a) The PI Trust shall not acquire, directly or indirectly, equity in any entity (other than Reorganized AWI or any successor to Reorganized AWI) or business enterprise if, immediately following such acquisition, the PI Trust would hold more than 5% of the equity in such entity or business enterprise. The PI Trust shall not hold, directly or indirectly, more than 10% of the equity in any entity (other than Reorganized AWI or any successor to Reorganized AWI) or business enterprise. (b) The PI Trust shall not acquire or hold any long-term debt securities unless (i) such securities are PI Trust Assets under the Plan, (ii) such securities are rated "Baa" or higher by Moody's, "BBB" or higher by Standard & Poor's ("S&P'S"), or have been given an equivalent investment grade rating by another nationally recognized statistical rating agency, or (iii) have been issued or fully guaranteed as to principal and interest by the United States of America or any agency or instrumentality thereof. (c) The PI Trust shall not acquire or hold for longer than ninety (90) days any commercial paper unless such commercial paper is rated "Prime-1" or higher by Moody's or "A-1" or higher by S&P's or has been given an equivalent rating by another nationally recognized statistical rating agency. (d) Excluding any securities by the Debtor or Reorganized AWI, the PI Trust shall not acquire or hold any common or preferred stock or convertible securities unless such stock or securities are rated "A" or high by Moody's or "A" or higher by S&P's or have been given an equivalent investment grade rating by another nationally recognized statistical rating agency. (e) The PI Trust shall not acquire any debt securities or other instruments issued by any entity (other than debt securities or other instruments issued or fully guaranteed as to principal and interest by the United States of America or any agency or instrumentality thereof) if, following such acquisition, the aggregate market value of all debt securities and instruments issued by such entity held by the PI Trust would exceed 2% of the aggregate value of the PI Trust estate. The PI Trust shall not hold any debt securities or other instruments issued by any entity (other than debt securities or other instruments issued or fully guaranteed as to principal and interest by the United States of America or any agency or instrumentality thereof and other than debt securities or other instruments of Reorganized AWI or any successor to Reorganized AWI) to the extent that the aggregate market value of all securities and instruments issued by such entity held by the PI Trust would exceed 5% of the aggregate value of the PI Trust Assets. (f) The PI Trust shall not acquire or hold any certificates of deposit unless all publicly held, long-term debt securities, if any, of the financial institution issuing the certificate of deposit and the holding company, if any, of which such financial institution is a subsidiary, meet the standards set forth in Section 3.2(b) above. Exhibit 1.23-7 (g) The PI Trust may acquire and hold any securities or instruments issued y Reorganized AWI or any successor to Reorganized AWI, or obtained as proceeds of litigation or otherwise to resolve disputes, without regard to the limitations set forth in Subsections (a)-(f) above. (h) The PI Trust shall not acquire or hold any repurchase obligations unless, in the opinion of the Trustees, they are adequately collateralized. (i) The PI Trust shall not acquire or hold any options. 3.3 SOURCE OF PAYMENTS. All PI Trust expenses and payments and all liabilities with respect to claims shall be payable solely by the Trustees out of the PI Trust Assets. Neither AWI, Reorganized AWI, their subsidiaries, any successor in interest, the present or former directors, officers, employees or agents of AWI, Reorganized AWI, nor the Trustees, the TAC or Future Claimants' Representative, or any of their officers, agents, advisors, or employees shall be liable for the payment of any PI Trust expense or any other liability of the PI Trust. SECTION 4 TRUSTEES 4.1 NUMBER. There shall be five (5) Trustees. The initial Trustees shall be those persons named on the signature page hereof. 4.2 TERM OF SERVICE. (a) The five initial Trustees named pursuant to Article 4.1 above shall each serve an initial two (2) year term. At the expiration of these initial two (2) year terms, the number of Trustees shall be reduced from five (5) to three (3). At that time, the five initial Trustees, after consultation with the TAC and the Future Claimants' Representative, shall decide which three individuals among their number shall continue to serve, and the three (3) Trustees so selected shall then serve staggered terms of three (3), four (4) and five (5) years each. Thereafter, each Trustee's term of service shall be five (5) years. The initial Trustees shall serve from the Effective Date until the earlier of (i) the end of his or her term, (ii) his or her death, (iii) his or her resignation pursuant to Section 4.2(b) below, (iv) his or her removal pursuant to Section 4.2(c) below, or (v) the termination of the PI Trust pursuant to Section 7.2 below. (b) A PI Trustee may resign at any time by written notice to the remaining Trustees, the TAC and the Future Claimants' Representative. Such notice shall specify a date when such resignation shall take place, which shall not be less than 90 days after the date such notice is given, where practicable. (c) A Trustee may be removed by unanimous vote of the remaining Trustees in the event that he or she becomes unable to discharge his or her duties hereunder due to accident or physical or mental deterioration, or for other good cause. Good cause shall be deemed to include, without limitation, any substantial failure to comply with the general administration provisions of Section 2.2 above, a consistent pattern of neglect and failure to perform or participate in performing the duties of the Trustees hereunder, or repeated non-attendance at scheduled meetings. Such removal shall require the approval of the Bankruptcy Court and shall take effect at such time as the Bankruptcy Court shall determine. 4.3 APPOINTMENT OF SUCCESSOR TRUSTEES. (a) In the event of a vacancy in the position of PI Trustee, whether by term expiration, resignation or removal, the remaining Trustees shall consult with the TAC and the Future Claimants' Representative concerning appointment of a successor PI Trustee. The vacancy shall be filled by the unanimous vote of the remaining Trustees unless a majority of the TAC or the Future Claimants' Representative vetoes the appointment. In the event that the remaining Trustees cannot agree on a Successor PI Trustee, or a majority of the TAC or the Future Claimants' Representative vetoes the appointment of a successor PI Trustee, the Bankruptcy Court shall make the appointment. Nothing shall prevent the reappointment of a PI Trustee for an additional term or terms. Exhibit 1.23-8 (b) Immediately upon the appointment of any Successor PI Trustee, all rights, titles, duties, powers and authority of the predecessor PI Trustee hereunder shall be vested in, and undertaken by, the Successor PI Trustee without any further act. No Successor PI Trustee shall be liable personally for any act or omission of his or her predecessor Trustees. (c) Each Successor PI Trustee shall serve until the earlier of (i) the end of a full term of five (5) years if the predecessor PI Trustee completed his or her term, (ii) the end of the remainder of the term of the PI Trustee whom he or she is replacing if said predecessor PI Trustee did not complete said term, (iii) his or her death, (iv) his or her resignation pursuant to Section 4.2(b) above, (v) his or her removal pursuant to Section 4.2(c) above, or (vi) the termination of the PI Trust pursuant to Section 7.2 below. 4.4 LIABILITY OF TRUSTEES, OFFICERS AND EMPLOYEES. The Trustees and the individuals identified as Additional Indemnitees in Section 2.1(c)(xiv) above shall not be liable to the PI Trust, to any individual holding an asbestos claim, or to any other person, except for such individual's own breach of trust committed in bad faith or willful misappropriation. In addition, the Trustees and the Additional Indemnitees shall not be liable for any act or omission of any other Trustee or Additional Indemnitee unless such person acted with bad faith in the selection or retention of such other Trustee or Additional Indemnitee. 4.5 COMPENSATION AND EXPENSES OF TRUSTEES. (a) The Trustees shall receive compensation from the PI Trust for their services as Trustees in the amount of $_____________ per annum, plus a per diem allowance for meetings or other PI Trust business performed in the amount of $__________. For purposes of the per diem allowance, PI Trust business includes, but is not limited to, attendance at meetings of Reorganized AWI's Board of Directors. For purposes of section 7.4 below, the Trustees shall determine the scope and duration of activities that constitute a meeting and, if the Trustees elect to provide for payment for activities of less than a full day's duration, may provide for partial payment of per diem amounts on a proportional basis for activities of less than a full day's duration. The per annum and per diem compensation payable to the Trustees hereunder shall be reviewed every three (3) years and appropriately adjusted for changes in the cost of living. Any other changes in compensation of the Trustees shall be made subject to the approval of the Bankruptcy Court. (b) The PI Trust will promptly reimburse the Trustees for all reasonable out-of-pocket costs and expenses incurred by the Trustees in connection with the performance of their duties hereunder. (c) The PI Trust shall include a description of the amounts paid under this Section 4.5 in the accounts to be filed with the Bankruptcy Court and provided to the TAC, the Future Claimants' Representative, and Reorganized AWI pursuant to Section 2.2(c)(i). 4.6 INDEMNIFICATION OF TRUSTEES AND ADDITIONAL INDEMNITEES. (a) The PI Trust shall indemnify and defend the Trustees, as well as the Additional Indemnitees in the performance of their duties hereunder to the fullest extent that a corporation or trust organized under the laws of the PI Trust's situs is from time to time entitled to indemnify and defend such persons against any and all liabilities, expenses, claims, damages or losses incurred by them in the performance of their duties. Notwithstanding the foregoing, the Trustees and the Additional Indemnitees shall not be indemnified or defended in any way for any liability, expense, claim, damage, or loss for which he or she is ultimately liable under Section 4.4 above. (b) Reasonable expenses, costs and fees (including attorneys' fees and costs) incurred by or on behalf of a PI Trustee or Additional Indemnitee in connection with any action, suit, or proceeding, whether civil, administrative or arbitrative from which they are indemnified by the PI Trust pursuant to Section 4.6(a) above, shall be paid by the PI Trust in advance of the final disposition thereof upon receipt of an undertaking, by or on behalf of the Trustees or Additional Indemnitee, to repay such amount in the Exhibit 1.23-9 event that it shall be determined ultimately by final order that such PI Trustee or Additional Indemnitee is not entitled to be indemnified by the PI Trust. (c) The Trustees may purchase and maintain reasonable amounts and types of insurance on behalf of an individual who is or was a PI Trustee or Additional Indemnitee including against liability asserted against or incurred by such individual in that capacity or arising from his or her status as a PI Trustee, TAC member, Future Claimants' Representative, officer, employee, agent or other representative. 4.7 TRUSTEES' LIEN. The Trustees and the Additional Indemnitees shall have a first priority lien upon the PI Trust Assets to secure the payment of any amounts payable to them pursuant to Section 4.6 above. 4.8 TRUSTEES' EMPLOYMENT OF EXPERTS. The Trustees may, but shall not be required to, retain and/or consult with counsel, accountants, appraisers, auditors and forecasters, and other parties deemed by the Trustees to be qualified as experts on the matters submitted to them, and the written opinion of or information provided by any such parties on any matters submitted to them by the Trustees shall be full and complete authorization and protection in respect of any action taken or not taken by the Trustees hereunder in good faith and in accordance with the written opinion of or information provided by any such party. 4.9 TRUSTEES' INDEPENDENCE. The Trustees shall not, during the term of their service, hold a financial interest in, act as attorney or agent for, or serve as any other professional for Reorganized AWI. Notwithstanding the foregoing, any PI Trustee may serve, without any additional compensation other than the per diem compensation to be paid by the PI Trust pursuant to Section 4.5(a) above, as a director of Reorganized AWI. No PI Trustee shall act as an attorney for any person who holds an asbestos claim. 4.10 BOND. The Trustees shall not be required to post any bond or other form of surety or security unless otherwise ordered by the Bankruptcy Court. SECTION 5 TRUST ADVISORY COMMITTEE 5.1 MEMBERS. The TAC shall consist of five (5) members, who shall initially be the persons named on the signature page hereof. 5.2 DUTIES. The members of the TAC shall serve in a fiduciary capacity representing all holders of present Asbestos Personal Injury Claims. The Trustees must consult with the TAC on matters identified in Section 2.2(e) above and in other provisions herein, and must obtain the consent of the TAC on matters identified in Section 2.2(f) above. Where provided in the TDP, certain other actions by the Trustees are also subject to the consent of the TAC. 5.3 TERM OF OFFICE. (a) Each member of the TAC shall serve until the earlier of (i) his or her death, (ii) his or her resignation pursuant to Section 5.3(b) below, (iii) his or her removal pursuant to Section 5.3(c) below, or (iv) the termination of the PI Trust pursuant to Section 7.2 below. (b) A member of the TAC may resign at any time by written notice to the other members of the TAC, the Trustees and the Future Claimants' Representative. Such notice shall specify a date when such resignation shall take effect, which shall not be less than ninety (90) days after the date such notice is given, where practicable. (c) A member of the TAC may be removed in the event that he or she becomes unable to discharge his or her duties hereunder due to accident, physical deterioration, mental incompetence, or a consistent pattern of neglect and failure to perform or to participate in performing the duties of such member hereunder, such as repeated non-attendance at scheduled meetings, or for other Exhibit 1.23-10 good cause. Such removal shall be made at the recommendation of the remaining members of the TAC with the approval of the Bankruptcy Court. 5.4 APPOINTMENT OF SUCCESSOR. (a) In the event of a vacancy caused by the resignation of a TAC member, his or her successor shall be selected by the TAC member who is resigning, unless the remaining members unanimously veto the selection, in which case, the successor shall be selected by a unanimous vote of the remaining members. If the remaining members cannot unanimously agree, the Bankruptcy Court shall appoint the successor. In the event of a vacancy caused by removal or death of a TAC member, or in the event that a resigning or retiring member does not name his or her successor, the remaining members of the TAC by unanimous vote shall name the successor. If the remaining members of the TAC cannot reach unanimous agreement, the Bankruptcy Court shall appoint the successor. (b) Each successor TAC member shall serve until the earlier of (i) his or her death, (ii) his or her resignation pursuant to Section 5.3(b) above, (iii) his or her removal pursuant to Section 5.3(c) above, or (iv) the termination of the PI Trust pursuant to Section 7.2 below. 5.5 TAC'S EMPLOYMENT OF PROFESSIONALS. (a) The TAC may but is not required to retain and/or consult counsel, accountants, appraisers, auditors, forecasters, experts, and financial and investment advisors, and such other parties deemed by the TAC to be qualified as experts on matters submitted to the TAC (the "PROFESSIONALS"). The TAC and its Professionals shall at all times have complete access to the PI Trust's officers, employees and agents, as well as to the Professionals retained by the PI Trust, and shall also have complete access to all information generated by them or otherwise available to the PI Trust or the Trustees. In the absence of gross negligence, the written opinion of or information provided by any Professional deemed by the TAC to be qualified as an expert on the particular matter submitted to the TAC shall be full and complete authorization and protection in support of any action taken or not taken by the TAC in good faith and in accordance with the written opinion of or information provided by the Professional. (b) The Trust shall promptly reimburse, or pay directly if so instructed, the TAC for all reasonable fees and costs associated with the TAC's employment of legal counsel pursuant to this provision in connection with the TAC's performance of its duties hereunder. The Trust shall also promptly reimburse, or pay directly if so instructed, the TAC for all reasonable fees and costs associated with the TAC's employment of any other Professional pursuant to this provision in connection with the TAC's performance of its duties hereunder; provided, however, that (i) the TAC has first submitted to the Trust a written request for such reimbursement setting forth the reasons (A) why the TAC desires to employ such Professional, and (B) why the TAC cannot rely on Professionals retained by the Trust to meet the need of the TAC for such expertise or advice, and (ii) the Trust has approved the TAC's request for reimbursement in writing. If the Trust agrees to pay for the TAC Professional, such reimbursement shall be treated as a Trust expense. If the Trust declines to pay for the TAC Professional, it must set forth its reasons in writing. If the TAC still desires to employ such Professional at Trust expense, the TAC and/or the Trustees shall resolve their dispute pursuant to Section 7.13 below. 5.6 COMPENSATION AND EXPENSES OF TAC. The members of the TAC shall receive compensation from the PI Trust for their services as TAC members in the form of a reasonable hourly rate set by the Trustees for attendance at meetings or other conduct of PI Trust business. The members of the TAC shall also be reimbursed promptly for all reasonable out-of-pocket costs and expenses incurred in connection with the performance of their duties hereunder. Such reimbursement or direct payment shall be deemed a PI Trust expense. The PI Trust shall include a description of the amounts paid under this Section 5.6 in the accounts to be filed with the Bankruptcy Court and provided to the Trustees, the Future Claimants' Representative, and Reorganized AWI pursuant to Section 2.2(c)(i). Exhibit 1.23-11 5.7 PROCEDURES FOR CONSULTATION WITH AND OBTAINING THE CONSENT OF THE TAC. (A) CONSULTATION PROCESS. (i) In the event the Trustees are required to consult with the TAC pursuant to Section 2.2(e) above or on other matters as provided herein, the Trustees shall provide the TAC with written advance notice of the matter under consideration, and with all relevant information concerning the matter as is reasonably practicable under the circumstances. The Trustees shall also provide the TAC with such reasonable access to Professionals and other experts retained by the PI Trust and its staff (if any) as the TAC may reasonably request during the time that the Trustees are considering such matter, and shall also provide the TAC the opportunity, at reasonable times and for reasonable periods of time, to discuss and comment on such matter with the Trustees. (ii) The Trustees shall take into consideration the time required for the TAC, if its members so wish, to engage and consult with its own independent financial or investment advisors as to such matter. (B) CONSENT PROCESS. (i) In the event the Trustees are required to obtain the consent of the TAC pursuant to Section 2.2(f) above, the Trustees shall provide the TAC with a written notice stating that their consent is being sought pursuant to that provision, describing in detail the nature and scope of the action the Trustees propose to take, and explaining in detail the reasons why the Trustees desire to take such action. The Trustees shall provide the TAC as much relevant additional information concerning the proposed action as is reasonably practicable under the circumstances. The Trustees shall also provide the TAC with such reasonable access to Professionals and other experts retained by the PI Trust and its staff (if any) as the TAC may reasonably request during the time that the Trustees are considering such action, and shall also provide the TAC the opportunity, at reasonable times and for reasonable periods of time, to discuss and comment on such action with the Trustees. (ii) The TAC must consider in good faith and in a timely fashion any request for its consent by the Trustees, and must in any event advise the Trustees in writing of its consent or its objection to the proposed action within 30 days of receiving the original request for consent from the Trustees. The TAC may not withhold its consent unreasonably. If the TAC decides to withhold its consent, it must explain in detail its objections to the proposed action. If the TAC does not advise the Trustees in writing of its consent or its objections to the action within 30 days of receiving notice regarding such request, the TAC's consent to the proposed actions shall be deemed to have been affirmatively granted. (iii) If, after following the procedures specified in this Section 5.7(b), the TAC continues to object to the proposed action and to withhold its consent to the proposed action, the Trustees and/or the TAC shall resolve their dispute pursuant to Section 7.13. However, the burden of proof with respect to the validity of Exhibit 1.23-12 the TAC's objection and withholding of its consent shall be on the TAC. SECTION 6 THE FUTURE CLAIMANTS' REPRESENTATIVE 6.1 DUTIES. The initial Future Claimants' Representative shall be the individual identified on the signature pages hereto, namely Dean M. Trafalet, Esquire. He shall serve in a fiduciary capacity, representing the interests of the holders of future Asbestos Personal Injury Claims for the purpose of protecting the rights of such persons. The Trustees must consult with the Future Claimants' Representative on matters identified in Section 2.2(e) above and on certain other matters provided herein, and must obtain the consent of the Future Claimants' Representative on matters identified in Section 2.2(f) above. Where provided in the TDP, certain other actions by the Trustees are also subject to the consent of the Future Claimants' Representative. 6.2 TERM OF OFFICE. (a) The Future Claimants' Representative shall serve until the earlier of (i) his or her death, (ii) his or her resignation pursuant to Section 6.2(b) below, (iii) his or her removal pursuant to Section 6.2(c) below, or (iv) the termination of the PI Trust pursuant to Section 7.2 below. (b) The Future Claimants' Representative may resign at any time by written notice to the Trustees. Such notice shall specify a date when such resignation shall take effect, which shall not be less than ninety (90) days after the date such notice is given, where practicable. (c) The Future Claimants' Representative may be removed by the Bankruptcy Court in the event he or she becomes unable to discharge his or her duties hereunder due to accident, physical deterioration, mental incompetence, or a consistent pattern of neglect and failure to perform or to participate in performing the duties hereunder, such as repeated non-attendance at scheduled meetings, or for other good cause. 6.3 APPOINTMENT OF SUCCESSOR. A vacancy caused by resignation shall be filled with an individual nominated prior to the effective date of the resignation by the resigning Future Claimants' Representative, and a vacancy caused by death or removal of the Future Claimants' Representative shall be filled with an individual nominated by the Trustees, the TAC or both. In any case, the nominee shall be subject to the approval of the Court. 6.4 FUTURE CLAIMANTS' REPRESENTATIVE'S EMPLOYMENT OF PROFESSIONALS. (a) The Future Claimants' Representative may but is not required to retain and/or consult counsel, accountants, appraisers, auditors, forecasters, experts, and financial and investment advisors, and such other parties deemed by the Future Claimants' Representative to be qualified as experts on matters submitted to the Future Claimants' Representative (the "PROFESSIONALS"). The Future Claimants' Representative and his or her experts shall at all times have complete access to the PI Trust's officers, employees and agents, as well as to the Professionals retained by the PI Trust, and shall also have complete access to all information generated by them or otherwise available to the PI Trust or the Trustees. In the absence of gross negligence, the written opinion of or information provided by any Professional deemed by the Future Claimants' Representative to be qualified as an expert on the particular matter submitted to the Future Claimants' Representative shall be full and complete authorization and protection in support of any action taken or not taken by the Future Claimants' Representative in good faith and in accordance with the written opinion of or information provided by the Professional. (b) The Trust shall promptly reimburse, or pay directly if so instructed, the Future Claimants' Representative for all reasonable fees and costs associated with the Future Claimants' Representative's employment of legal counsel pursuant to this provision in connection with the Future Claimants' Representative's performance of his or her duties hereunder. The Trust shall also promptly reimburse, or pay directly if so instructed, the Future Claimants' Representative for all reasonable fees and costs associated with the Future Exhibit 1.23-13 Claimants' Representative's employment of any other Professionals pursuant to this provision in connection with the Future Claimants' Representative's performance of his or her duties hereunder; provided, however, that (i) the Future Claimants' Representative has first submitted to the Trust a written request for such reimbursement setting forth the reasons (A) why the Future Claimants' Representative desires to employ the Professional, and (B) why the Future Claimants' Representative cannot rely on Professionals retained by the Trust to meet the need of the Future Claimants' Representative for such expertise or advice, and (ii) the Trust has approved the Future Claimants' Representative's request for reimbursement in writing. If the Trust agrees to pay for the Future Claimants' Representative's Professional, such reimbursement shall be treated as a Trust Expense. If the Trust declines to pay for the Future Claimants' Representative's Professional, it must set forth its reasons in writing. If the Future Claimants' Representative still desires to employ the Professional at Trust expense, the Future Claimants' Representative and/or the Trustees shall resolve their dispute pursuant to Section 7.13 below. 6.5 COMPENSATION AND EXPENSES OF THE FUTURE CLAIMANTS' REPRESENTATIVE. The Future Claimants' Representative shall receive compensation from the PI Trust in the form of the Future Claimants' Representative's normal hourly rate for services performed. The PI Trust will promptly reimburse the Future Claimants' Representative for all reasonable out-of-pocket costs and expenses incurred by the Future Claimants' Representative in connection with the performance of his or her duties hereunder. Such reimbursement or direct payment shall be deemed a PI Trust expense. The PI Trust shall include a description of the amounts paid under this Section 6.5 in the accounts to be filed with the Bankruptcy Court and provided to the Trustees, the Future Claimants' Representative, and Reorganized AWI pursuant to Section 2.2(c)(i). 6.6 PROCEDURES FOR CONSULTATION WITH AND OBTAINING THE CONSENT OF THE FUTURE CLAIMANTS REPRESENTATIVE. (a) CONSULTATION PROCESS. (i) In the event the Trustees are required to consult with the Future Claimants' Representative pursuant to Section 2.2(e) above or on any other matters specified herein, the Trustees shall provide the Future Claimants' Representative with written advance notice of the matter under consideration, and with all relevant information concerning the matter as is reasonably practicable under the circumstances. The Trustees shall also provide the Future Claimants' Representative with such reasonable access to Professionals and other experts retained by the PI Trust and its staff (if any) as the Future Claimants' Representative may reasonably request during the time that the Trustees are considering such matter, and shall also provide the Future Claimants' Representative the opportunity, at reasonable times and for reasonable periods of time, to discuss and comment on such matter with the Trustees. (ii) The Trustees shall take into consideration the time required for the Future Claimants' Representative, if he or she so wishes, to engage and consult with his or her own independent financial or investment advisors as to such matter. (b) CONSENT PROCESS. (i) In the event the Trustees are required to obtain the consent of the Future Claimants' Representative pursuant to Section 2.2(f) above, the Trustees shall provide the Future Claimants' Representative with a written notice stating that his or her consent is being sought Exhibit 1.23-14 pursuant to that provision, describing in detail the nature and scope of the action the Trustees propose to take, and explaining in detail the reasons why the Trustees desire to take such action. The Trustees shall provide the Future Claimants' Representative as much relevant additional information concerning the proposed action as is reasonably practicable under the circumstances. The Trustees shall also provide the Future Claimants' Representative with such reasonable access to Professional and other experts retained by the PI Trust and its staff (if any) as the Future Claimants' Representative may reasonably request during the time that the Trustees are considering such action, and shall also provide the Future Claimants' Representative the opportunity, at reasonable times and for reasonable periods of time, to discuss and comment on such action with the Trustees. (ii) The Future Claimants' Representative must consider in good faith and in a timely fashion any request for his or her consent by the Trustees, and must in any event advise the Trustees in writing of his or her consent or objection to the proposed action within 30 days of receiving the original request for consent from the Trustees. The Future Claimants' Representative may not withhold his or her consent unreasonably. If the Future Claimants' Representative decides to withhold consent, he or she must explain in detail his or her objections to the proposed action. If the Future Claimants' Representative does not advise the Trustees in writing of his or her consent or objections to the proposed action within 30 days of receiving the notice from the Trustees regarding such consent, the Future Claimants' Representative's consent shall be deemed to have been affirmatively granted. (iii) If, after following the procedures specified in this Section 5.7(b), the Future Claimants' Representative continues to object to the proposed action and to withhold its consent to the proposed action, the Trustees and/or the Future Claimants' Representative shall resolve their dispute pursuant to Section 7.13. However, the burden of proof with respect to the validity of the Future Claimants' Representative's objection and withholding of his or her consent shall be on the Future Claimants' Representative. SECTION 7 GENERAL PROVISIONS 7.1 IRREVOCABILITY. The PI Trust is irrevocable. 7.2 TERMINATION. (a) The PI Trust shall automatically terminate on the date ninety (90) days after the first to occur of the following events: (i) the Trustees decide to terminate the PI Trust because (A) they deem it unlikely that new asbestos claims will be filed against the PI Trust, (B) all Asbestos Personal Injury Claims duly filed with the PI Trust have been liquidated and paid to the extent provided in this PI Trust Agreement and the TDP or Exhibit 1.23-15 disallowed by a final, non-appealable order, to the extent possible based upon the funds available through the Plan, and (C) twelve (12) consecutive months have elapsed during which no new asbestos claim has been filed with the PI Trust; or (ii) if the Trustees have procured and have in place irrevocable insurance policies and have established claims handling agreements and other necessary arrangements with suitable third parties adequate to discharge all expected remaining obligations and expenses of the PI Trust in a manner consistent with this PI Trust Agreement and the TDP, the date on which the Bankruptcy Court enters an order approving such insurance and other arrangements and such order becomes a final order; or (iii) to the extent that any rule against perpetuities shall be deemed applicable to the PI Trust, twenty-one (21) years less ninety-one (91) days pass after the death of the last survivor of all of the descendants of the late Joseph P. Kennedy, Sr., father of the late President John F. Kennedy, living on the date hereof. (b) On the Termination Date, after payment of all the PI Trust's liabilities have been provided for, all monies remaining in the PI Trust estate shall be given to such organization(s) exempt from federal income tax under section 501(c)(3) of the Internal Revenue Code, which tax-exempt organization(s) shall be selected by the Trustees using their reasonable discretion; provided, however, that (i) if practicable, the activities of the selected tax-exempt organization(s) shall be related to the treatment of, research on, or the relief of suffering of individuals suffering from asbestos related lung disorders, and (ii) the tax-exempt organization(s) shall not bear any relationship to Reorganized AWI within the meaning of section 468B(d)(3) of the Internal Revenue Code. Notwithstanding any contrary provision of the Plan and related documents, this Section 7.2(b) cannot be modified or amended. 7.3 AMENDMENTS. The Trustees, after consultation with the TAC and the Future Claimants' Representative, and subject to the unanimous consent of the TAC and the Future Claimants' Representative, may modify or amend this PI Trust Agreement and the PI Trust By-laws. The Trustees, after consultation with the TAC and the Future Claimants' Representative, and subject to the consent of the TAC and the Future Claimants' Representative, may modify or amend the TDP; provided, however, that no amendment to the TDP shall be inconsistent with the provisions limiting amendments to that document provided therein, and in particular the provisions limiting amendment of the Claims Payment Ratio set forth in Section 2.5 of the TDP and of the Payment Percentage set forth in Section 4.2 of the TDP. Any modification or amendment made pursuant to this Article must be done in writing. Notwithstanding anything contained in this PI Trust Agreement to the contrary, neither this PI Trust Agreement, the PI Trust Bylaws, the TDP, nor any document annexed to the foregoing shall be modified or amended in any way that could jeopardize, impair, or modify the applicability of section 524(g) of the Bankruptcy Code, the efficacy or enforceability of the injunction entered thereunder, or the PI Trust's qualified settlement fund status under Section 468B of the Internal Revenue Code. 7.4 MEETINGS. The Trustees, the TAC, and the Future Claimants' Representative, shall be deemed to have attended a meeting in the event such person spends a substantial portion of the day conferring, in person or by telephone conference call, on PI Trust matters with the TAC, the Future Claimants' Representative, or Trustees, as applicable. A Trustee shall also be deemed to have attended a meeting in the event he or she spends a substantial portion of the day engaging in activities related to Reorganized AWI, including attendance at its Board of Directors meetings. The Trustees, the TAC and the Future Claimants' Representative shall have complete discretion to determine whether a meeting, as described herein, occurred for purposes of Sections 4.5, 5.6, and 6.5 above. Exhibit 1.23-16 7.5 SEVERABILITY. Should any provision in this PI Trust Agreement be determined to be unenforceable, such determination shall in no way limit or affect the enforceability and operative effect of any and all other provisions of this PI Trust Agreement. 7.6 NOTICES. Notices to persons asserting claims shall be given by first class mail, postage prepaid, at the address of such person, or, where applicable, such person's legal representative, in each case as provided on such person's claim form submitted to the PI Trust with respect to his or her PI Trust Claim. (a) Any notices or other communications required or permitted hereunder to the following parties shall be in writing and delivered at the addresses designated below, or sent by telex, telecopy or facsimile pursuant to the instructions listed below, or mailed by registered or certified mail, return receipt requested, postage prepaid, addressed as follows, or to such other address or addresses as may hereafter be furnished in writing to each of the other parties listed below in compliance with the terms hereof. To the PI Trust through the Trustees: To the TAC: To the Future Claimants' Representative: To Reorganized AWI: (b) All such notices and communications if mailed shall be effective when physically delivered at the designated addresses or, if electronically transmitted, when the communication is received at the designated addresses and confirmed by the recipient by return transmission. 7.7 SUCCESSORS AND ASSIGNS. The provisions of this PI Trust Agreement shall be binding upon and inure to the benefit of AWI, the PI Trust, the Trustees and Reorganized AWI, and their respective successors and assigns, except that neither AWI, the PI Trust, the Trustees nor Reorganized AWI may assign or otherwise transfer any of its, or their, rights or obligations under this PI Trust Agreement except, in the case of the PI Trust and the Trustees, as contemplated by Section 2.1 above. 7.8 LIMITATION ON CLAIM INTERESTS FOR SECURITIES LAWS PURPOSES. Asbestos Personal Injury Claims, and any interests therein (a) shall not be assigned, conveyed, hypothecated, pledged or otherwise transferred, voluntarily or involuntarily, directly or indirectly, except by will or under the laws of descent and distribution; (b) shall not be evidenced by a certificate or other instrument; (c) shall not possess any voting rights; and (d) shall not be entitled to receive any dividends or interest; provided, Exhibit 1.23-17 however, that clause (a) of this Section 7.8 shall not apply to the holder of a claim that is subrogated to a PI Trust Claim as a result of its satisfaction of such PI Trust Claim. 7.9 ENTIRE AGREEMENT; NO WAIVER. The entire agreement of the parties relating to the subject matter of this PI Trust Agreement is contained herein and in the documents referred to herein, and this PI Trust Agreement and such documents supersede any prior oral or written agreements concerning the subject matter hereof. No failure to exercise or delay in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any further exercise thereof or of any other right, power or privilege. The rights and remedies herein provided are cumulative and are not exclusive of rights under law or in equity. 7.10 HEADINGS. The headings used in this PI Trust Agreement are inserted for convenience only and do not constitute a portion of this PI Trust Agreement, nor in any manner affect the construction of the provisions of this PI Trust Agreement. 7.11 GOVERNING LAW. This PI Trust Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to Delaware conflict of law principles. 7.12 SETTLOR REPRESENTATIVE AND COOPERATION. AWI is hereby irrevocably designated as the Settlor, and it is hereby authorized to take any action required of the Settlor in connection with the PI Trust Agreement. AWI agrees to cooperate in implementing the goals and objectives of this PI Trust. 7.13 DISPUTE RESOLUTION. Any disputes that arise under this PI Trust Agreement or under the TDP shall be resolved by submission of the matter to an alternative dispute resolution ("ADR") process mutually agreeable to the parties involved. Should any party to the ADR process be dissatisfied with the decision of the arbitrator(s), that party may apply to the Bankruptcy Court for a judicial determination of the matter. In either case, if the dispute arose pursuant to the consent provision set forth in Section 5.7(b) (in the case of the TAC) or Section 6.6(b) (in the case of the Future Claimants' Representative), the burden of proof shall be on the party or parties who withheld consent to show that the objection was valid. Should the dispute not be resolved by ADR process within thirty (30) days after submission, the parties are relieved of the requirement to pursue ADR prior to application to the Bankruptcy Court. Notwithstanding anything else herein contained, to the extent any provision of this PI Trust Agreement is inconsistent with any provision of the Plan or the TDP, the Plan or the TDP shall control. 7.14 ENFORCEMENT AND ADMINISTRATION. The provisions of this PI Trust Agreement and the TDP attached hereto shall be enforced by the Bankruptcy Court pursuant to the Plan. The parties hereby further acknowledge and agree that the Bankruptcy Court shall have exclusive jurisdiction over the settlement of the accounts of the Trustees and over any disputes hereunder not resolved by alternative dispute resolution in accordance with Section 7.13 above. 7.15 EFFECTIVENESS. This PI Trust Agreement shall not become effective until it has been executed and delivered by all the parties hereto. 7.16 COUNTERPART SIGNATURES. This PI Trust Agreement may be executed in any number of counterparts, each of which shall constitute an original, but such counterparts shall together constitute but one and the same instrument. Exhibit 1.23-18 IN WITNESS WHEREOF, the parties have executed this PI Trust Agreement this _____ day of ________________________, _______. ARMSTRONG WORLD INDUSTRIES, INC., SETTLOR, BY Name: ---------------------------------------- Title: --------------------------------------- TRUSTEES ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- Exhibit 1.23-19 ASBESTOS CLAIMANTS' COMMITTEE By:_____________________________________ TRUST ADVISORY COMMITTEE ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- ---------------------------------------------- FUTURE CLAIMANTS' REPRESENTATIVE --------------------------------------------- Dean M. Trafelet, Esq. Exhibit 1.23-20 EX-99 6 jd9-5ex99_4.txt 99.4 Exhibit 99.4 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------- ) EXHIBIT 1.39 FORM OF ARMSTRONG WORLD INDUSTRIES, INC. AMENDED CLAIMS SETTLEMENT PROCEDURES ARMSTRONG WORLD INDUSTRIES, INC. AMENDED CLAIMS SETTLEMENT PROCEDURES The Armstrong World Industries, Inc. Amended Claims Settlement Procedures (the "CSP") contained herein provide a mechanism for resolving all claims, other than Asbestos Personal Injury Claims and Asbestos Property Damage Claims (as such terms are defined in the Fourth Amended Plan of Reorganization of Armstrong World Industries, Inc. (as hereafter amended or modified, the "PLAN")) that have been filed against Armstrong World Industries, Inc. ("AWI") in its chapter 11 case. Capitalized terms used herein and not otherwise defined shall have the meanings assigned to them in the Plan. SECTION I - INTRODUCTION ------------ 1.1 EFFECTIVENESS OF THE CSP. This CSP will become effective upon the occurrence of the Effective Date and, except with respect to Nitram and Desseaux, will amend and supersede the Order Granting Motion of the Debtors for Order Pursuant to Section 105(a) of the Bankruptcy Code and Bankruptcy Rule 9019(b) Authorizing the Establishment of Procedures to Settle Certain Prepetition Claims Against the Debtors' Estates, dated May 31, 2002. Such order shall remain fully applicable with respect to Nitram and Desseaux, and this CSP shall have no effect as to Nitram and Desseaux. 1.2 INTERPRETATION. Nothing in this CSP shall be deemed to create a substantive right for any claimant. Nothing in this CSP shall obligate or require Reorganized AWI to compromise and settle any Claims that it does not consider, in its sole discretion, appropriate to compromise and settle, and this CSP shall not obligate or require Reorganized AWI to compromise and settle any Claims in amounts in excess of the amounts that AWI, in its sole discretion, believes to be reasonable and appropriate. Nothing in this CSP shall affect the right of Reorganized AWI to object to any Claim on any ground whatsoever, including, without limitation, on the ground that such Claim was untimely or was discharged as a result of the confirmation of the Plan. SECTION II - CLAIM SETTLEMENTS NOT REQUIRING APPROVAL UNDER THIS CSP ------------------------------------------------------- 2.1 ADMINISTRATIVE EXPENSES. Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any Administrative Expenses that have not been Allowed as of the Effective Date, and any such compromise and settlement shall be deemed to have been authorized by 1.39-2 the Bankruptcy Court; provided, however, that the allowance of fees and expenses of professionals through the Confirmation Date shall, as set forth more fully in the Plan and the Confirmation Order, be subject to the approval of the Bankruptcy Court. 2.2 AFFILIATE CLAIMS. Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any Affiliate Claims, and any compromise and settlement of Affiliate Claims shall be deemed to have been authorized by the Bankruptcy Court. 2.3 SECURED CLAIMS. Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any Secured Claims, and any compromise and settlement of Secured Claims shall be deemed to have been authorized by the Bankruptcy Court. 2.4 PRIORITY CLAIMS. Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any Priority Claims, and any compromise and settlement of Priority Claims shall be deemed to have been authorized by the Bankruptcy Court. 2.5 CONVENIENCE CLAIMS. Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any Convenience Claims, and any compromise and settlement of Convenience Claims shall be deemed to have been authorized by the Bankruptcy Court. 2.6 EMPLOYEE BENEFIT CLAIMS. Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any Employee Benefit Claims, and any compromise and settlement of Employee Benefit Claims shall be deemed to have been authorized by the Bankruptcy Court. 2.7 ENVIRONMENTAL CLAIMS. From and after the Final Distribution Date, Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any Environmental Claim, and any compromise and settlement of Environmental Claims shall be deemed to have been authorized by the Bankruptcy Court. Prior to the Final Distribution Date, an Environmental Claim shall be considered a General Claim (as hereinafter defined) for purposes of this CSP. 2.8 CLAIMS OR CAUSES OF ACTION ASSERTED BY AWI AGAINST ANY ENTITY. Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any claim or cause of action brought by AWI against any Entity and pending as of the Effective Date, and any such compromise and settlement shall be deemed to have been authorized by the Bankruptcy Court. 1.39-3 SECTION III - SETTLEMENT OF EMPLOYEE LITIGATION CLAIMS ---------------------------------------- 3.1 EMPLOYEE LITIGATION CLAIMS. "EMPLOYEE LITIGATION CLAIMS" shall mean Claims asserted against AWI's estate by current or former employees for alleged wrongful termination or other contractual, statutory, and tort-based employment claims allegedly occurring prior to the Commencement Date other than Claims for workers' compensation or for employee or retiree benefits. 3.2 SETTLEMENT PROCEDURES FOR EMPLOYEE LITIGATION CLAIMS. Reorganized AWI shall be authorized to compromise and settle any Employee Litigation Claim in the manner described below: (a) Reorganized AWI may enter into a compromise and settlement of any Employee Litigation Claim for a cash payment not to exceed $75,000 per claimant or an allowed prepetition, unsecured claim not to exceed $50,000 per claimant without further approval or order of the Bankruptcy Court or approval of or notice to any other party in interest, and Reorganized AWI shall be deemed to have been authorized by the Bankruptcy Court to enter into any such compromise and settlement (b) For settlements of Employee Litigation Claims where (i) the proposed cash payment per claimant is greater than $75,000, or (ii) the proposed allowed, unsecured, prepetition claim is greater than $50,000, Reorganized AWI will submit the proposed settlement to a designated representative of the Unsecured Creditors' Committee (the "DESIGNATED COMMITTEE REPRESENTATIVE"), together with (i) the name of the other party to the settlement, (ii) a summary of the dispute with such other party, including a statement of the settlement amount and the basis for the controversy, (iii) an explanation of why the settlement of such Employee Litigation Claim is favorable to AWI, its estate, and its creditors, and (iv) a copy of any proposed settlement agreement (the "EMPLOYEE LITIGATION SETTLEMENT SUMMARY"). The Designated Committee Representative will be required to submit to Reorganized AWI any objections to the proposed settlement reflected on an Employee Litigation Settlement Summary on or before ten (10) Business Days after service of such Employee Litigation Settlement Summary. In the event that the Designated Committee Representative objects to the settlement set forth in the Employee Litigation Settlement Summary, Reorganized AWI may (i) seek to renegotiate the proposed settlement and may submit a revised Employee Litigation Settlement Summary in connection therewith or (ii) file a motion with the Bankruptcy Court seeking approval of the proposed settlement. If the Designated Committee Representative does not timely object to the proposed settlement, then Reorganized AWI will be deemed, without further order of the Bankruptcy Court, to be authorized by the Bankruptcy Court to enter into an agreement to compromise and settle the Employee Litigation Claim at issue as provided in the Employee Litigation Settlement Summary previously submitted to the Designated Committee Representative. 1.39-4 SECTION IV - SETTLEMENT OF TAX CLAIMS ------------------------ 4.1 TAX CLAIMS. As used in this CSP, a "TAX REFUND CLAIM" shall be any claim by AWI against a federal, state, county, or city taxing authority (a "TAXING AUTHORITY") for a refund of the overpayment and/or interest payments for any tax period, and a "TAX ASSESSMENT CLAIM" shall be any Claim by a Taxing Authority against AWI relating to any period prior to the Commencement Date. 4.2 SETTLEMENT PROCEDURES FOR TAX ASSESSMENT CLAIMS. Reorganized AWI will resolve Tax Assessment Claims pursuant as set forth below. (a) With respect to any Tax Assessment Claim that is a Secured Claim or a Priority Tax Claim, Reorganized AWI may enter into a compromise and settlement of any such Tax Assessment Claim without further approval or order of the Bankruptcy Court, or approval of or notice to any other party in interest, and Reorganized AWI shall be deemed to have been authorized by the Bankruptcy Court to enter into any such compromise and settlement. (b) With respect to any Tax Assessment Claim that is not a Secured Claim or a Priority Tax Claim and is asserted by a Taxing Authority other than the Internal Revenue Service: o Reorganized AWI shall be authorized to compromise and settle any such Tax Assessment Claim whenever the proposed settlement amount for such Tax Assessment Claim, net of any Tax Refund Claims offset against such settlement amount (such net amount, the "TAX ASSESSMENT SETTLEMENT AMOUNT") is less than or equal to $500,000 without further approval or order of the Bankruptcy Court, or approval of or notice to any other party in interest, and Reorganized AWI shall be deemed to have been authorized by the Bankruptcy Court to enter into any such compromise and settlement. o With respect to any such Tax Assessment Claim where the Tax Assessment Settlement Amount is greater than $500,000 but less than $10,000,000, Reorganized AWI will submit the proposed compromise and settlement to the Designated Committee Representative together with (i) the name of the taxing authority, (ii) a summary of the dispute with the taxing authority, including the basis for the controversy, and (iii) an explanation of why the settlement of such Tax 1.39-5 Assessment Claim is favorable to AWI, its estate, and its creditors (the "TAX ASSESSMENT SETTLEMENT SUMMARY"). The Designated Committee Representative will be required to submit to Reorganized AWI any objections to the Tax Assessment Settlement Amount on or before ten (10) Business Days after service of such Tax Assessment Settlement Summary. In the event that the Designated Committee Representative objects to the settlement set forth in the Tax Assessment Settlement Summary, Reorganized AWI may (i) seek to renegotiate the proposed settlement and will submit a revised Tax Assessment Settlement Summary in connection therewith or (ii) file a motion with the Bankruptcy Court seeking approval of the proposed settlement of the Tax Assessment Claim. If the Designated Committee Representative does not timely object to the proposed settlement, then Reorganized AWI will be deemed, without further order of the Bankruptcy Court, to be authorized to enter into an agreement to compromise and settle the Tax Assessment Claim at issue for the settlement amount previously submitted to the Designated Committee Representative in the Tax Assessment Settlement Summary. o With respect to any such Tax Assessment Claim where the Tax Assessment Settlement Amount is equal to or greater than $10,000,000, Reorganized AWI will be required to file a motion with the Bankruptcy Court requesting approval of such compromise and settlement under Bankruptcy Rule 9019. (c) With respect to any Tax Assessment Claim that is not a Secured Claim or a Priority Tax Claim and is asserted by the Internal Revenue Service: o Reorganized AWI shall be authorized to compromise and settle any such Tax Assessment Claim for each three (3) year audit period whenever the aggregate Tax Assessment Settlement Amount for such Tax Assessment Claim is less than or equal to $5,000,000 without further approval or order of the Bankruptcy Court, or approval of or notice to any other party in interest, and Reorganized AWI shall be deemed to have been authorized by the Bankruptcy Court to enter into any such compromise and settlement. o With respect to any such Tax Assessment Claim for each three (3) year audit period where the aggregate Tax Assessment Settlement Amount for such Tax Assessment Claim is greater than $5,000,000 but less than $10,000,000, Reorganized AWI will submit the proposed compromise and settlement to the Designated Committee Representative together with the Tax Assessment Settlement Summary as described in subparagraph 1.39-6 (a) above. The Designated Committee Representative will be required to submit to Reorganized AWI any objections to the Tax Assessment Settlement Amount on or before ten (10) Business Days after service of such Tax Assessment Settlement Summary. In the event that the Designated Committee Representative objects to the settlement set forth in the Tax Assessment Settlement Summary, Reorganized AWI may (i) seek to renegotiate the proposed settlement and will submit a revised Tax Assessment Settlement Summary in connection therewith or (ii) file a motion with the Bankruptcy Court seeking approval of the proposed settlement of the Tax Assessment Claims. If the Designated Committee Representative does not timely object to the proposed settlement, then Reorganized AWI will be deemed, without further order of the Bankruptcy Court, to be authorized to enter into an agreement to compromise and settle the Tax Assessment Claim at issue for the settlement amount previously submitted to the Designated Committee Representative in the Tax Assessment Settlement Summary. o With respect to any Tax Assessment Claim for each three (3) year audit period where the aggregate Tax Assessment Settlement Amount is greater than or equal to $10,000,000, Reorganized AWI will be required to file a motion with the Bankruptcy Court requesting approval of the compromise and settlement under Bankruptcy Rule 9019. 4.3 SETTLEMENT OF TAX REFUND CLAIMS. Reorganized AWI shall not be required to obtain any approval of the Bankruptcy Court, or obtain any approval of or provide notice to any party in interest, to compromise and settle any Tax Refund Claims, of Tax Refund Claims shall be deemed to have been authorized by the Bankruptcy Court. SECTION V - REMAINING UNSECURED CLAIMS -------------------------- 5.1 GENERAL CLAIMS. With respect to all other types of Claims other than Priority Claims, Secured Claims, Affiliate Claims, Convenience Claims, Employee Litigation Claims, Tax Assessment Claims, Employee Benefit Claims, Asbestos Property Damage Claims, and Asbestos Personal Injury Claims (collectively, "GENERAL CLAIMS"), Reorganized AWI will settle such Claims as set forth below based upon the difference between (i) the amount of the General Claim as scheduled on the Schedules ("AWI'S AMOUNT") and (ii) the proposed amount of the allowed claim for which AWI is seeking to compromise and settle such General Claim (the "SETTLEMENT AMOUNT"). If a General Claim was not scheduled by AWI or was scheduled as contingent or unliquidated, AWI's Amount shall be $0. Under this method, the difference between the Settlement Amount and AWI's Amount will be referred to as the "DOCUMENTED DIFFERENCE." 1.39-7 (a) Reorganized AWI will be authorized to compromise and settle a General Claim whenever the Documented Difference is less than $100,000 without further approval or order of the Bankruptcy Court, or approval of or notice to any other party in interest, and Reorganized AWI shall be deemed to have been authorized by the Bankruptcy Court to enter into any such compromise and settlement. (b) If Reorganized AWI wishes to compromise and settle a General Claim where the Documented Difference is over $100,000 but less than $10,000,000, Reorganized AWI will submit the Settlement Amount to the Designated Committee Representative together with (i) the name of the other party to the settlement, (ii) a summary of the dispute with such other party, including a statement of AWI's Amount and the basis for the controversy, (iii) an explanation of why the settlement of such General Claim is favorable to AWI, its estate, and its creditors, and (iv) a copy of any proposed settlement agreement (the "GENERAL CLAIM SETTLEMENT SUMMARY"). The Designated Committee Representative will be required to submit to Reorganized AWI any objections to a proposed settlement reflected on a General Claim Settlement Summary on or before ten (10) Business Days after service of such General Claim Settlement Summary. In the event that the Designated Committee Representative objects to the settlement set forth in the General Claim Settlement Summary, Reorganized AWI may (i) seek to renegotiate the proposed settlement and may submit a revised General Claim Settlement Summary in connection therewith or (ii) file a motion with the Bankruptcy Court seeking approval of the proposed settlement. If the Designated Committee Representative does not timely object to the proposed settlement, then Reorganized AWI will be deemed, without further order of the Bankruptcy Court, to be authorized to enter into an agreement to compromise and settle the General Claim at issue for the settlement amount previously submitted to the Designated Committee Representative in the General Claim Settlement Summary. (c) For each General Claim asserted against AWI where the Documented Difference is greater than or equal to $10,000,000, AWI will be required to file a motion with the Bankruptcy Court requesting approval of the compromise and settlement under Bankruptcy Rule 9019. 1.39-8 EX-99 7 jd9-5ex99_5.txt 99.5 Exhibit 99.5 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------- ) EXHIBIT 1.90 FORM OF NEW LONG-TERM INCENTIVE PLAN FORM OF NEW LONG-TERM INCENTIVE PLAN (SEPT. 5, 2003) ---------------------------------------------------- ARMSTRONG WORLD INDUSTRIES, INC. 2003 LONG-TERM INCENTIVE PLAN EFFECTIVE AS OF _________, 2003 INDEX OF DEFINED TERMS ---------------------- TERM SECTION WHERE DEFINED OR FIRST USED Beneficial Owner........................................14(C)(II) Benefits................................................4 Cash Awards.............................................10 Change in Control.......................................14(C)(III) Code....................................................2(A) Committee...............................................2(A) Common Stock............................................5(A) Company.................................................1 Dividend Equivalent Right...............................9(C) Effective Date..........................................24 Exchange Act............................................2(A) Fair Market Value.......................................17 Incentive Stock Option..................................6(A) Injurious Conduct.......................................13 Non-Employee Director...................................2(A) Nonqualified Stock Option...............................6(A) Parent Corporation......................................6(F) Performance-Based Awards................................11(A) Person..................................................14(C)(IV) Plan....................................................1 Restoration Stock Options...............................6(E) Restricted Stock Award..................................8 Stock Appreciation Rights...............................7 Stock Options...........................................6 Stock Unit..............................................9(C) Subsidiary Corporation..................................6(F) ARMSTRONG WORLD INDUSTRIES, INC. 2003 LONG-TERM INCENTIVE PLAN 1. PURPOSE. Armstrong World Industries, Inc. 2003 Long-Term Incentive Plan (the "Plan") is intended to provide incentives which will attract, retain and motivate highly competent persons as officers and key employees of Armstrong World Industries, Inc., a Pennsylvania corporation (the "Company"), and its subsidiaries and affiliates, by providing them with appropriate incentives and rewards to encourage them to enter into and continue in the employ of the Company, to acquire a proprietary interest in the long-term success of the Company and to reward the performance of individuals in fulfilling their personal responsibilities for long-range achievements. 2. ADMINISTRATION. (a) Committee. The Plan will be administered by a committee (the "Committee") appointed by the Board of Directors of the Company from among its members (which may be the Management Development and Compensation Committee) and shall be comprised, unless otherwise determined by the Company's Board of Directors, solely of not less than two (2) members who shall be (i) "Non-Employee Directors" within the meaning of Rule 16b-3(b)(3) (or any successor rule) promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act") and (ii) "outside directors" within the meaning of Treasury Regulation Section 1.162-27(e)(3) under Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code"). (b) Authority. The Committee is authorized, subject to the provisions of the Plan, to establish such rules and regulations as it deems necessary for the proper administration of the Plan and to make such determinations and interpretations and to take such action in connection with the Plan and any Benefits granted hereunder as it deems necessary or advisable. All determinations and interpretations made by the Committee shall be binding and conclusive on all participants and their legal representatives. (c) Indemnification. No member of the Committee and no employee of the Company shall be liable for any act or failure to act hereunder, except in circumstances involving his or her bad faith or willful misconduct, or for any act or failure to act hereunder by any other member or employee or by any agent to whom duties in connection with the administration of this Plan have been delegated. The Company shall indemnify members of the Committee and any agent of the Committee who is an employee of the Company, a subsidiary or an affiliate against any and all liabilities or expenses to which they may be subjected by reason of any act or failure to act with respect to their duties on behalf of the Plan, except in circumstances involving such person's bad faith or willful misconduct. (d) Delegation and Advisers. The Committee may delegate to one or more of its members, to management or to or to one or more agents, such administrative duties as it may deem advisable; provided, such delegation does 1.90-1 not adversely effect the exemption provided by Rule 16b-3 of the Exchange Act, prevent a Benefit from qualifying as a Performance-Based Award, if so intended, and complies with applicable law. The Committee, or any person to whom it has delegated duties as aforesaid, may employ one or more persons to render advice with respect to any responsibility the Committee or such person may have under the Plan. The Committee may employ such legal or other counsel, consultants and agents as it may deem desirable for the administration of the Plan and may rely upon any opinion or computation received from any such counsel, consultant or agent. Expenses incurred by the Committee in the engagement of such counsel, consultant or agent shall be paid by the Company, or the subsidiary or affiliate whose employees have benefited from the Plan, as determined by the Committee. 3. PARTICIPANTS. Participants will consist of such officers and key employees of the Company and its subsidiaries and affiliates as the Committee in its sole discretion determines to be significantly responsible for the success and future growth and profitability of the Company and whom the Committee may designate from time to time to receive Benefits under the Plan. Designation of a participant in any year shall not require the Committee to designate such person to receive a Benefit in any other year or, once designated, to receive the same type or amount of Benefit as granted to the participant in any other year. The Committee shall consider such factors as it deems pertinent in selecting participants and in determining the type and amount of their respective Benefits. 4. TYPE OF BENEFITS. Benefits under the Plan may be granted in any one or a combination of (a) Stock Options, (b) Stock Appreciation Rights, (c) Restricted Stock Awards, (d) Stock Units and (e) Cash Awards (each as described below, and collectively, the "Benefits"). Restricted Stock Awards, Stock Units and Cash Awards may, as determined by the Committee in its discretion, constitute Performance-Based Awards, as described in Section 11 hereof. Benefits granted under the Plan shall be evidenced by an agreement (which need not be identical) that may provide additional terms and conditions associated with such Benefits, as determined by the Committee in its sole discretion, provided, however, that in the event of any conflict between the provisions of the Plan and any such agreement, the provisions of the Plan shall prevail. 5. COMMON STOCK AVAILABLE UNDER THE PLAN. (a) Basic Limitations. The aggregate number of shares of common stock of the Company (the "Common Stock") that may be subject to Benefits, granted under this Plan shall be 5,349,000 shares of Common Stock, which may be authorized and unissued shares or treasury shares or may be purchased on the open market or by private purchase, subject to any adjustments made in accordance with Section 14(a) hereof. The maximum number of shares of Common Stock with respect to which Benefits may be granted or measured to any individual participant under the Plan in any one calendar year shall not exceed 750,000 (subject to adjustments made in accordance with Section 14(a) hereof). (b) Additional Shares. Any shares of Common Stock subject to (or referenced by) a Benefit which are not ultimately used to settle a Benefit shall again be available for Benefits under this Plan and any shares of Common Stock 1.90-2 delivered to the Company as part or full payment for the exercise of a Stock Option, Stock Appreciation Right, or Restricted Stock Award or to satisfy a tax obligation shall also be available for Benefits under this Plan. This includes shares of Common Stock that are: (i) covered by a Stock Option or referenced by a Stock Appreciation Right which for any reason is cancelled or terminated without having been exercised, (ii) subject to Restricted Stock Awards or Stock Units which are forfeited, and (iii) not delivered to a participant because all or a portion of a Benefit is settled in cash. The preceding sentences of this Section shall apply only for purposes of determining the aggregate number of shares of Common Stock subject to Benefits but shall not apply for purposes of determining the maximum number of shares of Common Stock with respect to which Benefits (including the maximum number of shares of Common Stock subject to Stock Options and Stock Appreciation Rights) that may be granted to any individual participant under the Plan. (c) Acquisitions. In connection with the acquisition of any business by the Company or any of its subsidiaries or affiliates, any outstanding grants, awards or sales of options or other similar rights pertaining to such business may be assumed or replaced by Benefits under the Plan upon such terms and conditions as the Committee determines in its sole discretion. 6. STOCK OPTIONS. (a) Generally. Stock Options will consist of awards from the Company that will enable the holder to purchase a number of shares of Common Stock, at set terms. Stock Options may be "incentive stock options" ("Incentive Stock Options"), within the meaning of Section 422 of the Code, or Stock Options which do not constitute Incentive Stock Options ("Nonqualified Stock Options"). The Committee will have the authority to grant to any participant one or more Incentive Stock Options, Nonqualified Stock Options, or both types of Stock Options (in each case with or without Stock Appreciation Rights). Each Stock Option shall be subject to such terms and conditions, including vesting, consistent with the Plan as the Committee may impose from time to time, subject to the following limitations. (b) Exercise Price. Each Nonqualified Stock Option granted hereunder shall have a per-share exercise price as the Committee may determine on the date of grant. (c) Payment of Exercise Price. The option exercise price may be paid in cash or, in the discretion of the Committee, by the delivery of shares of Common Stock of the Company then owned by the participant, provided such shares have been held by such participant for at least six (6) months. In the discretion of the Committee, payment may also be made by delivering a properly executed exercise notice to the Company together with a copy of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or loan proceeds to pay the exercise price as long as such transaction does not constitute an impermissible loan to an executive officer under the Sarbanes-Oxley Act of 2002. To facilitate the foregoing, the Company may enter into agreements for coordinated procedures with one or more brokerage firms. The Committee may prescribe any other method of paying the exercise price that it 1.90-3 determines to be consistent with applicable law and the purpose of the Plan, including, without limitation, in lieu of the exercise of a Stock Option by delivery of shares of Common Stock of the Company then owned by a participant, providing the Company with a notarized statement attesting to the number of shares owned, where upon verification by the Company, the Company would issue to the participant only the number of incremental shares to which the participant is entitled upon exercise of the Stock Option. (d) Exercise Period. Stock Options granted under the Plan shall be exercisable at such time or times and subject to such terms and conditions, including vesting, as shall be determined by the Committee; provided, however, that no Stock Option shall be exercisable later than ten (10) years after the date it is granted. All Stock Options shall terminate at such earlier times and upon such conditions or circumstances as the Committee shall in its discretion set forth in such option agreement on the date of grant. (e) Restoration of Stock Options. The Committee may, at the time of grant of an option, provide for the grant of a subsequent Restoration Stock Option if the exercise price is paid for by delivering previously owned shares of Common Stock of the Company. Restoration Stock Options (i) may be granted in respect of no more than the number of shares of Common Stock tendered in exercising the predecessor Stock Option, (ii) shall have an exercise price equal to the Fair Market Value (as defined in Section 16 below) on the date the Restoration Stock Option is granted, and (iii) may have an exercise period that does not extend beyond the remaining term of the predecessor Stock Option. In determining which methods a participant may utilize to pay the exercise price, the Committee may consider such factors as it determines are appropriate. (f) Limitations on Incentive Stock Options. Incentive Stock Options may be granted only to participants who are employees of the Company or of a "Parent Corporation" or "Subsidiary Corporation" (as defined in Sections 424(e) and (f) of the Code, respectively) on the date of grant. The aggregate Fair Market Value (determined as of the time the Stock Option is granted) of the Common Stock with respect to which Incentive Stock Options are exercisable for the first time by a participant during any calendar year (under all option plans of the Company and of any Parent Corporation or Subsidiary Corporation) shall not exceed one hundred thousand dollars ($100,000), provided, however, that if such $100,000 limit is exceeded, the excess Incentive Stock Options shall be treated as Nonqualified Stock Options. For purposes of the preceding sentence, Incentive Stock Options will be taken into account in the order in which they are granted. The per-share exercise price of an Incentive Stock Option shall not be less than one hundred percent (100%) of the Fair Market Value of the Common Stock on the date of grant, and no Incentive Stock Option may be exercised later than ten (10) years after the date it is granted. (g) Additional Limitations on Incentive Stock Options for Ten Percent Shareholders. Incentive Stock Options may not be granted to any participant who, at the time of grant, owns stock possessing (after the application of the attribution rules of Section 424(d) of the Code) more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent Corporation or Subsidiary Corporation, unless the exercise price of the 1.90-4 option is fixed at not less than one hundred ten percent (110%) of the Fair Market Value of the Common Stock on the date of grant and the exercise of such option is prohibited by its terms after the expiration of five (5) years from the date of grant of such option. 7. STOCK APPRECIATION RIGHTS. (a) Generally. The Committee may, in its discretion, grant Stock Appreciation Rights, including a concurrent grant of Stock Appreciation Rights in tandem with any Stock Option grant. A Stock Appreciation Right means a right to receive a payment in cash, Common Stock or a combination thereof, as determined by the Committee, in an amount equal to the excess of (i) the Fair Market Value, or other specified valuation, of a specified number of shares of Common Stock on the date the right is exercised over (ii) the Fair Market Value of such shares of Common Stock on the date the right is granted, or other specified amount, all as determined by the Committee; provided, however, that if a Stock Appreciation Right is granted in tandem with or in substitution for a Stock Option, the designated Fair Market Value in the award agreement shall reflect the Fair Market Value on the date such Stock Option was granted. Each Stock Appreciation Right shall be subject to such terms and conditions, including vesting, as the Committee shall impose from time to time, provided, however, that if a Stock Appreciation Right is granted in connection with a Stock Option, the Stock Appreciation Right shall become exercisable, be transferable and shall expire according to the same vesting, transferability and expiration rules as the corresponding Stock Option. (b) Exercise Period. Stock Appreciation Rights granted under the Plan shall be exercisable at such time or times and subject to such terms and conditions, including vesting, as shall be determined by the Committee; provided, however, that no Stock Appreciation Rights shall be exercisable later than ten (10) years after the date it is granted. All Stock Appreciation Rights shall terminate at such earlier times and upon such conditions or circumstances as the Committee shall in its discretion set forth in such right at the date of grant. 8. RESTRICTED STOCK AWARDS. (a) Generally. The Committee may, in its discretion, grant Restricted Stock Awards consisting of Common Stock issued or transferred to participants with or without other payments therefor. Each participant granted a Restricted Stock Award shall execute and deliver to the Company an agreement with respect to the Restricted Stock setting forth the restrictions applicable to such Restricted Stock. If a participant fails to execute such an agreement, the Restricted Stock Award shall be null and void. (b) Payment of the Purchase Price. If the Restricted Stock Award requires payment therefor, the purchase price of any shares of Common Stock subject to a Restricted Stock Award may be paid in any manner authorized by the Committee, which may include any manner authorized under the Plan for the payment of the exercise price of a Stock Option. Restricted Stock Awards may also be made in consideration of services rendered to the Company or its subsidiaries or affiliates. 1.90-5 (c) Additional Terms. Restricted Stock Awards may be subject to such terms and conditions, including vesting, as the Committee determines appropriate, including, without limitation, (i) restrictions on the sale or other disposition of such shares, and (ii) the right of the Company to reacquire such shares for no consideration upon termination of the participant's employment within specified periods, the participant's competition with the Company, or the participant's breach of other obligations to the Company. Restricted Stock Awards may constitute Performance-Based Awards, as described in Section 11 hereof. The Committee may require the participant to deliver a duly signed stock power, endorsed in blank, relating to the Common Stock covered by such an Award. The Committee may also require that the stock certificates evidencing such shares be held in custody or bear restrictive legends until the restrictions thereon shall have lapsed. (d) Rights as a Shareholder. The participant shall have, with respect to the shares of Common Stock subject to a Restricted Stock Award, all of the rights of a holder of shares of Common Stock of the Company, including the right to vote the shares. At the discretion of the Committee, cash dividends and stock dividends with respect to the Restricted Stock may be either currently paid to the participant or withheld by the Company for the participant's account, and interest may be credited on the amount of cash dividends withheld at a rate and subject to such terms as determined by the Committee. The cash dividends or stock dividends so withheld by the Committee and attributable to any particular share of Restricted Stock (and earnings thereon, if applicable) shall be distributed to the participant upon the release of restrictions on such shares and, if such share is forfeited, the participant shall have no right to such cash dividends or stock dividends. 9. STOCK UNITS. (a) Generally. The Committee may, in its discretion, grant Stock Units (as defined in subsection (c) below) to participants hereunder. Stock Units may be subject to such terms and conditions, including vesting, as the Committee determines appropriate. Stock Units may constitute Performance-Based Awards, as described in Section 11 hereof. A Stock Unit granted by the Committee shall provide payment in shares of Common Stock at such time as the award agreement shall specify. Shares of Common Stock issued pursuant to this Section 9 may be issued with or without other payments therefor as may be required by applicable law or such other consideration as may be determined by the Committee. The Committee shall determine whether a participant granted a Stock Unit shall be entitled to a Dividend Equivalent Right (as defined in subsection (c) below). (b) Settlement of Stock Units. Shares of Common Stock representing the Stock Units shall be distributed to the participant unless the Committee provides for the payment of the Stock Units in cash equal to the value of the shares of Common Stock which would otherwise be distributed to the participant or partly in cash and partly in shares of Common Stock. 1.90-6 (c) Definitions. A "Stock Unit" means a notional account representing one (1) share of Common Stock. A "Dividend Equivalent Right" means the right to receive the amount of any dividend paid on the share of Common Stock underlying a Stock Unit, which shall be payable in cash or in the form of additional Stock Units. 10. CASH AWARDS. The Committee may, in its discretion, grant awards to be settled solely in cash ("Cash Awards"). Cash Awards may be subject to such terms and conditions, including vesting, as the Committee determines appropriate. Cash Awards may constitute Performance-Based Awards, as described in Section 11 hereof. The maximum Cash Award that may be paid to any participant is $3,000,000. 11. PERFORMANCE-BASED AWARDS. (a) Generally. Any Benefits granted under the Plan may be granted in a manner such that the Benefits qualify for the performance-based compensation exemption of Section 162(m) of the Code ("Performance-Based Awards"). As determined by the Committee in its sole discretion, either the granting or vesting of such Performance-Based Awards shall be based on achievement of performance objectives that are based on one or more of the business criteria described below that apply to the individual participant, one or more business units or the Company as a whole. (b) Business Criteria. The business criteria shall be as follows, individually or in combination: (i) net earnings; (ii) earnings per share; (iii) sales; (iv) operating income; (v) earnings before interest and taxes (EBIT); (vi) earnings before interest, taxes, depreciation and amortization (EBITDA); (vii) cash flow; (viii) working capital targets; (ix) return on equity; (x) return on capital; (xi) market price per share; and (xii) total return to shareholders. In addition, Performance-Based Awards may include comparisons to the performance of other companies, such performance to be measured by one or more of the foregoing business criteria. (c) Establishment of Performance Goals. With respect to Performance-Based Awards, the Committee shall establish in writing (i) the performance goals applicable to a given period, and such performance goals shall state, in terms of an objective formula or standard, the method for computing the amount of compensation payable to the participant if such performance goals are obtained and (ii) the individual employees or class of employees to which such performance goals apply; provided, however, that such performance goals shall be established in writing no later than ninety (90) days after the commencement of the applicable performance period (but in no event after twenty-five percent (25%) of such performance period has elapsed). (d) Certification of Performance. No Performance-Based Awards shall be payable to or vest with respect to, as the case may be, any participant for a given period until the Committee certifies in writing that the objective performance goals (and any other material terms) applicable to such period have been satisfied. 1.90-7 (e) Modification of Performance-Based Awards. With respect to any Benefits intended to qualify as Performance-Based Awards, after establishment of a performance goal, the Committee shall not revise such performance goal or increase the amount of compensation payable thereunder (as determined in accordance with Section 162(m) of the Code) upon the attainment of such performance goal. Notwithstanding the preceding sentence, the Committee may reduce or eliminate the number of shares of Common Stock or cash granted or the number of shares of Common Stock vested upon the attainment of such performance goal. 12. FOREIGN LAWS. The Committee may grant Benefits to individual participants who are subject to the tax laws of nations other than the United States, which Benefits may have terms and conditions as determined by the Committee as necessary to comply with applicable foreign laws. The Committee may take any action which it deems advisable to obtain approval of such Benefits by the appropriate foreign governmental entity; provided, however, that no such Benefits may be granted pursuant to this Section 12 and no action may be taken which would result in a violation of the Exchange Act, the Code or any other applicable law. 13. CERTAIN TERMINATIONS OF EMPLOYMENT; FORFEITURES. (a) Forfeiture of Unsettled Benefits. Unless the Committee or any agreement providing for Benefits under this Plan shall otherwise provide, a participant shall forfeit all Benefits, which have not been settled under this Plan (other than fully vested Restricted Stock Awards) if: (i) the participant's employment with the Company or with any Parent Corporation or Subsidiary Corporation is terminated for willful, deliberate, or gross misconduct, as determined by the Committee, in its sole discretion, or (ii) following the participant's termination of employment with the Company (or with any Parent Corporation or Subsidiary Corporation) and for a period of two (2) years thereafter, the participant engages in any business or enters into any employment relationship which the Committee in its sole discretion determines to be either directly or indirectly competitive with the business of the Company or substantially injurious to the Company's business interest. The activities described in (i) and (ii) above are hereafter referred to as "Injurious Conduct". (b) Forfeiture of Settled Benefits. If the Committee determines that a participant has engaged in Injurious Conduct during the course of his employment (or during the two (2) year period following his or her termination of employment), the Committee may in its discretion require the participant to return to the Company any Common Stock or cash received in settlement of any Benefit under this Plan. If the Common Stock acquired in settlement of a Benefit has been disposed of by the participant, then the Company may require the participant to pay to the Company the economic value of the Common Stock as of the date of disposition. 1.90-8 (c) Timing. The Committee shall exercise the right of forfeiture provided to the Company in this Section 13 within ninety (90) days after the discovery of the activities giving rise to the Company's right of forfeiture, which activities must have occurred no later than twenty-four (24) months after the participant's termination of employment. (d) Determination from the Committee. A participant may make a request to the Committee in writing for a determination regarding whether any proposed business or activity would constitute Injurious Conduct. Such request shall fully describe the proposed business or activity. The Committee shall respond to the participant in writing and the Committee's determination shall be limited to the specific business or activity so described. (e) Condition Precedent. Unless the Committee or any agreement providing for Benefits under this Plan shall otherwise provide, no Benefit shall be deemed awarded to any participant under this Plan unless and until the participant agrees to the applicability of this Section 13. (f) Enforceability. The purpose of this Section 13 is to protect the Company (and any Parent and Subsidiaries) from Injurious Conduct. To the extent that this Section 13 is not fully enforceable as written, the unenforceable provisions shall be modified so as to provide the Company with the fullest protection permitted by law. 14. ADJUSTMENT PROVISIONS; CHANGE IN CONTROL. (a) Adjustment. Benefits granted under the Plan and any agreements evidencing such Benefits, the maximum number of shares of Common Stock subject to all Benefits stated in Section 5(a) and the maximum number of shares of Common Stock with respect to which Benefits may be granted to any one person during any period stated in Section 5(a) shall be subject to adjustment or substitution, as determined by the Committee in its sole discretion, as to the number, price or kind of a share of Common Stock or other consideration subject to such Benefits or as otherwise determined by the Committee to be equitable (i) in the event of changes in the outstanding Common Stock or in the capital structure of the Company by reason of stock or extraordinary cash dividends, stock splits, reverse stock splits, recapitalization, reorganizations, mergers, consolidations, combinations, exchanges, or other relevant changes in capitalization occurring after the date of grant of any such Benefit or (ii) in the event of any change in applicable laws or any change in circumstances which results in or would result in any substantial dilution or enlargement of the rights granted to, or available for, participants, or which otherwise warrants equitable adjustment because it interferes with the intended operation of the Plan. Any adjustment in Incentive Stock Options under this Section 14 shall be made only to the extent not constituting a "modification" within the meaning of Section 424(h)(3) of the Code, and any adjustments under this Section 14 shall be made in a manner which does not adversely affect the exemption provided pursuant to Rule 16b-3 under the Exchange Act. Further, with respect to Benefits intended to qualify as "performance-based compensation" under Section 162(m) of the Code, such adjustments or substitutions shall be made only to the extent 1.90-9 that the Committee determines that such adjustments or substitutions may be made without causing the Company to be denied a tax deduction on account of Section 162(m) of the Code. The Company shall give each participant notice of an adjustment hereunder and, upon notice, such adjustment shall be conclusive and binding for all purposes. (b) Effect of a Change in Control. Notwithstanding any other provision of this Plan, if there is a Change in Control (as defined in subsection (c) below) of the Company, all then outstanding Stock Options, Stock Appreciation Rights and Stock Units shall immediately vest and become exercisable and any restrictions on Restricted Stock Awards or Stock Units shall immediately lapse. Thereafter, insofar as any Benefit is provided in shares of stock of the Company or in Stock Options or Stock Appreciation Rights or is determined based on the value or other attributes of a share of stock of the Company, such Benefit shall be subject to the same terms to which a share of stock of the Company is subject in accordance with any agreement effecting the Change in Control, which agreement, may provide, without limitation, that each Stock Option and Stock Appreciation Right outstanding hereunder shall terminate within a specified number of days after notice to the holder, and that such holder shall receive, with respect to each share of Common Stock subject to such Stock Option or Stock Appreciation Right, an amount equal to the excess of the Fair Market Value of such shares of Common Stock immediately prior to the occurrence of such Change in Control over the exercise price per share underlying such Stock Option or Stock Appreciation Right with such amount payable in cash, in one or more kinds of property (including the property, if any, payable in the transaction) or in a combination thereof, as the Committee, in its discretion, shall determine. (c) Definitions. For purposes of this Section 14, the following words shall have the meaning ascribed to them below: (i) "Affiliate' means (i) any entity that directly or indirectly is controlled by, controls or is under common control with the Company and (ii) any entity in which the Company has a significant equity interest, in either case as determined by the Committee. (ii) "Beneficial Owner" shall have the meaning set forth in Rule 13d-3 under the Exchange Act. (iii) "Change in Control" of the Company, with respect to any participant, shall be deemed to have occurred upon any of the following events (unless another definition is provided in any applicable individual change in control agreement between the Company and the participant, in which case such agreement shall govern): (A) Any Person becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its affiliates) representing twenty percent (20%) or more of either the then outstanding shares of Common Stock or the combined voting power of the Company's then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction described in clause (i) of Paragraph (C) below; 1.90-10 (B) The following individuals cease for any reason to constitute a majority of the number of directors then serving: individuals who, on the Effective Date (as defined in Section 24 below), constitute the Board of Directors and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board of Directors or nomination for election by the Company's shareholder's was approved by a vote of least two-thirds (2/3) of the directors then still in office who either were directors on the Effective Date or whose appointment, election or nomination for election was previously so approved; or (C) There is consummated a merger or consolidation of the Company (including a triangular merger to which the Company is a party) with any other corporation other than (i) a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least sixty-six and two-thirds percent (66-2/3%) of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its subsidiaries) representing twenty percent (20%) or more of either the then outstanding shares of Common Stock or the combined voting power of the Company's then outstanding securities; (D) The shareholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company's assets, other than a sale or disposition by the Company of all or substantially all of the Company's assets to an entity at least seventy-five percent (75%) of the combined voting power of the voting securities of which are owned by shareholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale. Notwithstanding the foregoing, no "change in Control" shall be deemed to have occurred if there is consummated any transaction or series of integrated transactions immediately following which the record holders of the Common Stock immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in the entity which owns all or substantially all of the assets of the Company immediately following such transaction or series of transactions. 1.90-11 (iv) "Person" shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Section 13(d) and 14(d) thereof, except that such term shall not include (A) the Company or any of its subsidiaries, (B) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its subsidiaries, (C) an underwriter temporarily holding securities pursuant to an offering of such securities, (D) a corporation owned, directly or indirectly, by the shareholders of the Company in substantially the same proportion as their ownership of the Common Stock, or (E) an entity or entities which are eligible to file and have filed a Schedule 13G under Rule 13d-1(b) under the Exchange Act, which Schedule indicates beneficial ownership of fifteen percent (15%) or more of the outstanding shares of Common Stock or of the combined voting power of the Company's then outstanding securities. 15. NONTRANSFERABILITY. Each Benefit granted under the Plan to a participant (other than awards of unrestricted Stock Awards, vested restricted Stock Awards and vested Cash Awards) shall not be transferable otherwise than by will or the laws of descent and distribution, and shall be exercisable, during the participant's lifetime, only by the participant. In the event of the death of a participant, each Stock Option or Stock Appreciation Right theretofore granted to him or her shall be exercisable during such period after his or her death as the Committee shall in its discretion set forth in such option or right at the date of grant and then only by the executor or administrator of the estate of the deceased participant or the person or persons to whom the deceased participant's rights under the Stock Option or Stock Appreciation Right shall pass by will or the laws of descent and distribution. Notwithstanding the foregoing, at the discretion of the Committee, an award of a Benefit other than an Incentive Stock Option may permit the transferability of a Benefit by a participant solely to the participant's spouse, siblings, parents, children and grandchildren or trusts for the benefit of such persons or partnerships, corporations, limited liability companies or other entities owned solely by such persons, including trusts for such persons, subject to any restriction included in the award of the Benefit. 16. OTHER PROVISIONS. The award of any Benefit under the Plan may also be subject to such other provisions (whether or not applicable to the Benefit awarded to any other participant) as the Committee determines appropriate, including, without limitation, for the forfeiture of, or restrictions on resale or other disposition of, Common Stock acquired under any form of Benefit, for the acceleration of exercisability or vesting of Benefits, or to comply with federal and state securities laws, or understandings or conditions as to the participant's employment in addition to those specifically provided for under the Plan. 17. FAIR MARKET VALUE. For purposes of this Plan and any Benefits awarded hereunder, Fair Market Value on any given date means (i) if the Common Stock is listed on a national securities exchange or is quoted in the National Market System of the National Association of Securities Dealers Automated Quotation System ("NASDAQ") on a last sale basis, the closing price reported as 1.90-12 having occurred on the such date, or, if there is no sale on such date, then on the last preceding date on which such a sale was reported, or (ii) if the Common Stock is not listed on a national securities exchange nor quoted in NASDAQ on a last sale basis, the amount determined by the Committee to be the fair market value based upon a good faith attempt to value the Common Stock accurately. 18. WITHHOLDING. All payments or distributions of Benefits made pursuant to the Plan shall be net of any amounts required to be withheld pursuant to applicable federal, state and local tax withholding requirements. If the Company proposes or is required to distribute Common Stock pursuant to the Plan, it may require the recipient to remit to it or to the corporation that employs such recipient an amount sufficient to satisfy such tax withholding requirements prior to the delivery of any certificates for such Common Stock. In lieu thereof, the Company or the employing corporation shall have the right to withhold the amount of such taxes from any other sums due or to become due from such corporation to the recipient as the Committee shall prescribe. The Committee may, in its discretion and subject to such rules as it may adopt (including any as may be required to satisfy applicable tax and/or non-tax regulatory requirements), permit an optionee or award or right holder to pay all or a portion of the federal, state and local withholding taxes arising in connection with any Benefit consisting of shares of Common Stock by electing to have the Company withhold shares of Common Stock having a Fair Market Value equal to the amount of tax to be withheld, such tax calculated at minimum statutory withholding rates. 19. EMPLOYMENT RIGHTS. Neither the Plan nor any action taken hereunder shall be construed as giving any participant the right to be retained in the employ or service of the company or any of its subsidiaries or affiliates. 20. UNFUNDED PLAN. Participants shall have no right, title, or interest whatsoever in or to any investments which the Company may make to aid it in meeting its obligations under the Plan. Nothing contained in the Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship between the Company and any participant, beneficiary, legal representative or any other person. To the extent that any person acquires a right to receive payments from the Company under the Plan, such right shall be no greater than the right of an unsecured general creditor of the Company. All payments to be made hereunder shall be paid from the general funds of the Company and no special or separate fund shall be established and no segregation of assets shall be made to assure payment of such amounts except as expressly set forth in the Plan. The Plan is not intended to be subject to the Employee Retirement Income Security Act of 1974, as amended. 21. NO FRACTIONAL SHARES. No fractional shares of Common Stock shall be issued or delivered pursuant to the Plan or any Benefit. The Committee shall determine whether cash, or Benefits, or other property shall be issued or paid in lieu of fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated. 1.90-13 22. DURATION, AMENDMENT AND TERMINATION. No Benefit shall be granted more than ten (10) years after the Effective Date. The Company may amend the Plan from time to time or suspend or terminate the Plan at any time. No amendment of the Plan may be made without approval of the majority of the shareholders of the Company if the amendment will: (i) increase the aggregate number of shares of Common Stock that may be delivered through Stock Options under the Plan; (ii) increase the maximum number of shares that may be awarded to any participant under Section 5 hereof or the maximum Cash Award that can be paid to any individual under Section 10 hereof; (iii) change the types of business criteria on which Performance-Based Awards are to be based under the Plan; or (iv) modify the requirements as to eligibility for participation in the Plan. 23. GOVERNING LAW. This Plan, Benefits granted hereunder and actions taken in connection herewith shall be governed and construed in accordance with the laws of the Commonwealth of Pennsylvania (regardless of the law that might otherwise govern under applicable Pennsylvania principles of conflict of laws). 24. EFFECTIVE DATE. This Plan is adopted by the Company in anticipation of its emergence from chapter 11 of title 11 of the United States Bankruptcy Code, as a publicly-owned SEC reporting issuer. Stock Options and Restricted Stock Awards provided for in the Company's plan of reorganization will be provided under this Plan. The Plan shall be effective as of the date on which all the conditions to the effectiveness of the Company's plan of reorganization (the "Effective Date"), provided that the Plan is approved by a majority of the Company's shareholders within twelve (12) months of the Effective Date. Such shareholder approval shall be a condition to the right of each participant to receive any Benefits hereunder. Any Benefits granted under the Plan prior to such shareholder approval shall be effective as of the date of grant (unless, with respect to any Benefit, the Committee specifies otherwise at the time of grant), but no such Benefit may be exercised or settled and no restrictions relating to any Benefit may lapse prior to such shareholder approval, and if such shareholder approval is not obtained as provided hereunder, any such Benefit shall be cancelled. 1.90-14 EX-99 8 jd9-5ex99_6.txt 99.6 Exhibit 99.6 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------- ) EXHIBIT 1.91 FORM OF WARRANT AGREEMENT AND FORM OF WARRANT FORM OF WARRANT AGREEMENT (SEPT. 5, 2003) ----------------------------------------- ---------------------------------------------------------- WARRANT AGREEMENT between ARMSTRONG WORLD INDUSTRIES, INC. and [-------------------------] as Warrant Agent [ ] Warrants to Purchase Common Stock Dated as of [ ], 200[ ] ---------------------------------------------------------- This Warrant Agreement (this "Warrant Agreement"), dated as of [ ], 200[ ], is made by and between Armstrong World Industries, Inc., a Pennsylvania corporation (the "Company"), and [ ], as warrant agent (the "Warrant Agent"). W I T N E S S E T H : WHEREAS, the Company proposes to issue warrants (the "Warrants") to purchase Common Stock (as defined below) pursuant to the Company's Fourth Amended Plan of Reorganization under Chapter 11 of the Bankruptcy Code (the "Plan of Reorganization"), as confirmed pursuant to the order, dated [ ], 2003, of the United States Bankruptcy Court for the District of Delaware, and the terms and conditions of this Warrant Agreement; and WHEREAS, the Company has requested the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing so to act, in connection with the issuance, division, transfer, exchange and exercise of Warrants pursuant to the terms and conditions of this Warrant Agreement; NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereto agree as follows: 1. Definitions. As used in this Warrant Agreement, the following capitalized terms have the respective meanings set forth below: "Applicable Procedures" means, with respect to any transfer or exchange of or for beneficial interests in any Global Warrant, the rules and procedures of the Depositary and Euroclear that apply to such transfer or exchange. "Business Day" shall mean any day that is not a Saturday or Sunday or a day on which banks are required or permitted to be closed in the State of New York or the Commonwealth of Pennsylvania. "Common Stock" shall mean the Common Stock, par value $___ per share, of the Company. "Company" has the meaning specified in the preamble hereof. "Definitive Warrants" means Warrants issued in definitive form as set forth in Section 5.1 hereof. "Depositary" shall mean the Person specified in Section 3.2 hereof as the Depositary with respect to the Warrants and any and all successors thereto appointed as Depositary hereunder. "Euroclear" means Euroclear Bank S.A./N.V., as operator of the Euroclear system. 1.91-1 "Exercise Price" shall be equal to $ ___ per share of Common Stock (1) as such price may be adjusted pursuant to Section 6 of this Agreement. "Expiration Date" shall mean [ ], 2010.(2) After the Expiration Date, the Warrants will become void and of no value. "Global Warrants" means a global Warrant substantially in the form of Exhibit A hereto bearing the Global Warrant Legend and deposited with or on behalf of, and registered in the name of, the Depositary or its nominee. "Global Warrant Legend" means the legend set forth in Section 5.4, which is required to be placed on all Global Warrants issued under this Warrant Agreement. "Holder" shall mean the Person in whose name a Warrant is registered in the warrant register of the Company maintained by or on behalf of the Company for such purpose. "Initial Holder" means Armstrong Holdings, Inc. "Other Property" shall have the meaning set forth in Section 6.3. "Person" shall mean any individual, sole proprietorship, partnership, joint venture, trust, incorporated organization, association, corporation, limited liability company, limited liability partnership, institution, public benefit corporation, entity or government (whether federal, state, county, city, municipal or otherwise, including, without limitation, any instrumentality, division, agency, body or department thereof). "Transaction" shall have the meaning set forth in Section 6.3. "Warrants" has the meaning specified in the recitals hereto, and shall include all Warrants issued upon registration of transfer, division or combination of, or in substitution for, any thereof. All Warrants shall be issued in the form of a Global Warrant. "Warrant Agent" has the meaning specified in the preamble hereof and shall include any successor Warrant Agent hereunder. "Warrant Agent's Principal Office" shall mean the principal office of the Warrant Agent at [ ] (or such other office of the Warrant Agent or any successor thereto hereunder acceptable to the Company as set forth in a written notice provided to the Company and the Holders). "Warrant Agreement" has the meaning specified in the preamble hereof. - ---------------------------- (1) 125% of the Equity Value of the Common Stock as set forth in the Disclosure Statement. (2) The 7th anniversary of the Effective Date. 1.91-2 "Warrant Price" shall mean an amount equal to (i) the number of shares of Common Stock being purchased upon exercise of a Warrant pursuant to Section 4.1, multiplied by (ii) the Exercise Price. "Warrant Stock" shall mean the shares of Common Stock purchased by the Holders of the Warrants upon the exercise thereof. 2. Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company in accordance with the instructions set forth in this Warrant Agreement, and the Warrant Agent hereby accepts such appointment. 3. Issuance; Registration; Form and Execution of Warrants. 3.1 Issuance. The Company hereby authorizes the Warrants and issues and grants to the Holders listed on Schedule A hereto the number of Warrants set forth opposite the name of such Holder on Schedule A attached hereto. The aggregate number of Warrants to be issued under this Agreement is [ ].(3) Each Warrant shall entitle the Holder, subject to the satisfaction of the conditions to exercise set forth in Section 4 hereof, to purchase from and after the date hereof and until 5:00 p.m., New York City time, on the Expiration Date, one share of Common Stock of the Company at the Exercise Price. The number of Warrants issued to the Holders pursuant to this Warrant Agreement, the number of shares of Common Stock issuable on exercise of each Warrant and the Exercise Price are all subject to adjustment pursuant to Section 6 hereof. 3.2 Warrant Registrar and Depositary. A register of the Warrants and of their transfer shall be maintained at the Warrant Agent's Principal Office by the Warrant Agent (the "Warrant Register"). The Company initially appoints the Warrant Agent to act as the registrar with respect to the Global Warrants (the "Warrant Registrar"). The Company initially appoints The Depository Trust Company to act as Depositary with respect to the Global Warrants. 3.3 Form of Warrant. (a) General. The Warrants shall be issued in global form and shall be substantially in the form of Exhibit A hereto (including the Global Warrant Legend thereon and the "Schedule of Exchanges of Interests in the Global Warrant" attached thereto). The Warrants may have notations, legends or endorsements required by law, stock exchange rule or usage. Warrants shall be dated the date of the countersignature. The terms and provisions contained in the Warrants shall constitute, and are hereby expressly made, a part of this Warrant Agreement. The Company and the Warrant Agent, by their execution and delivery of this Warrant - ----------------------- (3) 5% of the number of shares of Common Stock to be outstanding on the Effective Date on a fully-diluted basis. 1.91-3 Agreement, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any Warrant conflicts with the express provisions of this Warrant Agreement, the provisions of this Warrant Agreement shall govern and be controlling. (b) Global Warrants. Each Global Warrant shall represent such of the outstanding Warrants as shall be specified therein and shall provide that it shall represent the number of outstanding Warrants from time to time endorsed thereon and that the number of outstanding Warrants represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. 3.4 Execution of Warrants. An Officer shall sign the Warrants on behalf of the Company by manual or facsimile signature. If the Officer whose signature is on a Warrant no longer holds that office at the time a Warrant is countersigned, the Warrant shall nevertheless be valid. A Warrant shall not be valid until countersigned by the manual signature of the Warrant Agent. The signature shall be conclusive evidence that the Warrant has been properly issued under this Warrant Agreement. The Warrant Agent shall, upon a written order of the Company signed by an Officer, countersign Warrants for original issue up to the number stated in Section 3.1 hereof. The Warrant Agent may appoint an agent acceptable to the Company to countersign Warrants. Such an agent may countersign Warrants whenever the Warrant Agent may do so. Each reference in this Warrant Agreement to a countersignature by the Warrant Agent includes a countersignature by such agent. Such agent shall have the same rights as the Warrant Agent in dealing with the Company. 3.5 Registration Rights. In the event prior to the second anniversary of the initial issuance of the Warrants the distribution of the Warrants by the Initial Holder to its shareholders as a liquidating distribution or in any comparable manner is determined by the SEC to require registration under the Securities Act of 1933, as amended, the Company shall use its commercially reasonable efforts, at its expense, to register such distribution of the Warrants for such distribution or disposition as promptly as is practicable after a request therefor by the Initial Holder. Such registration shall proceed substantially in accordance with the most favorable terms and conditions (if any) on which the Company has granted registration rights to any other person. 4. Exercise of Warrants. 4.1 Manner of Exercise. In order to exercise all or any of the Warrants, the exercising Holder whose name appears on a securities position listing of the Depositary as the holder of such book-entry interest must comply with the Depositary's procedures relating to the exercise of such book-entry interest in such Global Warrant. In addition, the Holder shall deliver to the Company at the Warrant Agent's Principal Office, (i) the Form of Election to Purchase substantially in the form attached hereto as Exhibit A duly executed by such Holder or its agent or attorney and (ii) payment of the Warrant Price to the Warrant Agent for the account of the Company. 1.91-4 4.2 Payment of Taxes. The Company shall pay all expenses and costs in connection with the issuance or delivery of the Warrants. The Holder shall be responsible for any taxes or other governmental charges imposed on such Holder with respect to the issuance or delivery of the Warrants or any transfer thereof. 4.3 Fractional Shares. The Company shall not issue fractional shares of Common Stock upon exercise of any Warrant. Whenever any distribution of Warrants exercisable into fractional shares of Common Stock would otherwise be called for, the actual distribution thereof shall be rounded as follows: (i) fractions of 1/2 or greater shall be rounded to the next higher whole number and (ii) fractions of less than 1/2 shall be rounded to the next lower whole number. 5. Transfer and Exchange. 5.1 Transfer and Exchange of Global Warrants. A Global Warrant may not be transferred as a whole except by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary. All Global Warrants will be exchanged by the Company for Definitive Warrants if (i) the Company delivers to the Warrant Agent notice from the Depositary that it is unwilling or unable to continue to act as Depositary or that it is no longer a clearing agency registered under the Exchange Act and, in either case, a successor Depositary is not appointed by the Company within 120 days after the date of such notice from the Depositary or (ii) the Company in its sole discretion determines that the Global Warrants (in whole but not in part) should be exchanged for Definitive Warrants and delivers a written notice to such effect to the Warrant Agent. Upon the occurrence of either of the preceding events, Definitive Warrants shall be issued in such names as the Depositary shall instruct the Warrant Agent. Global Warrants may also be exchanged or replaced, in whole or in part, as provided in Section 11 hereof. A Global Warrant may not be exchanged for another Warrant other than as provided in this Section 5.1; however, beneficial interests in a Global Warrant may be transferred and exchanged as provided in Section 5.2 hereof. 5.2 Transfer and Exchange of Beneficial Interests in the Global Warrants. The transfer and exchange of beneficial interests in the Global Warrants shall be effected through the Depositary, in accordance with the Applicable Procedures. 5.3 Transfer and Exchange of Definitive Warrants for Definitive Warrants. Upon request by a holder of Definitive Warrants and such holder's compliance with the provisions of this Section 5.3, the Warrant Registrar shall register the transfer or exchange of Definitive Warrants on the Warrant Register. Prior to such registration of transfer or exchange, the requesting holder shall present or surrender to the Warrant Registrar the Definitive Warrants duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Warrant Registrar duly executed by such holder or by its attorney, duly authorized in writing. 1.91-5 5.4 Global Warrant Legend. Each Global Warrant shall bear a legend in substantially the following form: "THIS GLOBAL WARRANT IS HELD BY THE DEPOSITARY (AS DEFINED IN THE WARRANT AGREEMENT GOVERNING THIS WARRANT) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE WARRANT AGENT MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 5 OF THE WARRANT AGREEMENT, (ii) this global warrant may be exchanged in whole but not in part pursuant to section 5.1 of the warrant agreement, (III) THIS GLOBAL WARRANT MAY BE DELIVERED TO THE WARRANT AGENT FOR CANCELLATION PURSUANT TO SECTION 13.5 OF THE WARRANT AGREEMENT AND (Iv) THIS GLOBAL WARRANT MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY." 5.5 General Provisions Relating to Transfers and Exchanges. (a) To permit registrations of transfers and exchanges, the Company shall execute and the Warrant Agent shall countersign Global Warrants and Definitive Warrants upon the Company's order or at the Warrant Registrar's request. (b) No service charge shall be made to a holder of a beneficial interest in a Global Warrant or to a holder of a Definitive Warrant for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or governmental charge payable in connection therewith. (c) All Global Warrants and Definitive Warrants issued upon any registration of transfer or exchange of Global Warrants or Definitive Warrants shall be duly authorized, executed and issued Warrants for Common Stock of the Company, not subject to any preemptive rights, and entitled to the same benefits under this Warrant Agreement, as the Global Warrants or Definitive Warrants surrendered upon such registration of transfer or exchange. (d) Prior to due presentment for the registration of a transfer of any Warrant, the Warrant Agent, and the Company may deem and treat the Person in whose name any Warrant is registered as the absolute owner of such Warrant for all purposes and neither the Warrant Agent nor the Company shall be affected by notice to the contrary. (e) The Warrant Agent shall countersign Global Warrants and Definitive Warrants in accordance with the provisions of Section 3.4 hereof. 5.6 Facsimile Submissions to Warrant Agent. All instructions required to be submitted to the Warrant Registrar pursuant to this Section 5 to effect a registration of transfer or exchange may be submitted by facsimile. 6. Adjustments. The number of shares of Common Stock for which a Warrant is exercisable, and the Exercise Price shall be subject to adjustment from time to time as set forth in this Section 6. 1.91-6 6.1 Stock Dividends, Subdivisions and Combinations. If at any time the Company shall: (i) take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend payable in, or other distribution of, additional shares of Common Stock; (ii) subdivide its outstanding shares of Common Stock into a larger number of shares of Common Stock, or (iii) combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock, then (a) the number of shares of Common Stock for which a Warrant is exercisable immediately after the occurrence of any such event shall be adjusted to equal the number of shares of Common Stock that a record holder of the same number of shares of Common Stock for which a Warrant is exercisable immediately prior to the occurrence of such event would own or be entitled to receive after the happening of such event and (b) the Exercise Price shall be adjusted to equal (1) the Exercise Price prior to such adjustment multiplied by the number of shares of Common Stock for which a Warrant is exercisable immediately prior to the adjustment divided by (2) the number of shares for which a Warrant is exercisable immediately after such adjustment. 6.2 Other Provisions Applicable to Adjustments under this Section. The following provisions shall be applicable to the making of adjustments of the number of shares of Common Stock for which a Warrant is exercisable and the Exercise Price provided for in this Section 6: (a) When Adjustments to Be Made. The adjustments required by this Section 6 shall be made whenever and as often as any specified event requiring an adjustment shall occur, except that any adjustment of the number of shares of Common Stock for which a Warrant is exercisable that otherwise would be required may be postponed (except in the case of a subdivision or combination of shares of Common Stock, as provided for in Section 6.1) up to, but not later than the date of exercise if such adjustment either by itself or with other adjustments not previously made would result in an increase or decrease, as the case may be, of less than 1% of the shares of Common Stock for which a Warrant is exercisable immediately prior to the making of such adjustment. Any adjustment representing a change of less than such minimum amount (except as aforesaid) which is postponed shall be carried forward and made as soon as such adjustment, together with other adjustments required by this Section 6 and not previously made, would result in a minimum adjustment or on the date of exercise. For the purpose of any adjustment, any specified event shall be deemed to have occurred at the close of business on the date of its occurrence. (b) Fractional Interests. In computing adjustments pursuant to this Section 6 (but subject to Section 4.3), fractional interests in Common Stock shall be taken into account to the nearest 1/1000th of a share. 6.3 Reorganization, Reclassification, Merger, Consolidation or Sale of Substantially all Assets of the Company. If the Company (or any other entity, the stock or other securities of which are at the time receivable on the exercise of the Warrants) shall reorganize its capital, reclassify its capital stock, consolidate or merge with or into another Person (where the Company is not the surviving corporation or resulting entity or where there is a change in or distribution with respect to the Common Stock of the Company), other than as a result of a stock dividend, stock split, reverse stock split, recapitalization or the like provided for in Section 6.1 above (each such event hereinafter 1.91-7 referred to as a "Transaction"), and pursuant to the terms of any such Transaction, the consideration to be paid or distributed to or otherwise received by the holders of Common Stock consists of shares of common stock of the surviving corporation or resulting entity and/or any cash, shares of stock (not constituting common stock) or other securities or property of any nature whatsoever (including warrants or other subscription or purchase rights) (such non-common stock property hereinafter referred to as "Other Property"), then each Holder shall have the right thereafter to receive, upon exercise of a Warrant, solely the number of shares of common stock of the surviving corporation or resulting entity and/or such amount of Other Property receivable pursuant to such Transaction by a holder of the number of shares of Warrant Stock for which a Warrant is exercisable immediately prior to the effective time of such Transaction. In the case of any Transaction of the type described in the preceding sentence, it shall be a condition precedent to consummation of the Transaction that the surviving corporation or resulting entity assume the due and punctual observance and performance of each and every covenant and condition of this Warrant Agreement and the Warrants to be performed and observed by the Company and all the obligations and liabilities hereunder, subject to such modifications as may be deemed appropriate (as determined by resolution of the Board of Directors of the Company) in order to provide for adjustments of shares of the Warrant Stock for which a Warrant is exercisable which shall be as nearly equivalent as practicable to the adjustments provided for in this Section 6.3. For purposes of this Section 6.3, "common stock of the surviving corporation or resulting entity" shall include stock of such corporation of any class which does not have a preference as to dividends or assets over any other class of stock of such corporation and which is not subject to redemption and shall also include any evidences of indebtedness, shares of stock or other securities which are convertible into or exercisable or exchangeable for any such stock, either immediately or after the lapse of any prescribed time period or the occurrence of a specified event, and any warrants or other rights to subscribe for or purchase any such stock. The foregoing provisions of this Section 6.3 shall similarly apply to successive Transactions. 6.4 Certain Limitations. Notwithstanding anything herein to the contrary, the Company agrees not to enter into any transaction which, by reason of any adjustment hereunder, would cause the Exercise Price to be less than the par value per share of Common Stock unless the Company shall take such corporate action in order that the Company may validly and legally issue fully paid and nonassessable shares of such Common Stock at such adjusted Exercise Price. 7. Notice to Warrant Holders. Whenever the number of shares of Common Stock for which a Warrant is exercisable, or whenever the Exercise Price shall be adjusted pursuant to Section 6, the Company shall forthwith prepare a certificate setting forth, in reasonable detail, the event requiring the adjustment and the method by which such adjustment was calculated, specifying the number of shares of Common Stock for which a Warrant is exercisable and describing the number and kind of any other shares of stock or Other Property for which a Warrant is exercisable, and any change in the purchase price or prices thereof, after giving effect to such adjustment or change. The Company shall promptly cause a signed copy of such certificate to be delivered to the Warrant Agent in accordance with Section 14.2. The Company shall keep at its office or agency designated by the Company pursuant to Section 12 copies of all such certificates and cause the same to be available for inspection at said office during normal business hours by any Holder or any prospective purchaser of a Warrant designated by a Holder thereof. 1.91-8 8. No Impairment. The Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant Agreement or any Warrant. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any shares of Common Stock receivable upon the exercise of a Warrant above the amount payable therefor upon such exercise immediately prior to such increase in par value and (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of any Warrant. 9. Reservation and Authorization of Common Stock. From and after the date hereof, the Company shall at all times reserve and keep available for issue upon the exercise of Warrants such number of its authorized but unissued shares of Common Stock as will be sufficient to permit the exercise in full of all outstanding Warrants. All shares of Common Stock which shall be so issuable, when issued upon exercise of any Warrant and payment therefor in accordance with the terms of this Warrant Agreement and such Warrant, shall be duly and validly issued and fully paid and nonassessable, and not subject to preemptive rights. 10. Stock and Warrant Transfer Books. The Company will not at any time, except upon dissolution, liquidation or winding up of the Company, close its stock transfer books or Warrant transfer books so as to result in preventing or delaying the exercise or transfer of any Warrant. 11. Loss or Mutilation. Upon receipt by the Company and the Warrant Agent from any Holder of evidence reasonably satisfactory to them of the ownership of and the loss, theft, destruction or mutilation of such Holder's Warrant and indemnity reasonably satisfactory to them, and in case of mutilation upon surrender and cancellation thereof, the Company will execute and the Warrant Agent will countersign and deliver in lieu hereof a new Warrant of like tenor and representing an equal number of Warrants to such Holder; provided, in the case of mutilation, no indemnity shall be required if such Warrant in identifiable form is surrendered to the Company or the Warrant Agent for cancellation. 12. Office of Company. As long as any of the Warrants remain outstanding, the Company shall maintain an office or agency (which may be the principal executive offices of the Company) where the Warrants may be presented for exercise, registration of transfer, division or combination as provided in this Warrant Agreement. The Company shall initially maintain such an agency at the Warrant Agent's Principal Offices. 13. Warrant Agent. 13.1 Merger or Consolidation or Change of Name of Warrant Agent. Any Person into which the Warrant Agent may be merged or with which it may be consolidated, or any Person resulting from any merger or consolidation to which the Warrant Agent shall be a party, or any Person succeeding to all or substantially all of the corporate trust business of the Warrant Agent, shall be the successor to the Warrant Agent hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto. If, at the time such successor by merger or consolidation to the Warrant Agent shall 1.91-9 succeed to the agency created by this Warrant Agreement, any of the Warrants shall have been countersigned but not delivered, any such successor to the Warrant Agent may adopt the countersignature of the predecessor Warrant Agent and deliver such Warrants so countersigned; and if at that time any of the Warrants shall not have been countersigned, any successor to the Warrant Agent may countersign such Warrants either in the name of the predecessor Warrant Agent or in the name of the successor Warrant Agent; and in all such cases Warrants shall have the full force provided in the Warrants and in this Warrant Agreement. If at any time the name of the Warrant Agent shall be changed and at such time any of the Warrants shall have been countersigned but not delivered, the Warrant Agent may adopt the countersignatures under its prior name and deliver such Warrants so countersigned; and if at that time any of the Warrants shall not have been countersigned as provided in Section 3.4, the Warrant Agent may countersign such Warrants either in its prior name or in its changed name; and in all such cases such Warrants shall have the full force provided in the Warrants and in this Warrant Agreement. 13.2 Certain Terms and Conditions Concerning the Warrant Agent. The Warrant Agent undertakes the duties and obligations imposed by this Warrant Agreement upon the following terms and conditions, by all of which the Company and the Holders, by their acceptance of Warrants, shall be bound: (a) Correctness of Statements. The statements contained herein and in the Warrants shall be taken as statements of the Company, and the Warrant Agent assumes no responsibility for the correctness of any of the same. The Warrant Agent assumes no responsibility with respect to the distribution of the Warrants except as herein expressly provided. (b) Breach of Covenants. The Warrant Agent shall not be responsible for any failure of the Company to comply with any of the covenants contained in this Warrant Agreement or in the Warrants to be complied with specifically by the Company. (c) Performance of Duties. The Warrant Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself or by or through its attorneys or agents (which shall not include its employees) and shall not be responsible for the misconduct or negligence of any agent appointed with due care. (d) Reliance on Counsel. The Warrant Agent may consult at any time with legal counsel satisfactory to it, and the Warrant Agent shall incur no liability or responsibility to the Company or to any Holder in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the opinion or the advice of such counsel provided that such counsel shall have been selected with due care. (e) Proof of Actions Taken. Whenever in the performance of its duties under this Warrant Agreement the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed conclusively to be proved and established by a certificate signed by the President, a Vice President, the Secretary or an Assistant Secretary of the 1.91-10 Company and delivered to the Warrant Agent; and such certificate shall be full authorization to the Warrant Agent for any action taken or suffered in good faith by it under the provisions of this Warrant Agreement in reliance upon such certificate. (f) Legal Proceedings. The Warrant Agent shall be under no obligation to institute any action, suit or legal proceeding or to take any other action likely to involve expense unless the Company or one or more Holders shall furnish the Warrant Agent with reasonable security and indemnity for any costs and expenses that may be incurred, but this provision shall not affect the power of the Warrant Agent to take such action as the Warrant Agent may consider proper, whether with or without any such security or indemnity. All rights of action under this Warrant Agreement or under any of the Warrants may be enforced by the Warrant Agent without the possession of any of the Warrants or the production thereof at any trial or other proceeding relative thereto, and any such action, suit or proceeding instituted by the Warrant Agent shall be brought in its name as Warrant Agent, and any recovery of judgment shall be for the ratable benefit of the Holders, as their respective rights or interests may appear. (g) Other Transactions in Securities of the Company. [The Warrant Agent and any stockholder, director, officer or employee of the Warrant Agent may buy, sell or deal in any of the Warrants or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not Warrant Agent under this Warrant Agreement.] Nothing herein shall preclude the Warrant Agent from acting in any other capacity for the Company or for any other legal entity. (h) Liability of Warrant Agent. The Warrant Agent shall act hereunder solely as agent, and its duties shall be determined solely by the provisions hereof. The Warrant Agent shall not be liable for anything that it may do or refrain from doing in connection with this Warrant Agreement except for its own gross negligence or bad faith. (i) Reliance on Documents. The Warrant Agent will not incur any liability or responsibility to the Company or to any Holder for any action taken in reliance on any notice, resolution, waiver, consent, order, certificate, or other paper, document or instrument reasonably believed by it to be genuine and to have been signed, sent or presented by the proper party or parties. (j) Validity of Agreements. The Warrant Agent shall not be under any responsibility in respect of the validity of this Warrant Agreement or the execution and delivery hereof (except the due execution and delivery hereof by the Warrant Agent) or in respect of the validity or execution of any Warrant (except its countersignature and delivery thereof); nor shall the Warrant Agent by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Common Stock (or other stock or other property) to be issued pursuant to this Warrant Agreement or any Warrant, or as to whether any Common Stock (or other stock or other property) will, when issued, be validly issued, fully paid and nonassessable, or as to the Warrant Price or the number or amount of Common Stock or other securities or other property issued upon exercise of any Warrant. 1.91-11 (k) Instructions from Company. The Warrant Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from the President, a Vice President, the Secretary or any Assistant Secretary of the Company, and to apply to such officers for advice or instructions in connection with its duties, and shall not be liable for any action taken or suffered to be taken by it in good faith in accordance with instructions of any such officer or officers. 13.3 Change of Warrant Agent. The Warrant Agent may resign and be discharged from its duties under this Warrant Agreement by giving to the Company 30 days' advance notice in writing. The Warrant Agent may be removed by like notice to the Warrant Agent from the Company. If the Warrant Agent shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Warrant Agent. If the Company shall fail to make such appointment within a period of 30 days after such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Warrant Agent, then any Holder may apply to a court of competent jurisdiction for the appointment of a successor to the Warrant Agent. Pending the appointment of the successor warrant agent, the Company shall perform the duties of the Warrant Agent. After appointment, the successor warrant agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Warrant Agent without further act or deed; provided, however, the former Warrant Agent shall be required to deliver and transfer to the successor warrant agent any property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary for the purpose. Failure to file any notice provided for in this Section 13.3, however, or any defect therein, shall not affect the legality or validity of the resignation or removal of the Warrant Agent or the appointment of the successor warrant agent, as the case may be. In the event of such resignation or removal, the successor warrant agent shall mail, first class, to each Holder, written notice of such removal or resignation and the name and address of such successor warrant agent. 13.4 Disposition of Proceeds on Exercise of Warrants; Inspection of Warrant Agreement. The Warrant Agent shall account promptly to the Company with respect to Warrants exercised and concurrently pay to the Company in immediately available funds all amounts received by the Warrant Agent for the purchase of the Warrant Stock through the exercise of such Warrants. The Warrant Agent shall, upon request of the Company from time to time, deliver to the Company such complete reports of registered ownership of the Warrants and such complete records of transactions with respect to the Warrants as the Company may request. The Warrant Agent shall also make available to the Company for inspection by the Company's agents or employees, from time to time as the Company may request, such original books of accounts and records maintained by the Warrant Agent in connection with the issuance and exercise of Warrants hereunder, such inspections to occur at the Warrant Agent's Principal Office. The Warrant Agent shall keep copies of this Warrant Agreement and any notices given or received hereunder available for inspection by the Company or the Holders at the Warrant Agent's Principal Office. The Company shall supply the Warrant Agent from time to time with such numbers of copies of this Warrant Agreement as the Warrant Agent may request. 13.5 Cancellation. The Warrant Agent shall cancel all Warrant certificates properly surrendered for exercise, exchange, substitution, or transfer. The Warrant Agent shall destroy all cancelled Warrant certificates and, if requested, deliver a certificate of such destruction to the Company. 1.91-12 13.6 Survival. This Section 13 shall survive the resignation or removal of the Warrant Agent and the termination of this Warrant Agreement. 14. Miscellaneous. 14.1 Rights of Holders. Holders of unexercised Warrants are not entitled to (i) receive dividends or other distributions, (ii) receive notice of or vote at any meeting of the stockholders, (iii) consent to any action of the stockholders, (iv) exercise any preemptive right, or (v) exercise any other right whatsoever granted to stockholders of the Company. 14.2 Notice Generally. Any notice, demand, request, consent, approval, declaration, delivery or other communication hereunder to be made pursuant to the provisions of this Warrant Agreement shall be sufficiently given or made if in writing and either delivered in person with receipt acknowledged or sent by registered or certified mail, return receipt requested, postage prepaid or by facsimile, addressed as follows: If to any Holder or holder of Warrant Stock, at its last known address appearing on the Warrant Register of the Company maintained for such purpose. If to the Company at: Armstrong World Industries, Inc. 2500 Columbia Avenue Lancaster, PA 17603 Attention: [_________________] Telephone: (___) _________ Fax: (___) ___________ If to the Warrant Agent at: [-----------------] [-----------------] [-----------------] Attention: [_________________] Telephone: (___) _________ Fax: (___) ___________ or at such other address as may be substituted by notice given as herein provided. The giving of any notice required hereunder may be waived in writing by the party entitled to receive such notice. Every notice, demand, request, consent, approval, declaration, delivery or other communication hereunder shall be deemed to have been duly given or served on the date on which personally delivered, the first Business Day after delivery by facsimile, receipt acknowledged, or the third Business Day after deposit in the United States mail, whichever is earliest. 1.91-13 14.3 Successors and Assigns. All covenants and provisions of this Warrant Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the benefit of their respective successors and assigns hereunder. 14.4 Supplements and Amendment. This Warrant Agreement constitutes the entire agreement and supersedes all other prior agreements and understandings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof and may not be amended, except in a writing signed by both of them. The Company and the Warrant Agent may from time to time supplement or amend this Warrant Agreement (a) without the approval of any Holders of Warrants in order to cure any ambiguity, manifest error or other mistake in this Warrant Agreement, or to correct or supplement any provision contained herein that may be defective or inconsistent with any other provision herein, or to make any other provisions in regard to matters or questions arising hereunder that the Company and the Warrant Agent may deem necessary or desirable and that shall not adversely affect, alter or change the interests of the Holders of the Warrants or (b) with the prior written consent of Holders of the Warrants exercisable for a majority of the Common Stock then issuable upon exercise of the Warrants then outstanding; provided, however, that each amendment or supplement that decreases the Warrant Agent's rights or increases its duties and responsibilities hereunder shall also require the prior written consent of the Warrant Agent. 14.5 Third-Party Beneficiaries. All covenants and provisions of this Warrant Agreement shall inure to the benefit of each Holder from time to time of Warrants. 14.6 Severability. Wherever possible, each provision of this Warrant Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Warrant Agreement. 14.7 Headings. The headings used in this Warrant Agreement are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant Agreement. 14.8 Governing Law. This Warrant Agreement and the Warrants shall be governed by the laws of the State of [New York], without regard to the provisions thereof relating to conflict of laws. 14.9 Counterparts. This Warrant Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. * * * * * 1.91-14 In witness whereof, each of the Company and the Warrant Agent has caused this Warrant Agreement to be executed by its duly authorized officers as of the date first above written. ARMSTRONG WORLD INDUSTRIES, INC. By: ---------------------------------- Name: -------------------------------- Title: -------------------------------- [ ] as Warrant Agent By: ---------------------------------- Name: -------------------------------- Title: -------------------------------- Schedule A ---------- Holder Aggregate Number of Warrants - ------ ---------------------------- Exhibit A --------- [Form of Face of Warrant Certificate] CLASS [__] WARRANT TO PURCHASE COMMON STOCK, PAR VALUE [$_____] PER SHARE, OF ARMSTRONG WORLD INDUSTRIES, INC. CERTIFICATE NO.:_____________ NUMBER OF WARRANTS:_____________ Exercisable from and after the date hereof until 5:00 p.m., New York City time on [________], 20[__] (the "Expiration Date"). THIS GLOBAL WARRANT IS HELD BY THE DEPOSITARY (AS DEFINED IN THE WARRANT AGREEMENT GOVERNING THIS WARRANT) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE WARRANT AGENT MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 5.1 OF THE WARRANT AGREEMENT, (ii) this global warrant may be exchanged in whole but not in part pursuant to section 3.5(a) of the warrant agreement, (IIi) THIS GLOBAL WARRANT MAY BE DELIVERED TO THE WARRANT AGENT FOR CANCELLATION PURSUANT TO SECTION 13.5 OF THE WARRANT AGREEMENT AND (Iv) THIS GLOBAL WARRANT MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. THE SALE, ENCUMBRANCE OR OTHER DISPOSITION OF THE WARRANTS AND ANY SECURITIES ACQUIRED UPON EXERCISE OF THE WARRANTS IS SUBJECT TO THE PROVISIONS OF THE WARRANT AGREEMENT (AS DEFINED BELOW), A COPY OF WHICH MAY BE INSPECTED AT THE PRINCIPAL OFFICE OF THE WARRANT AGENT OR OBTAINED FROM THE COMPANY WITHOUT CHARGE. NO REGISTRATION OR TRANSFER OF THE SECURITIES ISSUABLE PURSUANT TO THE WARRANT WILL BE RECORDED ON THE BOOKS OF THE COMPANY UNTIL SUCH PROVISIONS HAVE BEEN COMPLIED WITH. This Warrant Certificate certifies that ____________________, or its registered assigns, is the registered holder ("Holder") of the number of Warrants set forth above expiring at 5:00 p.m., New York City time, on the Expiration Date (the "Warrants") to purchase common stock, par value [$___] per share (the "Common Stock"), of Armstrong World Industries, Inc., a Pennsylvania corporation (the "Company"). The Common Stock issuable upon exercise of the Warrants is hereinafter referred to as the "Warrant Stock." Each Warrant entitles the Holder, upon exercise thereof, to purchase from the Company at any time from and after the date hereof until 5:00 p.m., New York City time, on the Expiration Date, one (1) share of Common Stock at the purchase price of [$____] per share subject to adjustment and the other terms and conditions set forth herein and in the Warrant Agreement dated as of [________], 2003 (the "Warrant Agreement") by and between the Company and [_____________], as warrant agent (the "Warrant Agent"). Such purchase shall be payable in lawful money of the United States of America by certified or official bank check or any combination thereof to the order of the Warrant Agent for the account of the Company at the principal office of the Warrant Agent, subject to the conditions set forth herein and in the Warrant Agreement. The number of shares of Common Stock for which each Warrant is exercisable, and the price at which such shares may be purchased upon exercise of each Warrant, are subject to adjustment upon the occurrence of certain events as set forth in the Warrant Agreement. Whenever the number of shares of Common Stock for which a Warrant is exercisable, or the price at which a share of such Common Stock may be purchased upon exercise of the Warrants, is adjusted pursuant to the Warrant Agreement, the Company shall cause written notice of such adjustment to be given to each Holder at such Holder's address appearing on the Warrant register by first class mail postage pre-paid. No Warrant may be exercised after 5:00 p.m., New York City time, on the Expiration Date, and to the extent not exercised by such time such Warrants shall be void. Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse side hereof, and such further provisions shall for all purposes have the same effect as though fully set forth at this place. This Warrant Certificate is not valid unless countersigned by the Warrant Agent. THIS WARRANT CERTIFICATE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF [NEW YORK], WITHOUT REGARD TO THE PROVISIONS THEREOF RELATING TO CONFLICT OF LAWS. In witness whereof, the undersigned, duly authorized officer of the Company has caused this Warrant Certificate to be signed as of this [___] day of [_______], 2003. ARMSTRONG WORLD INDUSTRIES, INC. By: ---------------------------------- Name: -------------------------------- Title: -------------------------------- COUNTERSIGNED: [----------------------] as Warrant Agent By: ---------------------------------- Name: -------------------------------- Title: -------------------------------- [Form of Reverse of Warrant Certificate] The Warrants evidenced by this Warrant Certificate are part of a duly authorized issue of up to [_________] Warrants expiring at 5:00 p.m., New York City time, on the Expiration Date, entitling the Holder, on exercise, to purchase shares of Common Stock, par value [$____] per share, of the Company, and are issued or to be issued pursuant to the Warrant Agreement, which Warrant Agreement is hereby incorporated by reference and made a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Warrant Agent, the Company and the Holders. A copy of the Warrant Agreement may be obtained by the Holder hereof upon written request to the Company or the Warrant Agent at the addresses set forth below. Warrants may be exercised by surrendering this Warrant Certificate, with the Election to Purchase set forth hereon properly completed and executed, together with payment of the purchase price by certified or official bank check payable to the order of the Warrant Agent for the account of the Company. In the event that the number of Warrants exercised shall be less than the total number of Warrants evidenced hereby, there shall be issued to the Holder hereof or the Holder's assignee a new Warrant Certificate evidencing the number of Warrants not exercised. The Warrant Agreement provides that the number of shares of Common Stock for which each Warrant is exercisable, and the price at which such shares may be purchased upon exercise of each Warrant, are subject to adjustment upon the occurrence of certain events as set forth in the Warrant Agreement. The Company shall not issue fractional shares of Common Stock upon the exercise of any Warrant, and the Company shall round up or down, as the case may be, to the nearest share of Common Stock as provided in the Warrant Agreement. Warrant Certificates, when surrendered at the office of the Warrant Agent by the registered Holder thereof in person or by legal representative or attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided in the Warrant Agreement for another Warrant Certificate or Warrant Certificates of like tenor evidencing in the aggregate a like number of Warrants. Upon due presentation for registration of transfer of this Warrant Certificate at the office of the Warrant Agent, a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee in exchange for this Warrant Certificate, subject to the limitations provided in the Warrant Agreement. * * * * * COMPANY: WARRANT AGENT: Armstrong World Industries, Inc. [___________________] 2500 Columbia Avenue [___________________] Lancaster, PA 17603 [___________________] (---) ---------- (___) __________ * * * * * ELECTION TO PURCHASE The undersigned registered owner of this Warrant irrevocably exercises this Warrant for the purchase of ______ shares of Common Stock of Armstrong World Industries, Inc. and herewith makes payment therefor, all at the price and on the terms and conditions specified in this Warrant and the Warrant Agreement and requests that certificates for the shares of Common Stock hereby purchased (and any securities or other property issuable upon such exercise) be issued in and delivered to the name and address specified below and, if such shares of Common Stock shall not include all of the shares of Common Stock issuable as provided in this Warrant, that a new Warrant of like tenor and date for the balance of the shares of Common Stock issuable hereunder be delivered to the undersigned. Date: ---------------- ------------------------------------------- Signature of Registered Owner* Name Common Stock to be Registered Under -------------------------------------------- Address Common Stock to be Registered Under * * * * * SCHEDULE OF EXCHANGES OF INTERESTS OF GLOBAL WARRANTS The following exchanges of a part of this Global Warrant have been made: Amount of decrease in Amount of increase in Number of Warrants in number of warrants in number of Warrants in this Global Warrant Signature of authorized this Global Warrant this Global Warrant following such decrease officer of Warrant Agent Date of Exchange or increase - ----------------------- -------------------------- --------------------------- --------------------------- -------------------------
EX-99 9 jd9-5ex99_7.txt 99.7 Exhibit 99.7 EXPLANATORY NOTE (1) -------------------- The forms of indentures for the 7-year and 10-year fixed-rate Plan Notes being filed as Exhibits 1.96-A and 1.96-B to the Plan of Reorganization as part of the Plan Supplement (the "Plan Notes Indentures") are the product of negotiations and discussions among Armstrong World Industries, Inc. ("AWI"), its financial advisor and counsel, and members of the Asbestos PI Claimants' Committee, the Future Claimants' Representative and the Unsecured Creditors' Committee (collectively, the "Committees") and their respective advisors and counsel. It is possible that further discussions among these parties concerning the terms of these indentures may take place following this filing and that these discussions may result in changes to some of the terms currently contained therein. Section 7.3 of the Plan of Reorganization provides that AWI will use reasonable efforts to complete a 144A Offering on or as soon as practicable after the Effective Date. AWI has represented to the Committees that if AWI successfully completes an offering of notes in the 144A Offering (such notes being referred to as "144A Notes") but the net proceeds from the 144A Offering are less than the Plan Note Amount, AWI would issue additional 144A Notes to the applicable classes of creditors under the Plan of Reorganization in lieu of the Plan Notes it would otherwise issue under the Plan Note Indentures (subject to compliance with applicable securities laws). In addition, although the Plan of Reorganization provides for the possibility that AWI would issue Plan Notes bearing a floating interest rate ("Floating Rate Plan Notes"), AWI has not filed a form of indenture for such Floating Rate Plan Notes. Rather, AWI has represented to the Committees that it is AWI's intention to seek to obtain a floating rate term loan credit facility from a syndicate of banks and other financial institutions and lenders (a "Term Loan B"). AWI has represented to the Committees that if AWI is successful in obtaining a Term Loan B, AWI will not issue any Floating Rate Plan Notes under the Plan of Reorganization. AWI has further represented to the Committees that if AWI is not successful in obtaining a Term Loan B, AWI will not issue any Floating Rate Plan Notes under the Plan of Reorganization unless such Floating Rate Plan Notes satisfy the requirements of the Plan of Reorganization and are on terms and conditions that are mutually satisfactory to AWI and the Committees. - ---------------- (1) Capitalized terms used in this explanatory note and not otherwise defined have the meanings set forth in the Plan of Reorganization. ARMSTRONG WORLD INDUSTRIES, INC., as Company $[ ] [ ]% SENIOR NOTES DUE 201[ ](1) ------------------------------ INDENTURE Dated as of [ ], 2003 ------------------------------ [ ], as Trustee - ---------------------- (1) The seventh anniversary of the Issue Date.
TABLE OF CONTENTS PAGE ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE...........................................................1 Section 1.01. Definitions.....................................................................1 Section 1.02. Other Definitions..............................................................23 Section 1.03. Incorporation by Reference of Trust Indenture Act..............................23 Section 1.04. Rules of Construction..........................................................24 ARTICLE 2. THE NOTES...........................................................................................24 Section 2.01. Form and Dating................................................................25 Section 2.02. Execution and Authentication...................................................26 Section 2.03. Registrar, Paying Agent and Depositary.........................................26 Section 2.04. Paying Agent to Hold Money in Trust............................................27 Section 2.05. Holder Lists...................................................................27 Section 2.06. Transfer and Exchange..........................................................27 Section 2.07. Temporary Notes................................................................37 Section 2.08. Mutilated, Destroyed, Lost or Stolen Notes.....................................38 Section 2.09. Payment of Interest; Interest Rights Preserved.................................38 Section 2.10. Persons Deemed Owners..........................................................39 Section 2.11. Cancellation...................................................................39 Section 2.12. CUSIP or ISIN Numbers..........................................................39 Section 2.13. Outstanding Notes..............................................................39 Section 2.14. Treasury Notes.................................................................40 ARTICLE 3. REDEMPTION AND PREPAYMENT...........................................................................40 Section 3.01. Notices to Trustee.............................................................40 Section 3.02. Selection of Notes to Be Redeemed..............................................40 Section 3.03. Notice of Redemption...........................................................40 Section 3.04. Effect of Notice of Redemption.................................................41 Section 3.05. Deposit of Redemption Price....................................................41 Section 3.06. Notes Redeemed in Part.........................................................41 Section 3.07. Optional Redemption............................................................41 Section 3.08. Mandatory Redemption...........................................................42 Section 3.09. Offer To Purchase..............................................................42 ARTICLE 4. COVENANTS...........................................................................................44 Section 4.01. Payment of Notes; Money for Note Payments to be Held in Trust..................44 Section 4.02. Maintenance of Office or Agency................................................46 Section 4.03. Reports........................................................................46 i TABLE OF CONTENTS (CONTINUED) PAGE Section 4.04. Compliance Certificate.........................................................46 Section 4.05. Taxes..........................................................................47 Section 4.06. Stay, Extension and Usury Laws.................................................47 Section 4.07. Corporate Existence............................................................47 Section 4.08. Payments for Consent...........................................................47 Section 4.09. Incurrence of Additional Debt..................................................47 Section 4.10. Restricted Payments............................................................48 Section 4.11. Liens..........................................................................51 Section 4.12. Asset Sales....................................................................51 Section 4.13. Restrictions on Distributions from Restricted Subsidiaries.....................52 Section 4.14. Affiliate Transactions.........................................................53 Section 4.15. Sale and Leaseback Transactions................................................54 Section 4.16. Designation of Restricted and Unrestricted Subsidiaries........................54 Section 4.18. Future Subsidiary Guarantors...................................................55 Section 4.19. Covenant Termination...........................................................55 ARTICLE 5. SUCCESSORS..........................................................................................56 Section 5.01. Merger, Consolidation and Sale of Assets.......................................56 Section 5.02. Successor Corporation Substituted..............................................57 ARTICLE 6. DEFAULTS AND REMEDIES...............................................................................58 Section 6.01. Events of Default..............................................................58 Section 6.02. Acceleration...................................................................59 Section 6.03. Other Remedies.................................................................60 Section 6.04. Waiver of Past Defaults........................................................60 Section 6.05. Control by Majority............................................................60 Section 6.06. Limitation on Suits............................................................60 Section 6.07. Rights of Holders to Receive Payment...........................................61 Section 6.08. Collection Suit by Trustee.....................................................61 Section 6.09. Trustee May File Proofs of Claim...............................................61 Section 6.10. Priorities.....................................................................61 Section 6.11. Undertaking for Costs..........................................................62 ARTICLE 7. TRUSTEE.............................................................................................62 Section 7.01. Duties of Trustee..............................................................62 Section 7.02. Rights of Trustee..............................................................63 Section 7.03. Individual Rights of Trustee...................................................64 ii TABLE OF CONTENTS (CONTINUED) PAGE Section 7.04. Trustee's Disclaimer...........................................................64 Section 7.05. Notice of Defaults.............................................................64 Section 7.06. Reports by Trustee to Holders..................................................64 Section 7.07. Compensation and Indemnity.....................................................64 Section 7.08. Replacement of Trustee.........................................................65 Section 7.09. Successor Trustee by Merger, etc...............................................66 Section 7.10. Eligibility; Disqualification..................................................66 Section 7.11. Preferential Collection of Claims Against Company..............................66 ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE............................................................66 Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.......................66 Section 8.02. Legal Defeasance and Discharge.................................................67 Section 8.03. Covenant Defeasance............................................................67 Section 8.04. Conditions to Legal or Covenant Defeasance.....................................67 Section 8.05. Deposited Cash and U.S. Government Securities to Be Held in Trust; Other Miscellaneous Provisions................................................68 Section 8.06. Repayment to Company...........................................................69 Section 8.07. Reinstatement..................................................................69 ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER....................................................................69 Section 9.01. Without Consent of Holders of Notes............................................69 Section 9.02. With Consent of Holders of Notes...............................................70 Section 9.03. Compliance with Trust Indenture Act............................................71 Section 9.04. Revocation and Effect of Consents..............................................71 Section 9.05. Notation on or Exchange of Notes...............................................71 Section 9.06. Trustee to Sign Amendments, etc................................................72 ARTICLE 10. GUARANTEES..........................................................................................72 Section 10.01. Subsidiary Guarantees..........................................................72 Section 10.02. Limitation on Subsidiary Guarantor Liability...................................73 Section 10.03. Execution and Delivery of Subsidiary Guarantee.................................73 Section 10.04. Subsidiary Guarantors May Consolidate, etc. on Certain Terms...................74 Section 10.05. Releases Following Sale of Assets, Etc.........................................74 ARTICLE 11. SATISFACTION AND DISCHARGE..........................................................................75 Section 11.01. Satisfaction and Discharge.....................................................75 Section 11.02. Deposited Cash and U.S. Government Securities to Be Held in Trust; Other Miscellaneous Provisions................................................75 iii TABLE OF CONTENTS (CONTINUED) PAGE Section 11.03. Repayment to Company...........................................................76 ARTICLE 12. MISCELLANEOUS.......................................................................................76 Section 12.01. Trust Indenture Act Controls...................................................76 Section 12.02. Notices........................................................................76 Section 12.03. Communication by Holders of Notes with Other Holders of Notes..................77 Section 12.04. Certificate and Opinion as to Conditions Precedent.............................77 Section 12.05. Statements Required in Certificate or Opinion..................................77 Section 12.06. Rules by Trustee and Agents....................................................77 Section 12.07. No Personal Liability of Directors, Officers, Employees and Stockholders.......78 Section 12.08. Governing Law..................................................................78 Section 12.09. No Adverse Interpretation of Other Agreements..................................78 Section 12.10. Successors.....................................................................78 Section 12.11. Severability...................................................................78 Section 12.12. Counterpart Originals..........................................................78 Section 12.13. Table of Contents, Headings, etc...............................................78 Section 12.14. Qualification of this Indenture................................................78
iv CROSS-REFERENCE TABLE TIA SECTION REFERENCE INDENTURE SECTION 310(a)(1)................................................... 7.10 (a)(2)...................................................... 7.10 (a)(3)...................................................... N.A. (a)(4)...................................................... N.A. (a)(5)...................................................... 7.10 (b)......................................................... 7.08, 7.10 (c)......................................................... N.A. 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)(1)...................................................... N.A. (b)(2)...................................................... 7.06 (c)......................................................... 7.06, 12.02 (d)......................................................... 7.06 314(a)...................................................... 4.03, 4.04, 12.02 (b)......................................................... N.A. (c)(1)...................................................... 12.04 (c)(2)...................................................... 12.04 (c)(3)...................................................... N.A. (d)......................................................... N.A. (e)......................................................... 12.05 315(a)...................................................... 7.01 (b)......................................................... 7.05, 12.02 (c)......................................................... 7.01 (d)......................................................... 7.01 (e)......................................................... 6.11 316(a) (last sentence)...................................... 6.04 (a)(1)(A)................................................... 6.05 (a)(1)(B)................................................... 6.04 (a)(2)...................................................... N.A. (b)......................................................... 6.07 317(a)(1)................................................... 6.08 (a)(2)...................................................... 6.09 (b)......................................................... 2.04 318(a)...................................................... 12.01 N.A. means Not Applicable. Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture. This INDENTURE dated as of [ ], 2003, is by and among Armstrong World Industries, Inc., a Pennsylvania corporation (the "Company"), each Subsidiary Guarantor listed on the signature pages hereto, and [ ], as trustee (the "Trustee"). The Company, each Subsidiary Guarantor and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders of the [ ]%(2) Senior Notes due 201[ ] (3) (the "Notes"): ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE ------------------------------------------ Section 1.01. Definitions. For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires: "144A Global Note" means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of any Notes that may be sold in reliance on Rule 144A. "Acquired Debt" of any specified Person means Debt of any other Person and its Restricted Subsidiaries existing at the time such other Person merged with or into or became a Restricted Subsidiary of such specified Person or assumed by the specified Person in connection with the acquisition of assets from such other Person, in each case pursuant to a transaction permitted under this Indenture. "Additional Assets" means: (a) Any Property (other than cash, Cash Equivalents, securities and Capital Stock) to be Owned by the Company or any Restricted Subsidiary and used or useful in a Related Business; or (b) Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock by the Company or another Restricted Subsidiary from any Person other Than the Company or a Subsidiary of the Company; or (c) Capital Stock constituting a minority interest in any Person that at such time is a Restricted Subsidiary; provided, however, that, in the case of clauses (b) and (c), such Restricted Subsidiary is primarily engaged in a Related Business. "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 the purposes of this definition, "control" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; provided that beneficial ownership of 10% or more of the Voting Stock of a Person shall be deemed to be control. The terms "controlling" and "controlled" have meanings correlative to the foregoing. "Agent" means any Registrar, co-registrar, Paying Agent or additional paying agent. - ---------------------- (2) See footnote 4. (3) The seventh anniversary of the Issue Date. 1 "Applicable Procedures" means, with respect to any transfer, redemption or exchange of or for beneficial interests in any Global Note, the rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer, redemption or exchange. "Asset Sale" means any sale, lease, transfer, issuance or other disposition (or series of related sales, leases, transfers, issuances or dispositions) by the Company or any Restricted Subsidiary, including any disposition by means of a merger, consolidation or similar transaction (each referred to for the purposes of this definition as a "disposition") of: (a) any shares of capital stock of a restricted subsidiary (other than directors' qualifying shares), or (b) any other assets of the company or any restricted subsidiary (other than cash equivalents) outside of the ordinary course of business of the company or such restricted subsidiary, other than, in the case of clause (a) or (b) above, (1) any disposition by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to a Restricted Subsidiary; provided that the aggregate amount of any such dispositions by the Company or any Domestic Subsidiary to Foreign Restricted Subsidiaries shall not exceed $[ ] per annum; (2) any disposition that constitutes a Permitted Investment or Restricted Payment permitted by Section 4.10 hereof, (3) any disposition effected in compliance with the first paragraph of Section 5.01 hereof, (4) the granting of any Permitted Lien (or the foreclosure thereon), (5) a disposition of obsolete or worn out equipment or equipment that is no longer useful in the conduct of the business of the Company and its Restricted Subsidiaries and that is disposed of in each case in the ordinary course of business, (6) sales of assets in connection with Sale and Leaseback Transactions otherwise permitted under this Indenture, and (7) any sale, transfer or other disposition that does not (together with all related sales, transfers or dispositions) involve consideration in excess of $2.5 million. Notwithstanding the foregoing, that the sale, lease, transfer, conveyance, issuance or other disposition of all or substantially all of the assets of the Company and the Restricted Subsidiaries, taken as a whole, will be governed by the provisions of Section 4.17 and/or Section 5.01 hereof and not by Section 4.12 hereof. "Attributable Debt" in respect of a Sale and Leaseback Transaction means, at any date of determination, (a) if such sale and leaseback transaction results in a capital lease obligation, the amount of debt represented thereby according to the definition of "capital lease obligation," and (b) in all other instances, the greater of: (i) the fair market value of the property subject to such sale and leaseback transaction; and (ii) the present value (discounted at the interest rate borne by the notes, compounded annually) of the total obligations of the lessee for 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).\ 2 "Average Life" means, as of any date of determination, with respect to any Debt or Preferred Stock, the quotient obtained by dividing: (a) the sum of the product of the numbers of years (rounded to the nearest one-twelfth of one year) from the date of determination to the dates of each successive scheduled principal payment of such debt or redemption or similar payment with respect to such preferred stock multiplied by the amount of such payment by (b) the sum of all such payments. "Bankruptcy Law" means Title 11, U.S. Code or any similar federal, state or foreign law for the relief of debtors. "Board of Directors" means (1) in respect of a corporation, the board of directors of the corporation, or any duly authorized committee thereof and (2) in respect of any other Person, the board or committee of that Person serving a similar function. "Board Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the applicable 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 Legal Holiday. "Capital Lease Obligations" means any obligation under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP; and the amount of Debt represented by such obligation shall be the capitalized amount of such obligations determined in accordance with GAAP; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be terminated by the lessee without payment of a penalty. For purposes of Section 4.11 hereof, a Capital Lease Obligation shall be deemed secured by a Lien on the Property being leased. "Capital Stock" means, with respect to any Person, any shares or other equivalents (however designated) of any class of corporate stock or partnership interests or any other participations, rights, warrants, options or other interests in the nature of an equity interest in such Person, including Preferred Stock, but excluding any debt security convertible or exchangeable into such equity interest. "Capital Stock Sale Proceeds" means the aggregate cash proceeds received by the Company from the issuance or sale (other than to a Subsidiary of the Company or an employee stock ownership plan or trust established by the Company or any such Subsidiary) by the Company of its Capital Stock (other than Disqualified Stock) after the Issue Date, net of attorneys' fees, accountants' fees, underwriters' or placement agents' fees, discounts or commissions and brokerage, consultant and other fees actually incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof. "Cash Equivalents" means any of the following: (a) any Investment in direct obligations of the United States of America or any agency thereof or obligations guaranteed by the United States of America or any agency thereof; (b) Investments in eurodollar time deposits, time deposit accounts, demand deposit accounts, certificates of deposit and money market deposits maturing within 365 days of the date of acquisition thereof issued by a bank or trust company which is organized under the laws of the United States of America, any state thereof or any foreign country recognized by the United States of America having capital, surplus and undivided profits aggregating in excess of $500.0 million and whose long-term debt, or whose parent holding company's long-term debt, is rated "A-3" or "A-" or higher according to Moody's or S&P (or such similar equivalent rating or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act)); 3 (c) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (a) above entered into with (i) a bank meeting the qualifications described in clause (b) above or (ii) any primary government securities dealer reporting to the Market Reports Division of the Federal Reserve Bank of New York; (d) Investments in commercial paper, maturing not more than 270 days after the date of acquisition, issued by a corporation (other than an Affiliate of the Company) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of "P-1" (or higher) according to Moody's or "A-1" (or higher) according to S&P ; (e) Investments in securities maturing not more than 365 days after the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least "A" by S&P or "A" by Moody's; (f) Investments in mutual funds whose investment guidelines restrict such funds' investments to those satisfying the provisions of clauses (a) through (e) above; and (g) in the case of Foreign Restricted Subsidiaries, substantially similar investments denominated in foreign currencies (including securities issued or fully guaranteed by foreign countries or political subdivisions or taxing authorities thereof). "Change of Control" means the occurrence of any of the following events: (a) any "person" or "group" (as such terms are used in Sections 13(D) and 14(D) of the Exchange Act or any successor provisions to either of the foregoing) of persons, including any group acting for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule 13D-5(b)(1) under the Exchange Act, other than the Asbestos Pi Trust, becomes the "beneficial owner" (as defined in Rule 13D-3 under the Exchange Act, except that a person will be deemed to have "beneficial ownership" of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 35.0% of the total voting power of the Voting Stock of the Company; provided, however, that for purposes of this clause (A), such person or group shall be deemed to beneficially own any Voting Stock of a corporation held by any other corporation (the "parent corporation") so long as such person or group beneficially owns, directly or indirectly, in the aggregate at least a majority of the total voting power of the Voting Stock of such parent corporation; and provided, further, however that notwithstanding the foregoing, a Change of Control will not be deemed to have occurred under this clause (a) if and so long as the Asbestos Pi Trust is the "beneficial owner" (as defined above), directly or indirectly, in the aggregate of a greater percentage of the total voting power of the Voting Stock of the Company than such other person or group); or (b) the sale, transfer, assignment, lease, conveyance or other disposition, directly or indirectly, of all or substantially all the Property of the Company and the Restricted Subsidiaries, considered as a whole (other than a disposition of such Property as an entirety or virtually as an entirety to a Wholly Owned Restricted Subsidiary or the Asbestos PI Trust) shall have occurred, or the Company merges, consolidates or amalgamates with or into any Other Person (other Than the Asbestos PI Trust) or any other person (other than the Asbestos PI Trust) merges, consolidates or amalgamates with or into the Company, in any such event pursuant to a transaction in which the outstanding Voting Stock of the Company is reclassified into or exchanged for cash, securities or other Property, other than any such transaction where: (1) the outstanding Voting Stock of the Company is reclassified into or exchanged for other Voting Stock of the Company or for Voting Stock of the Surviving Person, and (2) the holders of the Voting Stock of the Company immediately prior to such transaction own, directly or indirectly, not less than a majority of the Voting Stock of the Company or the Surviving Person immediately after such transaction and in substantially the same proportion as before the transaction; or 4 (c) During any period of two consecutive years, individuals who at the beginning of such period constituted the Board of Directors (together with any new directors whose election or appointment by such board or whose nomination for election by the shareholders of the Company was approved by a vote of not less than a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office; or (d) The shareholders of the company shall have approved any plan of liquidation or dissolution of the company. "Clearstream" means Clearstream Banking S.A. and any successor thereto. "Code" means the Internal Revenue Code of 1986, as amended. "Commission" means the Securities and Exchange Commission. "Commodity Price Protection Agreement" means, in respect of a Person, any forward contract, commodity swap agreement, commodity option agreement or other similar agreement or arrangement designed to protect such Person against fluctuations in commodity prices. "Consolidated Current Liabilities" means, as of any date of determination, the aggregate amount of liabilities of the Company and its consolidated Restricted Subsidiaries that may properly be classified as current liabilities (including taxes accrued as estimated), after eliminating: (a) All intercompany items between the Company and any Restricted Subsidiary or between Restricted Subsidiaries, and (b) All current maturities of long-term Debt. "Consolidated Interest Coverage Ratio" means, as of any date of determination, the ratio of: (a) the aggregate amount of EBITDA for the most recent four consecutive fiscal quarters for which financial statements are available on such determination date to (b) Consolidated Interest Expense for such four fiscal quarters; provided, however, that: (1) if (A) since the beginning of such period the Company or any Restricted Subsidiary has Incurred any Debt that remains outstanding or Repaid any Debt, or (B) the transaction giving rise to the need to calculate the Consolidated Interest Coverage Ratio is or includes an Incurrence or Repayment of Debt, Consolidated Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Incurrence or Repayment as if such Debt was Incurred or Repaid on the first day of such period, provided that, in the event of any such Repayment of Debt, EBITDA for such period shall be calculated as if the Company or such Restricted Subsidiary had not earned any interest income actually earned during such period in respect of the funds used to Repay such Debt, and (2) if (A) since the beginning of such period the Company or any Restricted Subsidiary shall have made any Asset Sale or an Investment 5 (by merger or otherwise) in any Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary) or an acquisition of Property which constitutes all or substantially all of an operating unit of a business, (B) the transaction giving rise to the need to calculate the Consolidated Interest Coverage Ratio is such an Asset Sale, Investment or acquisition, or (C) since the beginning of such period any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Company or any Restricted Subsidiary since the beginning of such period) shall have made such an Asset Sale, Investment or acquisition, EBITDA for such period shall be calculated after giving pro forma effect to such Asset Sale, Investment or acquisition as if such Asset Sale, Investment or acquisition (and, as set forth above, the Incurrence or Repayment of any Debt in connection therewith) occurred on the first day of such period. If any Debt bears a floating rate of interest and is being given pro forma effect, the interest expense on such Debt shall be calculated as if the base interest rate in effect for such floating rate of interest on the date of determination had been the applicable base interest rate for the entire period (taking into account any Interest Rate Agreement applicable to such Debt if such Interest Rate Agreement has a remaining term of at least 12 months or, if earlier, through the maturity of such Debt). In the event the Capital Stock of any Restricted Subsidiary is sold during the period, the Company shall be deemed, for purposes of clause (1) above, to have Repaid during such period the Debt of such Restricted Subsidiary to the extent the Company and its continuing Restricted Subsidiaries are no longer liable for such Debt after such sale. "Consolidated Interest Expense" means, for any period, the total interest expense of the Company and its consolidated Restricted Subsidiaries, plus, to the extent not included in such total interest expense, and to the extent Incurred by the Company or its Restricted Subsidiaries, (a) interest expense attributable to leases constituting part of a Sale and Leaseback Transaction and to Capital Lease Obligations, (b) amortization of debt discount and debt issuance cost, including commitment fees, (c) capitalized interest, (d) non-cash interest expense, (e) commissions, discounts and other fees and charges owed with respect to letters of credit and bankers' acceptance financing, (f) net costs associated with Hedging Obligations (including amortization of fees), (g) Disqualified Stock Dividends, (h) Preferred Stock Dividends; (i) interest Incurred in connection with Investments in discontinued operations; (j) interest accruing on any Debt of any other Person to the extent such Debt is Guaranteed by the Company or any Restricted Subsidiary; and (k) the cash contributions to any employees stock ownership plan or similar trust to the extent such contributions are used by such plan or trust to pay interest or fees to any Person (other than the Company) in connection with Debt Incurred by such plan or trust. 6 For purposes of the foregoing, total interest expense will be determined after giving effect to any net payments made or received by the Company and its Restricted Subsidiaries with respect to Interest Rate Agreements. "Consolidated Net Income" means, for any period, the net income (loss) of the Company and its consolidated Subsidiaries; provided, however, that there shall not be included in such Consolidated Net Income: (a) any net income (loss) of any Person (other than the Company) if such person is not a Restricted Subsidiary, except that: (1) subject to the exclusion contained in clause (d) below, the Company's equity in the net income of any such Person for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash distributed by such Person during such period to the Company or a Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution to a Restricted Subsidiary, to the limitations contained in clause (c) below), and (2) the Company's equity in a net loss of any such Person for such period shall be included in determining such Consolidated Net Income to the extent such loss has been funded with cash by the Company or a Restricted Subsidiary; (b) any net income (loss) of any person acquired by the Company or any of its consolidated Subsidiaries in a pooling of interests transaction for any period prior to the date of such acquisition; (c) any net income (loss) of any Restricted Subsidiary if such Restricted Subsidiary is subject to restrictions on the payment of dividends or the making of distributions, directly or indirectly, to the Company, except that: (1) subject to the exclusion contained in clause (d) below, the Company's equity in the net income of any such Restricted Subsidiary for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash that was permitted to be distributed by such Restricted Subsidiary during such period to the Company or another Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution to another Restricted Subsidiary, to the limitation contained in this clause (1)), and (2) the Company's equity in a net loss of any such Restricted Subsidiary for such period shall be included in determining such Consolidated Net Income; (d) Any gain or loss realized upon the sale or other disposition of any property of the Company or any of its consolidated Subsidiaries (including pursuant to any Sale and Leaseback Transaction) that is not sold or otherwise disposed of in the ordinary course of business; (e) any gain or loss that is extraordinary (as determined in accordance with GAAP); (f) any restructuring charges (as determined in accordance with gaap) plus any other non-cash charges associated with facility closures or production line shutdowns such as accelerated depreciation and amortization and any gain or loss in connection with the extinguishment of Debt; and (g) the cumulative effect of a change in accounting principles. Notwithstanding the foregoing, for purposes of Section 4.10 hereof only, there shall be excluded from Consolidated Net Income any dividends, repayments of loans or advances or other transfers of assets from Unrestricted Subsidiaries to the Company or a Restricted Subsidiary to the extent such dividends, repayments or transfers increase the amount of Restricted Payments permitted under such covenant pursuant to clause (c)(3) thereof. 7 "Consolidated Net Tangible Assets" means, as of any date of determination, the sum of the amounts that would appear on a consolidated balance sheet of the Company and its consolidated Restricted Subsidiaries as the total assets (less accumulated depreciation and amortization, allowances for doubtful receivables, other applicable reserves and other items properly deductible under GAAP) of the Company and its Restricted Subsidiaries, after giving effect to purchase accounting and after deducting therefrom Consolidated Current Liabilities and, to the extent otherwise included, the amounts of (without duplication): (a) intangible assets, including the excess of cost over fair market value of assets or businesses acquired, goodwill, trademarks, trade names, patents, unamortized debt discount and accumulated organizational expenses; (b) Minority interests in consolidated Subsidiaries held by Persons other than the Company or any Restricted Subsidiary; (c) treasury stock; (d) cash or securities set aside and held in a sinking or other analogous fund established for the purpose of redemption or other retirement of Capital Stock to the extent such obligation is not reflected in Consolidated Current Liabilities; and (e) Investments in and assets of Unrestricted Subsidiaries. "Corporate Trust Office of the Trustee" shall be at the address of the Trustee specified in Section 12.02 hereof or such other address as to which the Trustee may give notice to the Company. "Credit Facilities" means, with respect to the Company or any Restricted Subsidiary, the Exit Credit Facility and one or more other debt or commercial paper facilities with banks or other institutional lenders (including providing for revolving credit loans, term loans, receivables or inventory financing including through the sale of receivables or inventory to such lenders or to special purpose, bankruptcy remote entities formed to borrow from such lenders against such receivables or inventory) or trade letters of credit, in each case together with any extensions, revisions, refinancings or replacements thereof. "Currency Exchange Protection Agreement" means, in respect of a Person, any foreign exchange contract, currency swap agreement, currency option or other similar agreement or arrangement designed to protect such Person against fluctuations in currency exchange rates. "Custodian" means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03 hereof as Custodian with respect to the Notes, any and all successors thereto appointed as custodian hereunder and having become such pursuant to the applicable provisions of this Indenture. "Debt" means, with respect to any Person on any date of determination (without duplication): (a) debt of such Person for money borrowed and debt evidenced by notes, debentures, bonds or other similar instruments for the payment of which such Person is responsible or liable; (b) all Capital Lease Obligations of such Person and all Attributable Debt in respect of Sale and Leaseback Transactions entered into by such Person; (c) all obligations of such Person issued or assumed as the deferred purchase price of Property, all conditional sale obligations of such Person and all obligations of such person under any title retention agreement (but excluding trade accounts payable arising in the ordinary course of business); (d) all obligations of such Person for the reimbursement of any obligor on any letter of credit, banker's acceptance or similar credit transaction (other than obligations with respect to letters of credit securing obligations (other than obligations described in (a) through (c) above) entered 8 Into in the ordinary course of business of such Person to the extent such letters of credit are not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no later than the third Business Day following receipt by such Person of a demand for reimbursement following payment on the letter of credit); (e) the amount of all obligations of such Person with respect to the Repayment of any Disqualified Stock or, with respect to any Subsidiary of such Person, any Preferred Stock (but excluding, in each case, any accrued dividends): (f) all obligations of the type referred to in clauses (a) through (e) of other Persons and all dividends of other Persons for the payment of which, in either case, such Person is responsible or liable, directly or indirectly, as obligor, guarantor or otherwise; (g) all obligations of the type referred to in clauses (a) through (f) of other persons secured by any Lien on any Property of such Person (whether or not such obligation is assumed by such Person), the amount of such obligation being deemed to be the lesser of the value of such Property or the amount of the obligation so secured; and (h) to the extent not otherwise included in this definition, Hedging Obligations of such Person. The amount of Debt of any Person at any date shall be the outstanding balance at such date of all unconditional obligations as described above and the maximum liability, upon the occurrence of the contingency giving rise to the obligation, of any contingent obligations at such date. "Default" means any event which is, or after notice or passage of time or both would be, an Event of Default. "Definitive Note" means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 hereof, in substantially the form of Exhibit A hereto except that such Note shall not bear the Global Note Legend and shall not have the "Schedule of Exchanges of Interests in the Global Note" attached thereto. "Depositary" means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03 hereof as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provisions of this Indenture. "Disqualified Stock" means, with respect to any Person, any Capital Stock that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable, in either case at the option of the holder thereof) or otherwise: (a) matures or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise, (b) Is or may become redeemable or repurchaseable at the option of the holder thereof, in whole or in part, or (c) is convertible or exchangeable at the option of the holder thereof for Debt or Disqualified Stock, on or prior to, in the case of clause (a), (b) or (c), the first anniversary after the Stated Maturity of the Notes. "Disqualified Stock Dividends" means all dividends with respect to Disqualified Stock of the Company held by Persons other than a Restricted Subsidiary. "Distribution Compliance Period" means the 40-day distribution compliance period as defined in Regulation S. 9 "Domestic Subsidiary" means any Restricted Subsidiary of the Company that was formed under the laws of the United States or any State or territory of the United States or the District of Columbia. "EBITDA" means, for any period, an amount equal to, for the Company and its consolidated Restricted Subsidiaries: (a) the sum of Consolidated Net Income for such period, plus the following to the extent included in Consolidated Net Income for such period: (1) the provision for taxes based on income or profits or utilized in computing net loss, (2) Consolidated Interest Expense, (3) depreciation, (4) amortization, (5) non-capitalized transaction costs in connection with actual or proposed financings, acquisitions or divestitures, (6) any expenses after the effective date of the Plan of Reorganization that are included in cost of goods sold arising from adjustments to inventory that are made as a result of the application fresh start accounting; and (7) any other non-cash items, including without limitation, any non-cash adjustments as a result of the application of fresh start accounting (other than any such non-cash item to the extent that it represents an accrual of or reserve for cash expenditures in any future period), minus (b) all non-cash items increasing Consolidated Net Income for such period (other than any such non-cash item to the extent that it will result in the receipt of cash payments in any future period). Notwithstanding the foregoing clause (a), the provision for taxes and the depreciation, amortization and non-cash items of a Restricted Subsidiary shall be added to Consolidated Net Income to compute EBITDA only to the extent (and in the same proportion) that the net income of such Restricted Subsidiary was included in calculating Consolidated Net Income and only if a corresponding amount would be permitted at the date of determination to be dividended to the Company by such Restricted Subsidiary without prior approval (that has not been obtained), pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to such Restricted Subsidiary or its shareholders. "Equity Interests" means Qualified Capital Stock and all warrants, options or other rights to acquire Qualified Capital Stock, but excluding any debt security that is convertible into, or exchangeable for, Qualified Capital Stock. "Equity Offering" means a primary offering of common stock of the Company or an offering of capital stock of any direct or indirect parent of the Company. "Euroclear" means Euroclear Bank, S.A./N.V., as operator of the Euroclear systems, and any successor thereto. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Exchange Notes" means Notes that may be issued in an Exchange Offer pursuant to Section 2.06(e)(iv) hereof as evidence of the same continuing Debt of the Company under, and in exchange for, any Notes. 10 "Exchange Offer" means an offer by the Company to issue and deliver to the Holders that are not prohibited by any law or policy of the Commission from participating in such offer, in exchange for any Notes, a like principal amount of Exchange Notes, as set forth in a Registration Rights Agreement. "Exit Credit Facility" means the $[ ] million revolving credit and term loan facility to be entered into on or before the Issue Date between the Company,[ ], as agent, and the lenders thereunder. "Floating Rate Notes" means the floating rate notes, if any, issued by the Company in satisfaction of claims pursuant to the Plan of Reorganization. "Foreign Restricted Subsidiary" means any Restricted Subsidiary which is not organized under the laws of the United States of America or any State thereof or the District of Columbia. "GAAP" means United States generally accepted accounting principles as in effect on the Issue Date, including those set forth: (a) in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants, (b) in the statements and pronouncements of the Financial Accounting Standards Board, (c) in such other statements by such other entity as approved by a significant segment of the accounting profession, and (d) the rules and regulations of the Commission governing the inclusion of financial statements (including pro forma financial statements) in periodic reports required to be filed pursuant to Section 13 of the Exchange act, including opinions and pronouncements in staff accounting bulletins and similar written statements from the accounting staff of the Commission. "Global Note Legend" means the legend set forth in Section 2.06(f)(ii) hereof, which is required to be placed on all Global Notes issued under this Indenture. "Global Notes" means one or more global Notes registered in the name of the Depositary or its nominee issued in accordance with Article 2 hereof substantially in the form of Exhibit A hereto and bearing the Global Note Legend and including the "Schedule of Exchanges of Interests in the Global Note" attached thereto. "Guarantee" means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Debt of any other Person and any obligation, direct or indirect, contingent or otherwise, of such Person: (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt of such other Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, Capital Stock, goods, securities or services, to take-or-pay or to maintain financial statement conditions or otherwise), or (b) entered into for the purpose of assuring or protecting in any other manner the obligee against loss in respect thereof (in whole or in part); provided, however, that the term "Guarantee" shall not include (i) endorsements for collection or deposit in the ordinary course of business or (ii) a contractual commitment by one Person to invest in another Person for so long as such Investment is reasonably expected to constitute a Permitted Investment under clause (a), (b) or (c) of the definition of "Permitted Investment." The term "Guarantee" used as a verb has a corresponding meaning. "guarantor" means any Person Guaranteeing any obligation. 11 "Hedging Obligations" of any Person means any obligation of such Person pursuant to any Interest Rate Agreement, Currency Exchange Protection Agreement or Commodity Price Protection Agreement. "Holder" means a Person in whose name a Note is registered. "IAI Global Note" means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of any Notes that may be sold to Institutional Accredited Investors. "Incur" means, with respect to any Debt or other obligation of any Person, to create, issue, incur (by merger, conversion, exchange or otherwise), extend, assume, guarantee or become liable in respect of such Debt or other obligation or the recording, as required pursuant to GAAP or otherwise, of any such Debt or obligation on the balance sheet of such Person (and "Incurrence" and "Incurred" shall have meanings correlative to the foregoing); provided, however, that a change in GAAP that results in an obligation of such Person that exists at such time, and is not theretofore classified as Debt, becoming Debt shall not be deemed an Incurrence of such Debt; provided further, however, that any Debt or other obligations of a Person existing at the time such Person becomes a Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at the time it becomes a Subsidiary; and provided further, however, that solely for purposes of determining compliance with Section 4.09 hereof, amortization of debt discount shall not be deemed to be the Incurrence of Debt, provided that in the case of Debt sold at a discount, the amount of such Debt Incurred shall at all times be the aggregate principal amount at Stated Maturity. "Indenture" means this instrument, as originally executed or as it may from time to time be supplemented or amended in accordance with Article 9 hereof. "Independent Financial Advisor" means an investment banking firm of national standing or any third party appraiser of national standing, provided that such firm or appraiser is not an Affiliate of the Company. "Indirect Participant" means a Person who holds a beneficial interest in a Global Note through a Participant. "Initial Notes" means $[ ] million aggregate principal amount of Notes issued under this Indenture on the date hereof pursuant to the Plan of Reorganization. "Institutional Accredited Investor" means an institution that is an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act. "Interest Payment Dates" shall have the meaning set forth in paragraph 1 of the Note. "Interest Rate Agreement" means, for any Person, any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement or other similar agreement designed to protect against fluctuations in interest rates. "Investment" by any Person means any direct or indirect loan (other than advances to customers in the ordinary course of business that are recorded as accounts receivable on the balance sheet of such Person), advance or other extension of credit or capital contribution (by means of transfers of cash or other Property to others or payments for Property or services for the account or use of others, or otherwise) to, or Incurrence of a guarantee of any obligation of, or purchase or acquisition of Capital Stock, bonds, notes, debentures or other securities or evidence of Debt issued by, any other Person. "Investment" shall include the portion (proportionate to the Company's equity interest in such Subsidiary) of the fair market value of the net assets of any Subsidiary of the Company at the time that such Subsidiary is designated an Unrestricted Subsidiary. In determining the amount of any Investment made by transfer of any Property other than cash, such Property shall be valued at its fair market value at the time of such Investment. 12 "Investment Grade Rating" means a rating equal to or higher than Baa3 (or the equivalent) by Moody's or BBB- (or the equivalent) by S&P. "Investment Grade Status" shall be deemed to have been reached on the date that the Notes have an Investment Grade Rating from both of the Rating Agencies. "Issue Date" means the date on which the Notes are initially issued. "Legal Holiday" means a Saturday, a Sunday or a day on which banking institutions in the City of New York, the city in which the Corporate Trust Office of the Trustee is located, or at a place of payment are authorized by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue on such payment for the intervening period. "Lien" means, with respect to any Property of any Person, any mortgage or deed of trust, pledge, hypothecation, security interest, deposit arrangement, lien or charge of any kind on or with respect to such Property (including any Capital Lease Obligation, conditional sale or other title retention agreement having substantially the same economic effect as any of the foregoing or any Sale and Leaseback Transaction). "Moody's" means Moody's Investors Service, Inc. or any successor to the rating agency business of Moody's Investors Service, Inc. "Net Available Cash" from any Asset Sale means cash or Cash Equivalents received therefrom (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise, but only as and when received, but excluding any other consideration received in the form of assumption by the acquiring Person of Debt or other obligations relating to the Property that is the subject of such Asset Sale or received in any other non-cash form), in each case net of: (a) all legal, title and recording tax expenses, commissions and other reasonable and customary fees and expenses, including those relating to legal and financial advisory services, incurred, and all Federal, state, provincial, foreign and local taxes required to be accrued as a liability under GAAP, as a consequence of such Asset Sale, (b) all payments made on any Debt that is secured by any Property subject to such Asset Sale, in accordance with the terms of any Lien upon or other security agreement of any kind with respect to such property, or which must by its terms, or in order to obtain a necessary consent to such Asset Sale, or by applicable law, be repaid out of the proceeds from such asset sale, (c) all distributions and other payments required to be made to minority interest holders in Subsidiaries or joint ventures as a result of such Asset Sale, and (d) the deduction of appropriate amounts provided by the seller as a reserve, in accordance with GAAP, against any liabilities associated with the Property disposed in such Asset Sale and retained by the Company or any Restricted Subsidiary after such Asset Sale. "Non-Recourse Debt" means Debt: (a) as to which neither the Company nor any Restricted Subsidiary (i) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Debt or the incurrence of any Lien), (ii) is directly or indirectly liable as a guarantor or otherwise, or (iii) constitutes the lender, (b) no default with respect to which (including any rights that the holders thereof may have to take enforcement action against an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any Debt (other than the Notes) of the Company or any Restricted Subsidiary to declare a default on such other Debt or cause the payment thereof to be accelerated or payable prior to its stated maturity; and 13 (c) As to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of the Company or any of its Restricted Subsidiaries. "Obligations" means all obligations for principal, premium, interest, penalties, fees, indemnifications, reimbursements, damages and other amounts payable under the documentation governing any Debt. "Officer" means the principal executive officer, the principal financial officer or any senior vice president of the Company. "Officers' Certificate" means a certificate signed by two Officers of the Company, at least one of whom shall be the principal executive officer or principal financial officer of the Company, and delivered to the Trustee. "Opinion of Counsel" means a written opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee. "Participant" means, with respect to the Depositary, Euroclear or Clearstream, a Person who has an account with the Depositary, Euroclear or Clearstream, respectively, and, with respect to The Depository Trust Company, shall include Euroclear and Clearstream. "Permitted Debt" means the following: (a) Debt of the Company and any Subsidiary Guarantors evidenced by the Notes and the Subsidiary Guarantees thereof and the other debt securities Listed On Schedule 1.01 attached hereto; (b) Debt of the Company and its Restricted Subsidiaries under the Credit Facilities; provided that the aggregate principal amount of all such Debt under the Credit Facilities at any one Time outstanding shall not exceed $600.0 Million less the aggregate principal amount then outstanding of any Floating Rate Notes issued pursuant to the Plan of Reorganization; (c) Debt of the Company or a Restricted Subsidiary in respect of Capital Lease Obligations and Purchase Money Debt; provided that: (1) the aggregate principal amount of such debt does not exceed the fair market value (on the date of the incurrence thereof) of the property acquired, constructed or leased (as determined in good faith by the Company), and (2) The aggregate principal amount of all Debt Incurred and then outstanding pursuant to this clause (c) does not exceed $50.0 million less the aggregate amount then outstanding of any Capital Lease Obligations and Purchase Money Debt that were outstanding on the Issue Date; (d) Debt of the Company owing to and held by any Restricted Subsidiary and Debt of a Restricted Subsidiary owing to and held by the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary is the Obligor On Any Such Debt Incurred After the Issue Date, Then such Debt is expressly subordinated by its terms to the prior payment in full in cash of the Notes or the Subsidiary Guarantees, as the case may be; provided, further, however, that any subsequent issue or transfer of Capital Stock or other event that results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of any such debt (Except to the Company or a Restricted Subsidiary) shall be deemed, in each case, to Constitute the Incurrence of Such Debt by the Issuer Thereof; (e) Debt Under Interest Rate Agreements entered into by the Company or a Restricted Subsidiary for the Purpose of Limiting Interest rate risk of the Company or such Restricted Subsidiary related to Debt permitted under this Indenture to be Outstanding and not for speculative purposes; 14 (f) Debt under Currency Exchange Protection Agreements entered into by the Company or a Restricted Subsidiary for the purpose of limiting currency exchange rate risks directly related to transactions entered into by the Company or such Restricted Subsidiary and not for speculative purposes; (g) Debt under Commodity Price Protection Agreements entered into by the Company or a Restricted Subsidiary in the ordinary course of business and not for speculative purposes; (h) Debt in connection with one or more performance, completion and surety bonds and completion guarantees Issued by the Company or a Restricted Subsidiary in the Ordinary Course of Business or Pursuant to Self-insurance obligations and not in connection With the borrowing of money or the obtaining of advances or credit; (i) Acquired Debt; provided that the Company could have incurred such debt in accordance with clause (a) of the first paragraph of Section 4.09 hereof on the date such Debt became acquired Debt; (j) Debt incurred by Foreign Restricted Subsidiaries in an aggregate amount not to exceed $100.0 million at any one yime outstanding less the aggregate amount of any such Debt then outstanding that was outstanding on the Issue Date; (k) Qualified Distribution Guarantees of the Company or a Restricted Subsidiary in an aggregate principal amount not to exceed $25.0 million at any one time outstanding; (l) Debt not to exceed $[ ] million (including any Guarantees) outstanding on the Issue Date not otherwise described in clauses (a) Through (k) above; (m) Debt of the Company or a Restricted Subsidiary not otherwise permitted to be incurred pursuant to (a) through (l) above and (n) and (o) below, which together with any other Debt incurred pursuant to this clause (m) and outstanding on the date of Such incurrence has an aggregate principal amount outstanding at any one time not to exceed $25.0 million; (n) Guarantees by the Company or any of its Restricted Subsidiaries of Debt of the Company or Any Restricted Subsidiary to the extent the Company or Such Restricted Subsidiary has Incurred Such Debt Pursuant to any other clause of this covenant; and (o) Permitted Refinancing Debt Incurred in Respect of Debt Incurred Pursuant to Clause (a) of the first paragraph of Section 4.09 hereof and clauses (a), (i) and (l) above and this clause (o). For purposes of determining compliance with Section 4.09, (1) in the event that an item of Debt meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above or is entitled to be incurred pursuant to Section 4.09(a), the Company shall classify such item of Debt at the time of its Incurrence and will only be required to include the amount and type of such Debt in one of the above clauses, (2) the Company will be permitted at the time of such Incurrence to divide and classify an item of Debt in more than one of the types of Debt described herein, and (3) any Permitted Debt may later be reclassified, in whole or in part, as having been Incurred pursuant to any other clause of this definition to the extent such Debt could be Incurred pursuant to such clause at the time of such reclassification. Notwithstanding the preceding sentence, all Debt outstanding under the Exit Credit Facility will be deemed to be incurred pursuant to clause (b) above. "Permitted Investment" means any Investment by the Company or a Restricted Subsidiary in: (a) the Company or any Restricted Subsidiary or any Person that will, upon the making of such investment, Become a Restricted Subsidiary; provided that the primary business of such Restricted Subsidiary is a Related Business; provided, further, that any such Investments by the Company or Domestic Subsidiaries in Foreign Restricted Subsidiaries shall not exceed $[ ] per annum; 15 (b) any Person if as a result of such Investment such Person is merged or consolidated with or into, or transfers or conveys all or substantially all its Property To, the Company or a Restricted Subsidiary, in each case in accordance with Section 5.01 hereof; provided that such Person's primary business is a Related Business; (c) Cash Equivalents; (d) receivables owing to the Company or a Restricted Subsidiary, if created or acquired in the ordinary course of business; (e) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business; (f) extensions of credit to suppliers and customers represented by accounts receivable and loans, advances and extensions of credit to employees, in each case, made in the ordinary course of business; (g) stock, obligations or other securities received in settlement of debts created in the ordinary course of business and owing to the Company or a Restricted Subsidiary or in Satisfaction of claims or judgments; (h) any Person to the extent such Investment represents the non-cash portion of the consideration received in connection with an Asset Sale consummated in compliance with Section 4.12 hereof; (i) Investments for which the sole consideration provided is, or which is funded out of the net proceeds of a substantially concurrent sale of, Qualified Capital Stock of the Company; provided That the proceeds from the issuance of such Qualified Capital Stock shall not be (and have not been) included in any calculation pursuant to clause (c) of Section 4.10 hereof; (j) so long as no Event of Default shall have occurred and be continuing, Investments to fund the working capital requirements of the Worthington/Armstrong Joint Venture in an Aggregate amount not in excess of $25.0 million and Investments in other Permitted Joint Ventures in an aggregate amount not in excess of $25.0 million at any one time outstanding; (k) Investments Existing On the Issue Date in an amount not to exceed the amount invested on such date; (l) Hedging Obligations otherwise permitted under the Indenture; and (m) so long as no Event of Default shall have occurred and be continuing, other Investments in any Person after the Issue Date Made for fair market value as determined in good faith by the Company That do not exceed $100.0 million outstanding at any one time in the aggregate. "Permitted Joint Venture" means any Person which is not a Subsidiary and is, directly or indirectly, through its subsidiaries or otherwise, engaged principally in a Related Business, and the Capital Stock of which is owned by the Company or its Restricted Subsidiaries, on the one hand, and one or more Persons other than the Company or any Affiliate of the Company, on the other hand. "Permitted Liens" means: (a) Liens to secure Debt permitted to be Incurred under clause (b) of the definition of "Permitted Debt" hereof; (b) Liens to Secure Debt (x) Incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of any Property, or (y) permitted to be Incurred under clause (c) of the definition of "Permitted Debt" hereof; provided that any such Lien may not extend to any Property of the Company or Any Restricted Subsidiary, Other Than the Property acquired, constructed or leased with the proceeds of such Debt and any improvements or accessions to such Property; 16 (c) Liens for taxes, assessments or governmental charges or levies On the Property of the Company or any Restricted Subsidiary if the same shall not at the time be delinquent, or are being contested in good faith and by appropriate proceedings promptly instituted and diligently concluded; (d) Liens imposed by law, such as statutory mechanics', workmen's, materialmen's, operators' or similar Liens, on the Property of the Company or any Restricted Subsidiary securing payment of obligations that are not more than 60 Days past due or are being contested in good faith and by appropriate proceedings promptly instituted and diligently conducted and for which adequate reserves have been established or other provisions have been made in accordance with GAAP; (e) survey exceptions, minor imperfections of, or encumbrances on, title that do not interfere in any material respect with the value of the property to which they apply or the conduct of the business of the Company and its Restricted Subsidiaries; (f) Liens on Property at the time the Company or any Restricted Subsidiary acquired Such Property, including any acquisition by means of a merger or consolidation with or into the Company or any Restricted Subsidiary; provided, however, that any such lien is not incurred in anticipation of such acquisition and does not extend to any other property of the Company or any Restricted Subsidiary; provided, further that if any such Lien secures Acquired Debt, the incurrence of such Acquired Debt was permitted by the terms of this Indenture; (g) Liens On the Property of a Person at the time such person becomes a Restricted Subsidiary; provided, however, that any such Lien is not incurred in anticipation of such acquisition and does not extend to any other property of the Company or any other Restricted Subsidiary that is not a Direct Subsidiary of such Person; provided, further, however that if any such lien secures Debt of Such Person, the Incurrence of such Debt was permitted by the terms of this Indenture; (h) pledges or deposits by the Company or any Restricted Subsidiary under workmen's compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Debt) or leases to which the Company or any Restricted Subsidiary is Party, or deposits to secure public or statutory obligations of the Company, or deposits for the payment of rent, in each case Incurred in the ordinary course of business; (i) Utility Easements, Rights-of-way, Municipal and Zoning Ordinances, Building Regulations and Such Other Encumbrances or Charges Against Real Property as are of a Nature Generally Existing With Respect to Properties of a Similar Character and That Do Not Materially Interfere With the Ordinary Course of Business of the Company or of Any Restricted Subsidiary; (j) Leases or Subleases Granted to Others That Do Not Materially Interfere With the Ordinary Course of Business of the Company or of Any Restricted Subsidiary; (k) Liens arising from filing Uniform Commercial Code Financing statements with respect to a lessor's rights in and to personal property leased through a true lease in the ordinary course of business; (l) Liens arising from the rendering of a final judgment or order against the Company or any Restricted Subsidiary of the Company that does not give rise to an Event of Default; (m) Liens securing reimbursement obligations with respect to letters of credit incurred in accordance with the Indenture That encumber documents and other property relating to such letters of credit and the products and proceeds thereof; (n) Liens in favor of the Trustee arising under the Indenture; 17 (o) Liens in favor of the Company or any Subsidiary Guarantor; (p) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of nondelinquent customs duties in connection with the importation of goods; (q) Liens encumbering deposits made in the ordinary course of business to secure nondelinquent obligations arising from statutory, regulatory, contractual or warranty requirements of the Company or its Restricted Subsidiaries for which a reserve or other appropriate provision, if any, as shall be required by GAAP shall have been made; (r) Liens arising Out of consignment or similar arrangements for the sale of goods entered into by the Company or any Restricted Subsidiary in the ordinary course of business; (s) Liens to secure Hedging Obligations Otherwise Permitted by This Indenture; (t) Liens on assets of Foreign Restricted Subsidiaries securing Debt of Foreign Restricted Subsidiaries Permitted to be Incurred Under clause (j) of the definition of "Permitted Debt" hereof; (u) from and after the first date on which the Notes have Investment Grade Status, Liens On any asset of the Company or a Restricted Subsidiary other than (i) a principal operating facility located in the United States or (ii) any Capital Stock or Debt of a Restricted Subsidiary owning such a facility; (v) Liens existing on the Issue Date not otherwise described in Clauses (a) Through (u) above; (w) Liens on the Property of the Company or any Restricted Subsidiary to secure any Refinancing, in whole or in part, of any Debt secured by Liens referred to in clauses (b), (f), (g), (m) and (v) above; provided, however, that Any Such Lien Shall be Limited to All or Part of the Same Property That Secured the original lien (together with improvements and accessions to such Property) and the aggregate principal amount of Debt that is secured by such Lien shall not be increased to an amount greater than the sum of: (1) the outstanding principal amount, or, if greater, the committed amount, of the Debt secured by Liens described under clauses (b), (f), (g), (m) and (v) above, as the case may be, at the time the original Lien became a Permitted Lien under the Indenture, and (2) an amount necessary to pay any fees and expenses, including premiums and defeasance costs, incurred by the Company or such Restricted Subsidiary in connection with such Refinancing; and (x) Liens not otherwise permitted by clauses (a) through (w) above encumbering assets having an aggregate fair market value not in excess of 7.5% of Consolidated Net Tangible Assets, as determined based on the consolidated balance sheet of the Company as of the end of the most recent fiscal quarter for which financial statements are available. "Permitted Refinancing Debt" means any Debt that Refinances any other Debt, including any successive Refinancings, so long as: (a) such Debt is in an aggregate principal amount (or if Incurred with original issue discount, an aggregate issue price) not in excess of the sum of: (1) the aggregate principal amount (or if Incurred with original issue discount, the aggregate accreted value) then outstanding of the Debt being Refinanced, and (2) an amount necessary to pay any reasonable and customary fees and expenses, including premiums and defeasance costs, related to such Refinancing, 18 (b) the Average Life of such Debt is equal to or greater than the Average Life of the Debt being Refinanced, (c) the Stated Maturity of Such Debt is no earlier than the Stated Maturity of the Debt being Refinanced, (d) the new Debt shall be Subordinated in right of payment to the Notes if and to the same extent as the Debt that is being Refinanced is a Subordinated Obligation; and (e) such Debt is incurred either by the Company or by the Subsidiary who is the obligor on the Debt being refinanced. "Person" means any individual, corporation, company (including any limited liability company), association, partnership, joint venture, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity. "Plan of Reorganization" means [the Fourth Amended Plan of Reorganization of Armstrong World Inc. as confirmed by the United States Bankruptcy Court for the District of Delaware pursuant to the confirmation order thereof dated [ ], 200[ ]]. "Predecessor Note" of any particular Note means every previous Note evidencing all or a portion of the same Debt as that evidenced by such particular Note; and for the purposes of this definition, any Note authenticated and delivered under Section 2.08 in lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same Debt as the lost, destroyed or stolen Note. "Preferred Stock" of any Person means any Capital Stock of a Person, however designated, which entitles the holder thereof to a preference with respect to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of any other class of Capital Stock issued by such Person. "Preferred Stock Dividends" means all dividends with respect to Preferred Stock of Restricted Subsidiaries held by Persons other than the Company or a Restricted Subsidiary. "Private Placement Legend" means the legend set forth in Section 2.06(f)(i) hereof. "pro forma" means, with respect to any calculation made or required to be made pursuant to the terms hereof, a calculation performed in accordance with Article 11 of Regulation S-X promulgated under the Securities Act. "Property" means, with respect to any Person, any interest of such Person in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including Capital Stock in, and other securities of, any other Person. For purposes of any calculation required pursuant to the Indenture, the value of any Property shall be its fair market value as determined in good faith by the Company. "Purchase Money Debt" means Debt Incurred to finance the acquisition, construction or lease by the Company or a Restricted Subsidiary of Property, including additions and improvements thereto (or the acquisition of Capital Stock of a Person owning such assets); provided, however, that such Debt is Incurred within 180 days after the acquisition, construction or lease of such Property or Capital Stock by the Company or such Restricted Subsidiary. "QIB" means a "qualified institutional buyer" as defined in Rule 144A. "Qualified Capital Stock" means, with respect to any Person, any Capital Stock of such Person that is not Disqualified Stock or convertible into or exchangeable or exercisable for Disqualified Stock. 19 "Qualified Distributor Guarantee" means any guarantee by the Company or any of its Subsidiaries with respect to any Debt of a distributor of products of the Company or any of its Subsidiaries (other than distributors that are Affiliates of the Company), to the extent the grant of any such guarantee relates only to the repurchase of the distributor's inventory and is in the ordinary course of business of the Company or the applicable Restricted Subsidiary. "Rating Agencies" mean Moody's and S&P. "Refinance" means, in respect of any Debt, to refinance, extend, renew, refund, repay, prepay, repurchase, redeem, defease or retire, or to issue other Debt, in exchange or replacement for, such Debt. "Refinanced" and "Refinancing" shall have correlative meanings. "Registration Rights Agreement" means one or more registration rights agreements between the Company and the other parties thereto, as such agreement(s) may be amended, modified or supplemented from time to time, relating to rights given by the Company to the purchasers of Notes to register such Notes under the Securities Act. "Regular Record Date" for the interest payable on any Interest Payment Date means the date specified on the face of the Note. "Regulation S" means Regulation S promulgated under the Securities Act. "Regulation S Global Note" means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of any Notes that may be sold in reliance on Rule 903 of Regulation S. "Related Business" means any business that is related, ancillary or complementary to the businesses of the Company and the Restricted Subsidiaries on the Issue Date. "Repay" means, in respect of any Debt, to repay, prepay, repurchase, redeem, legally defease or otherwise retire such Debt. "Repayment" and "Repaid" shall have correlative meanings. For purposes of Section 4.12 hereof and the definition of "Consolidated Interest Coverage Ratio," Debt shall be considered to have been Repaid only to the extent the related loan commitment, if any, shall have been permanently reduced in connection therewith. "Responsible Officer," when used with respect to the Trustee, means any officer within the Corporate Trust Department of the Trustee (or any successor group of the Trustee) with direct responsibility for the administration of this Indenture and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his or her knowledge of and familiarity with the particular subject. "Restricted Definitive Note" means one or more Definitive Notes bearing the Private Placement Legend. "Restricted Global Notes" means one or more 144A Global Notes, IAI Global Notes and Regulation S Global Notes and any other Global Notes bearing the Private Placement Legend. "Restricted Payment" means (a) any dividend or distribution (whether made in cash, securities or other Property) declared or paid on or with respect to any shares of Capital Stock of the Company or any Restricted Subsidiary, except for any dividend or distribution That is made solely to the Company or a Restricted Subsidiary (and, if such Restricted Subsidiary is not a Wholly Owned Restricted Subsidiary, to the other shareholders of such Restricted Subsidiary on a pro rata basis or on a basis that results in the receipt by the Company or a Restricted Subsidiary of dividends or distributions of greater value than it would receive on a pro rata basis) or any dividend or distribution payable solely in shares of Capital Stock (other than Disqualified Stock) of the Company; 20 (b) the purchase, repurchase, redemption, acquisition or retirement for value of any Capital Stock of the Company or any Restricted Subsidiary (other than from the Company or a Restricted Subsidiary); (c) the purchase, repurchase, redemption, acquisition or retirement for value, prior to the date for any scheduled maturity, sinking fund or amortization or other installment payment, or mandatory redemption, of any Subordinated Obligation (other than any Subordinated Obligation owed to the Company or any Restricted Subsidiary); (d) any Investment (other than Permitted Investments) in any Person; or (e) the issuance, sale or other disposition of Capital Stock of any Restricted Subsidiary to a Person other than the Company or another Restricted Subsidiary if the result Thereof is that such Restricted Subsidiary shall cease to be a Restricted Subsidiary, in which event the amount of such "Restricted Payment" shall be the fair market value of the remaining interest, if any, in Such Former Restricted Subsidiary Held by the Company and the Other Restricted Subsidiaries (as determined in good faith by the Company). "Restricted Subsidiary" means any Subsidiary of the Company other than an Unrestricted Subsidiary. "Rule 144" means Rule 144 promulgated under the Securities Act. "Rule 144A" means Rule 144A promulgated under the Securities Act. "Rule 903" means Rule 903 promulgated under the Securities Act. "Rule 904" means Rule 904 promulgated under the Securities Act. "S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill, Inc., or any successor to the rating agency business thereof. "Sale and Leaseback Transaction" means any direct or indirect arrangement relating to Property now owned or hereafter acquired whereby the Company or a Restricted Subsidiary transfers such Property to another Person and the Company or a Restricted Subsidiary leases it from such Person. "Securities Act" means the Securities Act of 1933, as amended. "Significant Subsidiary" means any Restricted Subsidiary that would be a "significant subsidiary" of the Company within the meaning of Rule 1-02(h) (1) or (2) under Regulation S-X promulgated by the Commission as in effect on the Issue Date. "Special Record Date" for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 2.09 hereof. "Stated Maturity" means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency beyond the control of the issuer unless such contingency has occurred). "Subordinated Obligations" means any Debt of the Company or a Restricted Subsidiary, whether outstanding on the date the Notes are first issued or thereafter Incurred, which is subordinate or junior in right of payment to the Notes or any guarantee of such Restricted Subsidiary, as the case may be, pursuant to a written agreement to that effect. 21 "Subsidiary," with respect to any Person, means, in respect of any Person, any corporation, company (including any limited liability company), association, partnership, joint venture or other business entity of which a majority of the total voting power of the Voting Stock is at the time owned or controlled, directly or indirectly, by: (a) such Person (b) such Person and one or more Subsidiaries of such Person, or (c) one or more Subsidiaries of such Person. "Subsidiary Guarantee" means a guarantee on the terms set forth in Article 10 hereof by a Subsidiary Guarantor of the Company's obligations with respect to the Notes. "Subsidiary Guarantor" means each Domestic Subsidiary of the Company and any other Subsidiary that becomes a Subsidiary Guarantor pursuant to Section 4.17 hereof. "Surviving Person" means the surviving Person formed by a merger, consolidation or amalgamation and, for purposes of Section 5.01 hereof, a Person to whom all or substantially all of the Property of the Company or a Subsidiary Guarantor is sold, transferred, assigned, leased, conveyed or otherwise disposed. "TIA" means the Trust Indenture Act of 1939, as amended. "Trustee" means the Person named as the "Trustee" in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Trustee" shall mean such successor Trustee. "Unrestricted Definitive Notes" means one or more Definitive Notes that do not and are not required to bear the Private Placement Legend. "Unrestricted Global Notes" means one or more Global Notes that do not and are not required to bear the Private Placement Legend. "Unrestricted Subsidiary" means (a) any Subsidiary of the Company that is designated after the Issue Date as an Unrestricted Subsidiary as permitted or required pursuant to Section 4.16 hereof and is not thereafter redesignated as a Restricted Subsidiary as permitted pursuant thereto and the Subsidiary to be so designated: (1) does not own any Capital Stock or Debt of, or own or hold any Lien on any Property of the Company or any other Restricted Subsidiary; (2) has no Debt other than Non-Recourse Debt; (3) is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company; (4) is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation (i) to subscribe for additional Capital Stock or (ii) to maintain or preserve such Person's financial condition or to cause such Person to achieve any specified levels of operating results; and 22 (5) has not Guaranteed or otherwise directly or indirectly provided credit support for any Debt of the Company or any of its Restricted Subsidiaries; and (b) any Subsidiary of an Unrestricted Subsidiary. "U.S. Government Obligations" means direct obligations (or certificates representing an ownership interest in such obligations) of the United States of America (including any agency or instrumentality thereof) 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. "Voting Stock" of any Person as of any date means all classes of Capital Stock or other interests (including partnership interests) of such Person then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof. "Wholly Owned Restricted Subsidiary" means any Restricted Subsidiary that is a Wholly Owned Subsidiary. "Wholly Owned Subsidiary" means a Subsidiary of any Person, all of the outstanding Capital Stock of which (other than any director's qualifying shares or shares owned by foreign nationals to the extent mandated by applicable law) is owned by such Person or one or more Wholly Owned Subsidiaries of such Person. "Worthington/Armstrong Joint Venture" means the joint venture between the Company and Worthington established pursuant to the agreement dated [ ]. Section 1.02. Other Definitions. Defined in Term Section ---- ------- "Acceleration Notice"..................................................................6.02 "Affiliate Transaction"................................................................4.14 "Authentication Order".................................................................2.02 "Benefited Party"......................................................................10.01 "Change of Control Offer"..............................................................4.17 "Change of Control Purchase Price".....................................................4.17 "Covenant Defeasance"..................................................................8.03 "CUSIP" ...............................................................................2.12 "Defaulted Interest" ..................................................................2.09 "DTC"..................................................................................2.06 "Event of Default".....................................................................6.01 "Legal Defeasance".....................................................................8.02 "losses"...............................................................................7.07 "Note Register" .......................................................................2.03 "Offer Amount".........................................................................3.09 "Offer Period".........................................................................3.09 "Offer to Purchase"....................................................................3.09 "Paying Agent".........................................................................2.03 "Prepayment Offer".....................................................................4.12 "Purchase Date"........................................................................3.09 "Purchase Price".......................................................................3.09 "Registrar"............................................................................2.03 "Suspended Covenants"..................................................................4.19 "Suspension Period"....................................................................4.19
23 Section 1.03 Incorporation by Reference of Trust Indenture Act. ------------------------------------------------- (a) Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. (b) The Following TIA Terms used in this Indenture have the following meanings: "indenture securities" means the Notes and the Subsidiary Guarantees; "indenture security holder" means a Holder of a Note; "indenture to be qualified" means this Indenture; "indenture trustee" or "institutional trustee" means the Trustee; and "obligor" on the Notes means the Company and any successor obligor upon the Notes. (c) All other terms used in this Indenture that are Defined by the TIA, Defined by TIA reference to another Statute or Defined by Commission rule under the TIA and not otherwise defined herein have the meanings so assigned to them. Section 1.04. Rules of Construction. ---------------------- UNLESS THE CONTEXT OTHERWISE REQUIRES: (a) a term has the meaning assigned to it; (b) an accounting term not otherwise defined herein has the meaning assigned to it in accordance with GAAP; (c) "or" is not exclusive; (d) words in the singular include the plural, and in the plural include the singular; (e) all references in this instrument to designated "Articles," "Sections" and other subdivisions are to the designated Articles, Sections and Subdivisions of this instrument as originally executed; (f) the words "herein," "hereof" and "hereunder" and other words of similar import refer to this indenture as a whole and not to any particular Article, Section or other subdivision. (g) "including" means "including Without Limitation;" (h) provisions apply to successive events and transactions; (i) references to sections of or rules under the Securities Act shall be deemed to include substitute, replacement or successor sections or rules adopted by the Commission from time to time; and (j) in the event that a transaction meets the criteria of more than one category of permitted transactions or listed exceptions the Company may classify such transaction as it, in its sole discretion, determines. 24 ARTICLE 2. THE NOTES --------- Section 2.01. Form and Dating. ---------------- (a) General. the Notes Shall be Known and Designated as the "[ ](4)% Senior Notes Due 2010" of the Company. the Stated Maturity of the Notes Shall be [ ], 201[ ](5). the Notes and the Trustee's Certificate of Authentication Shall be Substantially in the Form of Exhibit a Hereto, Which is Hereby Incorporated in and Expressly Made Part of This Indenture. the Notes May Have Notations, Legends or Endorsements Required by Law, Stock Exchange Rule or Usage in Addition to Those Set Forth On Exhibit A. Each Note Shall be Dated the Date of Its Authentication. the Notes Shall be in Denominations of $1,000 and Integral Multiples Thereof. the Terms and Provisions Contained in the Notes Shall Constitute, and are Hereby Expressly Made, a Part of This Indenture, and the Company, the Subsidiary Guarantors and the Trustee, by Their Execution and Delivery of This Indenture, Expressly Agree to Such Terms and Provisions and to be Bound Thereby. However, to the Extent Any Provision of Any Note Conflicts With the Express Provisions of This Indenture, the Provisions of This Indenture Shall Govern and be Controlling. (b) Form of Notes. Notes Shall be Issued Initially in Global Form and Shall be Substantially in the Form of Exhibit a Attached Hereto (Including the Global Note Legend Thereon and the "Schedule of Exchanges of Interests in the Global Note" Attached Thereto). Notes Issued in Definitive Form Shall be Substantially in the Form of Exhibit a Attached Hereto (But Without the Global Note Legend Thereon and Without the "Schedule of Exchanges of Interests in the Global Note" Attached Thereto). Each Global Note Shall Represent Such of the Outstanding Notes as Shall be Specified Therein and Each Shall Provide That It Shall Represent the Aggregate Principal Amount of Outstanding Notes From Time to Time Endorsed Thereon and That the Aggregate Principal Amount of Outstanding Notes Represented Thereby May From Time to Time be Reduced or Increased, as Appropriate, to Reflect Exchanges and Redemptions and Transfers of Interests Therein. Any Endorsement of a Global Note to Reflect the Amount of Any Increase or Decrease in the Aggregate Principal Amount of Outstanding Notes Represented Thereby Shall be Made by the Trustee or the Custodian, At the Direction of the Trustee, in Accordance With Instructions Given by the Holder Thereof as Required by Section 2.06 Hereof. (c) Book-entry Provisions. Participants and Indirect Participants Shall Have No Rights Under This Indenture With Respect to Any Global Note Held On Their Behalf by the Depositary or by the Trustee as the Custodian for the Depositary or Under Such Global Note, and the Depositary Shall be Treated by the Company, the Trustee and Any Agent of the Company or the Trustee as the Absolute Owner of Such Global Note for All Purposes Whatsoever. Notwithstanding the Foregoing, Nothing Herein Shall Prevent the Company, the Trustee or Any Agent of the Company or the Trustee From Giving Effect to Any Written Certification, Proxy or Other Authorization Furnished by the Depositary or Impair, as Between the Depositary and Its Participants or Indirect Participants, the Applicable Procedures or the Operation of Customary Practices of the Depositary Governing the Exercise of the Rights of a Holder of a Beneficial Interest in Any Global Note. (d) Euroclear and Clearstream Procedures Applicable. the Provisions of the "Operating Procedures of the Euroclear System" and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and Conditions of Clearstream" and "Customer Handbook" of Clearstream Shall be Applicable to Transfers of Beneficial Interests in Global Notes That are Held by Participants Through Euroclear or Clearstream. (e) Certificated Securities. If At Any Time the Depositary Notifies the Company That It is Unwilling or Unable to Continue as Depositary or If At Any Time the Depositary Shall No Longer be Eligible Under This Section 2.01, the Company Shall Appoint a Successor Depositary. If a Successor Depositary is Not Appointed by the Company Within 120 Days After the Company Receives Such Notice or Becomes Aware of Such Ineligibility, the Company Will Execute, and the - ------------------------- (4) The interest rate for the Notes shall be determined in the manner described in the definition of "Plan Notes" contained in the Plan of Reorganization. (5) The seventh anniversary of the Issue Date. 25 Trustee, Upon Receipt of a Company Order for the Authentication and Delivery of Definitive Notes, Will Authenticate and Deliver Definitive Notes, in Authorized Denominations, in an Aggregate Principal Amount and Like Terms and Tenor Equal to the Principal Amount of the Global Notes in Exchange for Such Global Notes. The Company may at any time and in its sole discretion determine that Global Notes shall no longer be represented by such Global Notes. In such event, the Company will execute, and the Trustee, upon receipt of a Company order for the authentication and delivery of Definitive Notes of the same terms and tenor, will authenticate and deliver Definitive Notes, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Notes in exchange for such Global Notes. If specified by the Company pursuant to Section 2.02 with respect to Global Notes, the Depositary may surrender Global Notes in exchange in whole or in part for Definitive Notes and of like terms and tenor on such terms as are acceptable to the Company and such Depositary. Thereupon, the Company shall execute, and the Trustee upon receipt of a Company order for the authentication and delivery of Definitive Notes, shall authenticate and deliver, without service charge to the holders: (i) To Each Person Specified by Such Depositary a New Definitive Note or Notes of the Same Tenor, in Authorized Denominations, in an Aggregate Principal Amount Equal to and in Exchange for Such Person's Beneficial Interest in the Global Note; and (ii) To Such Depositary a New Global Note in a Denomination Equal to the Difference, If Any, Between the Principal Amount of the Surrendered Global Note and the Aggregate Principal Amount of the Definitive Notes Delivered to Holders Pursuant to Clause (A) Above. Upon the exchange of a Global Note for Definitive Notes, such Global Note shall be cancelled by the Trustee or an agent of the Company or the Trustee. Definitive Notes in exchange for a Global Note pursuant to this Section 2.01 shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee or an agent of the Company or the Trustee in writing. The Trustee or such agent shall deliver such Notes to or as directed by the Persons in whose names such Notes are so registered or to the Depositary. Section 2.02. Execution and Authentication. ----------------------------- (a) One Officer Shall Sign the Notes for the Company by Manual or Facsimile Signature. (b) If an Officer Whose Signature is On a Note No Longer Holds That Office At the Time a Note is Authenticated, the Note Shall Nevertheless be Valid. (c) a Note Shall Not be Valid Until Authenticated by the Manual Signature of the Trustee. the Signature Shall be Conclusive Evidence That the Note has Been Authenticated Under This Indenture. (d) the Trustee Shall, Upon a Written Order of the Company Signed by an Officer (An "Authentication Order"), Authenticate Notes for Original Issue. (e) the Trustee May Appoint an Authenticating Agent Acceptable to the Company 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 Holders or an Affiliate of the Company or Any of Their Respective Subsidiaries. Section 2.03. Registrar, Paying Agent and Depositary. --------------------------------------- The Company shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange ("REGISTRAR") and an office or agency where Notes may be presented for payment ("PAYING AGENT"). The Registrar shall keep in a register of the Notes (the "NOTE REGISTER") the names 26 and addresses of the Holders and of their transfer and exchange. The Company, upon prior written notice to the Trustee, may appoint one or more co-registrars and one or more additional paying agents. The term "Registrar" includes any co-registrar and the term "Paying Agent" includes any additional paying agent. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company shall notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. The Company or any of its subsidiaries may act as Paying Agent or Registrar. The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture, which shall incorporate the provisions of the Trust Indenture Act. Such agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall notify the Trustee of the name and address of such Agent. The Company initially appoints The Depository Trust Company to act as Depositary with respect to the Global Notes. The Company initially appoints the Trustee to act as the Registrar and Paying Agent and to act as Custodian with respect to the Global Notes. Section 2.04. Paying Agent to Hold Money in Trust. ----------------------------------- The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent shall hold in trust for the benefit of the Holders or the Trustee all money held by the Paying Agent for the payment of principal, premium, if any, or interest on the Notes, and shall notify the Trustee of any default by the Company in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for the money. If the Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the Company, the Trustee shall serve as Paying Agent for the Notes. 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 all Holders and shall otherwise comply with TIA ss.312(a). If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least seven Business Days before each Interest Payment Date and at such other times as the Trustee may request in writing, a list in such form and as of such date or such shorter time as the Trustee may allow, as the Trustee may reasonably require of the names and addresses of the Holders and the Company shall otherwise comply with TIA ss.312(a). Section 2.06. Transfer and Exchange. ---------------------- (a) Transfer and Exchange of Global Notes. a Global Note May Not be Transferred as a Whole Except by the Depositary to a Nominee of the Depositary, by a Nominee of the Depositary to the Depositary or to Another Nominee of the Depositary, or by the Depositary or Any Such Nominee to a Successor Depositary or a Nominee of Such Successor Depositary. All Global Notes Will be Exchanged by the Company for Definitive Notes If (1) the Company Delivers to the Trustee Notice From the Depositary That It is Unwilling or Unable to Continue to Act as Depositary or That It is No Longer a Clearing Agency Registered Under the Exchange Act And, in Either Case, a Successor Depositary is Not Appointed by the Company Within 120 Days After the Date of Such Notice From the Depositary or (2) the Company in Its Sole Discretion Determines That the Global Notes (In Whole But Not in Part) Should be Exchanged for Definitive Notes and Delivers a Written Notice to Such Effect to the Trustee; or (3) an Event of Default Entitling the Holders to Accelerate Shall Have Occurred and be Continuing and the Registrar has Received a Written Request From the Depositary to Issue Definitive Notes. Upon the Occurrence of Any of the Preceding Events in (1), (2) or (3) Above, Definitive Notes Shall be Issued in Denominations of $1,000 or Integral Multiples Thereof and in Such Names as the Depositary Shall Instruct the Trustee in Writing. Global Notes Also May be Exchanged or Replaced, in Whole or in Part, as Provided in Sections 2.07 and 2.08 Hereof. Every Note Authenticated and Delivered in Exchange For, or in Lieu Of, a Global Note or Any Portion Thereof, Pursuant to This Section 2.06 or Section 2.07 or 2.08 Hereof, Shall be Authenticated and Delivered in the Form Of, and Shall Be, a Global Note. a Global Note May Not be Exchanged for Another Note Other Than as Provided in This Section 2.06(A); However, Beneficial Interests in a Global Note May be Transferred and Exchanged as Provided in Section 2.06(B), (C) or (E)(iv) Hereof. 27 (b) Transfer and Exchange of Beneficial Interests in the Global Notes. the Transfer and Exchange of Beneficial Interests in the Global Notes Shall be Effected Through the Depositary, in Accordance With the Provisions of This Indenture and the Applicable Procedures. Beneficial Interests in the Restricted Global Notes Shall be Subject to Restrictions On Transfer Comparable to Those Set Forth Herein to the Extent Required by the Securities Act. Transfers of Beneficial Interests in the Global Notes Also Shall Require Compliance With Either Clause (I) or (Ii) Below, as Applicable, as Well as One or More of the Other Following Clauses, as Applicable: (i) Transfer of Beneficial Interests in the Same Global Note. Beneficial Interests in Any Restricted Global Note May be Transferred to Persons Who Take Delivery Thereof in the Form of a Beneficial Interest in the Same Restricted Global Note in Accordance With the Transfer Restrictions Set Forth in the Private Placement Legend. Beneficial Interests in Any Unrestricted Global Note May be Transferred to Persons Who Take Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note. No Written Orders or Instructions Shall be Required to be Delivered to the Registrar to Effect the Transfers Described in This Section 2.06(B)(i). (ii) All Other Transfers and Exchanges of Beneficial Interests in Global Notes. in Connection With All Transfers and Exchanges of Beneficial Interests That are Not Subject to Section 2.06(B)(i) Above, the Transferor of Such Beneficial Interest Must Deliver to the Registrar Either (A)(1) a Written Order From a Participant or an Indirect Participant Given to the Depositary in Accordance With the Applicable Procedures Directing the Depositary to Credit or Cause to be Credited a Beneficial Interest in Another Global Note in an Amount Equal to the Beneficial Interest to be Transferred or Exchanged and (2) Instructions Given in Accordance With the Applicable Procedures Containing Information Regarding the Participant Account to be Credited With Such Increase or (B)(1) a Written Order From a Participant or an Indirect Participant Given to the Depositary in Accordance With the Applicable Procedures Directing the Depositary to Cause to be Issued a Definitive Note in an Amount Equal to the Beneficial Interest to be Transferred or Exchanged and (2) Instructions Given by the Depositary to the Registrar Containing Information Regarding the Person in Whose Name Such Definitive Note Shall be Registered to Effect the Transfer or Exchange Referred to in (B)(1) Above. Upon Consummation of an Exchange Offer by the Company in Accordance With Section 2.06(E)(iv) Hereof, the Requirements of This Section 2.06(B)(ii) Shall be Deemed to Have Been Satisfied Upon Receipt by the Registrar of the Instructions Contained in the Letter of Transmittal Delivered by the Holder of Such Beneficial Interests in the Restricted Global Notes. Upon Satisfaction of All of the Requirements for Transfer or Exchange of Beneficial Interests in Global Notes Contained in This Indenture and the Notes or Otherwise Applicable Under the Securities Act, the Trustee Shall Adjust the Principal Amount of the Relevant Global Note(s) Pursuant to Section 2.06(G) Hereof. (iii) Transfer of Beneficial Interests in a Restricted Global Note to Another Restricted Global Note. a Beneficial Interest in Any Restricted Global Note May be Transferred to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in Another Restricted Global Note If the Transfer Complies With the Requirements of Section 2.06(B)(ii) Above and the Registrar Receives the Following: (A) If the Transferee Will Take Delivery in the Form of a Beneficial Interest in an 144A Global Note, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications in Item (1) Thereof; (B) If the Transferee Will Take Delivery in the Form of a Beneficial Interest in a Regulation S Global Note, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications in Item (2) Thereof; and (C) If the Transferee Will Take Delivery in the Form of a Beneficial Interest in a Iai Global Note, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications and Certificates and Opinion of Counsel Required by Item (3) Thereof, If Applicable. 28 (iv) Transfer and Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in an Unrestricted Global Note. a Beneficial Interest in Any Restricted Global Note May be Exchanged by Any Holder Thereof for a Beneficial Interest in an Unrestricted Global Note or Transferred to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note If the Exchange or Transfer Complies With the Requirements of Section 2.06(B)(ii) Above And: (A) Such Exchange or Transfer is Effected Pursuant to an Exchange Offer in Accordance With the Applicable Registration Rights Agreement and the Holder of the Beneficial Interest to be Transferred, in the Case of an Exchange, or the Transferee, in the Case of a Transfer, Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; (B) Such Transfer is Effected Pursuant to an Effective Shelf Registration Statement in Accordance With the Applicable Registration Rights Agreement; (C) Such Transfer is Effected by a Broker-dealer Pursuant to an Effective Exchange Offer Registration Statement in Accordance With the Applicable Registration Rights Agreement; or (D) The Registrar Receives the Following: (1) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Exchange Such Beneficial Interest for a Beneficial Interest in an Unrestricted Global Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (1)(A) Thereof; or (2) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Transfer Such Beneficial Interest to a Person Who Shall Take Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note, a Certificate From Such Holder in the Form of Exhibit B Hereto, Including the Certifications in Item (4) Thereof; and, in each such case set forth in this clause (D), if the Registrar and the Company so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. If any such transfer is effected pursuant to clause (B) or (D) above at a time when an Unrestricted Global Note has not yet been issued, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred pursuant to clause (B) or (D) above. (v) Transfer or Exchange of Beneficial Interests in Unrestricted Global Notes for Beneficial Interests in Restricted Global Notes Prohibited. Beneficial Interests in an Unrestricted Global Note Cannot be Exchanged For, or Transferred to Persons Who Take Delivery Thereof in the Form Of, a Beneficial Interest in a Restricted Global Note. (C) Transfer or Exchange of Beneficial Interests for Definitive Notes. (i) Beneficial Interests in Restricted Global Notes to Restricted Definitive Notes. If Any Holder of a Beneficial Interest in a Restricted Global Note Proposes to Exchange Such Beneficial Interest for a Restricted Definitive Note or to Transfer Such Beneficial Interest to a Person Who Takes Delivery Thereof in the Form of a Restricted Definitive Note, Then, Upon Receipt by the Registrar of the Following Documentation: 29 (A) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Exchange Such Beneficial Interest for a Restricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (2)(A) Thereof; (B) If Such Beneficial Interest is Being Transferred to a Qib in Accordance With Rule 144A, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (1) Thereof; (C) If Such Beneficial Interest is Being Transferred to a Non-u.s. Person in an Offshore Transaction in Accordance With Rule 903 or Rule 904, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (2) Thereof; (D) If Such Beneficial Interest is Being Transferred Pursuant to an Exemption From the Registration Requirements of the Securities Act in Accordance With Rule 144 Under the Securities Act, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(A) Thereof; (E) If Such Beneficial Interest is Being Transferred to an Institutional Accredited Investor in Reliance On an Exemption From the Registration Requirements of the Securities Act Other Than Those Listed in Clauses (B) Through (D) Above, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications, Certificates and Opinion of Counsel Required by Item (3)(D) Thereof, If Applicable; (F) If Such Beneficial Interest is Being Transferred to the Company or Any of Its Subsidiaries, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(B) Thereof; or (G) If Such Beneficial Interest is Being Transferred Pursuant to an Effective Registration Statement Under the Securities Act, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(C) Thereof, the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.06(g) hereof, and the Company shall execute and the Trustee shall authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall mail or deliver such Definitive Notes to the Persons in whose names such Notes are so registered. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein. (ii) Beneficial Interests in Restricted Global Notes to Unrestricted Definitive Notes. a Holder of a Beneficial Interest in a Restricted Global Note May Exchange Such Beneficial Interest for an Unrestricted Definitive Note or May Transfer Such Beneficial Interest to a Person Who Takes Delivery Thereof in the Form of an Unrestricted Definitive Note Only If: (A) Such Exchange or Transfer is Effected Pursuant to an Exchange Offer in Accordance With the Applicable Registration Rights Agreement and the Holder of Such Beneficial Interest, in the Case of an Exchange, or the Transferee, in the Case of a 30 Transfer, Certifies in the Applicable Letter of Transmittal That It is Not (1) a Broker-dealer, (2) a Person Participating in the Distribution of the Exchange Notes or (3) a Person Who is an Affiliate (As Defined in Rule 144) of the Company; (B) Such Transfer is Effected Pursuant to an Effective Shelf Registration Statement in Accordance With the Applicable Registration Rights Agreement; (C) Such Transfer is Effected by a Broker-dealer Pursuant to an Effective Exchange Offer Registration Statement in Accordance With the Applicable Registration Rights Agreement; or (D) the Registrar Receives the Following: (1) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Exchange Such Beneficial Interest for an Unrestricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (1)(B) Thereof; or (2) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Transfer Such Beneficial Interest to a Person Who Shall Take Delivery Thereof in the Form of an Unrestricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit B Hereto, Including the Certifications in Item (4) Thereof; And, in Each Such Case Set Forth in This Clause (D), If the Registrar So Requests or If the Applicable Procedures So Require, an Opinion of Counsel in Form Reasonably Acceptable to the Registrar to the Effect That Such Exchange or Transfer is in Compliance With the Securities Act and That the Restrictions On Transfer Contained Herein and in the Private Placement Legend are No Longer Required in Order to Maintain Compliance With the Securities Act. (iii) Beneficial Interests in Unrestricted Global Notes to Unrestricted Definitive Notes. If Any Holder of a Beneficial Interest in an Unrestricted Global Note Proposes to Exchange Such Beneficial Interest for a Definitive Note or to Transfer Such Beneficial Interest to a Person Who Takes Delivery Thereof in the Form of a Definitive Note, Then, Upon Satisfaction of the Conditions Set Forth in Section 2.06(B)(ii) Hereof, the Trustee Shall Cause the Aggregate Principal Amount of the Applicable Global Note to be Reduced Accordingly Pursuant to Section 2.06(G) Hereof, and the Company Shall Execute and the Trustee Shall Authenticate and Mail or Deliver to the Person Designated in the Instructions a Definitive Note in the Appropriate Principal Amount. Any Definitive Note Issued in Exchange for a Beneficial Interest Pursuant to This Section 2.06(C)(iii) Shall be Registered in Such Name or Names and in Such Authorized Denomination or Denominations as the Holder of Such Beneficial Interest Shall Instruct the Registrar Through Instructions From the Depositary and the Participant or Indirect Participant. the Trustee Shall Mail or Deliver Such Definitive Notes to the Persons in Whose Names Such Notes are So Registered. Any Definitive Note Issued in Exchange for a Beneficial Interest Pursuant to This Section 2.06(C)(iii) Shall Not Bear the Private Placement Legend. (D) Transfer and Exchange of Definitive Notes for Beneficial Interests in the Global Notes. (i) Restricted Definitive Notes to Beneficial Interests in Restricted Global Notes. If Any Holder of a Restricted Definitive Note Proposes to Exchange Such Note for a Beneficial Interest in a Restricted Global Note or to Transfer Such Restricted Definitive Notes to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in a Restricted Global Note, Then, Upon Receipt by the Registrar of the Following Documentation: (A) If the Holder of Such Restricted Definitive Note Proposes to Exchange Such Note for a Beneficial Interest in a Restricted Global Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (2)(B) Thereof; 31 (B) If Such Restricted Definitive Note is Being Transferred to a Qib in Accordance With Rule 144A, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (1) Thereof; (C) If Such Restricted Definitive Note is Being Transferred to a Non-u.s. Person in an Offshore Transaction in Accordance With Rule 903 or Rule 904, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (2) Thereof; (D) If Such Restricted Definitive Note is Being Transferred Pursuant to an Exemption From the Registration Requirements of the Securities Act in Accordance With Rule 144, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(A) Thereof; (E) If Such Restricted Definitive Note is Being Transferred to an Institutional Accredited Investor in Reliance On an Exemption From the Registration Requirements of the Securities Act Other Than Those Listed in Clauses (B) Through (D) Above, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications, Certificates and Opinion of Counsel Required by Item (3)(D) Thereof, If Applicable; (F) If Such Restricted Definitive Note is Being Transferred to the Company or Any of Its Subsidiaries, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(B) Thereof; or (G) If Such Restricted Definitive Note is Being Transferred Pursuant to an Effective Registration Statement Under the Securities Act, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(C) Thereof, the Trustee shall cancel the Restricted Definitive Note, increase or cause to be increased the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Note, in the case of clause (B) above, the 144A Global Note, in the case of clause (C) above, the Regulation S Global Note, and in all other cases, the IAI Global Note. (ii) Restricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. a Holder of a Restricted Definitive Note May Exchange Such Note for a Beneficial Interest in an Unrestricted Global Note or Transfer Such Restricted Definitive Note to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note Only If: (A) Such Exchange or Transfer is Effected Pursuant to an Exchange Offer in Accordance With the Applicable Registration Rights Agreement and the Holder, in the Case of an Exchange, or the Transferee, in the Case of a Transfer, Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; (B) Such Transfer is Effected Pursuant to an Effective Shelf Registration Statement in Accordance With the Applicable Registration Rights Agreement; (C) Such Transfer is Effected by a Broker-dealer Pursuant to an Effective Exchange Offer Registration Statement in Accordance With the Applicable Registration Rights Agreement and the Transferee Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; or 32 (D) the Registrar Receives the Following: (1) If the Holder of Such Definitive Notes Proposes to Exchange Such Notes for a Beneficial Interest in the Unrestricted Global Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (1)(C) Thereof; or (2) If the Holder of Such Definitive Notes Proposes to Transfer Such Notes to a Person Who Shall Take Delivery Thereof in the Form of a Beneficial Interest in the Unrestricted Global Note, a Certificate From Such Holder in the Form of Exhibit B Hereto, Including the Certifications in Item (4) Thereof; And, in Each Such Case Set Forth in This Clause (D), If the Registrar So Requests or If the Applicable Procedures So Require, an Opinion of Counsel in Form Reasonably Acceptable to the Registrar to the Effect That Such Exchange or Transfer is in Compliance With the Securities Act and That the Restrictions On Transfer Contained Herein and in the Private Placement Legend are No Longer Required in Order to Maintain Compliance With the Securities Act. Upon satisfaction of the conditions of any of the clauses in this Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Note. (iii) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. a Holder of an Unrestricted Definitive Note May Exchange Such Note for a Beneficial Interest in an Unrestricted Global Note or Transfer Such Unrestricted Definitive Note to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note At Any Time. Upon Receipt of a Request for Such an Exchange or Transfer, the Trustee Shall Cancel the Applicable Unrestricted Definitive Note and Increase or Cause to be Increased the Aggregate Principal Amount of One of the Unrestricted Global Notes. (iv) Transfer or Exchange of Unrestricted Definitive Notes to Beneficial Interests in Restricted Global Notes Prohibited. an Unrestricted Definitive Note Cannot be Exchanged For, or Transferred to Persons Who Take Delivery Thereof in the Form Of, Beneficial Interests in a Restricted Global Note. (V) Issuance of Unrestricted Global Notes. If Any Such Exchange or Transfer From a Definitive Note to a Beneficial Interest is Effected Pursuant to Clauses (Ii)(b), (Ii)(d) or (Iii) Above At a Time When an Unrestricted Global Note has Not Yet Been Issued, the Company Shall Issue And, Upon Receipt of an Authentication Order in Accordance With Section 2.02 Hereof, the Trustee Shall Authenticate One or More Unrestricted Global Notes in an Aggregate Principal Amount Equal to the Principal Amount of Definitive Notes So Transferred. (E) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon Request by a Holder of Definitive Notes and Such Holder's Compliance With the Provisions of This Section 2.06(E), the Registrar Shall Register the Transfer or Exchange of Definitive Notes. Prior to Such Registration of Transfer or Exchange, the Requesting Holder Shall Present or Surrender to the Registrar the Definitive Notes Duly Endorsed or Accompanied by a Written Instruction of Transfer in Form Satisfactory to the Registrar Duly Executed by Such Holder or by Its Attorney, Duly Authorized in Writing. in Addition, the Requesting Holder Shall Provide Any Additional Certifications, Documents and Information, as Applicable, Required Pursuant to the Following Provisions of This Section 2.06(E). (i) Restricted Definitive Notes to Restricted Definitive Notes. Any Restricted Definitive Note May be Transferred to and Registered in the Name of Persons Who Take Delivery Thereof in the Form of a Restricted Definitive Note If the Registrar Receives the Following: 33 (A) If the Transfer Will be Made Pursuant to Rule 144A, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications in Item (1) Thereof; (B) If the Transfer Will be Made Pursuant to Rule 903 or Rule 904, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications in Item (2) Thereof; and (C) If the Transfer Will be Made Pursuant to Any Other Exemption From the Registration Requirements of the Securities Act, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications, Certificates and Opinion of Counsel Required by Item (3) Thereof, If Applicable. (ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any Restricted Definitive Note May be Exchanged by the Holder Thereof for an Unrestricted Definitive Note or Transferred to a Person or Persons Who Take Delivery Thereof in the Form of an Unrestricted Definitive Note If: (A) Such Exchange or Transfer is Effected Pursuant to an Exchange Offer in Accordance With the Applicable Registration Rights Agreement and the Holder, in the Case of an Exchange, or the Transferee, in the Case of a Transfer, Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; (B) Any Such Transfer is Effected Pursuant to an Effective Shelf Registration Statement in Accordance With the Applicable Registration Rights Agreement; (C) Any Such Transfer is Effected by a Broker-dealer Pursuant to an Effective Exchange Offer Registration Statement in Accordance With the Applicable Registration Rights Agreement and the Transferee Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; or (D) the Registrar Receives the Following: (1) If the Holder of Such Restricted Definitive Notes Proposes to Exchange Such Notes for an Unrestricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (1)(D) Thereof; or (2) If the Holder of Such Restricted Definitive Notes Proposes to Transfer Such Notes to a Person Who Shall Take Delivery Thereof in the Form of an Unrestricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit B Hereto, Including the Certifications in Item (4) Thereof; And, in Each Such Case Set Forth in This Clause (D), If the Registrar So Requests, an Opinion of Counsel in Form Reasonably Acceptable to the Registrar and the Company to the Effect That Such Exchange or Transfer is in Compliance With the Securities Act and That the Restrictions On Transfer Contained Herein and in the Private Placement Legend are No Longer Required in Order to Maintain Compliance With the Securities Act. (iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes. a Holder of Unrestricted Definitive Notes May Transfer Such Notes to a Person Who Takes Delivery Thereof in the Form of an Unrestricted Definitive Note. Upon Receipt of a Request to Register Such a Transfer, the Registrar Shall Register the Unrestricted Definitive Notes Pursuant to the Instructions From the Holder Thereof. 34 (iv) Exchange Offer. Upon the Occurrence of an Exchange Offer in Accordance With an Applicable Registration Rights Agreement, the Company Shall Issue And, Upon Receipt of an Authentication Order in Accordance With Section 2.02, the Trustee Shall Authenticate (A) One or More Exchange Notes That are Unrestricted Global Notes in an Aggregate Principal Amount Equal to the Principal Amount of the Beneficial Interests in the Restricted Global Notes Tendered for Acceptance by Persons That Make the Certifications in the Applicable Letters of Transmittal Required by Such Registration Rights Agreement, and Accepted for Exchange in the Exchange Offer and (B) Exchange Notes That are Unrestricted Definitive Notes in an Aggregate Principal Amount Equal to the Principal Amount of the Restricted Definitive Notes Tendered for Acceptance by Persons Who Made the Foregoing Certification and Accepted for Exchange in Such Exchange Offer. Concurrently With the Issuance of Such Exchange Notes, the Trustee Shall Cause the Aggregate Principal Amount of the Applicable Restricted Global Notes to be Reduced Accordingly, and the Company Shall Execute and the Trustee Shall Authenticate and Mail or Deliver to the Persons Designated by the Holders of Restricted Definitive Notes So Accepted Unrestricted Definitive Notes in the Appropriate Principal Amount. (F) Legends. the Following Legends Shall Appear On the Face of All Global Notes and Definitive Notes Issued Under This Indenture Unless Specifically Stated Otherwise in the Applicable Provisions of This Indenture. (i) Private Placement Legend. (A) Except as Permitted by Clause (B) Below, Each Global Note and Each Definitive Note (And All Notes Issued in Exchange Therefor or Substitution Thereof) Shall Bear the Legend in Substantially the Following Form: "THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD AS MAY BE PRESCRIBED BY RULE 144(K) (OR ANY SUCCESSOR PROVISION THEREOF UNDER THE SECURITIES ACT) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR ANY PREDECESSOR OF THIS SECURITY) AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY OR ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE OF THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, PURSUANT TO RULE 904 OF REGULATION S, (E) TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND THE 35 SECURITIES LAWS OF ANY OTHER JURISDICTION, INCLUDING OF ANY STATE OF THE UNITED STATES OR ANY PROVINCE OF CANADA, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. (B) Notwithstanding the Foregoing, All of the Initial Notes, and Any Global Note or Definitive Note Representing Notes Issued Pursuant to Clauses (B)(iv), (C)(ii), (C)(iii), (D)(ii), (D)(iii), (E)(ii), (E)(iii) or (E)(iv) of This Section 2.06 (And All Notes Issued in Exchange Therefor or Substitution Thereof) Shall Not Bear the Private Placement Legend; (ii) Global Note Legend. Each Global Note Shall Bear a Legend in Substantially the Following Form: "THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN." (g) Cancellation And/or Adjustment of Global Notes. At Such Time as All Beneficial Interests in a Particular Global Note Have Been Exchanged for Definitive Notes or a Particular Global Note has Been Redeemed, Repurchased or Cancelled in Whole and Not in Part, Each Such Global Note Shall be Returned to or Retained and Cancelled by the Trustee in Accordance With Section 2.11 Hereof. At Any Time Prior to Such Cancellation, If Any Beneficial Interest in a Global Note is Exchanged for or Transferred to a Person Who Will Take Delivery Thereof in the Form of a Beneficial Interest in Another Global Note or for Definitive Notes, the Principal Amount of Notes Represented by Such Global Note Shall be Reduced Accordingly and an Endorsement Shall be Made On Such Global Note by the Trustee or by the Depositary At the Direction of the Trustee to Reflect Such Reduction; and If the Beneficial Interest is Being Exchanged for or Transferred to a Person Who Will Take Delivery Thereof in the Form of a Beneficial Interest in Another Global Note, Such Other Global Note Shall be Increased Accordingly and an Endorsement Shall be Made On Such Global Note by the Trustee or by the Depositary At the Direction of the Trustee to Reflect Such Increase. (h) General Provisions Relating to Transfers and Exchanges. (i) to Permit Registrations of Transfers and Exchanges, the Company Shall Execute And, Upon Receipt of an Authentication Order in Accordance With Section 2.02, the Trustee Shall Authenticate Global Notes and Definitive Notes Upon the Company's Order or At the Registrar's Request. 36 (ii) No Service Charge Shall be Made to a Holder of a Beneficial Interest in a Global Note or to a Holder of a Definitive Note for Any Registration of Transfer or Exchange, But the Company May Require Payment of a Sum Sufficient to Cover Any Transfer Tax or Similar Governmental Charge Payable in Connection Therewith (Other Than Any Such Transfer Taxes or Similar Governmental Charge Payable Upon Exchange or Transfer Pursuant to Sections 2.07, 3.06, 4.12, 4.17 and 9.05 Hereof). (iii) All Global Notes and Definitive Notes Issued Upon Any Registration of Transfer or Exchange of Global Notes or Definitive Notes Shall be the Valid Obligations of the Company, Evidencing the Same Debt, and Entitled to the Same Benefits Under This Indenture, as the Global Notes or Definitive Notes Surrendered Upon Such Registration of Transfer or Exchange. (iv) Neither the Registrar Nor the Company Shall be Required (A) to Issue, to Register the Transfer of or to Exchange Any Notes During a Period Beginning At the Opening of Business 15 Days Before the Day of Any Selection of Notes for Redemption Under Section 3.02 Hereof and Ending At the Close of Business On the Day of Selection, (B) to Register the Transfer of or to Exchange Any Note So Selected for Redemption in Whole or in Part, Except the Unredeemed Portion of Any Note Being Redeemed in Part or (C) to Register the Transfer of or to Exchange a Note Between a Record Date and the Next Succeeding Interest Payment Date. (v) Prior to Due Presentment for the Registration of a Transfer of Any Note, the Trustee, Any Agent and the Company May Deem and Treat the Person in Whose Name Any Note is Registered as the Absolute Owner of Such Note for the Purpose of Receiving Payment of Principal of and Interest On Such Notes and for All Other Purposes, and None of the Trustee, Any Agent or the Company Shall be Affected by Notice to the Contrary. (vi) the Trustee Shall Authenticate Global Notes and Definitive Notes in Accordance With the Provisions of Section 2.02 Hereof. (vii) All Certifications, Certificates and Opinions of Counsel Required to be Submitted to the Registrar Pursuant to This Section 2.06 to Effect a Registration of Transfer or Exchange May be Submitted by Facsimile. (viii) the Trustee is Hereby Authorized to Enter Into a Letter of Representation With the Depositary in the Form Provided by the Company and to Act in Accordance With Such Letter. (ix) 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 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. Section 2.07. Temporary Notes. ---------------- Pending the preparation of Definitive Notes, the Company may execute, and upon receipt of a Company Order the Trustee shall authenticate and deliver, temporary Definitive Notes which shall be substantially in the form of Definitive Notes in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the officers executing such Notes may determine, as evidenced by their execution of such Notes. If temporary Notes are issued, the Company will cause Definitive Notes to be prepared without unreasonable delay. After the preparation of Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes upon surrender of the temporary Notes at any office or agency of the Company designated pursuant to Section 4.02, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Notes, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount of Definitive Notes of authorized denominations. Until so exchanged the temporary Notes shall in all respects be entitled to the same benefits under this Indenture as Definitive Notes. 37 Section 2.08. Mutilated, Destroyed, Lost or Stolen Notes. ------------------------------------------ If any mutilated Note is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Note of like tenor and principal amount and bearing a certificate number not contemporaneously outstanding. If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Note and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Note has been acquired by a bona fide purchaser, the Company shall execute and the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and principal amount and bearing a number not contemporaneously outstanding. In case any such mutilated, destroyed, lost or stolen Note has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Note, pay such Note. Upon the issuance of any new Note under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. Every new Note issued pursuant to this Section in lieu of any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen Note shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes. Section 2.09. Payment of Interest; Interest Rights Preserved. ---------------------------------------------- On or before any Interest Payment Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 4.01) an amount of money sufficient to pay the interest on all the Notes that is to be paid on such Interest Payment Date. Interest on any Note which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that Note is registered at the close of business on the Regular Record Date for such interest. Any interest on any Note which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called "DEFAULTED INTEREST") shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such Defaulted Interest shall be paid by the Company to the Persons in whose names the Notes (or their respective predecessor Notes) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Note and the date of the proposed payment (which date shall be a date which will enable the Trustee to comply with the provisions of the immediately following sentence), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as provided herein. The Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record 38 Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder at his address as it appears in the Note Register, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Notes (or their respective predecessor Notes) are registered at the close of business on such Special Record Date. Subject to the foregoing provisions of this Section, each Note delivered under this Indenture upon registration of transfer of, or in exchange for or in lieu of, any other Note shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note. Section 2.10. Persons Deemed Owners. ---------------------- Prior to due presentment of a Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Note is registered as the owner of such Note for the purpose of receiving payment of principal of and (subject to Section 2.09) interest on such Note and for all other purposes whatever, whether or not such Note be overdue, and neither the Company nor the Trustee shall be affected by notice to the contrary. Section 2.11. Cancellation. ------------- All Notes surrendered for payment, redemption, registration of transfer or exchange shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly canceled by it. The Company may at any time deliver to the Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever, and all Notes so delivered shall be promptly canceled by the Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes canceled as provided in this Section, except as expressly permitted by this Indenture. All canceled Notes held by the Trustee shall be disposed of by the Trustee in accordance with its customary procedures. Section 2.12. CUSIP or ISIN Numbers. ---------------------- Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures ("CUSIP"), the Company may cause CUSIP numbers to be printed on the Notes and may direct the Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders of Notes. No representation is made as to the accuracy of the CUSIP numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. The Company will promptly notify the Trustee of any change in the CUSIP numbers. Section 2.13. Outstanding Notes. ------------------ (a) the Notes Outstanding At Any Time are All the Notes Authenticated by the Trustee Except for Those Cancelled by It, Those Delivered to It for Cancellation, Those Reductions in the Interest in a Global Note Effected by the Trustee in Accordance With the Provisions Hereof, and Those Described in This Section 2.13 as Not Outstanding. Except as Set Forth in Section 2.14 Hereof, a Note Does Not Cease to be Outstanding Because the Company or an Affiliate of the Company Holds the Note; However, Notes Held by the Company or a Subsidiary of the Company Shall Not be Deemed to be Outstanding for Purposes of Section 3.07(D) Hereof. (b) If a Note is Replaced Pursuant to Section 2.07 Hereof, It Ceases to be Outstanding Unless the Trustee Receives Proof Satisfactory to It That the Replaced Note is Held by a Bona Fide Purchaser. (c) If the Principal Amount of Any Note is Considered Paid Under Section 4.01 Hereof, It Ceases to be Outstanding and Interest On It Ceases to Accrue. (d) If the Paying Agent (Other Than the Company, a Subsidiary or an Affiliate of Any Thereof) Holds, On a Redemption Date or Maturity Date, Money Sufficient to Pay Notes Payable On That Date, Then On and After That Date Such Notes Shall be Deemed to be No Longer Outstanding and Shall Cease to Accrue Interest. 39 Section 2.14. Treasury Notes. --------------- In determining whether the Holders of the required principal amount of Notes have concurred in any direction, amendment, supplement, waiver or consent, Notes owned by the Company or by any Affiliate of the Company shall be considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, amendment, supplement, waiver or consent, only Notes that the Trustee knows are so owned shall be so disregarded. ARTICLE 3. REDEMPTION AND PREPAYMENT ------------------------- Section 3.01. Notices to Trustee. ------------------- If the Company elects to redeem Notes pursuant to the optional redemption provisions of Section 3.07 hereof and paragraph 5 of the Notes, it shall furnish to the Trustee, at least 30 days but not more than 60 days before a redemption date unless a shorter notice shall be satisfactory to the Trustee, an Officers' Certificate setting forth (i) the clause of this Indenture pursuant to which the redemption shall occur, (ii) the redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the redemption price. Any such notice may be cancelled at any time prior to notice of such redemption being mailed to any Holder and shall, therefore, be void and of no effect. 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 shall select the Notes to be redeemed among the Holders of the Notes in compliance with any applicable depositary and legal requirements and the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis, at random or in accordance with any other method the Trustee considers fair and appropriate. In the event of partial redemption at random, the particular Notes to be redeemed shall be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the redemption date by the Trustee from the outstanding Notes not previously called for redemption. The Trustee shall promptly notify the Company in writing of the Notes selected for redemption and, in the case of any Note selected for partial redemption, the principal amount thereof to be redeemed. Notes and portions of Notes selected shall be in amounts of $1,000 or whole multiples of $1,000; except that if all of the Notes of a Holder are to be redeemed, the entire outstanding amount of Notes held by such Holder, even if not a multiple of $1,000, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. Section 3.03. Notice of Redemption. --------------------- At least 30 days but not more than 60 days before a redemption date, the Company shall mail or cause to be mailed, by first class mail, a notice of redemption to each Holder whose Notes are to be redeemed at its registered address. The notice shall identify the Notes to be redeemed and shall state: (a) the Redemption Date; (b) the Redemption Price or If the Redemption is Made Pursuant to Section 3.07(C) a Calculation of the Redemption Price; (c) 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 Upon Surrender of Such Note, a New Note or Notes in Principal Amount Equal to the Unredeemed Portion Shall be Issued Upon Cancellation of the Original Note; 40 (d) the Name and Address of the Paying Agent; (e) That Notes Called for Redemption Must be Surrendered to the Paying Agent to Collect the Redemption Price; (f) That, Unless the Company Defaults in Making Such Redemption Payment, Interest On Notes Called for Redemption Ceases to Accrue On and After the Redemption Date; (g) the Paragraph of the Notes or Section of This Indenture Pursuant to Which the Notes Called for Redemption are Being Redeemed; and (h) That No Representation is Made as to the Correctness or Accuracy of the Cusip Number, If Any, Listed in Such Notice or Printed On the Notes. At the Company's request, the Trustee shall give the notice of redemption in the Company's name and at its expense; provided, however, that the Company shall have delivered to the Trustee, at least 45 days, or such shorter period allowed by the Trustee, prior to the redemption date, an Officers' Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in this Section 3.03. Section 3.04. Effect of Notice of Redemption. ------------------------------- Once notice of redemption is mailed in accordance with Section 3.03 hereof, Notes called for redemption become irrevocably due and payable on the redemption date at the redemption price subject to satisfaction of any conditions specified in such notice. Section 3.05. Deposit of Redemption Price. ---------------------------- On or before 11:00 a.m. Eastern time on any redemption date, the Company shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption price of and accrued interest on all Notes (or portions of Notes) to be redeemed on that date. The Trustee or the Paying Agent shall promptly return to the Company any money deposited with the Trustee or the Paying Agent by the Company in excess of the amounts necessary to pay the redemption price of, and accrued interest on, all Notes to be redeemed. If the Company complies with the provisions of the preceding paragraph, on and after the redemption date, interest shall cease to accrue on the Notes or the portions of Notes called for redemption, whether or not such Notes are presented for payment. If a Note is redeemed on or after a Regular Record Date but on or prior to the related Interest Payment Date, then any accrued and unpaid interest shall be paid to the Person in whose name such Note was registered at the close of business on such Regular Record Date. If any Note called for redemption shall not be so paid upon surrender for redemption because of the failure of the Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal from the redemption date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.01 hereof. Section 3.06. Notes Redeemed in Part. ----------------------- Upon surrender of a Note that is redeemed in part, the Company shall issue and, upon the Company's written request, the Trustee shall authenticate for the Holder at the expense of the Company a new Note equal in principal amount to the unredeemed portion of the Note surrendered. Section 3.07. Optional Redemption. -------------------- (a) From the Issue Date Through [ ], 2004,(6) the Company May Redeem All or Any Portion of the Notes, At Once or Over Time, At a Redemption Price (Expressed as a Percentage of Principal Amount) Equal to 100.0% of the Principal Amount of the Notes to be Redeemed, Plus Accrued and Unpaid Interest to the Redemption Date (Subject to the Right of Holders of Record On the Relevant Record Date to Receive Interest Due On the Relevant Interest Payment Date). - ----------------------- (6) 180 days after the Issue Date. 41 (b) At Any Time and From Time to Time During the Twelve-month Period Commencing On [ ] of the Years Indicated Below, the Company May Redeem All or Any Portion of the Notes At the Redemption Prices (Expressed as Percentages of Principal Amount) Set Forth Below, Plus Accrued and Unpaid Interest On the Notes Redeemed, to the Applicable Redemption Date (Subject to the Right of Holders of Record On the Relevant Record Date to Receive Interest Due On the Relevant Interest Payment Date): Year Percentage ---- ---------- 2007..............................................[ ]%(7) 2008..............................................[ ]% 2009 and thereafter...............................[100.0]% (c) At Any Time and From Time to Time Prior to [ ], 20___,(8) the Company May Redeem Up to 35.0% of the Aggregate Principal Amount of the Notes Issued Under This Indenture At a Redemption Price (Expressed as a Percentage of Principal Amount) Equal to [ ]%(9) of the Principal Amount Thereof, Plus Accrued and Unpaid Interest to the Redemption Date (Subject to the Right of Holders of Record On the Relevant Record Date to Receive Interest Due On the Relevant Interest Payment Date) With the Net Cash Proceeds of One or More Equity Offerings by the Company or the Direct or Indirect Parent of the Company (To the Extent, in the Case of the Direct or Indirect Parent, That the Net Cash Proceeds of the Equity Offerings are Contributed to the Common or Non-redeemable Preferred Equity Capital That is Not Convertible or Exchangeable for Debt or Disqualified Stock of the Company); Provided, However, That After Giving Effect to Any Such Redemption, At Least 65.0% of the Aggregate Principal Amount of the Notes Initially Issued Under This Indenture (Excluding Notes Held by the Company and Its Subsidiaries) Remains Outstanding Immediately After Giving Effect to Such Redemption. Any Such Redemption Shall be Made Within 75 Days of Such Equity Offering Upon Not Less Than 30 Nor More Than 60 Days' Prior Notice. (d) Any Prepayment Pursuant to This Section 3.07 Shall be Made Pursuant to the Provisions of Sections 3.01 Through 3.06 Hereof. Section 3.08. Mandatory Redemption. --------------------- Except as set forth in Sections 4.12 and 4.17 hereof, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Notes. Section 3.09. Offer To Purchase. ------------------ (a) in the Event That, Pursuant to Section 4.12 or 4.17 Hereof, the Company Shall be Required to Commence a Prepayment Offer or a Change of Control Offer (Each, an "Offer to Purchase"), It Shall Follow the Procedures Specified Below. (b) the Company Shall Cause a Notice of the Offer to Purchase to be Sent At Least Once to the Dow Jones News Service or Similar Business News Service in the United States. (c) the Company Shall Commence the Offer to Purchase by Sending, by First Class Mail, a Notice to the Trustee and Each of the Holders, With a Copy to the Trustee. the Notice Shall Contain All Instructions and Materials Necessary to Enable Such Holders to Tender Notes Pursuant to the Offer to Purchase. the Notice, Which Shall Govern the Terms of the Offer to Purchase, Shall State: - -------------------------------- (7) The initial redemption price under Section 3.07(b) will be par plus 50.0% of the coupon. (8) The third anniversary of the Issue Date. (9) Par plus coupon. 42 (i) That the Offer to Purchase is Being Made Pursuant to This Section 3.09 and Section 4.12 or Section 4.17, as the Case May Be, And, in the Case of a Change of Control Offer, That a Change of Control has Occurred, the Circumstances and Relevant Facts Regarding the Change of Control and That a Change of Control Offer is Being Made Pursuant to Section 4.17; (ii) the Principal Amount of Notes Required to be Purchased Pursuant to Section 4.12 or Section 4.17, as the Case May be (The "Offer Amount"), the Purchase Price Set Forth in Section 4.12 or Section 4.17 Hereof, as Applicable (Including a Breakdown of the Portion of Such Purchase Price Attributable to Principal and Interest) (The "Purchase Price"), the Offer Period and the Purchase Date (Each as Defined Below); (iii) Except as Provided in Clause (Ix), That All Notes Timely Tendered and Not Withdrawn Shall be Accepted for Payment; (iv) That Any Note Not Tendered or Accepted for Payment Shall Continue to Accrue Interest; (v) That, Unless the Company Defaults in Making Such Payment, Any Note Accepted for Payment Pursuant to the Offer to Purchase Shall Cease to Accrue Interest After the Purchase Date; (vi) That Holders Electing to Have a Note Purchased Pursuant to an Offer to Purchase May Elect to Have Notes Purchased in Integral Multiples of $1,000 Only; (vii) That Holders Electing to Have a Note Purchased Pursuant to Any Offer to Purchase Shall be Required to Surrender the Note, With the Form Entitled "Option of Holder to Elect Purchase" On the Reverse of the Note Completed, or Transfer by Book-entry Transfer, to the Company, a Depositary, If Appointed by the Company, or a Paying Agent At the Address Specified in the Notice At Least Three Days Before the Purchase Date; (viii) That Holders Shall be Entitled to Withdraw Their Election If the Company, the Depositary or the Paying Agent, as the Case May Be, Receives, Not Later Than the Expiration of the Offer Period, a Telegram, Facsimile Transmission or Letter Setting Forth the Name of the Holder, the Principal Amount of the Note the Holder Delivered for Purchase and a Statement That Such Holder is Withdrawing His Election to Have Such Note Purchased; (ix) That, in the Case of a Prepayment Offer, If the Aggregate Principal Amount of Notes Surrendered by Holders Exceeds the Offer Amount, the Company Shall Select the Notes to be Purchased On a Pro Rata Basis (With Such Adjustments as May be Deemed Appropriate by the Company So That Only Notes in Denominations of $1,000 or Integral Multiples Thereof Shall be Purchased); (x) That Holders Whose Notes Were Purchased Only in Part Shall be Issued New Notes Equal in Principal Amount to the Unpurchased Portion of the Notes Surrendered (Or Transferred by Book-entry Transfer); and (xi) Any Other Procedures the Holders Must Follow in Order to Tender Their Notes (Or Portions Thereof) for Payment and the Procedures That Holders Must Follow in Order to Withdraw an Election to Tender Notes (Or Portions Thereof) for Payment. (d) the Offer to Purchase Shall Remain Open for a Period of 20 Business Days Following Its Commencement and No Longer, Except to the Extent That a Longer Period is Required by Applicable Law (The "Offer Period"). No Later Than Five Business Days (And in Any Event No Later Than the 60Th Day Following the Change of Control) After the Termination of the Offer Period (The "Purchase Date"), the Company Shall Purchase the Principal Amount of Notes Required to be Purchased Pursuant to Section 4.12 or Section 4.17 Hereof (The "Offer Amount") Or, If Less Than the Offer Amount has Been Tendered, All Notes Tendered in Response to the Offer to Purchase. Payment for Any Notes So Purchased Shall be Made in the Same Manner as Interest Payments are Made. 43 (e) On or Prior to the Purchase Date, the Company Shall, to the Extent Lawful: (i) Accept for Payment (On a Pro Rata Basis to the Extent Necessary in Connection With a Prepayment Offer), the Offer Amount of Notes or Portions of Notes Properly Tendered and Not Withdrawn Pursuant to the Offer to Purchase, or If Less Than the Offer Amount has Been Tendered, All Notes Tendered; (ii) Deposit With the Paying Agent Funds in an Amount Equal to the Purchase Price in Respect of All Notes or Portions of Notes Properly Tendered; and (iii) Deliver or Cause to be Delivered to the Trustee the Notes Properly Accepted Together With an Officers' Certificate Stating the Aggregate Principal Amount of Notes or Portions of Notes Being Purchased by the Company and That Such Notes or Portions Thereof Were Accepted for Payment by the Company in Accordance With the Terms of This Section 3.09. (f) the Paying Agent Shall Promptly (But in the Case of a Change of Control Not Later Than 60 Days From the Date of the Change of Control) Execute and Issue a New Note, And, Upon Receipt of an Authentication Order in Accordance With Section 2.02 Hereof, the Trustee Shall Authenticate and Deliver (Or Cause to be Transferred by Book-entry) Such New Note to Such Holder, in a Principal Amount Equal to Any Unpurchased Portion of the Note Surrendered; Provided, However, That Each Such New Note Shall be in a Principal Amount of $1,000 or an Integral Multiple Thereof. Any Note Not So Accepted Shall be Promptly Mailed or Delivered by the Company to the Holder Thereof. (g) If the Purchase Date is On or After a Regular 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 Regular Record Date, and No Additional Interest Shall be Payable to Holders Who Tender Notes Pursuant to the Offer to Purchase. (h) the Company Shall Comply, to the Extent Applicable, With the Requirements of Rule 14E-1 Under the Exchange Act and Any Other Securities Laws and Regulations Thereunder to the Extent Those Laws and Regulations are Applicable in Connection With the Offer to Purchase. to the Extent That the Provisions of Any Securities Laws or Regulations Conflict With Sections 4.12 or 4.17, as Applicable, This Section 3.09 or Other Provisions of This Indenture, the Company Shall Comply With Applicable Securities Laws and Regulations and Shall Not be Deemed to Have Breached Its Obligations Under Sections 4.12 or 4.17, as Applicable, This Section 3.09 or Such Other Provision by Virtue of Such Compliance. (i) Other Than as Specifically Provided in This Section 3.09, Any Purchase Pursuant to This Section 3.09 Shall be Made in Accordance With the Provisions of Section 3.01 Through 3.06 Hereof. ARTICLE 4. COVENANTS --------- Section 4.01. Payment of Notes; Money for Note Payments to be Held in Trust. ------------------------------------------------------------- (a) The Company shall pay or cause to be paid the principal of, premium, if any, and interest on, the Notes on the dates and in the manner provided in the Notes. Principal, premium, if any, and interest shall be considered paid on the date due if the Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 11:00 a.m. Eastern Time on the due date money deposited by the Company in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest then due. The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is [1.0]% per annum in excess of 44 the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods), from time to time on demand at the same rate to the extent lawful. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. (b) If the Company shall at any time act as its own Paying Agent, it will, on or before each due date of the principal of, or interest on any of the Notes, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal or interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act. Whenever the Company shall have one or more Paying Agents, it will, prior to each due date of the principal of, or interest on any of the Notes, deposit with a Paying Agent a sum sufficient to pay the principal or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act. The Company will cause each Paying Agent other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will: (1) Hold All Sums Held by It for the Payment of the Principal of or Interest On Notes in Trust for the Benefit of the Persons Entitled Thereto Until Such Sums Shall be Paid to Such Persons or Otherwise Disposed of as Herein Provided; (2) Give the Trustee Notice of Any Default by the Company (Or Any Other Obligor Upon the Notes) in the Making of Any Payment of Principal or Interest; and (3) At Any Time During the Continuance of Any Such Default, Upon the Written Request of the Trustee, Forthwith Pay to the Trustee All Sums So Held in Trust by Such Paying Agent. The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money. Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of or interest on any Note and remaining unclaimed for two years after such principal or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in the Borough of Manhattan, The City of New York, New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company. 45 Section 4.02. Maintenance of Office or Agency. -------------------------------- (a) the Company Shall Maintain an Office or Agency (Which May be an Office or Drop Facility of the Trustee or an Affiliate of the Trustee, Registrar or Co-registrar) Where Notes May be Presented or Surrendered for Registration of Transfer or for Exchange and Where Notices and Demands to or Upon the Company in Respect of the Notes and This Indenture May be Served. the Company Shall Give Prompt Written Notice to the Trustee of the Location, and Any Change in the Location, of Such Office or Agency. If At Any Time the Company Shall Fail to Maintain Any Such Required Office or Agency or Shall Fail to Furnish the Trustee With the Address Thereof, Such Presentations, Surrenders, Notices and Demands May be Made or Served At the Corporate Trust Office of the Trustee, and the Company Hereby Appoints the Trustee as Its Agent to Receive All Such Presentations, Surrenders, Notices and Demands. (b) the Company May Also From Time to Time Designate One or More Other Offices or Agencies Where the Notes May be Presented or Surrendered for Any or All Such Purposes and May From Time to Time Rescind Such Designations. the Company Shall Give Prompt Written Notice to the Trustee of Any Such Designation or Rescission and of Any Change in the Location of Any Such Other Office or Agency. (c) the Company Hereby Designates the Corporate Trust Office of the Trustee, as One Such Office, Drop Facility or Agency of the Company in Accordance With Section 2.04. Section 4.03. Reports. ------- (a) Notwithstanding That the Company May Not be Subject to the Reporting Requirements of Section 13 or 15(D) of the Exchange Act, So Long as Any Notes are Outstanding the Company Shall File With the Commission, to the Extent Such Submissions are Accepted for Filing With the Commission, and Shall Furnish to the Trustee, Within 15 Days After It is or Would Have Been Required to be Filed With the Commission: (i) All Quarterly and Annual Financial Information That Would be Required to be Contained in a Filing With the Commission On Forms 10-Q and 10-K If the Company Were Required to File Such Forms, Including a "Management's Discussion and Analysis of Financial Condition and Results of Operations" And, With Respect to the Annual Information Only, a Report On the Annual Financial Statements by the Company's Certified Independent Accountants; and (ii) All Information That Would be Required to be Filed With the Commission On Form 8-K If the Company Were Required to File Such Reports. (b) Delivery of Such Reports, Information and Documents to the Trustee is for Informational Purposes Only, and the Trustee's Receipt of Such Shall Not Constitute Constructive Notice of Any Information Contained Therein or Determinable From Information Contained Therein, Including the Company's Compliance With Any of Its Covenants Hereunder (As to Which the Trustee is Entitled to Rely Exclusively On Officers' Certificates). Section 4.04. Compliance Certificate. ----------------------- (a) the Company Shall Deliver to the Trustee, Within 90 Days After the End of Each Fiscal Year, an Officers' Certificate Stating That a Review of the Activities of the Company, the Subsidiary Guarantors and Their Respective Subsidiaries During the Preceding Fiscal Year has Been Made Under the Supervision of the Signing Officers With a View to Determining Whether the Company, the Subsidiary Guarantors and Their Respective Subsidiaries Have Kept, Observed, Performed and Fulfilled Their Obligations Under This Indenture, and Further Stating, as to Each Such Officer Signing Such Certificate, That to the Best of His or Her Knowledge the Company and Its Subsidiaries Have Kept, Observed, Performed and Fulfilled Each and Every Covenant Contained in This Indenture and is Not in Default in the Performance or Observance of Any of the Terms, Provisions and Conditions of This Indenture (Or, If a Default or Event of Default Shall Have Occurred, Describing All Such Defaults or Events of Default of Which He or She May Have Knowledge and What Action the Company is Taking or Proposes to Take With Respect Thereto) and That to the Best of His or Her Knowledge No Event has Occurred and Remains in Existence by Reason of Which Payments On Account of the Principal of or Interest On the Notes is Prohibited or If Such Event has Occurred, a Description of the Event and What Action the Company is Taking or Proposes to Take With Respect Thereto. 46 (b) the Company Shall Comply With Tia Ss.314(a)(2). (c) the Company Shall Deliver to the Trustee, Within 20 Business Days After Becoming Aware of the Occurrence Thereof, Written Notice in the Form of an Officers' Certificate of Any Default or Event of Default, Its Status and What Action the Company is Taking or Proposes to Take With Respect Thereto. Section 4.05. Taxes. ----- The Company shall pay or discharge, and shall cause each of its Restricted Subsidiaries to pay or discharge, prior to delinquency, all material taxes, assessments, and governmental levies; provided that neither the Company nor any such Restricted Subsidiary shall be required to pay or discharge, or cause to be paid or discharged, any such tax, assessment, charge or claim the amount, applicability or validity of which is being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP. Section 4.06. Stay, Extension and Usury Laws. ------------------------------- The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it shall not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law has been enacted. Section 4.07. Corporate Existence. -------------------- Subject to Article 5 hereof, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect (i) its corporate existence, and the corporate, partnership or other existence of each of its Restricted Subsidiaries, in accordance with the respective organizational documents (as the same may be amended from time to time) of the Company or any such Restricted Subsidiary and (ii) the rights (charter and statutory), licenses and franchises of the Company and its Restricted Subsidiaries; provided, however, that the Company shall not be required to preserve any such right, license or franchise, or the corporate, partnership or other existence of any of its Restricted Subsidiaries, if the Board of Directors shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and its Restricted Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any material respect to the Holders of the Notes. Section 4.08. Payments for Consent. --------------------- The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or otherwise, to or for the benefit of any Holder for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes unless such consideration is offered to be paid or is paid to all Holders that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement, which time frame shall in no event be less than ten Business Days following public announcement and mailing of notice thereof to the Holders. Section 4.09. Incurrence of Additional Debt ----------------------------- The Company shall not, and shall not permit any Restricted Subsidiary to, Incur, directly or indirectly, any Debt unless, after giving effect to the application of the proceeds thereof, no Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and either: (a) Such Debt is Debt of the Company or a Restricted Subsidiary and After Giving Effect to the Incurrence of Such Debt and the Application of the Proceeds Thereof, the Consolidated Interest Coverage Ratio Would be Greater Than 2.00 to 1.00, or 47 (b) Such Debt is Permitted Debt. Accrual of interest, accrual of dividends, the accretion of accreted value, the payment of interest in the form of additional Debt and the payment of dividends in the form of additional shares of Preferred Stock will not be deemed to be an incurrence of Debt for purposes of this Section 4.09. The amount of any Debt outstanding as of any date shall be (i) the accreted value of the Debt in the case of any Debt issued with original issue discount and (ii) the principal amount or liquidation preference thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Debt. For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Debt, the U.S. dollar-equivalent principal amount of Debt denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Debt was incurred, in the case of term Debt, or first committed, in the case of revolving credit Debt; provided, that if such Debt is incurred to refinance other Debt denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Debt does not exceed the principal amount of such Debt being refinanced. Notwithstanding any other provision of this Section 4.09, the maximum amount of Debt that the Company may incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in the exchange rate of currencies. The principal amount of any Debt incurred to refinance other Debt, if incurred in a different currency from the Debt being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such Debt is denominated that is in effect on the date of such refinancing. For purposes of determining compliance with this covenant in the event that an item of Debt meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (o) of the definition of Permitted Debt or is entitled to be incurred pursuant to clause (a) of the first paragraph of this covenant, the Company shall, in its sole discretion, classify (or later reclassify in whole or in part, in its sole discretion) such item of Debt in any manner that complies with this covenant. Section 4.10. Restricted Payments. -------------------- The Company shall not make, and shall not permit any Restricted Subsidiary to make, directly or indirectly, any Restricted Payment if at the time of, and after giving effect to, such proposed Restricted Payment, (a) an Event of Default Shall Have Occurred and be Continuing, (b) the Company Could Not Incur At Least $1.00 of Additional Debt Pursuant to Clause (A) of Section 4.09 Hereof; or (c) the Aggregate Amount of Such Restricted Payment and All Other Restricted Payments Declared or Made Since the Issue Date (The Amount of Any Restricted Payment, If Made Other Than in Cash, to be Based Upon Fair Market Value as Determined in Good Faith by the Company) Would Exceed an Amount Equal to the Sum Of: (1) 50.0% of the Aggregate Amount of Consolidated Net Income Accrued During the Period (Treated as One Accounting Period) From the Beginning of the First Fiscal Quarter After the Fiscal Quarter in Which the Effective Date Occurs to the End of the Most Recent Fiscal Quarter Ending for Which Financial Statements are Available (Or If the Aggregate Amount of Consolidated Net Income for Such Period Shall be a Deficit, Minus 100.0% of Such Deficit), Plus (2) Capital Stock Sale Proceeds, Plus (3) the Sum Of: 48 (A) the aggregate net cash proceeds received by the Company or any Restricted Subsidiary from the issuance or sale after the Issue Date of convertible or exchangeable Debt that has been converted into or exchanged for Capital Stock (other than Disqualified Stock) of the Company, and (B) the aggregate amount by which Debt of the Company or any Restricted Subsidiary is reduced on the Company's consolidated balance sheet on or after the Issue Date upon the conversion or exchange of any Debt issued or sold on or prior to the Issue Date that is convertible or exchangeable for Capital Stock (other than Disqualified Stock) of the Company, excluding, in the case of clause (A) or (B): (x) any such Debt issued or sold to the Company or a Subsidiary of the Company, and (y) the aggregate amount of any cash or other Property distributed by the Company or any Restricted Subsidiary upon any such conversion or exchange, plus (4) in the Case of the Disposition or Repayment of Any Investment Constituting a Restricted Payment Made After the Issue Date, an Amount of the Net Available Cash Received Therefrom by the Company or a Restricted Subsidiary Equal to the Lesser of the Return of Capital With Respect to Such Investment and the Cost of Such Investment, in Either Case, Less the Cost of the Disposition of Such Investment; Plus (5) an Amount Equal to the Sum Of: (A) the net reduction in Investments in any Person other than the Company or a Restricted Subsidiary resulting from dividends, repayments of loans or advances or other transfers of Property, in each case to the Company or any Restricted Subsidiary from such Person, and (B) the portion (proportionate to the Company's equity interest in such Unrestricted Subsidiary) of the fair market value of the net assets of an Unrestricted Subsidiary at the time such Unrestricted Subsidiary is designated a Restricted Subsidiary as determined in good faith by the Company; provided, however, that the foregoing sum shall not exceed, in the case of any Person, the amount of Investments previously made (and treated as a Restricted Payment) by the Company or any Restricted Subsidiary in such Person. Notwithstanding the foregoing, the provisions set forth in the immediately preceding paragraph will not prohibit: (a) the Company and Any Restricted Subsidiary May Pay Dividends On Its Capital Stock Within 60 Days of the Declaration Thereof If, On Said Declaration Date, Such Dividends Could Have Been Paid in Compliance With the Indenture; Provided, However, That Such Dividend Shall be Included in the Calculation of the Amount of Restricted Payments; (b) the Incurrence, Renewal, Extension or Refinancing of Permitted Refinancing Debt; (c) the Exchange or Conversion of Any Debt of the Company or Any of Its Restricted Subsidiaries for or Into Qualified Capital Stock of the Company; 49 (d) So Long as No Event of Default Shall Have Occurred and be Continuing, Payments of Ordinary Dividends On the Company's Common Stock in an Aggregate Amount Per Year Not to Exceed $25.0 Million; (e) the Purchase, Repurchase, Redemption, Legal Defeasance, Acquisition or Retirement for Value Capital Stock of the Company or Subordinated Obligations of the Company or Any Restricted Subsidiary in Exchange For, or Out of the Proceeds of the Substantially Concurrent Sale Of, Capital Stock of the Company (Other Than Disqualified Stock and Other Than Capital Stock Issued or Sold to a Subsidiary of the Company); Provided, However, That (1) Such Purchase, Repurchase, Redemption, Legal Defeasance, Acquisition or Retirement Shall be Excluded in the Calculation of the Amount of Restricted Payments; and (2) the Capital Stock Sale Proceeds From Such Exchange or Sale Shall be Excluded From the Calculation Pursuant to Clause (C)(2) of the Preceding Paragraph of This Section 4.10; (f) Scheduled Dividends (Not Constituting a Return On Capital) On Preferred Stock of a Restricted Subsidiary or On Disqualified Stock of the Company Issued Pursuant to and in Compliance With Section 4.09 Hereof; (g) the Redemption, Repurchase, Retirement or Other Acquisition of Any Capital Stock or Subordinated Obligation of the Company or a Restricted Subsidiary in Exchange for or Out of the Net Cash Proceeds of the Substantially Concurrent Sale (Other Than to a Subsidiary of the Company) of Debt That is Subordinated to the Same Extent in Right of Payment to the Notes; Provided That the Proceeds of Such Sale of Such Indebtedness Shall Not be (And Have Not Been) Included in Clause (C) of the Preceding Paragraph of This Section 4.10; (h) Repurchases of Shares Of, or Options to Purchase Shares Of, Common Stock of the Company or Any of Its Subsidiaries (X) From Current or Former Officers, Directors or Employees of the Company or Any of Its Subsidiaries (Or Permitted Transferees of Such Current or Former Officers, Directors or Employees), Pursuant to the Terms of Agreements (Including Employment Agreements) or Plans (Or Amendments Thereto) Approved by the Board of Directors Under Which Such Individuals Purchase or Sell, or are Granted the Option to Purchase or Sell, Shares of Such Common Stock or (Y) Which are or are Intended to be Used to Satisfy Issuances of Equity Interests Upon Exercise of Employee or Director Stock Options or Exercise or Satisfaction of Other Similar Instruments Outstanding Under Employee or Director Benefit Plans of the Company or Any Subsidiary of the Company; Provided, However, That: (1) the Aggregate Amount of Such Repurchases Shall Not Exceed $1.0 Million in Any Calendar Year; and (2) No Event of Default Shall Have Occurred and be Continuing At the Time of Such Repurchase or Immediately Thereafter; (i) Repurchases of Capital Stock Deemed to Occur Upon the Exercise of Stock Options or Warrants If Such Capital Stock Represents a Portion of the Exercise Price Thereof; (j) So Long as No Event of Default Shall Have Occurred and be Continuing or Would Otherwise Result Therefrom, Payments of Intercompany Debt, the Incurrence of Which was Permitted Pursuant to Section 4.09 Hereof; (k) Payments Made to Purchase, Redeem, Defease or Otherwise Acquire or Retire for Value Any Capital Stock or Subordinated Obligation of the Company Pursuant to Provisions Requiring the Company to Offer to Purchase, Redeem, Defease or Otherwise Acquire or Retire for Value Such Capital Stock or Subordinated Obligation Upon the Occurrence of a "Change of Control" or With the Proceeds of "Asset Sales" as Defined in the Charter Provisions, Agreements or Instruments Governing Such Capital Stock or Subordinated Obligation; Provided, However, That the Company has Made a Change of Control Offer and has Purchased All Notes Tendered in Connection With That Change of Control Offer; 50 (l) Payments Required to be Made by the Plan of Reorganization; (m) Restricted Payments by the Company or Any of Its Restricted Subsidiaries Not Otherwise Permitted to be Made Under Clauses (A) Through (K) Above in an Aggregate Amount Not to Exceed $50.0 Million. Each Restricted Payment described in clauses (a), (j) and (k) of the previous sentence shall be taken into account (and the Restricted Payments described in the remaining clauses shall not be taken into account) for purposes of computing the aggregate amount of all Restricted Payments made pursuant to clause (c) of the preceding paragraph. Section 4.11. Liens. ----- The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, Incur or suffer to exist, any Lien (other than Permitted Liens) upon any of its Property (including Capital Stock of a Restricted Subsidiary), whether owned at the Issue Date or thereafter acquired, or any interest therein or any income or profits therefrom, unless it has made or will make effective provision whereby the Notes will be secured by such Lien equally and ratably with (or prior to) all other Debt of the Company or any Restricted Subsidiary secured by such Lien. Section 4.12. Asset Sales. ----------- The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Sale unless: (a) the Company or Such Restricted Subsidiary Receives Consideration At the Time of Such Asset Sale At Least Equal to the Fair Market Value of the Property Subject to Such Asset Sale (As Determined in Good Faith by the Company); and (b) At Least 75.0% of the Consideration Paid At Closing to the Company or Such Restricted Subsidiary in Connection With Such Asset Sale is in the Form of Cash or Cash Equivalents or the Assumption by the Purchaser of Liabilities of the Company or Any Restricted Subsidiary (Other Than Liabilities That are by Their Terms Subordinated to the Notes or Any Subsidiary Guarantee) as a Result of Which the Company and the Restricted Subsidiaries are No Longer Obligated With Respect to Such Liabilities and are Fully Released Therefrom, or Securities Received by the Company or Any Restricted Subsidiary From the Transferee That are Converted Within 90 Days of Receipt by the Company or Such Restricted Subsidiary Into Cash, to the Extent of the Cash Received in That Conversion. The Net Available Cash (or any portion thereof) from Asset Sales may be applied by the Company or a Restricted Subsidiary, to the extent the Company or such Restricted Subsidiary elects (or is required by the terms of any Debt): (a) to Repay Debt under Credit Facilities or, if issued, the Floating Rate Notes; or (b) to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary). Pending the final application of any such Net Available Cash, the Company or any Restricted Subsidiary may temporarily reduce the revolving credit debt under its Credit Facilities or otherwise invest such Net Available Cash in any manner that is not prohibited by the Indenture. Any Net Available Cash from an Asset Sale not applied in accordance with the preceding paragraph within 360 days from the date of the receipt of such Net Available Cash shall constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $25.0 million (taking into account income earned on such Excess Proceeds, if any), the Company will be required to make an offer to purchase (the "PREPAYMENT OFFER") the Notes which offer shall be in the amount of the Allocable Excess Proceeds, on a pro 51 rata basis according to principal amount at maturity, at a purchase price equal to 100.0% of the principal amount, plus accrued and unpaid interest, if any, to the purchase date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), in accordance with the procedures (including prorating in the event of oversubscription) set forth in Section 3.09 hereof. To the extent that any portion of the amount of Net Available Cash remains after compliance with the preceding sentence and provided that all holders of Notes have been given the opportunity to tender their Notes for purchase in accordance with the Indenture, the Company or such Restricted Subsidiary may use such remaining amount for any purpose permitted by the Indenture and the amount of Excess Proceeds will be reset to zero. The term "Allocable Excess Proceeds" will mean the product of: (a) the Excess Proceeds and (b) a fraction, (1) the Numerator of Which is the Aggregate Principal Amount of the Notes Outstanding On the Date of the Prepayment Offer, and (2) the Denominator of Which is the Sum of the Aggregate Principal Amount of the Notes Outstanding On the Date of the Prepayment Offer and the Aggregate Principal Amount of Other Debt of the Company Outstanding On the Date of the Prepayment Offer That is Pari Passu in Right of Payment With the Notes and Subject to Terms and Conditions in Respect of Asset Sales Similar in All Material Respects to the Covenant Described Hereunder and Requiring the Company to Make an Offer to Purchase Such Debt At Substantially the Same Time as the Prepayment Offer. Within five business days after the Company is obligated to make a Prepayment Offer as described in the preceding paragraph, the Company shall send a written notice, by first-class mail, to the holders of Notes, accompanied by such information regarding the Company and its Subsidiaries as the Company in good faith believes will enable such holders to make an informed decision with respect to such Prepayment Offer. Such notice shall comply with the applicable requirements of Section 3.09 and shall contain all instructions and materials necessary to enable such holders to tender the Notes pursuant to the Prepayment Offer and state, among other things, the purchase price and the purchase date. The Company will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Section 4.12. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.12, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the covenant described hereunder by virtue thereof. Section 4.13. Restrictions on Distributions from Restricted Subsidiaries. ---------------------------------------------------------- The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or suffer to exist any consensual restriction on the right of any Restricted Subsidiary to: (a) Pay Dividends, in Cash or Otherwise, or Make Any Other Distributions On or in Respect of Its Capital Stock, or Pay Any Debt or Other Obligation Owed, to the Company or Any Other Restricted Subsidiary, (b) Make Any Loans or Advances to the Company or Any Other Restricted Subsidiary or (c) Transfer Any of Its Property to the Company or Any Other Restricted Subsidiary. The foregoing limitations will not apply: (1) to encumbrances or restrictions existing under or by reason of applicable law or regulations; 52 (2) with respect to clauses (a), (b) and (c), to restrictions: (A) in effect on the Issue Date (after giving effect to the Plan of Reorganization); (B) relating to Debt Incurred under clause (j) of the definition of "Permitted Debt;" provided, however, that such restrictions shall not apply to the Company or any Domestic Subsidiaries; (C) relating to Debt of a Restricted Subsidiary and existing at the time it became a Restricted Subsidiary if such restriction was not created in connection with or in anticipation of the transaction or series of transactions pursuant to which such Restricted Subsidiary became a Restricted Subsidiary or was acquired by the Company, or (D) that result from the Refinancing of Debt Incurred pursuant to an agreement referred to in clause (2)(A), (B) or (C) above or in clause (3)(A) or (B) below, so long as such restriction is no less favorable to the holders of Notes than those under the agreement evidencing the Debt so Refinanced, and (3) with respect to clause (c) only, to restrictions: (A) relating to Debt that is permitted to be Incurred and secured without also securing the Notes pursuant to Sections 4.09 and 4.11 hereof that limit the right of the debtor to dispose of the Property securing such Debt, (B) encumbering Property at the time such Property was acquired by the Company or any Restricted Subsidiary, so long as such restriction relates solely to the Property so acquired and was not created in connection with or in anticipation of such acquisition, (C) resulting from customary provisions restricting subletting or assignment of leases or customary provisions in other agreements that restrict assignment of such agreements or rights thereunder, (D) any encumbrances or restrictions contained in security agreements or mortgages securing Debt of a Restricted Subsidiary to the extent such encumbrance or restriction restricts the transfer of the property subject to such security agreement or mortgage, (E) customary restrictions contained in asset sale agreements limiting the transfer of such Property pending the closing of such sale; and (4) customary restrictions contained in joint venture or similar agreements relating to Permitted Joint Ventures. Section 4.14. Affiliate Transactions. ----------------------- The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, conduct any business or enter into or suffer to exist any transaction or series of transactions (including the purchase, sale, transfer, assignment, lease, conveyance or exchange of any Property or the rendering of any service) with, or for the benefit of, any Affiliate of the Company (an "AFFILIATE TRANSACTION"), unless: (a) the Terms of Such Affiliate Transaction are No Less Favorable to the Company or Such Restricted Subsidiary, as the Case May Be, Than Those That Could be Obtained At the Time in a Comparable Arm's-length Transaction With a Person That is Not an Affiliate of the Company, 53 (b) If Such Affiliate Transaction Involves Aggregate Payments or Value in Excess of $5.0 Million, the Board of Directors (Including a Majority of the Disinterested Members of the Board of Directors) Approves Such Affiliate Transaction as Evidenced by a Board Resolution Promptly Delivered to the Trustee, and (c) If Such Affiliate Transaction Involves Aggregate Payments or Value in Excess of $15.0 Million, the Company Obtains a Written Opinion From an Independent Financial Advisor to the Effect That the Consideration to be Paid or Received in Connection With Such Affiliate Transaction is Fair, From a Financial Point of View, to the Company and the Restricted Subsidiaries. Notwithstanding the Foregoing Limitation, the Company or Any Restricted Subsidiary May Enter Into or Suffer to Exist the Following: (a) Any Transaction or Series of Transactions Between the Company and One or More Restricted Subsidiaries or Between Two or More Restricted Subsidiaries If Such Transaction is Not Otherwise Prohibited by the Terms of This Indenture; (b) Any Restricted Payment Permitted to be Made Pursuant to Section 4.10 Hereof; (c) the Payment of Compensation (Including Amounts Paid Pursuant to Employee Benefit Plans) and the Entering Into of Employee Benefit and Indemnification Arrangements for the Personal Services of Officers, Directors and Employees of the Company or Any of the Restricted Subsidiaries, So Long as the Board of Directors in Good Faith Shall Have Approved the Terms Thereof; (d) Loans and Advances to Employees Made in the Ordinary Course of Business of the Company or Such Restricted Subsidiary, as the Case May Be, So Long as Such Loans and Advances Do Not Exceed $5.0 Million in the Aggregate At Any One Time Outstanding; (e) Any Agreement as in Effect as of the Issue Date (Or Otherwise Contemplated by the Plan of Reorganization) or Any Amendment Thereto or Any Transaction Contemplated Thereby (Including Pursuant to Any Amendment Thereto) or in Any Replacement Agreement Thereto So Long as Any Such Amendment or Replacement Agreement is Not More Disadvantageous to the Holders of the Notes in Any Material Respect Than the Original Agreement as in Effect On the Issue Date; and (f) the Issuance and Sale of Any Qualified Capital Stock of the Company. Section 4.15. Sale and Leaseback Transactions. -------------------------------- The Company shall not, and shall not permit any Restricted Subsidiary to, enter into any Sale and Leaseback Transaction with respect to any Property unless the Company or such Restricted Subsidiary would be entitled to: (a) Incur Debt in an Amount Equal to the Attributable Debt With Respect to Such Sale and Leaseback Transaction Pursuant to Section 4.09 Hereof, and (b) Create a Lien On Such Property Securing Such Attributable Debt Without Also Securing the Notes Pursuant to Section 4.11 Hereof. Section 4.16. Designation of Restricted and Unrestricted Subsidiaries. ------------------------------------------------------- The Company's Board of Directors may designate any of its Subsidiaries, including any newly formed Subsidiary or any Person that will become a Subsidiary by way of acquisition, to be an Unrestricted Subsidiary if that designation would not cause a Default. If any of the Company's Restricted Subsidiaries is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the newly designated Unrestricted Subsidiary will be deemed to be an Investment made as of the time of that designation and will either reduce the amount available for Restricted Payments under Section 4.10(a) or 4.10(b) or reduce the amount available for future Investments under one or 54 more clauses of the definition of "Permitted Investments," as the Company determines in its sole discretion. The designation of such a Subsidiary or Person as an "Unrestricted Subsidiary" will only be permitted if, in the case of a Restricted Subsidiary, the deemed Investment would be permitted at the time the Restricted Subsidiary is designated as an Unrestricted Subsidiary and, in any case, if that Subsidiary or Person otherwise satisfies the requirements set forth in the definition of "Unrestricted Subsidiary." Any designation of a Subsidiary of the Company as an Unrestricted Subsidiary will be evidenced to the Trustee by filing with the Trustee a certified copy of the Board Resolution of the Board of Directors of the Company giving effect to such designation and an Officers' Certificate certifying that such designation complied with the preceding conditions and was permitted by Section 4.10 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture, and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Company as of such date, and, if such Indebtedness is not permitted to be incurred as of such date under Section 4.09, the Company will be in default of such covenant. The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation will be deemed to be an incurrence of Indebtedness by one of the Company's Restricted Subsidiaries of any outstanding Indebtedness of such Unrestricted Subsidiary, and such designation will only be permitted if (1) such Indebtedness is permitted under Section 4.09(a), calculated on a pro forma basis as if such designation had occurred at the beginning of the four-quarter reference period; and (2) no Default or Event of Default would be in existence following such designation. Section 4.17. REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL. ------------------------------------------------------------ (a) Upon the Occurrence of a Change of Control, the Company Shall, Within 10 Days of a Change of Control, Make an Offer (The "Change of Control Offer") Pursuant to the Procedures Set Forth in Section 3.09. Each Holder Shall Have the Right to Accept Such Offer and Require the Company to Repurchase All or Any Portion (Equal to $1,000 or an Integral Multiple of $1,000) of Such Holder's Notes Pursuant to the Change of Control Offer At a Purchase Price, in Cash, Equal to 101% of the Aggregate Principal Amount of Notes Repurchased, Plus Accrued and Unpaid Interest (The "Change of Control Purchase Price") On the Notes Repurchased, to the Purchase Date (Subject to the Right of Holders of Record On the Relevant Regular Record Date) to Receive Interest To, But Excluding, the Purchase Date). (b) Prior to Complying With Any of the Provisions of This "Change of Control " Covenant, But in Any Event Within 90 Days Following a Change of Control, the Company Will Either Repay All Outstanding Senior Debt or Obtain the Requisite Consents, If Any, Under All Agreements Governing Outstanding Senior Debt to Permit the Repurchase of Notes Required by This Covenant. the Company Will Publicly Announce the Results of the Change of Control Offer On or as Soon as Practicable After the Change of Control Payment Date. (c) the Company Will Not be Required to Make a Change of Control Offer Upon a Change of Control If a Third Party Makes the Change of Control Offer in the Manner, At the Times and Otherwise in Compliance With the Requirements Set Forth in This Indenture Applicable to a Change of Control Offer Made by the Company and Purchases All Notes Properly Tendered and Not Withdrawn Under the Change of Control Offer. Section 4.18. Future Subsidiary Guarantors. ----------------------------- the Company Shall Cause Each Person That is or Becomes a Domestic Subsidiary to Execute and Deliver to the Trustee a Supplemental Indenture Pursuant to Which Such Domestic Subsidiary Will Fully and Unconditionally Guarantee Payment of the Notes On the Same Terms and Conditions as Those Set Forth in Article 10 Hereof. Section 4.19. Covenant Suspension. -------------------- (a) During Any Period of Time (A "Suspension Period") That: 55 (i) the Notes Have Investment Grade Ratings From Both Rating Agencies; and (ii) No Default or Event of Default Shall Have Occurred and be Continuing Under This Indenture, the Company and its Restricted Subsidiaries shall be released from their obligations to comply with Sections 4.09, 4.10, 4.12, 4.13, 4.14, 4.15, 4.16 and 4.17 (collectively, the "SUSPENDED COVENANTS") but shall remain obligated to comply with the following: (iii) Sections 4.01 Through 4.08 (iv) Section 4.11; And (v) Section 4.18. (b) the Company Shall Also, Upon Reaching Investment Grade Status, Remain Obligated to Comply With Section 5.01 (Other Than Clause (E) of the First Paragraph Thereunder). (c) in the Event That the Company and the Restricted Subsidiaries are Not Subject to the Suspended Covenants for Any Period of Time as a Result of the Preceding Clause (A) And, Subsequently, One or Both of the Rating Agencies Withdraws Its Ratings or Downgrades the Ratings Assigned to the Notes Below the Required Investment Grade Ratings or a Default or Event of Default Occurs and is Continuing, Then the Company and the Restricted Subsidiaries Will Thereafter Again be Subject to the Suspended Covenants. Compliance With the Suspended Covenants With Respect to Restricted Payments Made After the Time of Such Withdrawal, Downgrade, Default or Event of Default Will be Calculated in Accordance With Section 4.10 Hereof as Though Such Covenant Had Been in Effect During the Entire Period of Time From the Issue Date; Provided, However, That There Will Not be Deemed to Have Occurred a Default or Event of Default Under the Notes With Respect to the Suspended Covenants During the Suspension Period Solely as a Result of the Company's and Its Restricted Subsidiaries' Non-compliance With the Suspended Covenants During the Suspension Period. ARTICLE 5. SUCCESSORS ---------- Section 5.01. Merger, Consolidation and Sale of Assets. ----------------------------------------- The Company shall not merge, consolidate or amalgamate with or into any other Person (other than a merger of a Restricted Subsidiary into the Company) or sell, transfer, assign, lease, convey or otherwise dispose of all or substantially all its Property in any one transaction or series of transactions unless: (a) the Company Shall be the Surviving Person (The "Surviving Person") or the Surviving Person (If Other Than the Company) Formed by Such Merger, Consolidation or Amalgamation or to Which Such Sale, Transfer, Assignment, Lease, Conveyance or Disposition is Made Shall be a Corporation Organized and Existing Under the Laws of the United States of America, Any State Thereof or the District of Columbia; (b) the Surviving Person (If Other Than the Company) Expressly Assumes, by Supplemental Indenture in Form Satisfactory to the Trustee, Executed and Delivered to the Trustee by Such Surviving Person, the Due and Punctual Payment of the Principal Of, and Premium, If Any, and Interest On, All the Notes, According to Their Tenor, and the Due and Punctual Performance and Observance of All the Covenants and Conditions of the Indenture to be Performed by the Company; (c) in the Case of a Sale, Transfer, Assignment, Lease, Conveyance or Other Disposition of All or Substantially All the Property of the Company, Such Property Shall Have Been Transferred as an Entirety or Virtually as an Entirety to One Person; 56 (d) Immediately Before and After Giving Effect to Such Transaction or Series of Transactions On a Pro Forma Basis No Default or Event of Default Shall Have Occurred and be Continuing; (e) Immediately After Giving Effect to Such Transaction or Series of Transactions On a Pro Forma Basis, the Company or the Surviving Person, as the Case May Be, Would be Able to Incur At Least $1.00 of Additional Debt Under Clause (A) of Section 4.09 Hereof; and (f) the Company Shall Deliver, or Cause to be Delivered, to the Trustee, in Form and Substance Reasonably Satisfactory to the Trustee, an Officers' Certificate and an Opinion of Counsel, Each Stating That Such Transaction and the Supplemental Indenture, If Any, in Respect Thereto Comply With This Covenant and That All Conditions Precedent Herein Provided for Relating to Such Transaction Have Been Satisfied. The Company shall not permit any Subsidiary Guarantor to merge, consolidate or amalgamate with or into any other Person (other than a merger of a Restricted Subsidiary into the Subsidiary Guarantor) or sell, transfer, assign, lease, convey or otherwise dispose of all or substantially all its Property in any one transaction or series of transactions unless: (a) the Surviving Person (If Other Than the Subsidiary Guarantor) Formed by Such Merger, Consolidation or Amalgamation or to Which Such Sale, Transfer, Assignment, Lease, Conveyance or Disposition is Made Shall be a Corporation Organized and Existing Under the Laws of the United States of America, Any State Thereof or the District of Columbia; (b) the Surviving Person (If Other Than the Subsidiary Guarantor) Expressly Assumes, by Supplemental Indenture in Form Satisfactory to the Trustee, Executed and Delivered to the Trustee by Such Surviving Person, the Due and Punctual Payment of the Principal Of, and Premium, If Any, and Interest On, All the Notes, According to Their Tenor, and the Due and Punctual Performance and Observance of All the Obligations of Such Subsidiary Guarantor Under Its Subsidiary Guarantee; (c) in the Case of a Sale, Transfer, Assignment, Lease, Conveyance or Other Disposition of All or Substantially All the Property of Such Subsidiary Guarantor, Such Property Shall Have Been Transferred as an Entirety or Virtually as an Entirety to One Person; (d) Immediately Before and After Giving Effect to Such Transaction or Series of Transactions On a Pro Forma Basis (And Treating, for Purposes of This Clause (D), Any Debt That Becomes, or is Anticipated to Become, an Obligation of the Surviving Person, the Company or Any Restricted Subsidiary as a Result of Such Transaction or Series of Transactions as Having Been Incurred by the Surviving Person, the Company or Such Restricted Subsidiary At the Time of Such Transaction or Series of Transactions), No Default or Event of Default Shall Have Occurred and be Continuing; and (e) the Company Shall Deliver, or Cause to be Delivered, to the Trustee, in Form and Substance Reasonably Satisfactory to the Trustee, an Officers' Certificate and an Opinion of Counsel, Each Stating That Such Transaction and Such Subsidiary Guarantee, If Any, in Respect Thereto Comply With This Covenant and That All Conditions Precedent Herein Provided for Relating to Such Transaction Have Been Satisfied. This Section 5.01 Shall Not Prohibit Any Subsidiary Guarantor From Consolidating With, Merging Into or Transferring All or Part of Its Assets to the Company or Any Other Subsidiary Guarantor. in Addition, the Foregoing Provisions (Other Than Clause (D) in the First Paragraph of This Section 5.01) Shall Not Apply to Any Transactions Which Constitute an Asset Sale If the Company has Complied With Section 4.12 Hereof. Section 5.02. Successor Corporation Substituted. ---------------------------------- The Surviving Person shall succeed to, and be substituted for, and may exercise every right and power of the Company under this Indenture and the predecessor Company shall be released from this Indenture, but the predecessor Company in the case of: 57 (a) a Sale, Transfer, Assignment, Conveyance or Other Disposition (Unless Such Sale, Transfer, Assignment, Conveyance or Other Disposition is of All the Assets of the Company as an Entirety), or (b) a Lease, shall not be released from any of the obligations or covenants under this Indenture, including with respect to the payment of the Notes. ARTICLE 6. DEFAULTS AND REMEDIES --------------------- Section 6.01. Events of Default. ------------------ Each of the following is an "EVENT OF DEFAULT:" (a) Failure to Make the Payment of Any Interest On the Notes When the Same Becomes Due and Payable, and Such Failure Continues for a Period of 30 Days; (b) Failure to Make the Payment of Any Principal Of, or Premium, If Any, On, Any of the Notes When the Same Becomes Due and Payable At Its Stated Maturity, Upon Acceleration, Redemption, Optional Redemption, Required Repurchase or Otherwise; (c) Failure to Comply With the Provisions of Sections 4.12, 4.17 or 5.01 Hereof; (d) Failure to Comply With Any Other Covenant or Agreement in the Notes or in the Indenture (Other Than a Failure That is the Subject of the Foregoing Clause (A), (B) or (C)) and Such Failure Continues for 60 Days After Written Notice is Given to the Company as Provided Below; (e) a Default Under Any Debt by the Company or Any Restricted Subsidiary That is a Significant Subsidiary That Results in Acceleration of the Maturity of Such Debt, or Failure to Pay Any Such Debt At Maturity, in an Aggregate Amount Greater Than $25.0 Million or Its Foreign Currency Equivalent At the Time; (f) Any Judgment or Judgments for the Payment of Money in an Aggregate Amount in Excess of $25.0 Million (Or Its Foreign Currency Equivalent At the Time) in Excess of Amounts Which are Covered by Insurance Under Applicable Policies That Shall be Rendered Against the Company or Any Restricted Subsidiary That is a Significant Subsidiary and That Shall Not be Waived, Satisfied or Discharged for Any Period of 60 Consecutive Days During Which a Stay of Enforcement Shall Not be in Effect; and (g) the Company or Any of Its Restricted Subsidiaries That are Significant Subsidiaries Pursuant to or Within the Meaning of Any Bankruptcy Law: (A) Commences a Voluntary Case; (B) Consents to the Entry of an Order for Relief Against It in an Involuntary Case; (C) Consents to the Appointment of a Custodian of It or for All or Substantially All of Its Property; (D) Makes a General Assignment for the Benefit of Its Creditors; or (E) Admits in Writing Its Inability to Pay Its Debts as They Become Due; and 58 (h) a Court of Competent Jurisdiction Enters an Order or Decree Under Any Bankruptcy Law That: (A) is for Relief Against the Company or Any of Its Significant Subsidiaries in an Involuntary Case; or (B) Appoints a Custodian of the Company or Any of Its Significant Subsidiaries or for All or Substantially All of the Property of the Company or Any of Its Significant Subsidiaries; or (C) Orders the Liquidation of the Company or Any of Its Significant Subsidiaries; and the order or decree remains unstayed and in effect for 60 consecutive days; and (i) Any Guarantee of a Subsidiary Guarantor That is a Significant Subsidiary or a Group of Subsidiary Guarantors That, Taken as a Whole, Would Constitute a Significant Subsidiary Ceases to be in Full Force and Effect (Other Than in Accordance With the Terms of Such Guarantee) or Any Subsidiary Guarantor Denies or Disaffirms Its Obligations Under Its Guarantee. Section 6.02. Acceleration. ------------- If any Event of Default (other than those of the type described in Section 6.01(g) or (h) with respect to the Company) occurs and is continuing, the Trustee may, and the Trustee upon the request of Holders of 25.0% in principal amount of the outstanding Notes will, or the Holders of at least 25.0% in principal amount of outstanding Notes may, declare the principal of all the Notes, together with all accrued and unpaid interest, premium, if any, to be due and payable by notice in writing to the Company and the Trustee specifying the respective Event of Default and that such notice is a notice of acceleration (the "ACCELERATION NOTICE"), and the same shall become immediately due and payable. In the case of an Event of Default specified in Section 6.01(g) or (h) with respect to the Company, such amount with respect to all the Notes will become due and payable immediately without any declaration or other act on the part of the Trustee or the holders of the Notes. Holders may not enforce this Indenture or the Notes except as provided in this Indenture. At any time after a declaration of acceleration with respect to the Notes, the Holders of a majority in principal amount of the Notes then outstanding (by notice to the Trustee) may rescind and cancel that declaration and its consequences if: (a) the Rescission Would Not Conflict With Any Judgment or Decree of a Court of Competent Jurisdiction; (b) All Existing Defaults and Events of Default Have Been Cured or Waived Except Nonpayment of Principal of or Interest On the Notes That has Become Due Solely by Such Declaration of Acceleration; (c) to the Extent the Payment of Such Interest is Lawful, Interest (At the Same Rate Specified in the Notes) On Overdue Installments of Interest and Overdue Payments of Principal Which has Become Due Otherwise Than by Such Declaration of Acceleration has Been Paid; (d) the Company has Paid the Trustee Its Reasonable Compensation and Reimbursed the Trustee for Its Reasonable Expenses, Disbursements and Advances; and (e) in the Event of the Cure or Waiver of an Event of Default of the Type Described in Section 6.01(G) or (H), the Trustee has Received an Officers' Certificate That Such Event of Default has Been Cured or Waived. 59 Section 6.03. Other Remedies. --------------- If an Event of Default shall have occurred and be continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium, if any, and interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture. The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law. Section 6.04. Waiver of Past Defaults. ------------------------ The Holders of a majority in principal amount of the Notes may waive by consent (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes) any then existing or potential Default, and its consequences, except a default in the payment of the principal of or interest on any Notes. In the event of any Event of Default specified in clause (e) of the first paragraph of Section 6.01, such Event of Default and all consequences of that Event of Default, including without limitation any acceleration or resulting payment default, will be annulled, waived and rescinded, automatically and without any action by the Trustee or the Holders of the Notes, if within 60 days after the Event of Default arose: (a) the Debt That is the Basis for the Event of Default has Been Discharged; (b) the Holders of That Debt Have Rescinded or Waived the Acceleration, Notice or Action, as the Case May Be, Giving Rise to the Event of Default; or (c) If the Default That is the Basis for Such Event of Default has Been Cured. When a Default or Event of Default is waived, it is deemed cured, but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any consequent right. Section 6.05. Control by Majority. -------------------- Subject to Section 7.01, Section 7.02(f) (including the Trustee's receipt of the security or indemnification described therein) and Section 7.07, in case an Event of Default shall have occurred and be continuing, the Holders of a majority in aggregate principal amount of the Notes then outstanding will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the Notes. Section 6.06. Limitation on Suits. -------------------- No Holder will have any right to institute any proceeding with respect to this Indenture, or for the appointment of a receiver or trustee, or for any remedy thereunder, unless: (a) Such Holder has Previously Given to the Trustee Written Notice of a Continuing Event of Default, (b) Holders of At Least 25.0% in Aggregate Principal Amount of the Notes Then Outstanding Have Made Written Request and Offered Reasonable Indemnity to the Trustee to Institute Such Proceeding as Trustee, and (c) the Trustee Shall Not Have Received From the Holders of a Majority in Aggregate Principal Amount of the Notes Then Outstanding a Direction Inconsistent With Such Request and Shall Have Failed to Institute Such Proceeding Within 30 Days. 60 A Holder may not use this Indenture to affect, disturb or prejudice the rights of another Holder or to obtain a preference or priority over another Holder. Section 6.07. Rights of Holders to Receive Payment. ------------------------------------- Notwithstanding any other provision of this Indenture (including, without limitation, Section 6.06), the right of any Holder to receive payment of principal, premium, if any, and interest on the Notes held by such Holder, on or after the respective due dates expressed in the Notes (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder. Section 6.08. Collection Suit by Trustee. --------------------------- If an Event of Default specified in Section 6.01 (g) or (h) occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal of, premium, if any, and interest then due and owing (together with interest on overdue principal and, to the extent lawful, interest) and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. Section 6.09. Trustee May File Proofs of Claim. --------------------------------- The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor upon the Notes), its creditors or its property and shall be entitled and empowered to participate as a member, voting or otherwise, of any official committee of creditors appointed in such matter and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims, and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To the extent that any such compensation, expenses and advances of the Trustee and its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, moneys, securities and any other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. Section 6.10. Priorities. ----------- If the Trustee collects any money pursuant to this Article 6, it shall pay out the money in the following order: First: to the Trustee, its agents and attorneys for amounts due under Section 7.07 hereof, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection; Second: to Holders for amounts due and unpaid on the Notes for principal, premium, if any, and interest ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, and interest respectively; and 61 Third: to the Company or to such party as a court of competent jurisdiction shall direct. The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10. Section 6.11. Undertaking for Costs. ---------------------- In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by the Company, a suit by a Holder pursuant to Section 6.07 hereof, or a suit by Holders of more than 10.0% in principal amount of the then outstanding Notes. ARTICLE 7. TRUSTEE ------- Section 7.01. Duties of Trustee. ------------------ (a) If an Event of Default Which the Trustee Has, or is Deemed to Have, Notice of Hereunder has Occurred and is Continuing, the Trustee Shall Exercise Such of the Rights and Powers Vested in It by This Indenture, and Use the Same Degree of Care and Skill in Its Exercise, as a Prudent Person Would Exercise or Use Under the Circumstances in the Conduct of Such Person's Own Affairs. (b) Except During the Continuance of an Event of Default: (1) the Duties of the Trustee Shall be Determined Solely by the Express Provisions of This Indenture, and the Trustee Need Perform Only Those Duties That are Specifically Set Forth in This Indenture and No Others, and No Implied Covenants or Obligations Shall be Read Into This Indenture Against the Trustee; and (2) in the Absence of Bad Faith On Its Part, the Trustee May Conclusively Rely, as to the Truth of the Statements and the Correctness of the Opinions Expressed Therein, Upon Certificates or Opinions Furnished to the Trustee and Conforming to the Requirements of This Indenture. However, the Trustee Shall Examine the Certificates and Opinions to Determine Whether or Not They Conform to the Requirements of This Indenture (But Need Not Confirm or Investigate the Accuracy of Mathematical Calculations or Other Facts Stated Therein or Otherwise Verify the Contents Thereof). (c) the Trustee May Not be Relieved From Liabilities for Its Own Negligent Action, Its Own Negligent Failure to Act, or Its Own Willful Misconduct, Except That: (1) This Paragraph Does Not Limit the Effect of Paragraph (B) of This Section; (2) the Trustee Shall Not be Liable for Any Error of Judgment Made in Good Faith by a Responsible Officer, Unless It is Proved That the Trustee was Negligent in Ascertaining the Pertinent Facts; (3) the Trustee Shall Not be Liable With Respect to Any Action It Takes or Omits to Take in Good Faith in Accordance With a Direction Received by It Pursuant to Section 6.05 Hereof; and 62 (4) No Provision of This Indenture Shall Require the Trustee to Expend or Risk Its Own Funds or Incur Any Liability. (d) Whether or Not Therein Expressly So Provided, Every Provision of This Indenture That in Any Way Relates to the Trustee is Subject to Paragraphs (A), (B) and (C) of This Section. (e) Except for Information Provided by the Trustee Concerning the Trustee, the Trustee Shall Have No Responsibility for Any Information in Any Prospectus or Other Disclosure Material Distributed With Respect to the Notes. Section 7.02. Rights of Trustee. ------------------ (a) the Trustee May Conclusively Rely Upon Any Document Believed by It to be Genuine and to Have Been Signed or Presented by the Proper Person. the Trustee Need Not Investigate Any Fact or Matter Stated in Any Such Document. Any Facsimile Signature of Any Person On a Document Required or Permitted in This Indenture to be Delivered to the Trustee Shall Constitute a Legal, Valid and Binding Execution Thereof by Such Person. (b) Before the Trustee Acts or Refrains From Acting, It May Require an Officers' Certificate or an Opinion of Counsel or Both. the Trustee Shall Not be Liable for Any Action It Takes or Omits to Take in Good Faith in Reliance On Such Officers' Certificate or Opinion of Counsel. the Trustee May Consult With Counsel, and the Written Advice of Such Counsel or Any Opinion of Counsel Shall be Full and Complete Authorization and Protection From Liability in Respect of Any Action Taken, Suffered or Omitted by It Hereunder in Good Faith and in Reliance Thereon. (c) the Trustee May Act Through Its Attorneys and Agents and Shall Not be Responsible for the Misconduct or Negligence of Any Agent Appointed With Due Care. (d) the Trustee Shall Not be Liable for Any Action It Takes or Omits to Take in Good Faith That It Believes to be Authorized or Within the Rights or Powers Conferred Upon It by This Indenture. (E) Unless Otherwise Specifically Provided in This Indenture, Any Demand, Request, Direction or Notice From the Company Shall be Sufficient If Signed by an Officer of the Company. (f) the Trustee Shall be Under No Obligation to Exercise Any of the Rights or Powers Vested in It by This Indenture At the Request or Direction of Any of the Holders Unless Such Holders Shall Have Offered to the Trustee Reasonable Security or Indemnity Against the Costs, Expenses and Liabilities That Might be Incurred by It in Compliance With Such Request or Direction. (g) the Trustee Shall Not be Deemed to Have Notice of Any Default or Event of Default Unless a Responsible Officer of the Trustee has Actual Knowledge Thereof or Unless Written Notice of Any Event Which is in Fact Such a Default or Event of Default is Received by a Responsible Officer of the Trustee At the Corporate Trust Office of the Trustee From the Company or the Holders of 25.0% in Aggregate Principal Amount of the Outstanding Notes, and Such Notice References the Specific Default or Event of Default, the Notes and This Indenture And, in the Absence of Any Such Notice, the Trustee May Conclusively Assume That No Such Default or Event of Default Exists. (h) Money Held by the Trustee in Trust Hereunder Need Not be Segregated From Other Funds Except to the Extent Required by Law. the Trustee Shall be Under No Liability for Interest On Any Money Received by It Hereunder Except as Otherwise Agreed in Writing With the Company. (i) the Trustee Shall Not be Required to Give Any Bond or Surety in Respect of the Performance of Its Power and Duties Hereunder. (j) the Trustee Shall Have No Duty to Inquire as to the Performance of the Company's Covenants Herein. 63 (k) the Trustee's Immunities and Protections From Liability and Its Right to Indemnification in Connection With the Performance of Its Duties Under This Indenture Shall Extend to the Trustee's Officers, Directors, Agents, Attorneys and Employees. Such Immunities and Protections and Right to Indemnification, Together With the Trustee's Right to Compensation, Shall Survive the Trustee's Resignation or Removal, the Defeasance or Discharge of This Indenture and Final Payment of the Notes. (l) the Right of the Trustee to Take the Actions Permitted by This Indenture Shall Not be Construed as an Obligation or Duty to Do So. Section 7.03. Individual Rights of Trustee. ----------------------------- The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest, it must eliminate such conflict within 90 days, apply to the Commission for permission to continue as Trustee or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof. Section 7.04. Trustee's Disclaimer. --------------------- The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not be accountable for the Company's use of the proceeds from the Notes or any money paid to the Company or upon the Company's direction under any provision of this Indenture, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication. Section 7.05. Notice of Defaults. ------------------- If a Default or Event of Default shall have occurred and be continuing and if it is known to the Trustee, the Trustee shall mail to Holders a notice of the Default or Event of Default within 90 days after it occurs unless such Default or Event of Default has since been cured. Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest on any Note, the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders. Section 7.06. Reports by Trustee to Holders. ------------------------------ Within 60 days after each May 15 beginning with the May 15 following the date of this Indenture, and for so long as Notes remain outstanding, the Trustee shall mail to the Holders a brief report dated as of such reporting date that complies with TIA ss.313(a) (but if no event described in TIA ss.313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA ss.313(b)(2). The Trustee shall also transmit by mail all reports as required by TIA ss.313(c). A copy of each report at the time of its mailing to the Holders shall be mailed to the Company and filed with the Commission and each stock exchange on which the Notes are listed in accordance with TIA ss.313(d). The Company shall promptly notify the Trustee when the Notes are listed on any stock exchange and any delisting thereof. Section 7.07. Compensation and Indemnity. --------------------------- The Company shall pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder as the Company and the Trustee shall agree in writing. The Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee's agents and counsel. 64 The Company shall indemnify the Trustee (in its capacity as Trustee) or any predecessor Trustee (in its capacity as Trustee) against any and all losses, claims, damages, penalties, fines, liabilities or expenses, including incidental and out-of-pocket expenses and reasonable attorneys' fees ("LOSSES") incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture, including the costs and expenses of enforcing this Indenture against the Company (including this Section 7.07) and defending itself against any claim (whether asserted by the Company or any Holder or any other person) or liability in connection with the exercise or performance of any of its powers or duties hereunder. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim, and the Trustee shall cooperate in the defense. The Trustee may have separate counsel if the Trustee has been reasonably advised by counsel that there may be one or more legal defenses available to it that are different from or additional to those available to the Company and in the reasonable judgment of such counsel it is advisable for the Trustee to engage separate counsel, and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. The Company need not reimburse any expense or indemnify against any loss incurred by the Trustee through the Trustee's own willful misconduct, gross negligence or bad faith. The obligations of the Company under this Section 7.07 shall survive the satisfaction and discharge of this Indenture, the resignation or removal of the Trustee and payment in full of the Notes. To secure the Company's payment obligations in this Section, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal, premium, if any, and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of this Indenture. When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(g) or (h) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law. Section 7.08. Replacement of Trustee. ----------------------- A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee's acceptance of appointment as provided in this Section. The Trustee may resign in writing at any time upon 30 days' prior notice to the Company and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in principal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and the Company in writing. The Company may remove the Trustee if: (a) the Trustee Fails to Comply With Section 7.10 Hereof; (b) the Trustee is Adjudged a Bankrupt or an Insolvent or an Order for Relief is Entered With Respect to the Trustee Under Any Bankruptcy Law; (c) a Custodian or Public Officer Takes Charge of the Trustee or Its Property; or (d) the Trustee Becomes Incapable of Acting. If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Company. 65 If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company, or the Holders of at least 10.0% in principal amount of the then outstanding Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee. If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.10, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. Subject to the Lien provided for in Section 7.07 hereof, the retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Company's obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee. Section 7.09. Successor Trustee by Merger, etc. --------------------------------- If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation or banking association, the successor corporation or banking association without any further act shall, if such successor corporation or banking association is otherwise eligible hereunder, be the successor Trustee. Section 7.10. Eligibility; Disqualification. ------------------------------ There shall at all times be a Trustee hereunder that is a Person organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and surplus of at least $50.0 million (or a wholly-owned subsidiary of a bank or trust company, or of a bank holding company, the principal subsidiary of which is a bank or trust company having a combined capital and surplus of at least $50.0 million) as set forth in its most recent published annual report of condition. This Indenture shall always have a Trustee who satisfies the requirements of TIA ss.310(a)(1), (2) and (5). The Trustee is subject to TIA ss.310(b). Section 7.11. Preferential Collection of Claims Against Company. ------------------------------------------------- The Trustee is subject to TIAss.311(a), excluding any creditor relationship listed in TIAss.311(b). A Trustee who has resigned or been removed shall be subject to TIAss. 311(a) to the extent indicated therein. ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE ---------------------------------------- Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance. -------------------------------------------------------- The Company may, at its option and at any time, elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance with the conditions set forth below in this Article 8. 66 Section 8.02. Legal Defeasance and Discharge. ------------------------------- Upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.02, the Company shall, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to have been discharged from its obligations with respect to all outstanding Notes on the date the conditions set forth below are satisfied (hereinafter, "LEGAL DEFEASANCE") and each Subsidiary Guarantor shall be released from all of its obligations under its Subsidiary Guarantee. For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Debt represented by the outstanding Notes, which shall thereafter be deemed to be "outstanding" only for the purposes of Section 8.05 hereof and the other Sections of this Indenture referred to in (a), (b), (c) and (d) below, and to have satisfied all its other obligations under the Notes and this Indenture (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive solely from the trust fund described in Section 8.04 hereof, and as more fully set forth in such Section, payments in respect of the principal of, premium, if any, or interest on such Notes when such payments are due, (b) the Company's obligations with respect to such Notes under Article 2 and Sections 4.01 and 4.02 hereof, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder (including claims of, or payments to, the Trustee pursuant to Section 7.07 hereunder) and the Company's and each Subsidiary Guarantor's obligations in connection therewith and (d) this Article 8. If the Company exercises under Section 8.01 hereof the option applicable to this Section 8.02, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, payment of the Notes may not be accelerated because of an Event of Default. Subject to compliance with this Article 8, the Company may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03 hereof. Section 8.03. Covenant Defeasance. -------------------- Upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, the Company shall, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be released from its obligations under the covenants contained in Section 4.03 and Sections 4.09 through 4.17 hereof, and the operation of clause (e) of the first paragraph of Section 5.01 hereof, with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.04 are satisfied (hereinafter, "COVENANT DEFEASANCE"), and each Subsidiary Guarantor shall be released from all of its obligations under its Subsidiary Guarantee with respect to such covenants in connection with such outstanding Notes, and the Notes shall thereafter be deemed not "outstanding" for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed "outstanding" for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby. If the Company exercises under Section 8.01 hereof the option applicable to this Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, payment of the Notes may not be accelerated because of an Event of Default specified in clauses (d), (e), (f) hereof or because of the Company's failure to comply with clause (e) of the first paragraph of Section 5.01 hereof. Section 8.04. Conditions to Legal or Covenant Defeasance. ------------------------------------------ The following shall be the conditions to the application of either Section 8.02 or 8.03 hereof to the outstanding Notes. The Legal Defeasance or Covenant Defeasance may be exercised only if: (a) the Company Irrevocably Deposits With the Trustee, in Trust (The "Defeasance Trust"), for the Benefit of the Holders of the Notes, Cash in U.s. Dollars, Non-callable U.s. Government Securities, or a Combination of Cash in U.s. Dollars and Non-callable U.s. Government Securities, Sufficient, in the Opinion of a Firm of Independent Public Accountants of Recognized International Standing, to Pay the Principal, Premium, If Any, and Interest On the Outstanding 67 Notes On the Stated Maturity or On the Next Available Redemption Date, as the Case May Be, and the Company Must Specify Whether the Notes are Being Defeased to Maturity or to That Particular Redemption Date; (b) in the Case of Legal Defeasance, the Company Delivers to the Trustee an Opinion of Counsel Reasonably Acceptable to the Trustee Confirming That (X) the Company has Received From, or There has Been Published By, the Internal Revenue Service a Ruling or (Y) Since the Date Hereof, There has Been a Change in the Applicable Federal Income Tax Law, in Either Case to the Effect That, and Based Thereon Such Opinion of Counsel Will Confirm That, the Holders of the Outstanding Notes Will Not Recognize Income, Gain or Loss for Federal Income Tax Purposes as a Result of Such Legal Defeasance and Will be Subject to Federal Income Tax On the Same Amounts, in the Same Manner and At the Same Times as Would Have Been the Case If Such Legal Defeasance Had Not Occurred; (c) in the Case of Covenant Defeasance, the Company Delivers to the Trustee an Opinion of Counsel Reasonably Acceptable to the Trustee Confirming That the Holders of the Outstanding Notes Will Not Recognize Income, Gain or Loss for Federal Income Tax Purposes as a Result of Such Covenant Defeasance and Will be Subject to Federal Income Tax On the Same Amounts, in the Same Manner and At the Same Times as Would Have Been the Case If Such Covenant Defeasance Had Not Occurred; (d) No Event of Default Under Sections 6.01(G) or (H) Hereof Shall Have Occurred With Respect to the Company At Any Time in the Period Ending On the 91St Day After the Cash And/or Non-callable U.s. Government Securities Have Been Deposited in the Defeasance Trust; (e) Such Legal Defeasance or Covenant Defeasance Will Not Result in a Breach or Violation Of, or Constitute a Default Under, Any Material Agreement or Instrument (Other Than This Indenture) to Which the Company or Any of Its Restricted Subsidiaries is a Party or by Which the Company or Any of Its Restricted Subsidiaries is Bound; (f) the Company Delivers to the Trustee an Opinion of Counsel, Subject to Customary Exceptions, to the Effect That On the 91St Day Following the Deposit, the Defeasance Trust Funds Will Not be Subject to the Effect of Any Applicable Bankruptcy, Insolvency, Reorganization or Similar Laws Generally Affecting Creditors' Rights; (g) the Company Delivers to the Trustee an Officers' Certificate Stating That the Deposit was Not Made by the Company With the Intent of Preferring the Holders of Notes Over the Company's Other Creditors With the Intent of Defeating, Hindering, Delaying or Defrauding Any Other Creditors of the Company; and (h) the Company Delivers to the Trustee an Officers' Certificate and an Opinion of Counsel, Each Stating That All Conditions Precedent Relating to the Legal Defeasance or the Covenant Defeasance Have Been Complied With. (i) Notwithstanding the Foregoing, the Opinion of Counsel Required by Clause (B) Above With Respect to a Legal Defeasance Need Not be Delivered If All Notes Not Theretofore Delivered to the Trustee for Cancellation (A) Have Become Due and Payable, (B) Will Become Due and Payable On the Maturity Date Within One Year or (C) as to Which a Redemption Notice has Been Given Calling the Notes for Redemption Within One Year, Under Arrangements Satisfactory to the Trustee for the Giving of Notice of Redemption by the Trustee in the Name, and At the Expense, of the Company. Section 8.05. Deposited Cash and U.S. Government Securities to Be Held --------------------------------------------------------- in Trust; Other Miscellaneous Provisions. ----------------------------------------- Subject to Section 8.06 hereof, all cash and non-callable U.S. Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.05, the "TRUSTEE") pursuant to Section 8.04 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of all sums due and to become due thereon in respect of principal, premium, if any, and interest, but such cash and securities need not be segregated from other funds except to the extent required by law. 68 The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or U.S. Government Securities deposited pursuant to Section 8.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes. Anything in this Article 8 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any cash or non-callable U.S. Government Securities held by it as provided in Section 8.04 hereof which, in the opinion of a nationally recognized firm of independent certified public accountants of recognized international standing expressed in a written certification thereof delivered to the Trustee (which may be the certification delivered under Section 8.04(a) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance. Section 8.06. Repayment to Company. --------------------- Any cash or non-callable U.S. Government Securities deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal, premium, if any, or interest on any Note and remaining unclaimed for two years after such principal, premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in The New York Times and The Wall Street Journal (national edition), notice that such cash and securities remain unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash and securities then remaining shall be repaid to the Company. Section 8.07. Reinstatement. -------------- If the Trustee or Paying Agent is unable to apply any cash or non-callable U.S. Government Securities in accordance with Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company's obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is permitted to apply all such cash and securities in accordance with Section 8.02 or 8.03 hereof, as the case may be; provided, however, that, if the Company makes any payment of principal of, premium, if any, or interest on any Note following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders to receive such payment from the cash and securities held by the Trustee or Paying Agent. ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER -------------------------------- Section 9.01. Without Consent of Holders of Notes. ------------------------------------ Notwithstanding Section 9.02 of this Indenture, the Company, the Subsidiary Guarantors and the Trustee may amend or supplement this Indenture, the Notes or the Subsidiary Guarantees without the consent of any Holder to: (a) Cure Any Ambiguity, Omission, Defect or Inconsistency; (b) Provide for the Assumption by a Successor Corporation of the Obligations of the Company Under This Indenture; 69 (c) Provide for Uncertificated Notes in Addition to or in Place of Certificated Notes (Provided That the Uncertificated Notes are Issued in Registered Form for Purposes of Section 163(F) of the Code, or in a Manner Such That the Uncertificated Notes are Described in Section 163(F)(2)(b) of the Code); (d) Add Subsidiary Guarantees or Additional Obligors With Respect to the Notes; (e) Secure the Notes; (f) Add to the Covenants of the Company for the Benefit of the Holders of the Notes or to Surrender Any Right or Power Conferred Upon the Company; (g) Make Any Other Change That Does Not Adversely Affect the Legal Rights Hereunder of Any Such Holder; or (h) Make Any Change to Comply With Any Requirement of the Commission in Order to Effect or Maintain the Qualification of This Indenture Under the Tia. Section 9.02. With Consent of Holders of Notes. --------------------------------- Except as provided below in this Section 9.02, the Company, the Subsidiary Guarantors and the Trustee may amend or supplement this Indenture, the Notes and the Subsidiary Guarantees with the consent of the Holders of a majority in principal amount of the Notes then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of Default (except a continuing Default or Event of Default in the payment of principal, premium, if any, or interest on the Notes) or compliance with any provision of this Indenture or the Notes (except for certain covenants and provisions of this Indenture which cannot be amended without the consent of each Holder) may be waived with the consent of the Holders of a majority in principal amount of the Notes then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes). Without the consent of each Holder, an amendment or waiver under this Section 9.02 may not (with respect to any Notes held by a non-consenting Holder): (a) Reduce the Principal Amount of Notes Whose Holders Must Consent to an Amendment, Supplement or Waiver or Make Any Change in the Provisions Requiring Each Holder's Consent Under This Section 9.02; (b) Reduce the Rate of or Extend the Time for Payment of Interest, Including Defaulted Interest, On Any Notes; (c) Reduce the Principal of or Extend the Fixed Maturity of Any Notes, or Change the Date On Which Any Notes May be Subject to Redemption or Repurchase, or Reduce the Redemption or Repurchase Price for Those Notes; (d) Make Any Note Payable in Money Other Than That Stated in the Note and This Indenture; (e) Impair the Right of Any Holder to Receive Payment of Principal, Premium or Interest On That Holder's Notes On or After the Due Dates for Those Payments, or to Bring Suit to Enforce That Payment On or With Respect to Such Holder's Notes; (f) Modify Sections 4.08 or 6.04 Hereof; (g) Release Any Subsidiary Guarantor From Any of Its Obligations Under Its Subsidiary Guarantee or This Indenture Other Than in Accordance With the Provisions of This Indenture, or Amend or Modify Any Provision Relating to Such Release; 70 (h) Amend This Indenture or Any Subsidiary Guarantee to Subordinate the Notes or Such Subsidiary Guarantee to Any Other Obligation of the Company or the Applicable Subsidiary Guarantor; (i) Reduce the Premium Payable Upon a Change of Control Or, At Any Time After a Change of Control has Occurred, Change the Time At Which the Change of Control Offer Relating Thereto Must be Made or At Which the Notes Must be Repurchased Pursuant to Such Change of Control Offer; (j) At Any Time After the Company is Obligated to Make a Prepayment Offer With the Excess Proceeds From Asset Sales, Change the Time or Price At Which Such Prepayment Offer Must be Made or At Which the Notes Must be Repurchased Pursuant Thereto. The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Persons entitled to consent to any supplemental indenture. If a record date is fixed, the Holders on such record date, or their duly designated proxies, and only such Persons, shall be entitled to consent to such supplemental indenture, whether or not such Holders remain Holders after such record date; provided that unless such consent shall have become effective by virtue of the requisite percentage having been obtained prior to the date which is 120 days after such record date, any such consent previously given shall automatically and without further action by any Holder be cancelled and of no further effect. It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment or waiver, but it shall be sufficient if such consent approves the substance thereof. After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Company shall mail to the Holder of each Note affected thereby to such Holder's address appearing in the Note Register a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver. Section 9.03. Compliance with Trust Indenture Act. ------------------------------------ Every amendment or supplement to this Indenture or the Notes shall be set forth in an amended or supplemental indenture that complies with the TIA as then in effect. Section 9.04. Revocation and Effect of Consents. ---------------------------------- Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or portion thereof that evidences the same debt as the consenting Holder's Note, even if notation of the consent is not made on any Note. However, any such Holder or subsequent Holder may revoke the consent as to its Note or portion thereof if the Trustee receives written notice of revocation before the date the waiver, supplement or amendment becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder. Section 9.05. Notation on or Exchange of Notes. --------------------------------- The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Company in exchange for all Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate new Notes that reflect the amendment, supplement or waiver. Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver. 71 Section 9.06. Trustee to Sign Amendments, etc. -------------------------------- The Trustee shall sign any amended or supplemental indenture authorized pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. None of the Company nor any Subsidiary Guarantor may sign an amendment or supplemental indenture until its Board of Directors approves it. In executing any amended or supplemental indenture, the Trustee shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully protected in relying upon an Officer's Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Indenture and that such amended or supplemental indenture is the legal, valid and binding obligations of the Company enforceable against it in accordance with its terms, subject to customary exceptions and that such amended or supplemental indenture complies with the provisions hereof (including Section 9.03). ARTICLE 10. GUARANTEES ---------- Section 10.01. Subsidiary Guarantees. ---------------------- Subject to this Article 10, each of the Subsidiary Guarantors hereby unconditionally guarantees to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns that: (a) the principal of, premium, if any, and interest on the Notes shall be promptly paid in full when due, subject to any applicable grace period, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of, and interest on, the Notes, if lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder shall be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration pursuant to Section 6.02 hereof, redemption or otherwise. Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Subsidiary Guarantors shall be jointly and severally obligated to pay the same immediately. Each Subsidiary Guarantor agrees that this is a guarantee of payment and not a guarantee of collection. Each Subsidiary Guarantor hereby agrees that its obligations with regard to this Subsidiary Guarantee shall be joint and several and unconditional, irrespective of the validity or enforceability of the Notes or the obligations of the Company under this Indenture, the absence of any action to enforce the same, the recovery of any judgment against the Company or any other obligor with respect to this Indenture, the Notes or the Obligations of the Company under this Indenture or the Notes, any action to enforce the same or any other circumstances (other than complete performance) that might otherwise constitute a legal or equitable discharge or defense of a Subsidiary Guarantor. Each Subsidiary Guarantor further, to the extent permitted by law, waives and relinquishes all claims, rights and remedies accorded by applicable law to guarantors and agrees not to assert or take advantage of any such claims, rights or remedies, including but not limited to: (a) any right to require any of the Trustee, the Holders or the Company (each a "BENEFITED Party"), as a condition of payment or performance by such Subsidiary Guarantor, to (1) proceed against the Company, any other guarantor (including any other Subsidiary Guarantor) of the Obligations under the Subsidiary Guarantees or any other Person, (2) proceed against or exhaust any security held from the Company, any such other guarantor or any other Person, (3) proceed against or have resort to any balance of any deposit account or credit on the books of any Benefited Party in favor of the Company or any other Person, or (4) pursue any other remedy in the power of any Benefited Party whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of the Company including any defense based on or arising out of the lack of validity or the unenforceability of the Obligations under the Subsidiary Guarantees or any agreement or instrument relating thereto or by reason of the cessation of the liability of the Company from any cause other than payment in full of the Obligations under the Subsidiary Guarantees; (c) any defense based upon any statute or rule of law that provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (d) any defense based upon any Benefited Party's errors or omissions in the administration of the Obligations under the Subsidiary Guarantees, except behavior which amounts to bad faith; (e)(1) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms of the Subsidiary Guarantees and any legal or equitable discharge of such Subsidiary 72 Guarantor's obligations hereunder, (2) the benefit of any statute of limitations affecting such Subsidiary Guarantor's liability hereunder or the enforcement hereof, (3) any rights to set-offs, recoupments and counterclaims and (4) promptness, diligence and any requirement that any Benefited Party protect, secure, perfect or insure any security interest or lien or any property subject thereto; (f) notices, demands, presentations, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance of the Subsidiary Guarantees, notices of default under the Notes or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Obligations under the Subsidiary Guarantees or any agreement related thereto, and notices of any extension of credit to the Company and any right to consent to any thereof; (g) to the extent permitted under applicable law, the benefits of any "One Action" rule and (h) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms of the Subsidiary Guarantees. Except to the extent expressly provided herein, including Sections 8.02, 8.03 and 10.05, each Subsidiary Guarantor hereby covenants that its Subsidiary Guarantee shall not be discharged except by complete performance of the obligations contained in its Subsidiary Guarantee and this Indenture. If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Subsidiary Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Subsidiary Guarantors any amount paid by either to the Trustee or such Holder, this Subsidiary Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect. Each Subsidiary Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until indefeasible payment in full of all obligations guaranteed hereby. Each Subsidiary Guarantor further agrees that, as between the Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Section 6.02 hereof for the purposes of this Subsidiary Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby and (y) in the event of any declaration of acceleration of such obligations as provided in Section 6.02 hereof, such obligations (whether or not due and payable) shall forthwith become due and payable by the Subsidiary Guarantors for the purpose of this Subsidiary Guarantee. The Subsidiary Guarantors shall have the right to seek contribution from any non-paying Subsidiary Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Subsidiary Guarantee. Section 10.02. Limitation on Subsidiary Guarantor Liability. --------------------------------------------- Each Subsidiary Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such parties that the Subsidiary Guarantee of such Subsidiary Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law or Canadian federal or provincial law to the extent applicable to any Subsidiary Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Subsidiary Guarantors hereby irrevocably agree that the obligations of such Subsidiary Guarantor under this Article 10 shall be limited to the maximum amount as shall, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Subsidiary Guarantor that are relevant under such laws, including, if applicable, its guarantee of all obligations under Credit Facilities, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary Guarantor under this Article 10, result in the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee not constituting a fraudulent transfer or conveyance. Section 10.03. Execution and Delivery of Subsidiary Guarantee. ---------------------------------------------- To evidence its Subsidiary Guarantee set forth in Section 10.01 hereof, each Subsidiary Guarantor hereby agrees that a notation of such Subsidiary Guarantee in substantially the form included in Exhibit E shall be endorsed by an Officer of such Subsidiary Guarantor on each Note authenticated and delivered by the Trustee and that this Indenture shall be executed on behalf of such Subsidiary Guarantor by an Officer of such Subsidiary Guarantor. 73 Each Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee set forth in Section 10.01 hereof shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee. If an Officer whose signature is on this Indenture or on the Subsidiary Guarantee no longer holds that office at the time the Trustee authenticates the Note on which a Subsidiary Guarantee is endorsed, the Subsidiary Guarantee shall be valid nevertheless. The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee set forth in this Indenture on behalf of the Subsidiary Guarantors. Section 10.04. Subsidiary Guarantors May Consolidate, etc. on Certain Terms. ------------------------------------------------------------- Except as otherwise provided in Section 10.05 hereof, no Subsidiary Guarantor may consolidate with or merge with or into (whether or not such Subsidiary Guarantor is the surviving Person) another Person whether or not affiliated with such Subsidiary Guarantor unless: (A) Subject to Section 10.05 Hereof, the Person Formed by or Surviving Any Such Consolidation or Merger (If Other Than a Subsidiary Guarantor or the Company) Unconditionally Assumes All the Obligations of Such Subsidiary Guarantor, Pursuant to a Supplemental Indenture in Form and Substance Reasonably Satisfactory to the Trustee On the Terms Set Forth Herein or Therein; and (B) the Subsidiary Guarantor Complies With the Requirements of Article 5 Hereof. In case of any such consolidation, merger, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the Subsidiary Guarantee endorsed upon the Notes and the due and punctual performance of all of the covenants and conditions of this Indenture to be performed by the Subsidiary Guarantor, such successor Person shall succeed to and be substituted for the Subsidiary Guarantor with the same effect as if it had been named herein as a Subsidiary Guarantor. Such successor Person thereupon may cause to be signed any or all of the Subsidiary Guarantees to be endorsed upon all of the Notes issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee. All the Subsidiary Guarantees so issued shall in all respects have the same legal rank and benefit under this Indenture as the Subsidiary Guarantees theretofore and thereafter issued in accordance with the terms of this Indenture as though all of such Subsidiary Guarantees had been issued at the date of the execution hereof. Except as set forth in Articles 4 and 5 hereof, and notwithstanding clauses (a) and (b) above, nothing contained in this Indenture or in any of the Notes shall prevent any consolidation or merger of a Subsidiary Guarantor with or into the Company or another Subsidiary Guarantor, or shall prevent any sale or conveyance of the property of a Subsidiary Guarantor as an entirety or substantially as an entirety to the Company or another Subsidiary Guarantor. Section 10.05. Releases Following Sale of Assets, Etc. --------------------------------------- In the event of (i) the redesignation of a Subsidiary Guarantor as an Unrestricted Subsidiary in accordance with the provisions of Section 4.16 of this Indenture, or (ii) a sale or other disposition of all of the assets of any Subsidiary Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the capital stock of any Subsidiary Guarantor, in each case to a Person that is not (either before or after giving effect to such transactions) a Subsidiary of the Company, then such Subsidiary Guarantor (in the event of a sale or other disposition, by way of merger, consolidation or otherwise, of all of the capital stock of such Subsidiary Guarantor) or the corporation acquiring the property (in the event of a sale or other disposition of all or substantially all of the assets of such Subsidiary Guarantor) shall be released and relieved of any obligations under its Subsidiary Guarantee; provided that, in the case of clause (ii) of this Section, the net proceeds of such sale or other disposition are applied in accordance with the applicable provisions of this Indenture, including without limitation Section 4.12 hereof. Upon delivery by the Company to the Trustee of an Officers' Certificate and an 74 Opinion of Counsel to the effect that such sale or other disposition was made by the Company in accordance with the provisions of this Indenture, including without limitation Section 4.12 or Section 4.16 hereof, as applicable, the Trustee shall execute any documents reasonably required in order to evidence the release of any Subsidiary Guarantor from its obligations under its Subsidiary Guarantee. Any Subsidiary Guarantor not released from its obligations under its Subsidiary Guarantee shall remain liable for the full amount of principal of and interest on the Notes and for the other obligations of any Subsidiary Guarantor under this Indenture as provided in this Article 10. ARTICLE 11. SATISFACTION AND DISCHARGE -------------------------- Section 11.01. Satisfaction and Discharge. This Indenture will be discharged and will cease to be of further effect, except as to surviving rights of registration of transfer or exchange of the Notes, as to all Notes issued hereunder, when: (a) Either: (i) All Notes That Have Been Previously Authenticated (Except Lost, Stolen or Destroyed Notes That Have Been Replaced or Paid and Notes for Whose Payment Money has Previously Been Deposited in Trust or Segregated and Held in Trust by the Company and is Thereafter Repaid to the Company or Discharged From the Trust) Have Been Delivered to the Trustee for Cancellation; or (ii) All Notes That Have Not Been Previously Delivered to the Trustee for Cancellation (A) Have Become Due and Payable or (B) Will Become Due and Payable At Their Maturity Within One Year or (C) are to be Called for Redemption Within One Year Under Arrangements Satisfactory to the Trustee for the Giving of a Notice of Redemption by the Trustee, and the Company has Irrevocably Deposited or Caused to be Deposited With the Trustee as Trust Funds in Trust Solely for the Benefit of the Holders, Cash in U.s. Dollars, Non-callable U.s. Government Securities, or a Combination Thereof, in Such Amounts as Will be Sufficient Without Consideration of Any Reinvestment of Interest, to Pay and Discharge the Entire Debt On the Notes Not Previously Delivered to the Trustee for Cancellation for Principal, Premium, If Any, and Interest On the Notes to the Date of Deposit, in the Case of Notes That Have Become Due and Payable, or to the Stated Maturity or Redemption Date, as the Case May Be; (b) the Company has Paid or Caused to be Paid All Other Sums Payable by It Under This Indenture; and (c) the Company Delivers to the Trustee an Officers' Certificate and Opinion of Counsel Stating That All Conditions Precedent Under This Indenture Relating to the Satisfaction and Discharge of This Indenture Have Been Satisfied. Section 11.02. Deposited Cash and U.S. Government Securities to Be Held -------------------------------------------------------- in Trust; Other Miscellaneous Provisions. ----------------------------------------- Subject to Section 11.03 hereof, all cash and non-callable U.S. Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 11.02, the "Trustee") pursuant to Section 11.01 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and interest but such cash and securities need not be segregated from other funds except to the extent required by law. 75 Section 11.03. Repayment to Company. --------------------- Any cash or non-callable U.S. Government Securities deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or interest on, any Note and remaining unclaimed for two years after such principal, and premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in The New York Times and The Wall Street Journal (national edition), notice that such cash and securities remain unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash and securities then remaining will be repaid to the Company. ARTICLE 12. MISCELLANEOUS ------------- Section 12.01. Trust Indenture Act Controls. ----------------------------- If any provision of this Indenture limits, qualifies or conflicts with another provision that is required to be included in this Indenture by the TIA, the provision required by the TIA shall control. Section 12.02. Notices. -------- Any notice or communication by the Company, the Subsidiary Guarantors or the Trustee to the other is duly given if in writing and delivered in person or mailed by first class mail (registered or certified, return receipt requested), telecopier or overnight air courier guaranteeing next-day delivery, to the other's address: If to the Company or any Subsidiary Guarantor: Attention: Telecopier No.: With a copy to: If to the Trustee: Attention: Telecopier No.: The Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications. All notices and communications (other than those sent to the Trustee) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next-day delivery. All notices and communications to the Trustee shall be deemed duly given and effective only upon receipt. Any notice or communication to a Holder shall be mailed by first class mail, certified or registered, return receipt requested, or by overnight air courier guaranteeing next-day delivery to its address shown on the Note Register. Any notice or communication shall also be so mailed to any Person described in TIA ss. 313(c), to the extent required by the TIA. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. 76 If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. If the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time. Section 12.03. Communication by Holders of Notes with Other Holders of Notes. ------------------------------------------------------------- Holders may communicate pursuant to TIAss.312(b) with other Holders with respect to their rights under this Indenture or the Notes. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA ss.312(c). Section 12.04. Certificate and Opinion as to Conditions Precedent. -------------------------------------------------- Upon any request or application by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee: (a) an Officers' Certificate in Form and Substance Reasonably Satisfactory to the Trustee (Which Shall Include the Statements Set Forth in Section 12.05 Hereof) Stating That, in the Opinion of the Signers, All Conditions Precedent and Covenants, If Any, Provided for in This Indenture Relating to the Proposed Action Have Been Complied With; and (b) an Opinion of Counsel in Form and Substance Reasonably Satisfactory to the Trustee (Which Shall Include the Statements Set Forth in Section 12.05 Hereof) Stating That, in the Opinion of Such Counsel, All Such Conditions Precedent and Covenants Have Been Complied With. Section 12.05. Statements Required in Certificate or Opinion. --------------------------------------------- Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA ss.314(a)(4)) shall comply with the provisions of TIA ss.314(e) and shall include: (a) a Statement That the Person Making Such Certificate or Opinion has Read Such Covenant or Condition; (b) a Brief Statement as to the Nature and Scope of the Examination or Investigation Upon Which the Statements or Opinions Contained in Such Certificate or Opinion are Based; (c) a Statement That, in the Opinion of Such Person, He or She has Made Such Examination or Investigation as is Necessary to Enable Such Person to Express an Informed Opinion as to Whether or Not Such Covenant or Condition has Been Complied With; and (d) a Statement as to Whether or Not, in the Opinion of Such Person, Such Condition or Covenant has Been Complied With. With respect to matters of fact, an Opinion of Counsel may rely on an Officers' Certificate or certificates of public officials. Section 12.06. Rules by Trustee and Agents. ---------------------------- The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions. 77 Section 12.07. No Personal Liability of Directors, Officers, Employees -------------------------------------------------------- and Stockholders. ----------------- No past, present or future director, officer, employee, incorporator or stockholder of the Company, or any Subsidiary Guarantor, as such, shall have any liability for any obligations of the Company or the Subsidiary Guarantors under the Notes, the Subsidiary Guarantees, this Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Section 12.08. Governing Law. -------------- THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. Section 12.09. No Adverse Interpretation of Other Agreements. --------------------------------------------- This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. Section 12.10. Successors. ----------- All covenants and agreements of the Company in this Indenture and the Notes shall bind its successors. All covenants and agreements of the Trustee in this Indenture shall bind its successors. Section 12.11. Severability. ------------- In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. Section 12.12. Counterpart Originals. ---------------------- The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. Section 12.13. Table of Contents, Headings, etc. --------------------------------- The Table of Contents, Cross-Reference Table and Headings in this Indenture have been inserted for convenience of reference only, are not to be considered a part of this Indenture and shall in no way modify or restrict any of the terms or provisions hereof. Section 12.14. Qualification of this Indenture. -------------------------------- The Company shall qualify this Indenture under the TIA and shall pay all reasonable costs and expenses (including attorneys' fees and expenses for the Company, the Trustee and the Holders) incurred in connection therewith, including, but not limited to, costs and expenses of qualification of this Indenture and the Notes and printing this Indenture and the Notes. The Trustee shall be entitled to receive from the Company any such Officers' Certificates, Opinions of Counsel or other documentation as it may reasonably request in connection with any such qualification of this Indenture under the TIA. [Signatures on following page] 78 SIGNATURES Dated as of [ ], 2003 COMPANY: ARMSTRONG WORLD INDUSTRIES, INC. By: ----------------------------- Name: Title: [SUBSIDIARY GUARANTORS]: By: ----------------------------- Name: Title: TRUSTEE: Wells Fargo Bank Minnesota, N.A. By: ------------------------------ Name: Title: EXHIBIT A ================================================================================ (Face of Note) [ ]% SENIOR NOTES DUE 201[ ] CUSIP _____________ NO.____ $_____________ ARMSTRONG WORLD INDUSTRIES, INC. promises to pay to CEDE & CO., INC. or registered assigns, the principal sum of _________________ Dollars ($______________) on [ ], [ ]. Interest Payment Dates: [ ] and [ ], commencing [ ], 20[ ]. Record Dates: [ ] and [ ]. Dated: ______________, 20[ ]. A-1 IN WITNESS WHEREOF, the Company has caused this Note to be signed manually or by facsimile by its duly authorized officer. ARMSTRONG WORLD INDUSTRIES, INC. By: ------------------------------ Name: Title: This is one of the Global Notes referred to in the within-mentioned Indenture: [NAME OF TRUSTEE], as Trustee By: --------------------------------------- Authorized Signatory Dated _____________, 2003 A-2 (Back of Note) [ ]% SENIOR NOTES DUE 201[ ] [Insert the Global Note Legend, if applicable pursuant to the terms of the Indenture] [Insert the Private Placement Legend, if applicable pursuant to the terms of the Indenture] Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated. 1. INTEREST. Armstrong World Industries, Inc., a Pennsylvania corporation (the "COMPANY"), promises to pay interest on the principal amount of this Note at [ ](10)% per annum until maturity. The Company shall pay interest semi-annually on [ ] and [ ] of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each an "INTEREST PAYMENT DATE"). Interest on the Notes shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of original issuance; provided, however, that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided, further, that the first Interest Payment Date shall be the first of [ ] or [ ] to occur after the date of issuance. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1.0% per annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods), from time to time on demand at the same rate to the extent lawful. 2. METHOD OF PAYMENT. The Company shall pay interest on the Notes (except defaulted interest) to the Persons who are Holders at the close of business on the [ ] or [ ] next preceding the Interest Payment Date, even if such Notes are cancelled after such record date and on or before such Interest Payment Date, except as provided in Section 2.09 of the Indenture with respect to defaulted interest. The Notes shall be payable as to principal, premium, if any, and interest, if any, at the office or agency of the Company maintained for such purpose, or, at the option of the Company, payment of interest may be made by check mailed to the Holders at their addresses set forth in the Note Register; provided, however, that payment by wire transfer of immediately available funds shall be required with respect to principal of and interest, if any, and premium, if any, on all Global Notes and all other Notes the Holders of which shall have provided wire transfer instructions to the Company or the Paying Agent. Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 3. PAYING AGENT AND REGISTRAR. Initially, [ ], the Trustee under the Indenture, shall act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company or any of its subsidiaries may act in any such capacity. 4. INDENTURE. The Company issued the Notes under an Indenture dated as of [ ], 2003 ("INDENTURE") among the Company, the Subsidiary Guarantors party thereto and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are obligations of the Company unlimited in aggregate principal amount. - -------------------- (10) See footnote 4. A-3 5. OPTIONAL REDEMPTION. (a) From the Issue Date through [ ], 2004,(11) the Company may redeem all or any portion of the Notes, at once or over time, at a redemption price expressed as a percentage of principal amount) equal to 100.0% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to the redemption date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date). (b) At Any Time and From Time to Time During the Twelve-month Period Commencing On [ ] of the Years Indicated Below, the Company May Redeem All or Any Portion of the Notes At the Redemption Prices (Expressed as Percentages of Principal Amount) Set Forth Below, Plus Accrued and Unpaid Interest On the Notes Redeemed, to the Applicable Redemption Date (Subject to the Right of Holders of Record On the Relevant Record Date to Receive Interest Due On the Relevant Interest Payment Date): Year Percentage ---- ---------- 2007...................................................[ ]% 2008...................................................[ ]% 2009 and thereafter....................................[100.0]% (c) At Any Time and From Time to Time Prior to [ ], 20[ ], the Company May Redeem Up to 35.0% of the Aggregate Principal Amount of the Notes Issued Under This Indenture At a Redemption Price (Expressed as a Percentage of Principal Amount) Equal to [ ]%(12) of the Principal Amount Thereof, Plus Accrued and Unpaid Interest to the Redemption Date (Subject to the Right of Holders of Record On the Relevant Record Date to Receive Interest Due On the Relevant Interest Payment Date) With the Net Cash Proceeds of One or More Equity Offerings by the Company or the Direct or Indirect Parent of the Company (To the Extent, in the Case of the Direct or Indirect Parent, That the Net Cash Proceeds of the Equity Offerings are Contributed to the Common or Non-redeemable Preferred Equity Capital That is Not Convertible or Exchangeable for Debt or Disqualified Stock of the Company); Provided, However, That After Giving Effect to Any Such Redemption, At Least 65.0% of the Aggregate Principal Amount of the Notes Initially Issued Under This Indenture (Excluding Notes Held by the Company and Its Subsidiaries) Remains Outstanding Immediately After Giving Effect to Such Redemption. Any Such Redemption Shall be Made Within 75 Days of Such Equity Offering Upon Not Less Than 30 Nor More Than 60 Days' Prior Notice. (d) Any Prepayment Pursuant to This Paragraph Shall be Made Pursuant to the Provisions of Sections 3.01 Through 3.06 of the Indenture. 6. MANDATORY REDEMPTION. Except as set forth in Sections 4.12 and 4.17 of the Indenture, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Notes. 7. REPURCHASE AT OPTION OF HOLDER. (a) Upon the occurrence of a Change of Control, each Holder shall have the right to require the Company to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000) of such Holder's Notes (a "CHANGE OF CONTROL OFFER") at a purchase price, in cash, equal to 101% of the aggregate principal amount of the Notes repurchased, plus accrued and unpaid interest, if any, on the Notes repurchased to the Purchase Date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest to, but excluding the Purchase Date). (b) If the Company or one of its Restricted Subsidiaries consummates any Asset Sales, any Net Available Cash from Asset Sales that are not applied or - --------------------------- (11) 180 days after the Issue Date. (12) Par plus coupon. A-4 invested as provided in Section 4.12 of the Indenture will constitute "EXCESS PROCEEDS." When the aggregate amount of Excess Proceeds exceeds $25.0 million, the Company will make an offer to all Holders of Notes to purchase the maximum principal amount of Notes and, if the Company is required to do so under the terms of any other Indebtedness that is pari passu with the Notes, such other Indebtedness on a pro rata basis with the Notes, that may be purchased out of the Excess Proceeds (a "PREPAYMENT OFFER"). The offer price in any Prepayment Offer will be equal to 100% of principal amount plus accrued and unpaid interest and Additional Interest, if any, to the date of purchase, and will be payable in cash. If any Excess Proceeds remain after consummation of the purchase of all properly tendered and not withdrawn Notes pursuant to a Prepayment Offer, the Company may use such remaining Excess Proceeds for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and other pari passu Indebtedness tendered into such Prepayment Offer exceeds the amount of Excess Proceeds, the Trustee will select the Notes and such other pari passu Indebtedness to be purchased on a pro rata basis. Upon completion of each Prepayment Offer, the amount of Excess Proceeds will be reset at zero. Holders of Notes that are the subject of an offer to purchase will receive a Prepayment Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" on the reverse of the Notes. 8. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at its registered address. Notes in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the redemption date interest ceases to accrue on Notes or portions thereof called for redemption. 9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in denominations of $1,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents, and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before the mailing of a notice of redemption of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date. 10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner for all purposes. 11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Company, the Subsidiary Guarantors and the Trustee may amend or supplement the Indenture, the Notes or the Subsidiary Guarantees with the consent of the Holders of a majority in principal amount of the then outstanding Notes voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 of the Indenture, any existing Default or Event of Default (except a continuing Default or Event of Default in the payment of principal, premium, if any, or interest on the Notes) or compliance with any provision of the Indenture or the Notes (except for certain covenants and provisions of the Indenture that cannot be amended without the consent of each Holder) may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes). Without the consent of any Holder, the Company, the Subsidiary Guarantors and the Trustee may amend or supplement the Indenture, the Notes or the Subsidiary Guarantees to cure any ambiguity, omission, defect or inconsistency, to provide for the assumption by a successor corporation, partnership or limited liability company of the obligations of the Company under the Indenture, to provide for uncertificated Notes in addition to or in place of certificated Notes, to secure the Notes, to add to the covenants of the Company for the benefit of the Holders of the Notes or to surrender any right or power conferred upon the Company, to make any change that would provide any additional rights or benefits to the Holders of Notes or that does not adversely affect the legal rights under the Indenture of any such Holder, or to make any change to comply with any requirement of the Commission in order to effect or maintain the qualification of the Indenture under the TIA. 12. DEFAULTS AND REMEDIES. Each of the following is an Event of Default under the Indenture: (i) failure to make the payment of any interest on the Notes when the same becomes due and payable, and such failure continues for A-5 a period of 30 days; (ii) failure to make the payment of any principal of, or premium, if any, on, any of the Notes when the same becomes due and payable at its Stated Maturity, upon acceleration, redemption, optional redemption, required repurchase or otherwise; (iii) failure to comply with the provisions of Sections 4.12, 4.17 or 5.01 of the Indenture; (iv) failure to comply with any other covenant or agreement in the Notes or in the Indenture (other than a failure that is the subject of the foregoing clause (i), (ii) or (iii)) and such failure continues for 60 days after written notice is given to the Company as provided below; (v) a default under any Debt by the Company or any Restricted Subsidiary that is a Significant Subsidiary that results in acceleration of the maturity of such Debt, or failure to pay any such Debt at maturity, in an aggregate amount greater than $25.0 million or its foreign currency equivalent at the time; (vi) any judgment or judgments for the payment of money in an aggregate amount in excess of $25.0 million (or its foreign currency equivalent at the time) in excess of amounts which are covered by insurance under applicable policies that shall be rendered against the Company or any Restricted Subsidiary that is a Significant Subsidiary and that shall not be waived, satisfied or discharged for any period of 60 consecutive days during which a stay of enforcement shall not be in effect; (vii) certain events of bankruptcy, insolvency or reorganization affecting the Company or any of Restricted Subsidiary that is a Significant Subsidiary; and (viii) any guarantee of a Subsidiary Guarantor that is a Significant Subsidiary or a group of Subsidiary Guarantors that, taken as a whole, would constitute a Significant Subsidiary ceases to be in full force and effect (other than in accordance with the terms of such guarantee) or any Subsidiary Guarantor denies or disaffirms its obligations under its guarantee. If any Event of Default shall have occurred and be continuing, the Trustee or the Holders of at least 25.0% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency described in the Indenture with respect to the Company, all outstanding Notes shall become due and payable without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest) if it determines that withholding notice is in their interest. The Holders of a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest on, or the principal of, the Notes. The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default. 13. TRUSTEE DEALINGS WITH COMPANY. Subject to certain limitations, the Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee. 14. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator or stockholder of the Company or any Subsidiary Guarantor shall have any liability for any obligations of the Company or any Subsidiary Guarantor under the Indenture, the Notes or any Subsidiary Guarantee or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. 15. AUTHENTICATION. This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent. 16. ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act). 17. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes, and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. A-6 The Company shall furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to: 18. GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. A-7 OPTION OF HOLDER TO ELECT PURCHASE If you want to elect to have this Note purchased by the Company pursuant to Section 4.12 or 4.17 of the Indenture, check the box below: Section 4.12 [ ] Section 4.17 [ ] If you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.12 or Section 4.17 of the Indenture, state the amount you elect to have purchased: $_____________________ Date:_______________________ Your Signature:________________________________ (Sign exactly as your name appears on the Note) Tax Identification No.: _______________________________________________ SIGNATURE GUARANTEE: ---------------------------------------- Signatures must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. A-8 ASSIGNMENT FORM To assign this Note, fill in the form below: (I) or (we) assign and transfer this Note to ________________________________________________________________________________ (Insert assignee's social security or other tax I.D. no.) ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Print or type assignee's name, address and zip code) and irrevocably appoint _________________________________________________________ as agent to transfer this Note on the books of the Company. The agent may substitute another to act for him. ________________________________________________________________________________ Date: ______________ Your Signature:_______________________________________ (Sign exactly as your name appears on the face of this Note) Signature Guarantee:__________________________________ A-9 SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made: Principal Amount Amount of of this Global Note Signature of decrease in Amount of increase following such authorized signatory Principal Amount in Principal Amount decrease (or of Trustee or Date of Exchange of this Global Note of this Global Note increase) Custodian ---------------- ------------------- ------------------- --------- ---------
EXHIBIT B FORM OF CERTIFICATE OF TRANSFER Armstrong World Industries, Inc. [address] Attention: Chief Financial Officer and Corporate Secretary [Trustee] [address] Attention: Telecopier No.: Re: [ ]% Senior Notes due 2010 Reference is hereby made to the Indenture, dated as of , 2003 (the "Indenture"), among Armstrong World Industries, Inc., as issuer (the "Company"), the Subsidiary Guarantors party thereto and _________________, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. ___________________, (the "Transferor") owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $___________ in such Note[s] or interests (the "Transfer"), to ___________________________ (the "Transferee"), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that: [CHECK ALL THAT APPLY] 1. [ ] Check if Transferee will take delivery of a beneficial interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor hereby further certifies that the beneficial interest in the Global Note or Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest in the Global Note or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a "qualified institutional buyer" within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States and applicable securities laws of any other applicable jurisdiction. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest in the Global Note or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Note and/or the Definitive Note and in the Indenture and the Securities Act. 2.[ ] Check if Transferee will take delivery of a beneficial interest in the Regulation S Global Note or a Definitive Note pursuant to Regulation S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a Person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(a) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Distribution Compliance Period, the transfer is not being made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Global Note and/or the Definitive Note and in the Indenture and the Securities Act. B-1 3.[ ] Check and complete if Transferee will take delivery of a beneficial interest in the IAI Global Note or a Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States and the securities laws of any other applicable jurisdiction, and accordingly the Transferor hereby further certifies that (check one): (a) [ ] such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act; or (b) [ ] such Transfer is being effected to the Company or a subsidiary thereof; or (c) [ ] such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act; or (d)[ ] such Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption from the registration requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Note or Restricted Definitive Notes and the requirements of the exemption claimed, which certification is supported by (1) a certificate executed by the Transferee in the form of Exhibit D to the Indenture and (2) an Opinion of Counsel provided by the Transferor or the Transferee (a copy of which the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the IAI Global Note and/or the Definitive Notes and in the Indenture and the Securities Act. 4. [ ] Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Note or of an Unrestricted Definitive Note. (a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and the securities laws of any other applicable jurisdiction and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. (b)[ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and the securities laws of any other applicable jurisdiction and (ii) the restrictions on transfer contained in the Indenture B-2 and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. (c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and the securities laws of any other applicable jurisdiction and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture. This certificate and the statements contained herein are made for your benefit and the benefit of the Company. [Insert Name of Transferor] By:_________________________________ Name: Title: Dated: ______________________ B-3 ANNEX A TO CERTIFICATE OF TRANSFER 1. The Transferor owns and proposes to transfer the following: [CHECK ONE OF (a) OR (b)] (a) [ ] a beneficial interest in the: (i) [ ] 144A Global Note (CUSIP _________), or (ii) [ ] Regulation S Global Note (CUSIP _________), or (iii) [ ] IAI Global Note (CUSIP _________); or (b) [ ] a Restricted Definitive Note. 2. After the Transfer the Transferee will hold: [CHECK ONE OF (a), (b) OR (c)] (a) [ ] a beneficial interest in the: (i) [ ] 144A Global Note (CUSIP _________), or (ii) [ ] Regulation S Global Note (CUSIP _________), or (iii) [ ] IAI Global Note (CUSIP _________); or (iv) [ ] Unrestricted Global Note (CUSIP _________); or (b) [ ] a Restricted Definitive Note; or (c) [ ] an Unrestricted Definitive Note, in accordance with the terms of the Indenture. B-4 EXHIBIT C FORM OF CERTIFICATE OF EXCHANGE Armstrong World Industries, Inc. [address] Attention: Chief Financial Officer and Corporate Secretary [Trustee] [address] Attention: Telecopier No.: Re: [ ]% Senior Notes due 2010 ------------------------------ Reference is hereby made to the Indenture, dated as of ______________, 2003 (the "Indenture"), among Armstrong World Industries, Inc., as issuer (the "Company"), the Subsidiary Guarantors party thereto and ___________________, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. __________________________, (the "Owner") owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of $____________ in such Note[s] or interests (the "Exchange"). In connection with the Exchange, the Owner hereby certifies that: 1. Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Note and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Note and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance C-1 with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. 2. Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owner's own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act. (b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange of the Owner's Restricted Definitive Note for a beneficial interest in the [CIRCLE ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Definitive Note and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act. This certificate and the statements contained herein are made for your benefit and the benefit of the Company. ________________________________________ [Insert Name of Transferor] By:_____________________________________ Name: Title: Dated: _________________________________ C-2 EXHIBIT D FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR Armstrong World Industries, Inc. [address] Attention: Chief Financial Officer and Corporate Secretary [Trustee] [address] Attention: Telecopier No.: Re: [ ]% Senior Notes due 2010 ------------------------------ Reference is hereby made to the Indenture, dated as of _______________, 2003 (the "Indenture"), among Armstrong World Industries, Inc., as issuer (the "Company"), the Subsidiary Guarantors party thereto and ____________________, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. In connection with our proposed purchase of $____________ aggregate principal amount of: (a) [ ] a beneficial interest in a Global Note, or (b) [ ] a Definitive Note, we confirm that: 1. We understand that any subsequent transfer of the Notes or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes or any interest therein except in compliance with, such restrictions and conditions and the United States Securities Act of 1933, as amended (the "Securities Act"). 2. We understand that the offer and sale of the Notes have not been registered under the Securities Act, and that the Notes and any interest therein may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell the Notes or any interest therein, we will do so only (A) to the Company or any subsidiary thereof, (B) for so long as the Notes are eligible for resale pursuant to Rule 144A under the Securities Act to a person we reasonably believe is a "qualified institutional buyer" (as defined therein), (C) to an institutional "accredited investor" (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you and to the Company a signed letter substantially in the form of this letter and, if such transfer is in respect of a principal amount of Notes, at the time of transfer of less than US $250,000, an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such transfer is in compliance with the Securities Act, (D) to persons outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or (F) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any Person purchasing the Definitive Note or beneficial interest in a Global Note from us in a transaction meeting the requirements of clauses (A) through (E) of this paragraph a notice advising such purchaser that resales thereof are restricted as stated herein. 3. We understand that, on any proposed resale of the Notes or beneficial interest therein, we will be required to furnish to you and the Company such certifications, legal opinions and other information as you and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that the Notes purchased by us will bear a legend to the foregoing effect. D-1 4. We are an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we and any accounts for which we are acting are each able to bear the economic risk of our or its investment. We have had access to such financial and other information and have been afforded the opportunity to ask such questions of representatives of the Company and receive answers thereto, as we deem necessary in connection with our decision to purchase the Notes. 5. We are acquiring the Notes or beneficial interest therein purchased by us for our own account or for one or more accounts (each of which is an institutional "accredited investor") as to each of which we exercise sole investment discretion and are not acquiring the Notes with a view to any distribution thereof in a transaction that would violate the Securities Act of the securities laws of any state of the United States or any other applicable jurisdiction. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. This letter shall be governed by, and construed in accordance with, the laws of the State of New York. __________________________________________ [Insert Name of Accredited Investor] By:_______________________________________ Name: Title: Dated: _________________ D-2 EXHIBIT E FORM OF NOTATION OF SUBSIDIARY GUARANTEE For value received, each Subsidiary Guarantor (which term includes any successor Person under the Indenture), jointly and severally, unconditionally guarantees, to the extent set forth in the Indenture and subject to the provisions in the Indenture, dated as of [ ] (the "Indenture"), among ARMSTRONG WORLD INDUSTRIES, INC., as issuer (the "Company"), the Subsidiary Guarantors listed on the signature pages thereto and [ ], as trustee (the "Trustee"), (a) the due and punctual payment of the principal of and premium, if any, on the Notes, whether at maturity, by acceleration, redemption or otherwise, the due and punctual payment of interest on overdue principal and premium, if any, and, to the extent permitted by law, interest and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms of the Indenture and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. The obligations of the Subsidiary Guarantors to the Holders of Notes and to the Trustee pursuant to the Subsidiary Guarantee and the Indenture are expressly set forth in Article 10 of the Indenture and reference is hereby made to the Indenture for the precise terms of the Subsidiary Guarantee. This Subsidiary Guarantee is subject to release as and to the extent set forth in Sections 8.02, 8.03 and 10.05 of the Indenture. Each Holder of a Note, by accepting the same, agrees to and shall be bound by such provisions. [SUBSIDIARY GUARANTORS] By: ____________________________ Name: Title: E-1 EX-99 10 jd9-5ex99_8.txt 99.8 Exhibit 99.8 EXPLANATORY NOTE (1) -------------------- The forms of indentures for the 7-year and 10-year fixed-rate Plan Notes being filed as Exhibits 1.96-A and 1.96-B to the Plan of Reorganization as part of the Plan Supplement (the "Plan Notes Indentures") are the product of negotiations and discussions among Armstrong World Industries, Inc. ("AWI"), its financial advisor and counsel, and members of the Asbestos PI Claimants' Committee, the Future Claimants' Representative and the Unsecured Creditors' Committee (collectively, the "Committees") and their respective advisors and counsel. It is possible that further discussions among these parties concerning the terms of these indentures may take place following this filing and that these discussions may result in changes to some of the terms currently contained therein. Section 7.3 of the Plan of Reorganization provides that AWI will use reasonable efforts to complete a 144A Offering on or as soon as practicable after the Effective Date. AWI has represented to the Committees that if AWI successfully completes an offering of notes in the 144A Offering (such notes being referred to as "144A Notes") but the net proceeds from the 144A Offering are less than the Plan Note Amount, AWI would issue additional 144A Notes to the applicable classes of creditors under the Plan of Reorganization in lieu of the Plan Notes it would otherwise issue under the Plan Note Indentures (subject to compliance with applicable securities laws). In addition, although the Plan of Reorganization provides for the possibility that AWI would issue Plan Notes bearing a floating interest rate ("Floating Rate Plan Notes"), AWI has not filed a form of indenture for such Floating Rate Plan Notes. Rather, AWI has represented to the Committees that it is AWI's intention to seek to obtain a floating rate term loan credit facility from a syndicate of banks and other financial institutions and lenders (a "Term Loan B"). AWI has represented to the Committees that if AWI is successful in obtaining a Term Loan B, AWI will not issue any Floating Rate Plan Notes under the Plan of Reorganization. AWI has further represented to the Committees that if AWI is not successful in obtaining a Term Loan B, AWI will not issue any Floating Rate Plan Notes under the Plan of Reorganization unless such Floating Rate Plan Notes satisfy the requirements of the Plan of Reorganization and are on terms and conditions that are mutually satisfactory to AWI and the Committees. - ---------------------- (1) Capitalized terms used in this explanatory note and not otherwise defined have the meanings set forth in the Plan of Reorganization. ARMSTRONG WORLD INDUSTRIES, INC., as Company $[ ] [ ]% SENIOR NOTES DUE 201[ ]1 ------------------------------ INDENTURE Dated as of [ ], 2003 ------------------------------ [ ], as Trustee - ----------------------------------- (1) The tenth anniversary of the Issue Date.
TABLE OF CONTENTS PAGE ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE...........................................................1 Section 1.01. Definitions.....................................................................1 Section 1.02. Other Definitions..............................................................23 Section 1.03. Incorporation by Reference of Trust Indenture Act..............................23 Section 1.04. Rules of Construction..........................................................24 ARTICLE 2. THE NOTES...........................................................................................24 Section 2.01. Form and Dating................................................................25 Section 2.02. Execution and Authentication...................................................26 Section 2.03. Registrar, Paying Agent and Depositary.........................................26 Section 2.04. Paying Agent to Hold Money in Trust............................................27 Section 2.05. Holder Lists...................................................................27 Section 2.06. Transfer and Exchange..........................................................27 Section 2.07. Temporary Notes................................................................37 Section 2.08. Mutilated, Destroyed, Lost or Stolen Notes.....................................38 Section 2.09. Payment of Interest; Interest Rights Preserved.................................38 Section 2.10. Persons Deemed Owners..........................................................39 Section 2.11. Cancellation...................................................................39 Section 2.12. CUSIP or ISIN Numbers..........................................................39 Section 2.13. Outstanding Notes..............................................................39 Section 2.14. Treasury Notes.................................................................40 ARTICLE 3. REDEMPTION AND PREPAYMENT...........................................................................40 Section 3.01. Notices to Trustee.............................................................40 Section 3.02. Selection of Notes to Be Redeemed..............................................40 Section 3.03. Notice of Redemption...........................................................40 Section 3.04. Effect of Notice of Redemption.................................................41 Section 3.05. Deposit of Redemption Price....................................................41 Section 3.06. Notes Redeemed in Part.........................................................41 Section 3.07. Optional Redemption............................................................41 Section 3.08. Mandatory Redemption...........................................................42 Section 3.09. Offer To Purchase..............................................................42 ARTICLE 4. COVENANTS...........................................................................................44 Section 4.01. Payment of Notes; Money for Note Payments to be Held in Trust..................44 Section 4.02. Maintenance of Office or Agency................................................46 Section 4.03. Reports........................................................................46 i TABLE OF CONTENTS (CONTINUED) PAGE Section 4.04. Compliance Certificate.........................................................46 Section 4.05. Taxes..........................................................................47 Section 4.06. Stay, Extension and Usury Laws.................................................47 Section 4.07. Corporate Existence............................................................47 Section 4.08. Payments for Consent...........................................................47 Section 4.09. Incurrence of Additional Debt..................................................47 Section 4.10. Restricted Payments............................................................48 Section 4.11. Liens..........................................................................51 Section 4.12. Asset Sales....................................................................51 Section 4.13. Restrictions on Distributions from Restricted Subsidiaries.....................52 Section 4.14. Affiliate Transactions.........................................................53 Section 4.15. Sale and Leaseback Transactions................................................54 Section 4.16. Designation of Restricted and Unrestricted Subsidiaries........................54 Section 4.18. Future Subsidiary Guarantors...................................................55 Section 4.19. Covenant Termination...........................................................55 ARTICLE 5. SUCCESSORS..........................................................................................56 Section 5.01. Merger, Consolidation and Sale of Assets.......................................56 Section 5.02. Successor Corporation Substituted..............................................57 ARTICLE 6. DEFAULTS AND REMEDIES...............................................................................58 Section 6.01. Events of Default..............................................................58 Section 6.02. Acceleration...................................................................59 Section 6.03. Other Remedies.................................................................60 Section 6.04. Waiver of Past Defaults........................................................60 Section 6.05. Control by Majority............................................................60 Section 6.06. Limitation on Suits............................................................60 Section 6.07. Rights of Holders to Receive Payment...........................................61 Section 6.08. Collection Suit by Trustee.....................................................61 Section 6.09. Trustee May File Proofs of Claim...............................................61 Section 6.10. Priorities.....................................................................61 Section 6.11. Undertaking for Costs..........................................................62 ARTICLE 7. TRUSTEE.............................................................................................62 Section 7.01. Duties of Trustee..............................................................62 Section 7.02. Rights of Trustee..............................................................63 Section 7.03. Individual Rights of Trustee...................................................64 ii TABLE OF CONTENTS (CONTINUED) PAGE Section 7.04. Trustee's Disclaimer...........................................................64 Section 7.05. Notice of Defaults.............................................................64 Section 7.06. Reports by Trustee to Holders..................................................64 Section 7.07. Compensation and Indemnity.....................................................64 Section 7.08. Replacement of Trustee.........................................................65 Section 7.09. Successor Trustee by Merger, etc...............................................66 Section 7.10. Eligibility; Disqualification..................................................66 Section 7.11. Preferential Collection of Claims Against Company..............................66 ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE............................................................66 Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.......................66 Section 8.02. Legal Defeasance and Discharge.................................................67 Section 8.03. Covenant Defeasance............................................................67 Section 8.04. Conditions to Legal or Covenant Defeasance.....................................67 Section 8.05. Deposited Cash and U.S. Government Securities to Be Held in Trust; Other Miscellaneous Provisions................................................68 Section 8.06. Repayment to Company...........................................................69 Section 8.07. Reinstatement..................................................................69 ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER....................................................................69 Section 9.01. Without Consent of Holders of Notes............................................69 Section 9.02. With Consent of Holders of Notes...............................................70 Section 9.03. Compliance with Trust Indenture Act............................................71 Section 9.04. Revocation and Effect of Consents..............................................71 Section 9.05. Notation on or Exchange of Notes...............................................71 Section 9.06. Trustee to Sign Amendments, etc................................................72 ARTICLE 10. GUARANTEES..........................................................................................72 Section 10.01. Subsidiary Guarantees..........................................................72 Section 10.02. Limitation on Subsidiary Guarantor Liability...................................73 Section 10.03. Execution and Delivery of Subsidiary Guarantee.................................73 Section 10.04. Subsidiary Guarantors May Consolidate, etc. on Certain Terms...................74 Section 10.05. Releases Following Sale of Assets, Etc.........................................74 ARTICLE 11. SATISFACTION AND DISCHARGE..........................................................................75 Section 11.01. Satisfaction and Discharge.....................................................75 Section 11.02. Deposited Cash and U.S. Government Securities to Be Held in Trust; Other Miscellaneous Provisions................................................75 iii TABLE OF CONTENTS (CONTINUED) PAGE Section 11.03. Repayment to Company...........................................................76 ARTICLE 12. MISCELLANEOUS.......................................................................................76 Section 12.01. Trust Indenture Act Controls...................................................76 Section 12.02. Notices........................................................................76 Section 12.03. Communication by Holders of Notes with Other Holders of Notes..................77 Section 12.04. Certificate and Opinion as to Conditions Precedent.............................77 Section 12.05. Statements Required in Certificate or Opinion..................................77 Section 12.06. Rules by Trustee and Agents....................................................77 Section 12.07. No Personal Liability of Directors, Officers, Employees and Stockholders.......78 Section 12.08. Governing Law..................................................................78 Section 12.09. No Adverse Interpretation of Other Agreements..................................78 Section 12.10. Successors.....................................................................78 Section 12.11. Severability...................................................................78 Section 12.12. Counterpart Originals..........................................................78 Section 12.13. Table of Contents, Headings, etc...............................................78 Section 12.14. Qualification of this Indenture................................................78
iv CROSS-REFERENCE TABLE TIA SECTION REFERENCE INDENTURE SECTION 310(a)(1)................................................. 7.10 (a)(2).................................................... 7.10 (a)(3).................................................... N.A. (a)(4).................................................... N.A. (a)(5).................................................... 7.10 (b)....................................................... 7.08, 7.10 (c)....................................................... N.A. 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)(1).................................................... N.A. (b)(2).................................................... 7.06 (c)....................................................... 7.06, 12.02 (d)....................................................... 7.06 314(a).................................................... 4.03, 4.04, 12.02 (b)....................................................... N.A. (c)(1).................................................... 12.04 (c)(2).................................................... 12.04 (c)(3).................................................... N.A. (d)....................................................... N.A. (e)....................................................... 12.05 315(a).................................................... 7.01 (b)....................................................... 7.05, 12.02 (c)....................................................... 7.01 (d)....................................................... 7.01 (e)....................................................... 6.11 316(a) (last sentence).................................... 6.04 (a)(1)(A)................................................. 6.05 (a)(1)(B)................................................. 6.04 (a)(2).................................................... N.A. (b)....................................................... 6.07 317(a)(1)................................................. 6.08 (a)(2).................................................... 6.09 (b)....................................................... 2.04 318(a).................................................... 12.01 N.A. means Not Applicable. Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture. This INDENTURE dated as of [ ], 2003, is by and among Armstrong World Industries, Inc., a Pennsylvania corporation (the "Company"), each Subsidiary Guarantor listed on the signature pages hereto, and [ ], as trustee (the "Trustee"). The Company, each Subsidiary Guarantor and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders of the [ ](2)% Senior Notes due 201[ ](3) (the "Notes"): ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE Section 1.01. Definitions. For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires: "144A Global Note" means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of any Notes that may be sold in reliance on Rule 144A. "Acquired Debt" of any specified Person means Debt of any other Person and its Restricted Subsidiaries existing at the time such other Person merged with or into or became a Restricted Subsidiary of such specified Person or assumed by the specified Person in connection with the acquisition of assets from such other Person, in each case pursuant to a transaction permitted under this Indenture. "Additional Assets" means: (a) Any Property (Other Than Cash, Cash Equivalents, Securities and Capital Stock) to be Owned by the Company or Any Restricted Subsidiary and Used or Useful in a Related Business; or (b) Capital Stock of a Person That Becomes a Restricted Subsidiary as a Result of the Acquisition of Such Capital Stock by the Company or Another Restricted Subsidiary From Any Person Other Than the Company or a Subsidiary of the Company; or (c) Capital Stock Constituting a Minority Interest in Any Person That At Such Time is a Restricted Subsidiary; provided, however, that, in the case of clauses (b) and (c), such Restricted Subsidiary is primarily engaged in a Related Business. "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 the purposes of this definition, "control" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; provided that beneficial ownership of 10% or more of the Voting Stock of a Person shall be deemed to be control. The terms "controlling" and "controlled" have meanings correlative to the foregoing. "Agent" means any Registrar, co-registrar, Paying Agent or additional paying agent. - ---------------------------------- (2) See footnote 4. (3) The tenth anniversary of the Issue Date. "Applicable Procedures" means, with respect to any transfer, redemption or exchange of or for beneficial interests in any Global Note, the rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer, redemption or exchange. "Asset Sale" means any sale, lease, transfer, issuance or other disposition (or series of related sales, leases, transfers, issuances or dispositions) by the Company or any Restricted Subsidiary, including any disposition by means of a merger, consolidation or similar transaction (each referred to for the purposes of this definition as a "disposition") of: (a) Any Shares of Capital Stock of a Restricted Subsidiary (Other Than Directors' Qualifying Shares), or (b) Any Other Assets of the Company or Any Restricted Subsidiary (Other Than Cash Equivalents) Outside of the Ordinary Course of Business of the Company or Such Restricted Subsidiary, other than, in the case of clause (a) or (b) above, (1) any disposition by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to a Restricted Subsidiary; provided that the aggregate amount of any such dispositions by the Company or any Domestic Subsidiary to Foreign Restricted Subsidiaries shall not exceed $[ ] per annum; (2) any disposition that constitutes a Permitted Investment or Restricted Payment permitted by Section 4.10 hereof, (3) any disposition effected in compliance with the first paragraph of Section 5.01 hereof, (4) the granting of any Permitted Lien (or the foreclosure thereon), (5) a disposition of obsolete or worn out equipment or equipment that is no longer useful in the conduct of the business of the Company and its Restricted Subsidiaries and that is disposed of in each case in the ordinary course of business, (6) sales of assets in connection with Sale and Leaseback Transactions otherwise permitted under this Indenture, and (7) any sale, transfer or other disposition that does not (together with all related sales, transfers or dispositions) involve consideration in excess of $2.5 million. Notwithstanding the foregoing, that the sale, lease, transfer, conveyance, issuance or other disposition of all or substantially all of the assets of the Company and the Restricted Subsidiaries, taken as a whole, will be governed by the provisions of Section 4.17 and/or Section 5.01 hereof and not by Section 4.12 hereof. "Attributable Debt" in respect of a Sale and Leaseback Transaction means, at any date of determination, (a) if such sale and leaseback transaction results in a capital lease obligation, the amount of debt represented thereby according to the definition of "capital lease obligation," and (b) in all other instances, the greater of: (i) the fair market value of the property subject to such sale and leaseback transaction; and (ii) the present value (discounted at the interest rate borne by the notes, compounded annually) of the total obligations of the lessee for 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). 2 "Average Life" means, as of any date of determination, with respect to any Debt or Preferred Stock, the quotient obtained by dividing: (a) the sum of the product of the numbers of years (rounded to the nearest one-twelfth of one year) from the date of determination to the dates of each successive scheduled principal payment of such debt or redemption or similar payment with respect to such preferred stock multiplied by the amount of such payment by (b) the sum of all such payments. "Bankruptcy Law" means Title 11, U.S. Code or any similar federal, state or foreign law for the relief of debtors. "Board of Directors" means (1) in respect of a corporation, the board of directors of the corporation, or any duly authorized committee thereof and (2) in respect of any other Person, the board or committee of that Person serving a similar function. "Board Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the applicable 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 Legal Holiday. "Capital Lease Obligations" means any obligation under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP; and the amount of Debt represented by such obligation shall be the capitalized amount of such obligations determined in accordance with GAAP; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be terminated by the lessee without payment of a penalty. For purposes of Section 4.11 hereof, a Capital Lease Obligation shall be deemed secured by a Lien on the Property being leased. "Capital Stock" means, with respect to any Person, any shares or other equivalents (however designated) of any class of corporate stock or partnership interests or any other participations, rights, warrants, options or other interests in the nature of an equity interest in such Person, including Preferred Stock, but excluding any debt security convertible or exchangeable into such equity interest. "Capital Stock Sale Proceeds" means the aggregate cash proceeds received by the Company from the issuance or sale (other than to a Subsidiary of the Company or an employee stock ownership plan or trust established by the Company or any such Subsidiary) by the Company of its Capital Stock (other than Disqualified Stock) after the Issue Date, net of attorneys' fees, accountants' fees, underwriters' or placement agents' fees, discounts or commissions and brokerage, consultant and other fees actually incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof. "Cash Equivalents" means any of the following: (a) any Investment in direct obligations of the United States of America or any agency thereof or obligations guaranteed by the United States of America or any agency thereof; (b) Investments in eurodollar time deposits, time deposit accounts, demand deposit accounts, certificates of deposit and money market deposits maturing within 365 days of the date of acquisition thereof issued by a bank or trust company which is organized under the laws of the United States of America, any state thereof or any foreign country recognized by the United States of America having capital, surplus and undivided profits aggregating in excess of $500.0 million and whose long-term debt, or whose parent holding company's long-term debt, is rated "A-3" or "A-" or higher according to Moody's or S&P (or such similar equivalent rating or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act)); 3 (c) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (a) above entered into with (i) a bank meeting the qualifications described in clause (b) above or (ii) any primary government securities dealer reporting to the Market Reports Division of the Federal Reserve Bank of New York; (d) Investments in commercial paper, maturing not more than 270 days after the date of acquisition, issued by a corporation (other than an Affiliate of the Company) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of "P-1" (or higher) according to Moody's or "A-1" (or higher) according to S&P; (e) Investments in securities maturing not more than 365 days after the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least "A" by S&P or "A" by Moody's; (f) Investments in mutual funds whose investment guidelines restrict such funds' investments to those satisfying the provisions of clauses (a) through (e) above; and (g) in the case of Foreign Restricted Subsidiaries, substantially similar investments denominated in foreign currencies (including securities issued or fully guaranteed by foreign countries or political subdivisions or taxing authorities thereof). "Change of Control" means the occurrence of any of the following events: (A) Any "Person" or "Group" (As Such Terms are Used in Sections 13(D) and 14(D) of the Exchange Act or Any Successor Provisions to Either of the Foregoing) of Persons, Including Any Group Acting for the Purpose of Acquiring, Holding, Voting or Disposing of Securities Within the Meaning of Rule 13D-5(b)(1) Under the Exchange Act, Other Than the Asbestos Pi Trust, Becomes the "Beneficial Owner" (As Defined in Rule 13D-3 Under the Exchange Act, Except That a Person Will be Deemed to Have "Beneficial Ownership" of All Shares That Any Such Person has the Right to Acquire, Whether Such Right is Exercisable Immediately or Only After the Passage of Time), Directly or Indirectly, of More Than 35.0% of the Total Voting Power of the Voting Stock of the Company; Provided, However, That for Purposes of This Clause (A), Such Person or Group Shall be Deemed to Beneficially Own Any Voting Stock of a Corporation Held by Any Other Corporation (The "Parent Corporation") So Long as Such Person or Group Beneficially Owns, Directly or Indirectly, in the Aggregate At Least a Majority of the Total Voting Power of the Voting Stock of Such Parent Corporation; and Provided, Further, However That Notwithstanding the Foregoing, a Change of Control Will Not be Deemed to Have Occurred Under This Clause (A) If and So Long as the Asbestos Pi Trust is the "Beneficial Owner" (As Defined Above), Directly or Indirectly, in the Aggregate of a Greater Percentage of the Total Voting Power of the Voting Stock of the Company Than Such Other Person or Group); or (B) the Sale, Transfer, Assignment, Lease, Conveyance or Other Disposition, Directly or Indirectly, of All or Substantially All the Property of the Company and the Restricted Subsidiaries, Considered as a Whole (Other Than a Disposition of Such Property as an Entirety or Virtually as an Entirety to a Wholly Owned Restricted Subsidiary or the Asbestos Pi Trust) Shall Have Occurred, or the Company Merges, Consolidates or Amalgamates With or Into Any Other Person (Other Than the Asbestos PI Trust) or Any Other Person (Other Than the Asbestos Pi Trust) Merges, Consolidates or Amalgamates With or Into the Company, in Any Such Event Pursuant to a Transaction in Which the Outstanding Voting Stock of the Company is Reclassified Into or Exchanged for Cash, Securities or Other Property, Other Than Any Such Transaction Where: (1) the outstanding Voting Stock of the Company is reclassified into or exchanged for other Voting Stock of the Company or for Voting Stock of the Surviving Person, and (2) the holders of the Voting Stock of the Company immediately prior to such transaction own, directly or indirectly, not less than a majority of the Voting Stock of the Company or the Surviving Person immediately after such transaction and in substantially the same proportion as before the transaction; or 4 (c) During Any Period of Two Consecutive Years, Individuals Who At the Beginning of Such Period Constituted the Board of Directors (Together With Any New Directors Whose Election or Appointment by Such Board or Whose Nomination for Election by the Shareholders of the Company was Approved by a Vote of Not Less Than a Majority of the Directors Then Still in Office Who Were Either Directors At the Beginning of Such Period or Whose Election or Nomination for Election was Previously So Approved) Cease for Any Reason to Constitute a Majority of the Board of Directors Then in Office; or (d) the Shareholders of the Company Shall Have Approved Any Plan of Liquidation or Dissolution of the Company. "Clearstream" means Clearstream Banking S.A. and any successor thereto. "Code" means the Internal Revenue Code of 1986, as amended. "Commission" means the Securities and Exchange Commission. "Commodity Price Protection Agreement" means, in respect of a Person, any forward contract, commodity swap agreement, commodity option agreement or other similar agreement or arrangement designed to protect such Person against fluctuations in commodity prices. "Consolidated Current Liabilities" means, as of any date of determination, the aggregate amount of liabilities of the Company and its consolidated Restricted Subsidiaries that may properly be classified as current liabilities (including taxes accrued as estimated), after eliminating: (a) All Intercompany Items Between the Company and Any Restricted Subsidiary or Between Restricted Subsidiaries, and (b) All Current Maturities of Long-term Debt. "Consolidated Interest Coverage Ratio" means, as of any date of determination, the ratio of: (a) the Aggregate Amount of Ebitda for the Most Recent Four Consecutive Fiscal Quarters for Which Financial Statements are Available On Such Determination Date to (b) Consolidated Interest Expense for Such Four Fiscal Quarters; Provided, However, That: (1) if (A) since the beginning of such period the Company or any Restricted Subsidiary has Incurred any Debt that remains outstanding or Repaid any Debt, or (B) the transaction giving rise to the need to calculate the Consolidated Interest Coverage Ratio is or includes an Incurrence or Repayment of Debt, Consolidated Interest Expense for such period shall be calculated after giving effect on a pro forma basis to such Incurrence or Repayment as if such Debt was Incurred or Repaid on the first day of such period, provided that, in the event of any such Repayment of Debt, EBITDA for such period shall be calculated as if the Company or such Restricted Subsidiary had not earned any interest income actually earned during such period in respect of the funds used to Repay such Debt, and (2) if (A) since the beginning of such period the Company or any Restricted Subsidiary shall have made any Asset Sale or an Investment (by merger or otherwise) in any Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary) or an acquisition of Property which constitutes all or substantially all of an operating unit of a business, 5 (B) the transaction giving rise to the need to calculate the Consolidated Interest Coverage Ratio is such an Asset Sale, Investment or acquisition, or (C) since the beginning of such period any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Company or any Restricted Subsidiary since the beginning of such period) shall have made such an Asset Sale, Investment or acquisition, EBITDA for such period shall be calculated after giving pro forma effect to such Asset Sale, Investment or acquisition as if such Asset Sale, Investment or acquisition (and, as set forth above, the Incurrence or Repayment of any Debt in connection therewith) occurred on the first day of such period. If any Debt bears a floating rate of interest and is being given pro forma effect, the interest expense on such Debt shall be calculated as if the base interest rate in effect for such floating rate of interest on the date of determination had been the applicable base interest rate for the entire period (taking into account any Interest Rate Agreement applicable to such Debt if such Interest Rate Agreement has a remaining term of at least 12 months or, if earlier, through the maturity of such Debt). In the event the Capital Stock of any Restricted Subsidiary is sold during the period, the Company shall be deemed, for purposes of clause (1) above, to have Repaid during such period the Debt of such Restricted Subsidiary to the extent the Company and its continuing Restricted Subsidiaries are no longer liable for such Debt after such sale. "Consolidated Interest Expense" means, for any period, the total interest expense of the Company and its consolidated Restricted Subsidiaries, plus, to the extent not included in such total interest expense, and to the extent Incurred by the Company or its Restricted Subsidiaries, (a) Interest Expense Attributable to Leases Constituting Part of a Sale and Leaseback Transaction and to Capital Lease Obligations, (b) Amortization of Debt Discount and Debt Issuance Cost, Including Commitment Fees, (c) Capitalized Interest, (d) Non-cash Interest Expense, (e) Commissions, Discounts and Other Fees and Charges Owed With Respect to Letters of Credit and Bankers' Acceptance Financing, (f) Net Costs Associated With Hedging Obligations (Including Amortization of Fees), (g) Disqualified Stock Dividends, (h) Preferred Stock Dividends; (i) Interest Incurred in Connection With Investments in Discontinued Operations; (j) Interest Accruing On Any Debt of Any Other Person to the Extent Such Debt is Guaranteed by the Company or Any Restricted Subsidiary; and (k) the Cash Contributions to Any Employees Stock Ownership Plan or Similar Trust to the Extent Such Contributions are Used by Such Plan or Trust to Pay Interest or Fees to Any Person (Other Than the Company) in Connection With Debt Incurred by Such Plan or Trust. 6 For purposes of the foregoing, total interest expense will be determined after giving effect to any net payments made or received by the Company and its Restricted Subsidiaries with respect to Interest Rate Agreements. "Consolidated Net Income" means, for any period, the net income (loss) of the Company and its consolidated Subsidiaries; provided, however, that there shall not be included in such Consolidated Net Income: (a) Any Net Income (Loss) of Any Person (Other Than the Company) If Such Person is Not a Restricted Subsidiary, Except That: (1) subject to the exclusion contained in clause (d) below, the Company's equity in the net income of any such Person for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash distributed by such Person during such period to the Company or a Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution to a Restricted Subsidiary, to the limitations contained in clause (c) below), and (2) the Company's equity in a net loss of any such Person for such period shall be included in determining such Consolidated Net Income to the extent such loss has been funded with cash by the Company or a Restricted Subsidiary; (b) Any Net Income (Loss) of Any Person Acquired by the Company or Any of Its Consolidated Subsidiaries in a Pooling of Interests Transaction for Any Period Prior to the Date of Such Acquisition; (c) Any Net Income (Loss) of Any Restricted Subsidiary If Such Restricted Subsidiary is Subject to Restrictions On the Payment of Dividends or the Making of Distributions, Directly or Indirectly, to the Company, Except That: (1) subject to the exclusion contained in clause (d) below, the Company's equity in the net income of any such Restricted Subsidiary for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash that was permitted to be distributed by such Restricted Subsidiary during such period to the Company or another Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution to another Restricted Subsidiary, to the limitation contained in this clause (1)), and (2) the Company's equity in a net loss of any such Restricted Subsidiary for such period shall be included in determining such Consolidated Net Income; (d) Any Gain or Loss Realized Upon the Sale or Other Disposition of Any Property of the Company or Any of Its Consolidated Subsidiaries (Including Pursuant to Any Sale and Leaseback Transaction) That is Not Sold or Otherwise Disposed of in the Ordinary Course of Business; (e) Any Gain or Loss That is Extraordinary (As Determined in Accordance With Gaap); (f) Any Restructuring Charges (As Determined in Accordance With Gaap) Plus Any Other Non-cash Charges Associated With Facility Closures or Production Line Shutdowns Such as Accelerated Depreciation and Amortization and Any Gain or Loss in Connection With the Extinguishment of Debt; and (g) the Cumulative Effect of a Change in Accounting Principles. Notwithstanding the foregoing, for purposes of Section 4.10 hereof only, there shall be excluded from Consolidated Net Income any dividends, repayments of loans or advances or other transfers of assets from Unrestricted Subsidiaries to the Company or a Restricted Subsidiary to the extent such dividends, repayments or transfers increase the amount of Restricted Payments permitted under such covenant pursuant to clause (c)(3) thereof. 7 "Consolidated Net Tangible Assets" means, as of any date of determination, the sum of the amounts that would appear on a consolidated balance sheet of the Company and its consolidated Restricted Subsidiaries as the total assets (less accumulated depreciation and amortization, allowances for doubtful receivables, other applicable reserves and other items properly deductible under GAAP) of the Company and its Restricted Subsidiaries, after giving effect to purchase accounting and after deducting therefrom Consolidated Current Liabilities and, to the extent otherwise included, the amounts of (without duplication): (a) Intangible Assets, Including the Excess of Cost Over Fair Market Value of Assets or Businesses Acquired, Goodwill, Trademarks, Trade Names, Patents, Unamortized Debt Discount and Accumulated Organizational Expenses; (b) Minority Interests in Consolidated Subsidiaries Held by Persons Other Than the Company or Any Restricted Subsidiary; (c) Treasury Stock; (d) Cash or Securities Set Aside and Held in a Sinking or Other Analogous Fund Established for the Purpose of Redemption or Other Retirement of Capital Stock to the Extent Such Obligation is Not Reflected in Consolidated Current Liabilities; and (e) Investments in and Assets of Unrestricted Subsidiaries. "Corporate Trust Office of the Trustee" shall be at the address of the Trustee specified in Section 12.02 hereof or such other address as to which the Trustee may give notice to the Company. "Credit Facilities" means, with respect to the Company or any Restricted Subsidiary, the Exit Credit Facility and one or more other debt or commercial paper facilities with banks or other institutional lenders (including providing for revolving credit loans, term loans, receivables or inventory financing including through the sale of receivables or inventory to such lenders or to special purpose, bankruptcy remote entities formed to borrow from such lenders against such receivables or inventory) or trade letters of credit, in each case together with any extensions, revisions, refinancings or replacements thereof. "Currency Exchange Protection Agreement" means, in respect of a Person, any foreign exchange contract, currency swap agreement, currency option or other similar agreement or arrangement designed to protect such Person against fluctuations in currency exchange rates. "Custodian" means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03 hereof as Custodian with respect to the Notes, any and all successors thereto appointed as custodian hereunder and having become such pursuant to the applicable provisions of this Indenture. "Debt" means, with respect to any Person on any date of determination (without duplication): (a) Debt of Such Person for Money Borrowed and Debt Evidenced by Notes, Debentures, Bonds or Other Similar Instruments for the Payment of Which Such Person is Responsible or Liable; (b) All Capital Lease Obligations of Such Person and All Attributable Debt in Respect of Sale and Leaseback Transactions Entered Into by Such Person; (c) All Obligations of Such Person Issued or Assumed as the Deferred Purchase Price of Property, All Conditional Sale Obligations of Such Person and All Obligations of Such Person Under Any Title Retention Agreement (But Excluding Trade Accounts Payable Arising in the Ordinary Course of Business); (d) All Obligations of Such Person for the Reimbursement of Any Obligor On Any Letter of Credit, Banker's Acceptance or Similar Credit Transaction (Other Than Obligations With Respect to Letters of Credit Securing Obligations (Other Than Obligations Described in (A) Through (C) Above) Entered 8 Into in the Ordinary Course of Business of Such Person to the Extent Such Letters of Credit are Not Drawn Upon Or, If and to the Extent Drawn Upon, Such Drawing is Reimbursed No Later Than the Third Business Day Following Receipt by Such Person of a Demand for Reimbursement Following Payment On the Letter of Credit); (e) the Amount of All Obligations of Such Person With Respect to the Repayment of Any Disqualified Stock Or, With Respect to Any Subsidiary of Such Person, Any Preferred Stock (But Excluding, in Each Case, Any Accrued Dividends): (f) All Obligations of the Type Referred to in Clauses (A) Through (E) of Other Persons and All Dividends of Other Persons for the Payment of Which, in Either Case, Such Person is Responsible or Liable, Directly or Indirectly, as Obligor, Guarantor or Otherwise; (g) All Obligations of the Type Referred to in Clauses (A) Through (F) of Other Persons Secured by Any Lien On Any Property of Such Person (Whether or Not Such Obligation is Assumed by Such Person), the Amount of Such Obligation Being Deemed to be the Lesser of the Value of Such Property or the Amount of the Obligation So Secured; and (h) to the Extent Not Otherwise Included in This Definition, Hedging Obligations of Such Person. The amount of Debt of any Person at any date shall be the outstanding balance at such date of all unconditional obligations as described above and the maximum liability, upon the occurrence of the contingency giving rise to the obligation, of any contingent obligations at such date. "Default" means any event which is, or after notice or passage of time or both would be, an Event of Default. "Definitive Note" means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 hereof, in substantially the form of Exhibit A hereto except that such Note shall not bear the Global Note Legend and shall not have the "Schedule of Exchanges of Interests in the Global Note" attached thereto. "Depositary" means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03 hereof as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provisions of this Indenture. "Disqualified Stock" means, with respect to any Person, any Capital Stock that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable, in either case at the option of the holder thereof) or otherwise: (a) Matures or is Mandatorily Redeemable Pursuant to a Sinking Fund Obligation or Otherwise, (b) is or May Become Redeemable or Repurchaseable At the Option of the Holder Thereof, in Whole or in Part, or (c) is Convertible or Exchangeable At the Option of the Holder Thereof for Debt or Disqualified Stock, on or prior to, in the case of clause (a), (b) or (c), the first anniversary after the Stated Maturity of the Notes. "Disqualified Stock Dividends" means all dividends with respect to Disqualified Stock of the Company held by Persons other than a Restricted Subsidiary. "Distribution Compliance Period" means the 40-day distribution compliance period as defined in Regulation S. 9 "Domestic Subsidiary" means any Restricted Subsidiary of the Company that was formed under the laws of the United States or any State or territory of the United States or the District of Columbia. "EBITDA" means, for any period, an amount equal to, for the Company and its consolidated Restricted Subsidiaries: (a) the Sum of Consolidated Net Income for Such Period, Plus the Following to the Extent Included in Consolidated Net Income for Such Period: (1) the provision for taxes based on income or profits or utilized in computing net loss, (2) Consolidated Interest Expense, (3) depreciation, (4) amortization, (5) non-capitalized transaction costs in connection with actual or proposed financings, acquisitions or divestitures, (6) any expenses after the effective date of the Plan of Reorganization that are included in cost of goods sold arising from adjustments to inventory that are made as a result of the application fresh start accounting; and (7) any other non-cash items, including without limitation, any non-cash adjustments as a result of the application of fresh start accounting (other than any such non-cash item to the extent that it represents an accrual of or reserve for cash expenditures in any future period), minus (b) All Non-cash Items Increasing Consolidated Net Income for Such Period (Other Than Any Such Non-cash Item to the Extent That It Will Result in the Receipt of Cash Payments in Any Future Period). Notwithstanding the foregoing clause (a), the provision for taxes and the depreciation, amortization and non-cash items of a Restricted Subsidiary shall be added to Consolidated Net Income to compute EBITDA only to the extent (and in the same proportion) that the net income of such Restricted Subsidiary was included in calculating Consolidated Net Income and only if a corresponding amount would be permitted at the date of determination to be dividended to the Company by such Restricted Subsidiary without prior approval (that has not been obtained), pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to such Restricted Subsidiary or its shareholders. "Equity Interests" means Qualified Capital Stock and all warrants, options or other rights to acquire Qualified Capital Stock, but excluding any debt security that is convertible into, or exchangeable for, Qualified Capital Stock. "Equity Offering" means a primary offering of common stock of the Company or an offering of capital stock of any direct or indirect parent of the Company. "Euroclear" means Euroclear Bank, S.A./N.V., as operator of the Euroclear systems, and any successor thereto. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Exchange Notes" means Notes that may be issued in an Exchange Offer pursuant to Section 2.06(e)(iv) hereof as evidence of the same continuing Debt of the Company under, and in exchange for, any Notes. 10 "Exchange Offer" means an offer by the Company to issue and deliver to the Holders that are not prohibited by any law or policy of the Commission from participating in such offer, in exchange for any Notes, a like principal amount of Exchange Notes, as set forth in a Registration Rights Agreement. "Exit Credit Facility" means the $[ ] million revolving credit and term loan facility to be entered into on or before the Issue Date between the Company,[ ], as agent, and the lenders thereunder. "Floating Rate Notes" means the floating rate notes, if any, issued by the Company in satisfaction of claims pursuant to the Plan of Reorganization. "Foreign Restricted Subsidiary" means any Restricted Subsidiary which is not organized under the laws of the United States of America or any State thereof or the District of Columbia. "GAAP" means United States generally accepted accounting principles as in effect on the Issue Date, including those set forth: (a) in the Opinions and Pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants, (b) in the Statements and Pronouncements of the Financial Accounting Standards Board, (c) in Such Other Statements by Such Other Entity as Approved by a Significant Segment of the Accounting Profession, and (d) the Rules and Regulations of the Commission Governing the Inclusion of Financial Statements (Including Pro Forma Financial Statements) in Periodic Reports Required to be Filed Pursuant to Section 13 of the Exchange Act, Including Opinions and Pronouncements in Staff Accounting Bulletins and Similar Written Statements From the Accounting Staff of the Commission. "Global Note Legend" means the legend set forth in Section 2.06(f)(ii) hereof, which is required to be placed on all Global Notes issued under this Indenture. "Global Notes" means one or more global Notes registered in the name of the Depositary or its nominee issued in accordance with Article 2 hereof substantially in the form of Exhibit A hereto and bearing the Global Note Legend and including the "Schedule of Exchanges of Interests in the Global Note" attached thereto. "Guarantee" means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Debt of any other Person and any obligation, direct or indirect, contingent or otherwise, of such Person: (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt of such other Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, Capital Stock, goods, securities or services, to take-or-pay or to maintain financial statement conditions or otherwise), or (b) entered into for the purpose of assuring or protecting in any other manner the obligee against loss in respect thereof (in whole or in part); provided, however, that the term "Guarantee" shall not include (i) endorsements for collection or deposit in the ordinary course of business or (ii) a contractual commitment by one Person to invest in another Person for so long as such Investment is reasonably expected to constitute a Permitted Investment under clause (a), (b) or (c) of the definition of "Permitted Investment." The term "Guarantee" used as a verb has a corresponding meaning. "guarantor" means any Person Guaranteeing any obligation. 11 "Hedging Obligations" of any Person means any obligation of such Person pursuant to any Interest Rate Agreement, Currency Exchange Protection Agreement or Commodity Price Protection Agreement. "Holder" means a Person in whose name a Note is registered. "IAI Global Note" means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of any Notes that may be sold to Institutional Accredited Investors. "Incur" means, with respect to any Debt or other obligation of any Person, to create, issue, incur (by merger, conversion, exchange or otherwise), extend, assume, guarantee or become liable in respect of such Debt or other obligation or the recording, as required pursuant to GAAP or otherwise, of any such Debt or obligation on the balance sheet of such Person (and "Incurrence" and "Incurred" shall have meanings correlative to the foregoing); provided, however, that a change in GAAP that results in an obligation of such Person that exists at such time, and is not theretofore classified as Debt, becoming Debt shall not be deemed an Incurrence of such Debt; provided further, however, that any Debt or other obligations of a Person existing at the time such Person becomes a Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at the time it becomes a Subsidiary; and provided further, however, that solely for purposes of determining compliance with Section 4.09 hereof, amortization of debt discount shall not be deemed to be the Incurrence of Debt, provided that in the case of Debt sold at a discount, the amount of such Debt Incurred shall at all times be the aggregate principal amount at Stated Maturity. "Indenture" means this instrument, as originally executed or as it may from time to time be supplemented or amended in accordance with Article 9 hereof. "Independent Financial Advisor" means an investment banking firm of national standing or any third party appraiser of national standing, provided that such firm or appraiser is not an Affiliate of the Company. "Indirect Participant" means a Person who holds a beneficial interest in a Global Note through a Participant. "Initial Notes" means $[ ] million aggregate principal amount of Notes issued under this Indenture on the date hereof pursuant to the Plan of Reorganization. "Institutional Accredited Investor" means an institution that is an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act. "Interest Payment Dates" shall have the meaning set forth in paragraph 1 of the Note. "Interest Rate Agreement" means, for any Person, any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement or other similar agreement designed to protect against fluctuations in interest rates. "Investment" by any Person means any direct or indirect loan (other than advances to customers in the ordinary course of business that are recorded as accounts receivable on the balance sheet of such Person), advance or other extension of credit or capital contribution (by means of transfers of cash or other Property to others or payments for Property or services for the account or use of others, or otherwise) to, or Incurrence of a guarantee of any obligation of, or purchase or acquisition of Capital Stock, bonds, notes, debentures or other securities or evidence of Debt issued by, any other Person. "Investment" shall include the portion (proportionate to the Company's equity interest in such Subsidiary) of the fair market value of the net assets of any Subsidiary of the Company at the time that such Subsidiary is designated an Unrestricted Subsidiary. In determining the amount of any Investment made by transfer of any Property other than cash, such Property shall be valued at its fair market value at the time of such Investment. 12 "Investment Grade Rating" means a rating equal to or higher than Baa3 (or the equivalent) by Moody's or BBB- (or the equivalent) by S&P. "Investment Grade Status" shall be deemed to have been reached on the date that the Notes have an Investment Grade Rating from both of the Rating Agencies. "Issue Date" means the date on which the Notes are initially issued. "Legal Holiday" means a Saturday, a Sunday or a day on which banking institutions in the City of New York, the city in which the Corporate Trust Office of the Trustee is located, or at a place of payment are authorized by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue on such payment for the intervening period. "Lien" means, with respect to any Property of any Person, any mortgage or deed of trust, pledge, hypothecation, security interest, deposit arrangement, lien or charge of any kind on or with respect to such Property (including any Capital Lease Obligation, conditional sale or other title retention agreement having substantially the same economic effect as any of the foregoing or any Sale and Leaseback Transaction). "Moody's" means Moody's Investors Service, Inc. or any successor to the rating agency business of Moody's Investors Service, Inc. "Net Available Cash" from any Asset Sale means cash or Cash Equivalents received therefrom (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise, but only as and when received, but excluding any other consideration received in the form of assumption by the acquiring Person of Debt or other obligations relating to the Property that is the subject of such Asset Sale or received in any other non-cash form), in each case net of: (a) All Legal, Title and Recording Tax Expenses, Commissions and Other Reasonable and Customary Fees and Expenses, Including Those Relating to Legal and Financial Advisory Services, Incurred, and All Federal, State, Provincial, Foreign and Local Taxes Required to be Accrued as a Liability Under Gaap, as a Consequence of Such Asset Sale, (b) All Payments Made On Any Debt That is Secured by Any Property Subject to Such Asset Sale, in Accordance With the Terms of Any Lien Upon or Other Security Agreement of Any Kind With Respect to Such Property, or Which Must by Its Terms, or in Order to Obtain a Necessary Consent to Such Asset Sale, or by Applicable Law, be Repaid Out of the Proceeds From Such Asset Sale, (c) All Distributions and Other Payments Required to be Made to Minority Interest Holders in Subsidiaries or Joint Ventures as a Result of Such Asset Sale, and (d) the Deduction of Appropriate Amounts Provided by the Seller as a Reserve, in Accordance With Gaap, Against Any Liabilities Associated With the Property Disposed in Such Asset Sale and Retained by the Company or Any Restricted Subsidiary After Such Asset Sale. "Non-Recourse Debt" means Debt: (a) as to Which Neither the Company Nor Any Restricted Subsidiary (I) Provides Credit Support of Any Kind (Including Any Undertaking, Agreement or Instrument That Would Constitute Debt or the Incurrence of Any Lien), (Ii) is Directly or Indirectly Liable as a Guarantor or Otherwise, or (Iii) Constitutes the Lender, (b) No Default With Respect to Which (Including Any Rights That the Holders Thereof May Have to Take Enforcement Action Against an Unrestricted Subsidiary) Would Permit Upon Notice, Lapse of Time or Both Any Holder of Any Debt (Other Than the Notes) of the Company or Any Restricted Subsidiary to Declare a Default On Such Other Debt or Cause the Payment Thereof to be Accelerated or Payable Prior to Its Stated Maturity; and 13 (c) as to Which the Lenders Have Been Notified in Writing That They Will Not Have Any Recourse to the Stock or Assets of the Company or Any of Its Restricted Subsidiaries. "Obligations" means all obligations for principal, premium, interest, penalties, fees, indemnifications, reimbursements, damages and other amounts payable under the documentation governing any Debt. "Officer" means the principal executive officer, the principal financial officer or any senior vice president of the Company. "Officers' Certificate" means a certificate signed by two Officers of the Company, at least one of whom shall be the principal executive officer or principal financial officer of the Company, and delivered to the Trustee. "Opinion of Counsel" means a written opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee. "Participant" means, with respect to the Depositary, Euroclear or Clearstream, a Person who has an account with the Depositary, Euroclear or Clearstream, respectively, and, with respect to The Depository Trust Company, shall include Euroclear and Clearstream. "Permitted Debt" means the following: (a) Debt of the Company and Any Subsidiary Guarantors Evidenced by the Notes and the Subsidiary Guarantees Thereof and the Other Debt Securities Listed On Schedule 1.01 Attached Hereto; (b) Debt of the Company and Its Restricted Subsidiaries Under the Credit Facilities; Provided That the Aggregate Principal Amount of All Such Debt Under the Credit Facilities At Any One Time Outstanding Shall Not Exceed $600.0 Million Less the Aggregate Principal Amount Then Outstanding of Any Floating Rate Notes Issued Pursuant to the Plan of Reorganization; (c) Debt of the Company or a Restricted Subsidiary in Respect of Capital Lease Obligations and Purchase Money Debt; Provided That: (1) the Aggregate Principal Amount of Such Debt Does Not Exceed the Fair Market Value (On the Date of the Incurrence Thereof) of the Property Acquired, Constructed or Leased (As Determined in Good Faith by the Company), and (2) the Aggregate Principal Amount of All Debt Incurred and Then Outstanding Pursuant to This Clause (C) Does Not Exceed $50.0 Million Less the Aggregate Amount Then Outstanding of Any Capital Lease Obligations and Purchase Money Debt That Were Outstanding On the Issue Date; (d) Debt of the Company Owing to and Held by Any Restricted Subsidiary and Debt of a Restricted Subsidiary Owing to and Held by the Company or Any Restricted Subsidiary; Provided That If the Company or Any Restricted Subsidiary is the Obligor On Any Such Debt Incurred After the Issue Date, Then Such Debt is Expressly Subordinated by Its Terms to the Prior Payment in Full in Cash of the Notes or the Subsidiary Guarantees, as the Case May Be; Provided, Further, However, That Any Subsequent Issue or Transfer of Capital Stock or Other Event That Results in Any Such Restricted Subsidiary Ceasing to be a Restricted Subsidiary or Any Subsequent Transfer of Any Such Debt (Except to the Company or a Restricted Subsidiary) Shall be Deemed, in Each Case, to Constitute the Incurrence of Such Debt by the Issuer Thereof; (e) Debt Under Interest Rate Agreements Entered Into by the Company or a Restricted Subsidiary for the Purpose of Limiting Interest Rate Risk of the Company or Such Restricted Subsidiary Related to Debt Permitted Under This Indenture to be Outstanding and Not for Speculative Purposes; 14 (f) Debt Under Currency Exchange Protection Agreements Entered Into by the Company or a Restricted Subsidiary for the Purpose of Limiting Currency Exchange Rate Risks Directly Related to Transactions Entered Into by the Company or Such Restricted Subsidiary and Not for Speculative Purposes; (g) Debt Under Commodity Price Protection Agreements Entered Into by the Company or a Restricted Subsidiary in the Ordinary Course of Business and Not for Speculative Purposes; (h) Debt in Connection With One or More Performance, Completion and Surety Bonds and Completion Guarantees Issued by the Company or a Restricted Subsidiary in the Ordinary Course of Business or Pursuant to Self-insurance Obligations and Not in Connection With the Borrowing of Money or the Obtaining of Advances or Credit; (i) Acquired Debt; Provided That the Company Could Have Incurred Such Debt in Accordance With Clause (A) of the First Paragraph of Section 4.09 Hereof On the Date Such Debt Became Acquired Debt; (j) Debt Incurred by Foreign Restricted Subsidiaries in an Aggregate Amount Not to Exceed $100.0 Million At Any One Time Outstanding Less the Aggregate Amount of Any Such Debt Then Outstanding That was Outstanding On the Issue Date; (k) Qualified Distribution Guarantees of the Company or a Restricted Subsidiary in an Aggregate Principal Amount Not to Exceed $25.0 Million At Any One Time Outstanding; (l) Debt Not to Exceed $[ ] Million (Including Any Guarantees) Outstanding On the Issue Date Not Otherwise Described in Clauses (A) Through (K) Above; (m) Debt of the Company or a Restricted Subsidiary Not Otherwise Permitted to be Incurred Pursuant to (A) Through (L) Above and (N) and (O) Below, Which Together With Any Other Debt Incurred Pursuant to This Clause (M) and Outstanding On the Date of Such Incurrence has an Aggregate Principal Amount Outstanding At Any One Time Not to Exceed $25.0 Million; (n) Guarantees by the Company or Any of Its Restricted Subsidiaries of Debt of the Company or Any Restricted Subsidiary to the Extent the Company or Such Restricted Subsidiary has Incurred Such Debt Pursuant to Any Other Clause of This Covenant; and (o) Permitted Refinancing Debt Incurred in Respect of Debt Incurred Pursuant to Clause (A) of the First Paragraph of Section 4.09 Hereof and Clauses (A), (I) and (L) Above and This Clause (O). For purposes of determining compliance with Section 4.09, (1) in the event that an item of Debt meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above or is entitled to be incurred pursuant to Section 4.09(a), the Company shall classify such item of Debt at the time of its Incurrence and will only be required to include the amount and type of such Debt in one of the above clauses, (2) the Company will be permitted at the time of such Incurrence to divide and classify an item of Debt in more than one of the types of Debt described herein, and (3) any Permitted Debt may later be reclassified, in whole or in part, as having been Incurred pursuant to any other clause of this definition to the extent such Debt could be Incurred pursuant to such clause at the time of such reclassification. Notwithstanding the preceding sentence, all Debt outstanding under the Exit Credit Facility will be deemed to be incurred pursuant to clause (b) above. "Permitted Investment" means any Investment by the Company or a Restricted Subsidiary in: (a) the Company or Any Restricted Subsidiary or Any Person That Will, Upon the Making of Such Investment, Become a Restricted Subsidiary; Provided That the Primary Business of Such Restricted Subsidiary is a Related Business; Provided, Further, That Any Such Investments by the Company or Domestic Subsidiaries in Foreign Restricted Subsidiaries Shall Not Exceed $[ ] Per Annum; 15 (b) Any Person If as a Result of Such Investment Such Person is Merged or Consolidated With or Into, or Transfers or Conveys All or Substantially All Its Property To, the Company or a Restricted Subsidiary, in Each Case in Accordance With Section 5.01 Hereof; Provided That Such Person's Primary Business is a Related Business; (c) Cash Equivalents; (d) Receivables Owing to the Company or a Restricted Subsidiary, If Created or Acquired in the Ordinary Course of Business; (e) Payroll, Travel and Similar Advances to Cover Matters That are Expected At the Time of Such Advances Ultimately to be Treated as Expenses for Accounting Purposes and That are Made in the Ordinary Course of Business; (f) Extensions of Credit to Suppliers and Customers Represented by Accounts Receivable and Loans, Advances and Extensions of Credit to Employees, in Each Case, Made in the Ordinary Course of Business; (g) Stock, Obligations or Other Securities Received in Settlement of Debts Created in the Ordinary Course of Business and Owing to the Company or a Restricted Subsidiary or in Satisfaction of Claims or Judgments; (h) Any Person to the Extent Such Investment Represents the Non-cash Portion of the Consideration Received in Connection With an Asset Sale Consummated in Compliance With Section 4.12 Hereof; (i) Investments for Which the Sole Consideration Provided Is, or Which is Funded Out of the Net Proceeds of a Substantially Concurrent Sale Of, Qualified Capital Stock of the Company; Provided That the Proceeds From the Issuance of Such Qualified Capital Stock Shall Not be (And Have Not Been) Included in Any Calculation Pursuant to Clause (C) of Section 4.10 Hereof; (j) So Long as No Event of Default Shall Have Occurred and be Continuing, Investments to Fund the Working Capital Requirements of Worthington/armstrong Joint Venture in an Aggregate Amount Not in Excess of $25.0 Million and Investments in Other Permitted Joint Ventures in an Aggregate Amount Not in Excess of $25.0 Million At Any One Time Outstanding; (k) Investments Existing On the Issue Date in an Amount Not to Exceed the Amount Invested On Such Date; (l) Hedging Obligations Otherwise Permitted Under the Indenture; and (m) So Long as No Event of Default Shall Have Occurred and be Continuing, Other Investments in Any Person After the Issue Date Made for Fair Market Value as Determined in Good Faith by the Company That Do Not Exceed $100.0 Million Outstanding At Any One Time in the Aggregate. "Permitted Joint Venture" means any Person which is not a Subsidiary and is, directly or indirectly, through its subsidiaries or otherwise, engaged principally in a Related Business, and the Capital Stock of which is owned by the Company or its Restricted Subsidiaries, on the one hand, and one or more Persons other than the Company or any Affiliate of the Company, on the other hand. "Permitted Liens" means: (a) Liens to Secure Debt Permitted to be Incurred Under Clause (B) of the Definition of "Permitted Debt" Hereof; (b) Liens to Secure Debt (X) Incurred for the Purpose of Financing All or Any Part of the Purchase Price or Cost of Construction or Improvement of Any Property, or (Y) Permitted to be Incurred Under Clause (C) of the Definition of "Permitted Debt" Hereof; Provided That Any Such Lien May Not Extend to Any Property of the Company or Any Restricted Subsidiary, Other Than the Property Acquired, Constructed or Leased With the Proceeds of Such Debt and Any Improvements or Accessions to Such Property; 16 (c) Liens for Taxes, Assessments or Governmental Charges or Levies On the Property of the Company or Any Restricted Subsidiary If the Same Shall Not At the Time be Delinquent, or are Being Contested in Good Faith and by Appropriate Proceedings Promptly Instituted and Diligently Concluded; (d) Liens Imposed by Law, Such as Statutory Mechanics', Workmen's, Materialmen's, Operators' or Similar Liens, On the Property of the Company or Any Restricted Subsidiary Securing Payment of Obligations That are Not More Than 60 Days Past Due or are Being Contested in Good Faith and by Appropriate Proceedings Promptly Instituted and Diligently Conducted and for Which Adequate Reserves Have Been Established or Other Provisions Have Been Made in Accordance With Gaap; (e) Survey Exceptions, Minor Imperfections Of, or Encumbrances On, Title That Do Not Interfere in Any Material Respect With the Value of the Property to Which They Apply or the Conduct of the Business of the Company and Its Restricted Subsidiaries; (f) Liens On Property At the Time the Company or Any Restricted Subsidiary Acquired Such Property, Including Any Acquisition by Means of a Merger or Consolidation With or Into the Company or Any Restricted Subsidiary; Provided, However, That Any Such Lien is Not Incurred in Anticipation of Such Acquisition and Does Not Extend to Any Other Property of the Company or Any Restricted Subsidiary; Provided, Further That If Any Such Lien Secures Acquired Debt, the Incurrence of Such Acquired Debt was Permitted by the Terms of This Indenture; (h) Liens On the Property of a Person At the Time Such Person Becomes a Restricted Subsidiary; Provided, However, That Any Such Lien is Not Incurred in Anticipation of Such Acquisition and Does Not Extend to Any Other Property of the Company or Any Other Restricted Subsidiary That is Not a Direct Subsidiary of Such Person; Provided, Further, However That If Any Such Lien Secures Debt of Such Person, the Incurrence of Such Debt was Permitted by the Terms of This Indenture; (h) Pledges or Deposits by the Company or Any Restricted Subsidiary Under Workmen's Compensation Laws, Unemployment Insurance Laws or Similar Legislation, or Good Faith Deposits in Connection With Bids, Tenders, Contracts (Other Than for the Payment of Debt) or Leases to Which the Company or Any Restricted Subsidiary is Party, or Deposits to Secure Public or Statutory Obligations of the Company, or Deposits for the Payment of Rent, in Each Case Incurred in the Ordinary Course of Business; (i) Utility Easements, Rights-of-way, Municipal and Zoning Ordinances, Building Regulations and Such Other Encumbrances or Charges Against Real Property as are of a Nature Generally Existing With Respect to Properties of a Similar Character and That Do Not Materially Interfere With the Ordinary Course of Business of the Company or of Any Restricted Subsidiary; (j) Leases or Subleases Granted to Others That Do Not Materially Interfere With the Ordinary Course of Business of the Company or of Any Restricted Subsidiary; (k) Liens Arising From Filing Uniform Commercial Code Financing Statements With Respect to a Lessor's Rights in and to Personal Property Leased Through a True Lease in the Ordinary Course of Business; (l) Liens Arising From the Rendering of a Final Judgment or Order Against the Company or Any Restricted Subsidiary of the Company That Does Not Give Rise to an Event of Default; (m) Liens Securing Reimbursement Obligations With Respect to Letters of Credit Incurred in Accordance With the Indenture That Encumber Documents and Other Property Relating to Such Letters of Credit and the Products and Proceeds Thereof; (n) Liens in Favor of the Trustee Arising Under the Indenture; 17 (o) Liens in Favor of the Company or Any Subsidiary Guarantor; (p) Liens in Favor of Customs and Revenue Authorities Arising as a Matter of Law to Secure Payment of Nondelinquent Customs Duties in Connection With the Importation of Goods; (q) Liens Encumbering Deposits Made in the Ordinary Course of Business to Secure Nondelinquent Obligations Arising From Statutory, Regulatory, Contractual or Warranty Requirements of the Company or Its Restricted Subsidiaries for Which a Reserve or Other Appropriate Provision, If Any, as Shall be Required by Gaap Shall Have Been Made; (r) Liens Arising Out of Consignment or Similar Arrangements for the Sale of Goods Entered Into by the Company or Any Restricted Subsidiary in the Ordinary Course of Business; (s) Liens to Secure Hedging Obligations Otherwise Permitted by This Indenture; (t) Liens On Assets of Foreign Restricted Subsidiaries Securing Debt of Foreign Restricted Subsidiaries Permitted to be Incurred Under Clause (J) of the Definition of "Permitted Debt" Hereof; (u) From and After the First Date On Which the Notes Have Investment Grade Status, Liens On Any Asset of the Company or a Restricted Subsidiary Other Than (I) a Principal Operating Facility Located in the United States or (Ii) Any Capital Stock or Debt of a Restricted Subsidiary Owning Such a Facility; (v) Liens Existing On the Issue Date Not Otherwise Described in Clauses (A) Through (U) Above; (w) Liens On the Property of the Company or Any Restricted Subsidiary to Secure Any Refinancing, in Whole or in Part, of Any Debt Secured by Liens Referred to in Clauses (B), (F), (G), (M) and (V) Above; Provided, However, That Any Such Lien Shall be Limited to All or Part of the Same Property That Secured the Original Lien (Together With Improvements and Accessions to Such Property) and the Aggregate Principal Amount of Debt That is Secured by Such Lien Shall Not be Increased to an Amount Greater Than the Sum Of: (1) the outstanding principal amount, or, if greater, the committed amount, of the Debt secured by Liens described under clauses (b), (f), (g), (m) and (v) above, as the case may be, at the time the original Lien became a Permitted Lien under the Indenture, and (2) an amount necessary to pay any fees and expenses, including premiums and defeasance costs, incurred by the Company or such Restricted Subsidiary in connection with such Refinancing; and (x) Liens Not Otherwise Permitted by Clauses (A) Through (W) Above Encumbering Assets Having an Aggregate Fair Market Value Not in Excess of 7.5% of Consolidated Net Tangible Assets, as Determined Based On the Consolidated Balance Sheet of the Company as of the End of the Most Recent Fiscal Quarter for Which Financial Statements are Available. "Permitted Refinancing Debt" means any Debt that Refinances any other Debt, including any successive Refinancings, so long as: (a) Such Debt is in an Aggregate Principal Amount (Or If Incurred With Original Issue Discount, an Aggregate Issue Price) Not in Excess of the Sum Of: (1) the aggregate principal amount (or if Incurred with original issue discount, the aggregate accreted value) then outstanding of the Debt being Refinanced, and (2) an amount necessary to pay any reasonable and customary fees and expenses, including premiums and defeasance costs, related to such Refinancing, 18 (b) the Average Life of Such Debt is Equal to or Greater Than the Average Life of the Debt Being Refinanced, (c) the Stated Maturity of Such Debt is No Earlier Than the Stated Maturity of the Debt Being Refinanced, (d) the New Debt Shall be Subordinated in Right of Payment to the Notes If and to the Same Extent as the Debt That is Being Refinanced is a Subordinated Obligation; and (e) Such Debt is Incurred Either by the Company or by the Subsidiary Who is the Obligor On the Debt Being Refinanced. "Person" means any individual, corporation, company (including any limited liability company), association, partnership, joint venture, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity. "Plan of Reorganization" means [the Fourth Amended Plan of Reorganization of Armstrong World Inc. as confirmed by the United States Bankruptcy Court for the District of Delaware pursuant to the confirmation order thereof dated [ ], 200[ ]]. "Predecessor Note" of any particular Note means every previous Note evidencing all or a portion of the same Debt as that evidenced by such particular Note; and for the purposes of this definition, any Note authenticated and delivered under Section 2.08 in lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same Debt as the lost, destroyed or stolen Note. "Preferred Stock" of any Person means any Capital Stock of a Person, however designated, which entitles the holder thereof to a preference with respect to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of any other class of Capital Stock issued by such Person. "Preferred Stock Dividends" means all dividends with respect to Preferred Stock of Restricted Subsidiaries held by Persons other than the Company or a Restricted Subsidiary. "Private Placement Legend" means the legend set forth in Section 2.06(f)(i) hereof. "pro forma" means, with respect to any calculation made or required to be made pursuant to the terms hereof, a calculation performed in accordance with Article 11 of Regulation S-X promulgated under the Securities Act. "Property" means, with respect to any Person, any interest of such Person in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including Capital Stock in, and other securities of, any other Person. For purposes of any calculation required pursuant to the Indenture, the value of any Property shall be its fair market value as determined in good faith by the Company. "Purchase Money Debt" means Debt Incurred to finance the acquisition, construction or lease by the Company or a Restricted Subsidiary of Property, including additions and improvements thereto (or the acquisition of Capital Stock of a Person owning such assets); provided, however, that such Debt is Incurred within 180 days after the acquisition, construction or lease of such Property or Capital Stock by the Company or such Restricted Subsidiary. "QIB" means a "qualified institutional buyer" as defined in Rule 144A. "Qualified Capital Stock" means, with respect to any Person, any Capital Stock of such Person that is not Disqualified Stock or convertible into or exchangeable or exercisable for Disqualified Stock. 19 "Qualified Distributor Guarantee" means any guarantee by the Company or any of its Subsidiaries with respect to any Debt of a distributor of products of the Company or any of its Subsidiaries (other than distributors that are Affiliates of the Company), to the extent the grant of any such guarantee relates only to the repurchase of the distributor's inventory and is in the ordinary course of business of the Company or the applicable Restricted Subsidiary. "Rating Agencies" mean Moody's and S&P. "Refinance" means, in respect of any Debt, to refinance, extend, renew, refund, repay, prepay, repurchase, redeem, defease or retire, or to issue other Debt, in exchange or replacement for, such Debt. "Refinanced" and "Refinancing" shall have correlative meanings. "Registration Rights Agreement" means one or more registration rights agreements between the Company and the other parties thereto, as such agreement(s) may be amended, modified or supplemented from time to time, relating to rights given by the Company to the purchasers of Notes to register such Notes under the Securities Act. "Regular Record Date" for the interest payable on any Interest Payment Date means the date specified on the face of the Note. "Regulation S" means Regulation S promulgated under the Securities Act. "Regulation S Global Note" means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of any Notes that may be sold in reliance on Rule 903 of Regulation S. "Related Business" means any business that is related, ancillary or complementary to the businesses of the Company and the Restricted Subsidiaries on the Issue Date. "Repay" means, in respect of any Debt, to repay, prepay, repurchase, redeem, legally defease or otherwise retire such Debt. "Repayment" and "Repaid" shall have correlative meanings. For purposes of Section 4.12 hereof and the definition of "Consolidated Interest Coverage Ratio," Debt shall be considered to have been Repaid only to the extent the related loan commitment, if any, shall have been permanently reduced in connection therewith. "Responsible Officer," when used with respect to the Trustee, means any officer within the Corporate Trust Department of the Trustee (or any successor group of the Trustee) with direct responsibility for the administration of this Indenture and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his or her knowledge of and familiarity with the particular subject. "Restricted Definitive Note" means one or more Definitive Notes bearing the Private Placement Legend. "Restricted Global Notes" means one or more 144A Global Notes, IAI Global Notes and Regulation S Global Notes and any other Global Notes bearing the Private Placement Legend. "Restricted Payment" means (a) Any Dividend or Distribution (Whether Made in Cash, Securities or Other Property) Declared or Paid On or With Respect to Any Shares of Capital Stock of the Company or Any Restricted Subsidiary, Except for Any Dividend or Distribution That is Made Solely to the Company or a Restricted Subsidiary (And, If Such Restricted Subsidiary is Not a Wholly Owned Restricted Subsidiary, to the Other Shareholders of Such Restricted Subsidiary On a Pro Rata Basis or On a Basis That Results in the Receipt by the Company or a Restricted Subsidiary of Dividends or Distributions of Greater Value Than It Would Receive On a Pro Rata Basis) or Any Dividend or Distribution Payable Solely in Shares of Capital Stock (Other Than Disqualified Stock) of the Company; 20 (b) the Purchase, Repurchase, Redemption, Acquisition or Retirement for Value of Any Capital Stock of the Company or Any Restricted Subsidiary (Other Than From the Company or a Restricted Subsidiary); (c) the Purchase, Repurchase, Redemption, Acquisition or Retirement for Value, Prior to the Date for Any Scheduled Maturity, Sinking Fund or Amortization or Other Installment Payment, or Mandatory Redemption, of Any Subordinated Obligation (Other Than Any Subordinated Obligation Owed to the Company or Any Restricted Subsidiary); (d) Any Investment (Other Than Permitted Investments) in Any Person; or (e) the Issuance, Sale or Other Disposition of Capital Stock of Any Restricted Subsidiary to a Person Other Than the Company or Another Restricted Subsidiary If the Result Thereof is That Such Restricted Subsidiary Shall Cease to be a Restricted Subsidiary, in Which Event the Amount of Such "Restricted Payment" Shall be the Fair Market Value of the Remaining Interest, If Any, in Such Former Restricted Subsidiary Held by the Company and the Other Restricted Subsidiaries (As Determined in Good Faith by the Company). "Restricted Subsidiary" means any Subsidiary of the Company other than an Unrestricted Subsidiary. "Rule 144" means Rule 144 promulgated under the Securities Act. "Rule 144A" means Rule 144A promulgated under the Securities Act. "Rule 903" means Rule 903 promulgated under the Securities Act. "Rule 904" means Rule 904 promulgated under the Securities Act. "S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill, Inc., or any successor to the rating agency business thereof. "Sale and Leaseback Transaction" means any direct or indirect arrangement relating to Property now owned or hereafter acquired whereby the Company or a Restricted Subsidiary transfers such Property to another Person and the Company or a Restricted Subsidiary leases it from such Person. "Securities Act" means the Securities Act of 1933, as amended. "Significant Subsidiary" means any Restricted Subsidiary that would be a "significant subsidiary" of the Company within the meaning of Rule 1-02(h) (1) or (2) under Regulation S-X promulgated by the Commission as in effect on the Issue Date. "Special Record Date" for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 2.09 hereof. "Stated Maturity" means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency beyond the control of the issuer unless such contingency has occurred). "Subordinated Obligations" means any Debt of the Company or a Restricted Subsidiary, whether outstanding on the date the Notes are first issued or thereafter Incurred, which is subordinate or junior in right of payment to the Notes or any guarantee of such Restricted Subsidiary, as the case may be, pursuant to a written agreement to that effect. 21 "Subsidiary," with respect to any Person, means, in respect of any Person, any corporation, company (including any limited liability company), association, partnership, joint venture or other business entity of which a majority of the total voting power of the Voting Stock is at the time owned or controlled, directly or indirectly, by: (a) Such Person (b) Such Person and One or More Subsidiaries of Such Person, or (c) One or More Subsidiaries of Such Person. "Subsidiary Guarantee" means a guarantee on the terms set forth in Article 10 hereof by a Subsidiary Guarantor of the Company's obligations with respect to the Notes. "Subsidiary Guarantor" means each Domestic Subsidiary of the Company and any other Subsidiary that becomes a Subsidiary Guarantor pursuant to Section 4.17 hereof. "Surviving Person" means the surviving Person formed by a merger, consolidation or amalgamation and, for purposes of Section 5.01 hereof, a Person to whom all or substantially all of the Property of the Company or a Subsidiary Guarantor is sold, transferred, assigned, leased, conveyed or otherwise disposed. "TIA" means the Trust Indenture Act of 1939, as amended. "Trustee" means the Person named as the "Trustee" in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Trustee" shall mean such successor Trustee. "Unrestricted Definitive Notes" means one or more Definitive Notes that do not and are not required to bear the Private Placement Legend. "Unrestricted Global Notes" means one or more Global Notes that do not and are not required to bear the Private Placement Legend. "Unrestricted Subsidiary" means (a) Any Subsidiary of the Company That is Designated After the Issue Date as an Unrestricted Subsidiary as Permitted or Required Pursuant to Section 4.16 Hereof and is Not Thereafter Redesignated as a Restricted Subsidiary as Permitted Pursuant Thereto and the Subsidiary to be So Designated: (1) does not own any Capital Stock or Debt of, or own or hold any Lien on any Property of the Company or any other Restricted Subsidiary; (2) has no Debt other than Non-Recourse Debt; (3) is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company; (4) is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation (i) to subscribe for additional Capital Stock or (ii) to maintain or preserve such Person's financial condition or to cause such Person to achieve any specified levels of operating results; and 22 (5) has not Guaranteed or otherwise directly or indirectly provided credit support for any Debt of the Company or any of its Restricted Subsidiaries; and (b) Any Subsidiary of an Unrestricted Subsidiary. "U.S. Government Obligations" means direct obligations (or certificates representing an ownership interest in such obligations) of the United States of America (including any agency or instrumentality thereof) 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. "Voting Stock" of any Person as of any date means all classes of Capital Stock or other interests (including partnership interests) of such Person then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof. "Wholly Owned Restricted Subsidiary" means any Restricted Subsidiary that is a Wholly Owned Subsidiary. "Wholly Owned Subsidiary" means a Subsidiary of any Person, all of the outstanding Capital Stock of which (other than any director's qualifying shares or shares owned by foreign nationals to the extent mandated by applicable law) is owned by such Person or one or more Wholly Owned Subsidiaries of such Person. "Worthington/Armstrong Joint Venture" means the joint venture between the Company and Worthington established pursuant to the agreement dated [ ]. Section 1.02. Other Definitions. ------------------ Defined in Term Section ---- ------- "Acceleration Notice"..................................................................6.02 "Affiliate Transaction"................................................................4.14 "Authentication Order".................................................................2.02 "Benefited Party"......................................................................10.01 "Change of Control Offer"..............................................................4.17 "Change of Control Purchase Price".....................................................4.17 "Covenant Defeasance"..................................................................8.03 "CUSIP" ...............................................................................2.12 "Defaulted Interest" ..................................................................2.09 "DTC"..................................................................................2.06 "Event of Default".....................................................................6.01 "Legal Defeasance".....................................................................8.02 "losses"...............................................................................7.07 "Note Register" .......................................................................2.03 "Offer Amount".........................................................................3.09 "Offer Period".........................................................................3.09 "Offer to Purchase"....................................................................3.09 "Paying Agent".........................................................................2.03 "Prepayment Offer".....................................................................4.12 "Purchase Date"........................................................................3.09 "Purchase Price".......................................................................3.09 "Registrar"............................................................................2.03 "Suspended Covenants"..................................................................4.19 "Suspension Period"....................................................................4.19
23 Section 1.03. Incorporation by Reference of Trust Indenture Act. ------------------------------------------------- (a) Whenever This Indenture Refers to a Provision of the Tia, the Provision is Incorporated by Reference in and Made a Part of This Indenture. (b) the Following Tia Terms Used in This Indenture Have the Following Meanings: "indenture securities" means the Notes and the Subsidiary Guarantees; "indenture security holder" means a Holder of a Note; "indenture to be qualified" means this Indenture; "indenture trustee" or "institutional trustee" means the Trustee; and "obligor" on the Notes means the Company and any successor obligor upon the Notes. (c) All Other Terms Used in This Indenture That are Defined by the Tia, Defined by Tia Reference to Another Statute or Defined by Commission Rule Under the Tia and Not Otherwise Defined Herein Have the Meanings So Assigned to Them. Section 1.04. Rules of Construction. UNLESS THE CONTEXT OTHERWISE REQUIRES: (a) a Term has the Meaning Assigned to It; (b) an Accounting Term Not Otherwise Defined Herein has the Meaning Assigned to It in Accordance With Gaap; (c) "Or" is Not Exclusive; (d) Words in the Singular Include the Plural, and in the Plural Include the Singular; (e) All References in This Instrument to Designated "Articles," "Sections" and Other Subdivisions are to the Designated Articles, Sections and Subdivisions of This Instrument as Originally Executed; (f) the Words "Herein," "Hereof" and "Hereunder" and Other Words of Similar Import Refer to This Indenture as a Whole and Not to Any Particular Article, Section or Other Subdivision. (g) "Including" Means "Including Without Limitation;" (h) Provisions Apply to Successive Events and Transactions; (i) References to Sections of or Rules Under the Securities Act Shall be Deemed to Include Substitute, Replacement or Successor Sections or Rules Adopted by the Commission From Time to Time; and (j) in the Event That a Transaction Meets the Criteria of More Than One Category of Permitted Transactions or Listed Exceptions the Company May Classify Such Transaction as It, in Its Sole Discretion, Determines. 24 ARTICLE 2. THE NOTES --------- Section 2.01. Form and Dating. ---------------- (a) General. the Notes Shall be Known and Designated as the "[ ](4)% Senior Notes Due 2010" of the Company. the Stated Maturity of the Notes Shall be [ ], 201[ ](5). the Notes and the Trustee's Certificate of Authentication Shall be Substantially in the Form of Exhibit a Hereto, Which is Hereby Incorporated in and Expressly Made Part of This Indenture. the Notes May Have Notations, Legends or Endorsements Required by Law, Stock Exchange Rule or Usage in Addition to Those Set Forth On Exhibit A. Each Note Shall be Dated the Date of Its Authentication. the Notes Shall be in Denominations of $1,000 and Integral Multiples Thereof. the Terms and Provisions Contained in the Notes Shall Constitute, and are Hereby Expressly Made, a Part of This Indenture, and the Company, the Subsidiary Guarantors and the Trustee, by Their Execution and Delivery of This Indenture, Expressly Agree to Such Terms and Provisions and to be Bound Thereby. However, to the Extent Any Provision of Any Note Conflicts With the Express Provisions of This Indenture, the Provisions of This Indenture Shall Govern and be Controlling. (b) Form of Notes. Notes Shall be Issued Initially in Global Form and Shall be Substantially in the Form of Exhibit a Attached Hereto (Including the Global Note Legend Thereon and the "Schedule of Exchanges of Interests in the Global Note" Attached Thereto). Notes Issued in Definitive Form Shall be Substantially in the Form of Exhibit a Attached Hereto (But Without the Global Note Legend Thereon and Without the "Schedule of Exchanges of Interests in the Global Note" Attached Thereto). Each Global Note Shall Represent Such of the Outstanding Notes as Shall be Specified Therein and Each Shall Provide That It Shall Represent the Aggregate Principal Amount of Outstanding Notes From Time to Time Endorsed Thereon and That the Aggregate Principal Amount of Outstanding Notes Represented Thereby May From Time to Time be Reduced or Increased, as Appropriate, to Reflect Exchanges and Redemptions and Transfers of Interests Therein. Any Endorsement of a Global Note to Reflect the Amount of Any Increase or Decrease in the Aggregate Principal Amount of Outstanding Notes Represented Thereby Shall be Made by the Trustee or the Custodian, At the Direction of the Trustee, in Accordance With Instructions Given by the Holder Thereof as Required by Section 2.06 Hereof. (c) Book-entry Provisions. Participants and Indirect Participants Shall Have No Rights Under This Indenture With Respect to Any Global Note Held On Their Behalf by the Depositary or by the Trustee as the Custodian for the Depositary or Under Such Global Note, and the Depositary Shall be Treated by the Company, the Trustee and Any Agent of the Company or the Trustee as the Absolute Owner of Such Global Note for All Purposes Whatsoever. Notwithstanding the Foregoing, Nothing Herein Shall Prevent the Company, the Trustee or Any Agent of the Company or the Trustee From Giving Effect to Any Written Certification, Proxy or Other Authorization Furnished by the Depositary or Impair, as Between the Depositary and Its Participants or Indirect Participants, the Applicable Procedures or the Operation of Customary Practices of the Depositary Governing the Exercise of the Rights of a Holder of a Beneficial Interest in Any Global Note. (d) Euroclear and Clearstream Procedures Applicable. the Provisions of the "Operating Procedures of the Euroclear System" and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and Conditions of Clearstream" and "Customer Handbook" of Clearstream Shall be Applicable to Transfers of Beneficial Interests in Global Notes That are Held by Participants Through Euroclear or Clearstream. (e) Certificated Securities. If At Any Time the Depositary Notifies the Company That It is Unwilling or Unable to Continue as Depositary or If At Any Time the Depositary Shall No Longer be Eligible Under This Section 2.01, the Company Shall Appoint a Successor Depositary. If a Successor Depositary is Not Appointed by the Company Within 120 Days After the Company Receives Such Notice - -------------------------------- (4) The interest rate for the Notes shall be determined in the manner described in the definition of "Plan Notes" contained in the Plan of Reorganization. (5) The tenth anniversary of the Issue Date. 25 Or Becomes Aware of Such Ineligibility, the Company Will Execute, and the Trustee, Upon Receipt of a Company Order for the Authentication and Delivery of Definitive Notes, Will Authenticate and Deliver Definitive Notes, in Authorized Denominations, in an Aggregate Principal Amount and Like Terms and Tenor Equal to the Principal Amount of the Global Notes in Exchange for Such Global Notes. The Company may at any time and in its sole discretion determine that Global Notes shall no longer be represented by such Global Notes. In such event, the Company will execute, and the Trustee, upon receipt of a Company order for the authentication and delivery of Definitive Notes of the same terms and tenor, will authenticate and deliver Definitive Notes, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Notes in exchange for such Global Notes. If specified by the Company pursuant to Section 2.02 with respect to Global Notes, the Depositary may surrender Global Notes in exchange in whole or in part for Definitive Notes and of like terms and tenor on such terms as are acceptable to the Company and such Depositary. Thereupon, the Company shall execute, and the Trustee upon receipt of a Company order for the authentication and delivery of Definitive Notes, shall authenticate and deliver, without service charge to the holders: (i) to Each Person Specified by Such Depositary a New Definitive Note or Notes of the Same Tenor, in Authorized Denominations, in an Aggregate Principal Amount Equal to and in Exchange for Such Person's Beneficial Interest in the Global Note; and (ii) to Such Depositary a New Global Note in a Denomination Equal to the Difference, If Any, Between the Principal Amount of the Surrendered Global Note and the Aggregate Principal Amount of the Definitive Notes Delivered to Holders Pursuant to Clause (A) Above. Upon the exchange of a Global Note for Definitive Notes, such Global Note shall be cancelled by the Trustee or an agent of the Company or the Trustee. Definitive Notes in exchange for a Global Note pursuant to this Section 2.01 shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee or an agent of the Company or the Trustee in writing. The Trustee or such agent shall deliver such Notes to or as directed by the Persons in whose names such Notes are so registered or to the Depositary. Section 2.02. Execution and Authentication. ----------------------------- (a) One Officer Shall Sign the Notes for the Company by Manual or Facsimile Signature. (b) If an Officer Whose Signature is On a Note No Longer Holds That Office At the Time a Note is Authenticated, the Note Shall Nevertheless be Valid. (c) a Note Shall Not be Valid Until Authenticated by the Manual Signature of the Trustee. the Signature Shall be Conclusive Evidence That the Note has Been Authenticated Under This Indenture. (d) the Trustee Shall, Upon a Written Order of the Company Signed by an Officer (An "Authentication Order"), Authenticate Notes for Original Issue. (e) the Trustee May Appoint an Authenticating Agent Acceptable to the Company 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 Holders or an Affiliate of the Company or Any of Their Respective Subsidiaries. Section 2.03. Registrar, Paying Agent and Depositary. --------------------------------------- The Company shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange ("REGISTRAR") and an office or agency where Notes may be presented for payment ("PAYING AGENT"). The Registrar shall keep in a register of the Notes (the "NOTE REGISTER") the names 26 and addresses of the Holders and of their transfer and exchange. The Company, upon prior written notice to the Trustee, may appoint one or more co-registrars and one or more additional paying agents. The term "Registrar" includes any co-registrar and the term "Paying Agent" includes any additional paying agent. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company shall notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. The Company or any of its subsidiaries may act as Paying Agent or Registrar. The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture, which shall incorporate the provisions of the Trust Indenture Act. Such agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall notify the Trustee of the name and address of such Agent. The Company initially appoints The Depository Trust Company to act as Depositary with respect to the Global Notes. The Company initially appoints the Trustee to act as the Registrar and Paying Agent and to act as Custodian with respect to the Global Notes. Section 2.04. Paying Agent to Hold Money in Trust. ----------------------------------- The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent shall hold in trust for the benefit of the Holders or the Trustee all money held by the Paying Agent for the payment of principal, premium, if any, or interest on the Notes, and shall notify the Trustee of any default by the Company in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for the money. If the Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the Company, the Trustee shall serve as Paying Agent for the Notes. 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 all Holders and shall otherwise comply with TIA ss.312(a). If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least seven Business Days before each Interest Payment Date and at such other times as the Trustee may request in writing, a list in such form and as of such date or such shorter time as the Trustee may allow, as the Trustee may reasonably require of the names and addresses of the Holders and the Company shall otherwise comply with TIA ss.312(a). Section 2.06. Transfer and Exchange. ---------------------- (a) Transfer and Exchange of Global Notes. a Global Note May Not be Transferred as a Whole Except by the Depositary to a Nominee of the Depositary, by a Nominee of the Depositary to the Depositary or to Another Nominee of the Depositary, or by the Depositary or Any Such Nominee to a Successor Depositary or a Nominee of Such Successor Depositary. All Global Notes Will be Exchanged by the Company for Definitive Notes If (1) the Company Delivers to the Trustee Notice From the Depositary That It is Unwilling or Unable to Continue to Act as Depositary or That It is No Longer a Clearing Agency Registered Under the Exchange Act And, in Either Case, a Successor Depositary is Not Appointed by the Company Within 120 Days After the Date of Such Notice From the Depositary or (2) the Company in Its Sole Discretion Determines That the Global Notes (In Whole But Not in Part) Should be Exchanged for Definitive Notes and Delivers a Written Notice to Such Effect to the Trustee; or (3) an Event of Default Entitling the Holders to Accelerate Shall Have Occurred and be Continuing and the Registrar has Received a Written Request From the Depositary to Issue Definitive Notes. Upon the Occurrence of Any of the Preceding Events in (1), (2) or (3) Above, Definitive Notes Shall be Issued in Denominations of $1,000 or Integral Multiples Thereof and in Such Names as the Depositary Shall Instruct the Trustee in Writing. Global Notes Also May be Exchanged or Replaced, in Whole or in Part, as Provided in Sections 2.07 and 2.08 Hereof. Every Note Authenticated and Delivered in Exchange For, or in Lieu Of, a Global Note or Any Portion Thereof, Pursuant to This Section 2.06 or Section 2.07 or 2.08 Hereof, Shall be Authenticated and Delivered in the Form Of, and Shall Be, a Global Note. a Global Note May Not be Exchanged for Another Note Other Than as Provided in This Section 2.06(A); However, Beneficial Interests in a Global Note May be Transferred and Exchanged as Provided in Section 2.06(B), (C) or (E)(iv) Hereof. 27 (b) Transfer and Exchange of Beneficial Interests in the Global Notes. the Transfer and Exchange of Beneficial Interests in the Global Notes Shall be Effected Through the Depositary, in Accordance With the Provisions of This Indenture and the Applicable Procedures. Beneficial Interests in the Restricted Global Notes Shall be Subject to Restrictions On Transfer Comparable to Those Set Forth Herein to the Extent Required by the Securities Act. Transfers of Beneficial Interests in the Global Notes Also Shall Require Compliance With Either Clause (I) or (Ii) Below, as Applicable, as Well as One or More of the Other Following Clauses, as Applicable: (i) Transfer of Beneficial Interests in the Same Global Note. Beneficial Interests in Any Restricted Global Note May be Transferred to Persons Who Take Delivery Thereof in the Form of a Beneficial Interest in the Same Restricted Global Note in Accordance With the Transfer Restrictions Set Forth in the Private Placement Legend. Beneficial Interests in Any Unrestricted Global Note May be Transferred to Persons Who Take Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note. No Written Orders or Instructions Shall be Required to be Delivered to the Registrar to Effect the Transfers Described in This Section 2.06(B)(i). (ii) All Other Transfers and Exchanges of Beneficial Interests in Global Notes. in Connection With All Transfers and Exchanges of Beneficial Interests That are Not Subject to Section 2.06(B)(i) Above, the Transferor of Such Beneficial Interest Must Deliver to the Registrar Either (A)(1) a Written Order From a Participant or an Indirect Participant Given to the Depositary in Accordance With the Applicable Procedures Directing the Depositary to Credit or Cause to be Credited a Beneficial Interest in Another Global Note in an Amount Equal to the Beneficial Interest to be Transferred or Exchanged and (2) Instructions Given in Accordance With the Applicable Procedures Containing Information Regarding the Participant Account to be Credited With Such Increase or (B)(1) a Written Order From a Participant or an Indirect Participant Given to the Depositary in Accordance With the Applicable Procedures Directing the Depositary to Cause to be Issued a Definitive Note in an Amount Equal to the Beneficial Interest to be Transferred or Exchanged and (2) Instructions Given by the Depositary to the Registrar Containing Information Regarding the Person in Whose Name Such Definitive Note Shall be Registered to Effect the Transfer or Exchange Referred to in (B)(1) Above. Upon Consummation of an Exchange Offer by the Company in Accordance With Section 2.06(E)(iv) Hereof, the Requirements of This Section 2.06(B)(ii) Shall be Deemed to Have Been Satisfied Upon Receipt by the Registrar of the Instructions Contained in the Letter of Transmittal Delivered by the Holder of Such Beneficial Interests in the Restricted Global Notes. Upon Satisfaction of All of the Requirements for Transfer or Exchange of Beneficial Interests in Global Notes Contained in This Indenture and the Notes or Otherwise Applicable Under the Securities Act, the Trustee Shall Adjust the Principal Amount of the Relevant Global Note(s) Pursuant to Section 2.06(G) Hereof. (iii) Transfer of Beneficial Interests in a Restricted Global Note to Another Restricted Global Note. a Beneficial Interest in Any Restricted Global Note May be Transferred to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in Another Restricted Global Note If the Transfer Complies With the Requirements of Section 2.06(B)(ii) Above and the Registrar Receives the Following: (A) If the Transferee Will Take Delivery in the Form of a Beneficial Interest in an 144A Global Note, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications in Item (1) Thereof; (B) If the Transferee Will Take Delivery in the Form of a Beneficial Interest in a Regulation S Global Note, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications in Item (2) Thereof; and (C) If the Transferee Will Take Delivery in the Form of a Beneficial Interest in a Iai Global Note, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications and Certificates and Opinion of Counsel Required by Item (3) Thereof, If Applicable. 28 (iv) Transfer and Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in an Unrestricted Global Note. a Beneficial Interest in Any Restricted Global Note May be Exchanged by Any Holder Thereof for a Beneficial Interest in an Unrestricted Global Note or Transferred to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note If the Exchange or Transfer Complies With the Requirements of Section 2.06(B)(ii) Above And: (A) Such Exchange or Transfer is Effected Pursuant to an Exchange Offer in Accordance With the Applicable Registration Rights Agreement and the Holder of the Beneficial Interest to be Transferred, in the Case of an Exchange, or the Transferee, in the Case of a Transfer, Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; (B) Such Transfer is Effected Pursuant to an Effective Shelf Registration Statement in Accordance With the Applicable Registration Rights Agreement; (C) Such Transfer is Effected by a Broker-dealer Pursuant to an Effective Exchange Offer Registration Statement in Accordance With the Applicable Registration Rights Agreement; or (D) the Registrar Receives the Following: (1) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Exchange Such Beneficial Interest for a Beneficial Interest in an Unrestricted Global Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (1)(A) Thereof; or (2) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Transfer Such Beneficial Interest to a Person Who Shall Take Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note, a Certificate From Such Holder in the Form of Exhibit B Hereto, Including the Certifications in Item (4) Thereof; and, in each such case set forth in this clause (D), if the Registrar and the Company so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. If any such transfer is effected pursuant to clause (B) or (D) above at a time when an Unrestricted Global Note has not yet been issued, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred pursuant to clause (B) or (D) above. (v) Transfer or Exchange of Beneficial Interests in Unrestricted Global Notes for Beneficial Interests in Restricted Global Notes Prohibited. Beneficial Interests in an Unrestricted Global Note Cannot be Exchanged For, or Transferred to Persons Who Take Delivery Thereof in the Form Of, a Beneficial Interest in a Restricted Global Note. (c) Transfer or Exchange of Beneficial Interests for Definitive Notes. (i) Beneficial Interests in Restricted Global Notes to Restricted Definitive Notes. If Any Holder of a Beneficial Interest in a Restricted Global Note Proposes to Exchange Such Beneficial Interest for a Restricted Definitive Note or to Transfer Such Beneficial Interest to a Person Who Takes Delivery Thereof in the Form of a Restricted Definitive Note, Then, Upon Receipt by the Registrar of the Following Documentation: 29 (A) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Exchange Such Beneficial Interest for a Restricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (2)(A) Thereof; (B) If Such Beneficial Interest is Being Transferred to a Qib in Accordance With Rule 144A, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (1) Thereof; (C) If Such Beneficial Interest is Being Transferred to a Non-u.s. Person in an Offshore Transaction in Accordance With Rule 903 or Rule 904, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (2) Thereof; (D) If Such Beneficial Interest is Being Transferred Pursuant to an Exemption From the Registration Requirements of the Securities Act in Accordance With Rule 144 Under the Securities Act, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(A) Thereof; (E) If Such Beneficial Interest is Being Transferred to an Institutional Accredited Investor in Reliance On an Exemption From the Registration Requirements of the Securities Act Other Than Those Listed in Clauses (B) Through (D) Above, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications, Certificates and Opinion of Counsel Required by Item (3)(D) Thereof, If Applicable; (F) If Such Beneficial Interest is Being Transferred to the Company or Any of Its Subsidiaries, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(B) Thereof; or (G) If Such Beneficial Interest is Being Transferred Pursuant to an Effective Registration Statement Under the Securities Act, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(C) Thereof, the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.06(g) hereof, and the Company shall execute and the Trustee shall authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall mail or deliver such Definitive Notes to the Persons in whose names such Notes are so registered. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein. (ii) Beneficial Interests in Restricted Global Notes to Unrestricted Definitive Notes. a Holder of a Beneficial Interest in a Restricted Global Note May Exchange Such Beneficial Interest for an Unrestricted Definitive Note or May Transfer Such Beneficial Interest to a Person Who Takes Delivery Thereof in the Form of an Unrestricted Definitive Note Only If: (A) Such Exchange or Transfer is Effected Pursuant to an Exchange Offer in Accordance With the Applicable Registration Rights Agreement and the Holder of Such Beneficial Interest, in the Case of an Exchange, or the Transferee, in the Case of a Transfer, Certifies in 30 the Applicable Letter of Transmittal That It is Not (1) a Broker-dealer, (2) a Person Participating in the Distribution of the Exchange Notes or (3) a Person Who is an Affiliate (As Defined in Rule 144) of the Company; (B) Such Transfer is Effected Pursuant to an Effective Shelf Registration Statement in Accordance With the Applicable Registration Rights Agreement; (C) Such Transfer is Effected by a Broker-dealer Pursuant to an Effective Exchange Offer Registration Statement in Accordance With the Applicable Registration Rights Agreement; or (D) the Registrar Receives the Following: (1) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Exchange Such Beneficial Interest for an Unrestricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (1)(B) Thereof; or (2) If the Holder of Such Beneficial Interest in a Restricted Global Note Proposes to Transfer Such Beneficial Interest to a Person Who Shall Take Delivery Thereof in the Form of an Unrestricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit B Hereto, Including the Certifications in Item (4) Thereof; And, in Each Such Case Set Forth in This Clause (D), If the Registrar So Requests or If the Applicable Procedures So Require, an Opinion of Counsel in Form Reasonably Acceptable to the Registrar to the Effect That Such Exchange or Transfer is in Compliance With the Securities Act and That the Restrictions On Transfer Contained Herein and in the Private Placement Legend are No Longer Required in Order to Maintain Compliance With the Securities Act. (iii) Beneficial Interests in Unrestricted Global Notes to Unrestricted Definitive Notes. If Any Holder of a Beneficial Interest in an Unrestricted Global Note Proposes to Exchange Such Beneficial Interest for a Definitive Note or to Transfer Such Beneficial Interest to a Person Who Takes Delivery Thereof in the Form of a Definitive Note, Then, Upon Satisfaction of the Conditions Set Forth in Section 2.06(B)(ii) Hereof, the Trustee Shall Cause the Aggregate Principal Amount of the Applicable Global Note to be Reduced Accordingly Pursuant to Section 2.06(G) Hereof, and the Company Shall Execute and the Trustee Shall Authenticate and Mail or Deliver to the Person Designated in the Instructions a Definitive Note in the Appropriate Principal Amount. Any Definitive Note Issued in Exchange for a Beneficial Interest Pursuant to This Section 2.06(C)(iii) Shall be Registered in Such Name or Names and in Such Authorized Denomination or Denominations as the Holder of Such Beneficial Interest Shall Instruct the Registrar Through Instructions From the Depositary and the Participant or Indirect Participant. the Trustee Shall Mail or Deliver Such Definitive Notes to the Persons in Whose Names Such Notes are So Registered. Any Definitive Note Issued in Exchange for a Beneficial Interest Pursuant to This Section 2.06(C)(iii) Shall Not Bear the Private Placement Legend. (d) Transfer and Exchange of Definitive Notes for Beneficial Interests in the Global Notes. (i) Restricted Definitive Notes to Beneficial Interests in Restricted Global Notes. If Any Holder of a Restricted Definitive Note Proposes to Exchange Such Note for a Beneficial Interest in a Restricted Global Note or to Transfer Such Restricted Definitive Notes to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in a Restricted Global Note, Then, Upon Receipt by the Registrar of the Following Documentation: (A) If the Holder of Such Restricted Definitive Note Proposes to Exchange Such Note for a Beneficial Interest in a Restricted Global Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (2)(B) Thereof; 31 (B) If Such Restricted Definitive Note is Being Transferred to a Qib in Accordance With Rule 144A, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (1) Thereof; (C) If Such Restricted Definitive Note is Being Transferred to a Non-u.s. Person in an Offshore Transaction in Accordance With Rule 903 or Rule 904, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (2) Thereof; (D) If Such Restricted Definitive Note is Being Transferred Pursuant to an Exemption From the Registration Requirements of the Securities Act in Accordance With Rule 144, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(A) Thereof; (E) If Such Restricted Definitive Note is Being Transferred to an Institutional Accredited Investor in Reliance On an Exemption From the Registration Requirements of the Securities Act Other Than Those Listed in Clauses (B) Through (D) Above, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications, Certificates and Opinion of Counsel Required by Item (3)(D) Thereof, If Applicable; (F) If Such Restricted Definitive Note is Being Transferred to the Company or Any of Its Subsidiaries, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(B) Thereof; or (G) If Such Restricted Definitive Note is Being Transferred Pursuant to an Effective Registration Statement Under the Securities Act, a Certificate to the Effect Set Forth in Exhibit B Hereto, Including the Certifications in Item (3)(C) Thereof, the Trustee shall cancel the Restricted Definitive Note, increase or cause to be increased the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Note, in the case of clause (B) above, the 144A Global Note, in the case of clause (C) above, the Regulation S Global Note, and in all other cases, the IAI Global Note. (ii) Restricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. a Holder of a Restricted Definitive Note May Exchange Such Note for a Beneficial Interest in an Unrestricted Global Note or Transfer Such Restricted Definitive Note to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note Only If: (A) Such Exchange or Transfer is Effected Pursuant to an Exchange Offer in Accordance With the Applicable Registration Rights Agreement and the Holder, in the Case of an Exchange, or the Transferee, in the Case of a Transfer, Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; (B) Such Transfer is Effected Pursuant to an Effective Shelf Registration Statement in Accordance With the Applicable Registration Rights Agreement; (C) Such Transfer is Effected by a Broker-dealer Pursuant to an Effective Exchange Offer Registration Statement in Accordance With the Applicable Registration Rights Agreement and the Transferee Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; or 32 (D) the Registrar Receives the Following: (1) If the Holder of Such Definitive Notes Proposes to Exchange Such Notes for a Beneficial Interest in the Unrestricted Global Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (1)(C) Thereof; or (2) If the Holder of Such Definitive Notes Proposes to Transfer Such Notes to a Person Who Shall Take Delivery Thereof in the Form of a Beneficial Interest in the Unrestricted Global Note, a Certificate From Such Holder in the Form of Exhibit B Hereto, Including the Certifications in Item (4) Thereof; And, in Each Such Case Set Forth in This Clause (D), If the Registrar So Requests or If the Applicable Procedures So Require, an Opinion of Counsel in Form Reasonably Acceptable to the Registrar to the Effect That Such Exchange or Transfer is in Compliance With the Securities Act and That the Restrictions On Transfer Contained Herein and in the Private Placement Legend are No Longer Required in Order to Maintain Compliance With the Securities Act. Upon satisfaction of the conditions of any of the clauses in this Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Note. (iii) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. a Holder of an Unrestricted Definitive Note May Exchange Such Note for a Beneficial Interest in an Unrestricted Global Note or Transfer Such Unrestricted Definitive Note to a Person Who Takes Delivery Thereof in the Form of a Beneficial Interest in an Unrestricted Global Note At Any Time. Upon Receipt of a Request for Such an Exchange or Transfer, the Trustee Shall Cancel the Applicable Unrestricted Definitive Note and Increase or Cause to be Increased the Aggregate Principal Amount of One of the Unrestricted Global Notes. (iv) Transfer or Exchange of Unrestricted Definitive Notes to Beneficial Interests in Restricted Global Notes Prohibited. an Unrestricted Definitive Note Cannot be Exchanged For, or Transferred to Persons Who Take Delivery Thereof in the Form Of, Beneficial Interests in a Restricted Global Note. (v) Issuance of Unrestricted Global Notes. If Any Such Exchange or Transfer From a Definitive Note to a Beneficial Interest is Effected Pursuant to Clauses (Ii)(b), (Ii)(d) or (Iii) Above At a Time When an Unrestricted Global Note has Not Yet Been Issued, the Company Shall Issue And, Upon Receipt of an Authentication Order in Accordance With Section 2.02 Hereof, the Trustee Shall Authenticate One or More Unrestricted Global Notes in an Aggregate Principal Amount Equal to the Principal Amount of Definitive Notes So Transferred. (e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon Request by a Holder of Definitive Notes and Such Holder's Compliance With the Provisions of This Section 2.06(E), the Registrar Shall Register the Transfer or Exchange of Definitive Notes. Prior to Such Registration of Transfer or Exchange, the Requesting Holder Shall Present or Surrender to the Registrar the Definitive Notes Duly Endorsed or Accompanied by a Written Instruction of Transfer in Form Satisfactory to the Registrar Duly Executed by Such Holder or by Its Attorney, Duly Authorized in Writing. in Addition, the Requesting Holder Shall Provide Any Additional Certifications, Documents and Information, as Applicable, Required Pursuant to the Following Provisions of This Section 2.06(E). (i) Restricted Definitive Notes to Restricted Definitive Notes. Any Restricted Definitive Note May be Transferred to and Registered in the Name of Persons Who Take Delivery Thereof in the Form of a Restricted Definitive Note If the Registrar Receives the Following: 33 (A) If the Transfer Will be Made Pursuant to Rule 144A, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications in Item (1) Thereof; (B) If the Transfer Will be Made Pursuant to Rule 903 or Rule 904, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications in Item (2) Thereof; and (C) If the Transfer Will be Made Pursuant to Any Other Exemption From the Registration Requirements of the Securities Act, Then the Transferor Must Deliver a Certificate in the Form of Exhibit B Hereto, Including the Certifications, Certificates and Opinion of Counsel Required by Item (3) Thereof, If Applicable. (ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any Restricted Definitive Note May be Exchanged by the Holder Thereof for an Unrestricted Definitive Note or Transferred to a Person or Persons Who Take Delivery Thereof in the Form of an Unrestricted Definitive Note If: (A) Such Exchange or Transfer is Effected Pursuant to an Exchange Offer in Accordance With the Applicable Registration Rights Agreement and the Holder, in the Case of an Exchange, or the Transferee, in the Case of a Transfer, Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; (B) Any Such Transfer is Effected Pursuant to an Effective Shelf Registration Statement in Accordance With the Applicable Registration Rights Agreement; (C) Any Such Transfer is Effected by a Broker-dealer Pursuant to an Effective Exchange Offer Registration Statement in Accordance With the Applicable Registration Rights Agreement and the Transferee Makes the Certifications in the Applicable Letter of Transmittal Required by Such Registration Rights Agreement; or (D) the Registrar Receives the Following: (1) If the Holder of Such Restricted Definitive Notes Proposes to Exchange Such Notes for an Unrestricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit C Hereto, Including the Certifications in Item (1)(D) Thereof; or (2) If the Holder of Such Restricted Definitive Notes Proposes to Transfer Such Notes to a Person Who Shall Take Delivery Thereof in the Form of an Unrestricted Definitive Note, a Certificate From Such Holder in the Form of Exhibit B Hereto, Including the Certifications in Item (4) Thereof; And, in Each Such Case Set Forth in This Clause (D), If the Registrar So Requests, an Opinion of Counsel in Form Reasonably Acceptable to the Registrar and the Company to the Effect That Such Exchange or Transfer is in Compliance With the Securities Act and That the Restrictions On Transfer Contained Herein and in the Private Placement Legend are No Longer Required in Order to Maintain Compliance With the Securities Act. (iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes. a Holder of Unrestricted Definitive Notes May Transfer Such Notes to a Person Who Takes Delivery Thereof in the Form of an Unrestricted Definitive Note. Upon Receipt of a Request to Register Such a Transfer, the Registrar Shall Register the Unrestricted Definitive Notes Pursuant to the Instructions From the Holder Thereof. 34 (iv) Exchange Offer. Upon the Occurrence of an Exchange Offer in Accordance With an Applicable Registration Rights Agreement, the Company Shall Issue And, Upon Receipt of an Authentication Order in Accordance With Section 2.02, the Trustee Shall Authenticate (A) One or More Exchange Notes That are Unrestricted Global Notes in an Aggregate Principal Amount Equal to the Principal Amount of the Beneficial Interests in the Restricted Global Notes Tendered for Acceptance by Persons That Make the Certifications in the Applicable Letters of Transmittal Required by Such Registration Rights Agreement, and Accepted for Exchange in the Exchange Offer and (B) Exchange Notes That are Unrestricted Definitive Notes in an Aggregate Principal Amount Equal to the Principal Amount of the Restricted Definitive Notes Tendered for Acceptance by Persons Who Made the Foregoing Certification and Accepted for Exchange in Such Exchange Offer. Concurrently With the Issuance of Such Exchange Notes, the Trustee Shall Cause the Aggregate Principal Amount of the Applicable Restricted Global Notes to be Reduced Accordingly, and the Company Shall Execute and the Trustee Shall Authenticate and Mail or Deliver to the Persons Designated by the Holders of Restricted Definitive Notes So Accepted Unrestricted Definitive Notes in the Appropriate Principal Amount. (f) Legends. the Following Legends Shall Appear On the Face of All Global Notes and Definitive Notes Issued Under This Indenture Unless Specifically Stated Otherwise in the Applicable Provisions of This Indenture. (i) Private Placement Legend. ------------------------- (A) Except as Permitted by Clause (B) Below, Each Global Note and Each Definitive Note (And All Notes Issued in Exchange Therefor or Substitution Thereof) Shall Bear the Legend in Substantially the Following Form: "THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD AS MAY BE PRESCRIBED BY RULE 144(K) (OR ANY SUCCESSOR PROVISION THEREOF UNDER THE SECURITIES ACT) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR ANY PREDECESSOR OF THIS SECURITY) AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY OR ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE OF THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, PURSUANT TO RULE 904 OF REGULATION S, (E) TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND THE SECURITIES LAWS OF ANY OTHER JURISDICTION, INCLUDING OF ANY STATE OF THE UNITED 35 STATES OR ANY PROVINCE OF CANADA, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. (b) Notwithstanding the Foregoing, All of the Initial Notes, and Any Global Note or Definitive Note Representing Notes Issued Pursuant to Clauses (B)(iv), (C)(ii), (C)(iii), (D)(ii), (D)(iii), (E)(ii), (E)(iii) or (E)(iv) of This Section 2.06 (And All Notes Issued in Exchange Therefor or Substitution Thereof) Shall Not Bear the Private Placement Legend; (ii) Global Note Legend. Each Global Note Shall Bear a Legend in Substantially the Following Form: "THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN." (g) Cancellation And/or Adjustment of Global Notes. At Such Time as All Beneficial Interests in a Particular Global Note Have Been Exchanged for Definitive Notes or a Particular Global Note has Been Redeemed, Repurchased or Cancelled in Whole and Not in Part, Each Such Global Note Shall be Returned to or Retained and Cancelled by the Trustee in Accordance With Section 2.11 Hereof. At Any Time Prior to Such Cancellation, If Any Beneficial Interest in a Global Note is Exchanged for or Transferred to a Person Who Will Take Delivery Thereof in the Form of a Beneficial Interest in Another Global Note or for Definitive Notes, the Principal Amount of Notes Represented by Such Global Note Shall be Reduced Accordingly and an Endorsement Shall be Made On Such Global Note by the Trustee or by the Depositary At the Direction of the Trustee to Reflect Such Reduction; and If the Beneficial Interest is Being Exchanged for or Transferred to a Person Who Will Take Delivery Thereof in the Form of a Beneficial Interest in Another Global Note, Such Other Global Note Shall be Increased Accordingly and an Endorsement Shall be Made On Such Global Note by the Trustee or by the Depositary At the Direction of the Trustee to Reflect Such Increase. (h) General Provisions Relating to Transfers and Exchanges. (i) to Permit Registrations of Transfers and Exchanges, the Company Shall Execute And, Upon Receipt of an Authentication Order in Accordance With Section 2.02, the Trustee Shall Authenticate Global Notes and Definitive Notes Upon the Company's Order or At the Registrar's Request. 36 (ii) No Service Charge Shall be Made to a Holder of a Beneficial Interest in a Global Note or to a Holder of a Definitive Note for Any Registration of Transfer or Exchange, But the Company May Require Payment of a Sum Sufficient to Cover Any Transfer Tax or Similar Governmental Charge Payable in Connection Therewith (Other Than Any Such Transfer Taxes or Similar Governmental Charge Payable Upon Exchange or Transfer Pursuant to Sections 2.07, 3.06, 4.12, 4.17 and 9.05 Hereof). (iii) All Global Notes and Definitive Notes Issued Upon Any Registration of Transfer or Exchange of Global Notes or Definitive Notes Shall be the Valid Obligations of the Company, Evidencing the Same Debt, and Entitled to the Same Benefits Under This Indenture, as the Global Notes or Definitive Notes Surrendered Upon Such Registration of Transfer or Exchange. (iv) Neither the Registrar Nor the Company Shall be Required (A) to Issue, to Register the Transfer of or to Exchange Any Notes During a Period Beginning At the Opening of Business 15 Days Before the Day of Any Selection of Notes for Redemption Under Section 3.02 Hereof and Ending At the Close of Business On the Day of Selection, (B) to Register the Transfer of or to Exchange Any Note So Selected for Redemption in Whole or in Part, Except the Unredeemed Portion of Any Note Being Redeemed in Part or (C) to Register the Transfer of or to Exchange a Note Between a Record Date and the Next Succeeding Interest Payment Date. (v) Prior to Due Presentment for the Registration of a Transfer of Any Note, the Trustee, Any Agent and the Company May Deem and Treat the Person in Whose Name Any Note is Registered as the Absolute Owner of Such Note for the Purpose of Receiving Payment of Principal of and Interest On Such Notes and for All Other Purposes, and None of the Trustee, Any Agent or the Company Shall be Affected by Notice to the Contrary. (vi) the Trustee Shall Authenticate Global Notes and Definitive Notes in Accordance With the Provisions of Section 2.02 Hereof. (vii) All Certifications, Certificates and Opinions of Counsel Required to be Submitted to the Registrar Pursuant to This Section 2.06 to Effect a Registration of Transfer or Exchange May be Submitted by Facsimile. (viii) the Trustee is Hereby Authorized to Enter Into a Letter of Representation With the Depositary in the Form Provided by the Company and to Act in Accordance With Such Letter. (ix) 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 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. Section 2.07. Temporary Notes. ---------------- Pending the preparation of Definitive Notes, the Company may execute, and upon receipt of a Company Order the Trustee shall authenticate and deliver, temporary Definitive Notes which shall be substantially in the form of Definitive Notes in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the officers executing such Notes may determine, as evidenced by their execution of such Notes. If temporary Notes are issued, the Company will cause Definitive Notes to be prepared without unreasonable delay. After the preparation of Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes upon surrender of the temporary Notes at any office or agency of the Company designated pursuant to Section 4.02, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Notes, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount of Definitive Notes of authorized denominations. Until so exchanged the temporary Notes shall in all respects be entitled to the same benefits under this Indenture as Definitive Notes. Section 2.08. Mutilated, Destroyed, Lost or Stolen Notes. ------------------------------------------ If any mutilated Note is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Note of like tenor and principal amount and bearing a certificate number not contemporaneously outstanding. If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Note and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Note has been acquired by a bona fide purchaser, the Company shall execute and the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and principal amount and bearing a number not contemporaneously outstanding. 37 In case any such mutilated, destroyed, lost or stolen Note has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Note, pay such Note. Upon the issuance of any new Note under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. Every new Note issued pursuant to this Section in lieu of any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen Note shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes. Section 2.09. Payment of Interest; Interest Rights Preserved. ---------------------------------------------- On or before any Interest Payment Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 4.01) an amount of money sufficient to pay the interest on all the Notes that is to be paid on such Interest Payment Date. Interest on any Note which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that Note is registered at the close of business on the Regular Record Date for such interest. Any interest on any Note which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called "DEFAULTED INTEREST") shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such Defaulted Interest shall be paid by the Company to the Persons in whose names the Notes (or their respective predecessor Notes) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Note and the date of the proposed payment (which date shall be a date which will enable the Trustee to comply with the provisions of the immediately following sentence), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as provided herein. The Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record 38 Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder at his address as it appears in the Note Register, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Notes (or their respective predecessor Notes) are registered at the close of business on such Special Record Date. Subject to the foregoing provisions of this Section, each Note delivered under this Indenture upon registration of transfer of, or in exchange for or in lieu of, any other Note shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note. Section 2.10. Persons Deemed Owners. ---------------------- Prior to due presentment of a Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Note is registered as the owner of such Note for the purpose of receiving payment of principal of and (subject to Section 2.09) interest on such Note and for all other purposes whatever, whether or not such Note be overdue, and neither the Company nor the Trustee shall be affected by notice to the contrary. Section 2.11. Cancellation. ------------- All Notes surrendered for payment, redemption, registration of transfer or exchange shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly canceled by it. The Company may at any time deliver to the Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever, and all Notes so delivered shall be promptly canceled by the Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes canceled as provided in this Section, except as expressly permitted by this Indenture. All canceled Notes held by the Trustee shall be disposed of by the Trustee in accordance with its customary procedures. Section 2.12. CUSIP or ISIN Numbers. ---------------------- Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures ("CUSIP"), the Company may cause CUSIP numbers to be printed on the Notes and may direct the Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders of Notes. No representation is made as to the accuracy of the CUSIP numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. The Company will promptly notify the Trustee of any change in the CUSIP numbers. Section 2.13. Outstanding Notes. ------------------ (a) the Notes Outstanding At Any Time are All the Notes Authenticated by the Trustee Except for Those Cancelled by It, Those Delivered to It for Cancellation, Those Reductions in the Interest in a Global Note Effected by the Trustee in Accordance With the Provisions Hereof, and Those Described in This Section 2.13 as Not Outstanding. Except as Set Forth in Section 2.14 Hereof, a Note Does Not Cease to be Outstanding Because the Company or an Affiliate of the Company Holds the Note; However, Notes Held by the Company or a Subsidiary of the Company Shall Not be Deemed to be Outstanding for Purposes of Section 3.07(D) Hereof. (b) If a Note is Replaced Pursuant to Section 2.07 Hereof, It Ceases to be Outstanding Unless the Trustee Receives Proof Satisfactory to It That the Replaced Note is Held by a Bona Fide Purchaser. (c) If the Principal Amount of Any Note is Considered Paid Under Section 4.01 Hereof, It Ceases to be Outstanding and Interest On It Ceases to Accrue. (d) If the Paying Agent (Other Than the Company, a Subsidiary or an Affiliate of Any Thereof) Holds, On a Redemption Date or Maturity Date, Money Sufficient to Pay Notes Payable On That Date, Then On and After That Date Such Notes Shall be Deemed to be No Longer Outstanding and Shall Cease to Accrue Interest. 39 Section 2.14. Treasury Notes. --------------- In determining whether the Holders of the required principal amount of Notes have concurred in any direction, amendment, supplement, waiver or consent, Notes owned by the Company or by any Affiliate of the Company shall be considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, amendment, supplement, waiver or consent, only Notes that the Trustee knows are so owned shall be so disregarded. ARTICLE 3. REDEMPTION AND PREPAYMENT ------------------------- Section 3.01. Notices to Trustee. ------------------- If the Company elects to redeem Notes pursuant to the optional redemption provisions of Section 3.07 hereof and paragraph 5 of the Notes, it shall furnish to the Trustee, at least 30 days but not more than 60 days before a redemption date unless a shorter notice shall be satisfactory to the Trustee, an Officers' Certificate setting forth (i) the clause of this Indenture pursuant to which the redemption shall occur, (ii) the redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the redemption price. Any such notice may be cancelled at any time prior to notice of such redemption being mailed to any Holder and shall, therefore, be void and of no effect. 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 shall select the Notes to be redeemed among the Holders of the Notes in compliance with any applicable depositary and legal requirements and the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis, at random or in accordance with any other method the Trustee considers fair and appropriate. In the event of partial redemption at random, the particular Notes to be redeemed shall be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the redemption date by the Trustee from the outstanding Notes not previously called for redemption. The Trustee shall promptly notify the Company in writing of the Notes selected for redemption and, in the case of any Note selected for partial redemption, the principal amount thereof to be redeemed. Notes and portions of Notes selected shall be in amounts of $1,000 or whole multiples of $1,000; except that if all of the Notes of a Holder are to be redeemed, the entire outstanding amount of Notes held by such Holder, even if not a multiple of $1,000, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. Section 3.03. Notice of Redemption. --------------------- At least 30 days but not more than 60 days before a redemption date, the Company shall mail or cause to be mailed, by first class mail, a notice of redemption to each Holder whose Notes are to be redeemed at its registered address. The notice shall identify the Notes to be redeemed and shall state: (a) the Redemption Date; (b) the Redemption Price or If the Redemption is Made Pursuant to Section 3.07(C) a Calculation of the Redemption Price; (c) 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 Upon Surrender of Such Note, a New Note or Notes in Principal Amount Equal to the Unredeemed Portion Shall be Issued Upon Cancellation of the Original Note; 40 (d) the Name and Address of the Paying Agent; (e) That Notes Called for Redemption Must be Surrendered to the Paying Agent to Collect the Redemption Price; (f) That, Unless the Company Defaults in Making Such Redemption Payment, Interest On Notes Called for Redemption Ceases to Accrue On and After the Redemption Date; (g) the Paragraph of the Notes or Section of This Indenture Pursuant to Which the Notes Called for Redemption are Being Redeemed; and (h) That No Representation is Made as to the Correctness or Accuracy of the Cusip Number, If Any, Listed in Such Notice or Printed On the Notes. At the Company's request, the Trustee shall give the notice of redemption in the Company's name and at its expense; provided, however, that the Company shall have delivered to the Trustee, at least 45 days, or such shorter period allowed by the Trustee, prior to the redemption date, an Officers' Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in this Section 3.03. Section 3.04. Effect of Notice of Redemption. ------------------------------- Once notice of redemption is mailed in accordance with Section 3.03 hereof, Notes called for redemption become irrevocably due and payable on the redemption date at the redemption price subject to satisfaction of any conditions specified in such notice. Section 3.05. Deposit of Redemption Price. ---------------------------- On or before 11:00 a.m. Eastern time on any redemption date, the Company shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption price of and accrued interest on all Notes (or portions of Notes) to be redeemed on that date. The Trustee or the Paying Agent shall promptly return to the Company any money deposited with the Trustee or the Paying Agent by the Company in excess of the amounts necessary to pay the redemption price of, and accrued interest on, all Notes to be redeemed. If the Company complies with the provisions of the preceding paragraph, on and after the redemption date, interest shall cease to accrue on the Notes or the portions of Notes called for redemption, whether or not such Notes are presented for payment. If a Note is redeemed on or after a Regular Record Date but on or prior to the related Interest Payment Date, then any accrued and unpaid interest shall be paid to the Person in whose name such Note was registered at the close of business on such Regular Record Date. If any Note called for redemption shall not be so paid upon surrender for redemption because of the failure of the Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal from the redemption date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.01 hereof. Section 3.06. Notes Redeemed in Part. ----------------------- Upon surrender of a Note that is redeemed in part, the Company shall issue and, upon the Company's written request, the Trustee shall authenticate for the Holder at the expense of the Company a new Note equal in principal amount to the unredeemed portion of the Note surrendered. Section 3.07. Optional Redemption. -------------------- (a) From the Issue Date Through [ ], 2004, (6) the Company May Redeem All or Any Portion of the Notes, At Once or Over Time, At a Redemption Price (Expressed as a Percentage of Principal Amount) Equal to 100.0% of the Principal - ----------------------- (6) 180 days after the Issue Date. 41 Amount of the Notes to be Redeemed, Plus Accrued and Unpaid Interest to the Redemption Date (Subject to the Right of Holders of Record On the Relevant Record Date to Receive Interest Due On the Relevant Interest Payment Date). (b) At Any Time and From Time to Time During the Twelve-month Period Commencing On [ ] of the Years Indicated Below, the Company May Redeem All or Any Portion of the Notes At the Redemption Prices (Expressed as Percentages of Principal Amount) Set Forth Below, Plus Accrued and Unpaid Interest On the Notes Redeemed, to the Applicable Redemption Date (Subject to the Right of Holders of Record On the Relevant Record Date to Receive Interest Due On the Relevant Interest Payment Date): Year Percentage ---- ---------- 2009.....................................................[ ]%(7) 2010.....................................................[ ]% 2011 and thereafter......................................[100.0]% (c) At Any Time and From Time to Time Prior to [ ], 20___, (8) the Company May Redeem Up to 35.0% of the Aggregate Principal Amount of the Notes Issued Under This Indenture At a Redemption Price (Expressed as a Percentage of Principal Amount) Equal to [ ]% (9) of the Principal Amount Thereof, Plus Accrued and Unpaid Interest to the Redemption Date (Subject to the Right of Holders of Record On the Relevant Record Date to Receive Interest Due On the Relevant Interest Payment Date) With the Net Cash Proceeds of One or More Equity Offerings by the Company or the Direct or Indirect Parent of the Company (To the Extent, in the Case of the Direct or Indirect Parent, That the Net Cash Proceeds of the Equity Offerings are Contributed to the Common or Non-redeemable Preferred Equity Capital That is Not Convertible or Exchangeable for Debt or Disqualified Stock of the Company); Provided, However, That After Giving Effect to Any Such Redemption, At Least 65.0% of the Aggregate Principal Amount of the Notes Initially Issued Under This Indenture (Excluding Notes Held by the Company and Its Subsidiaries) Remains Outstanding Immediately After Giving Effect to Such Redemption. Any Such Redemption Shall be Made Within 75 Days of Such Equity Offering Upon Not Less Than 30 Nor More Than 60 Days' Prior Notice. (d) Any Prepayment Pursuant to This Section 3.07 Shall be Made Pursuant to the Provisions of Sections 3.01 Through 3.06 Hereof. Section 3.08. Mandatory Redemption. Except as set forth in Sections 4.12 and 4.17 hereof, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Notes. Section 3.09. Offer To Purchase. (a) in the Event That, Pursuant to Section 4.12 or 4.17 Hereof, the Company Shall be Required to Commence a Prepayment Offer or a Change of Control Offer (Each, an "Offer to Purchase"), It Shall Follow the Procedures Specified Below. (b) the Company Shall Cause a Notice of the Offer to Purchase to be Sent At Least Once to the Dow Jones News Service or Similar Business News Service in the United States. (c) the Company Shall Commence the Offer to Purchase by Sending, by First Class Mail, a Notice to the Trustee and Each of the Holders, With a Copy to the Trustee. the Notice Shall Contain All Instructions and Materials Necessary to Enable Such Holders to Tender Notes Pursuant to the Offer to Purchase. the Notice, Which Shall Govern the Terms of the Offer to Purchase, Shall State: - -------------------------------------------- (7) The initial redemption price under Section 3.07(b) will be par plus 50.0% of the coupon. (8) The third anniversary of the Issue Date. (9) Par plus coupon. 42 (i) That the Offer to Purchase is Being Made Pursuant to This Section 3.09 and Section 4.12 or Section 4.17, as the Case May Be, And, in the Case of a Change of Control Offer, That a Change of Control has Occurred, the Circumstances and Relevant Facts Regarding the Change of Control and That a Change of Control Offer is Being Made Pursuant to Section 4.17; (ii) the Principal Amount of Notes Required to be Purchased Pursuant to Section 4.12 or Section 4.17, as the Case May be (The "Offer Amount"), the Purchase Price Set Forth in Section 4.12 or Section 4.17 Hereof, as Applicable (Including a Breakdown of the Portion of Such Purchase Price Attributable to Principal and Interest) (The "Purchase Price"), the Offer Period and the Purchase Date (Each as Defined Below); (iii) Except as Provided in Clause (Ix), That All Notes Timely Tendered and Not Withdrawn Shall be Accepted for Payment; (iv) That Any Note Not Tendered or Accepted for Payment Shall Continue to Accrue Interest; (v) That, Unless the Company Defaults in Making Such Payment, Any Note Accepted for Payment Pursuant to the Offer to Purchase Shall Cease to Accrue Interest After the Purchase Date; (Vi) That Holders Electing to Have a Note Purchased Pursuant to an Offer to Purchase May Elect to Have Notes Purchased in Integral Multiples of $1,000 Only; (vii) That Holders Electing to Have a Note Purchased Pursuant to Any Offer to Purchase Shall be Required to Surrender the Note, With the Form Entitled "Option of Holder to Elect Purchase" On the Reverse of the Note Completed, or Transfer by Book-entry Transfer, to the Company, a Depositary, If Appointed by the Company, or a Paying Agent At the Address Specified in the Notice At Least Three Days Before the Purchase Date; (viii) That Holders Shall be Entitled to Withdraw Their Election If the Company, the Depositary or the Paying Agent, as the Case May Be, Receives, Not Later Than the Expiration of the Offer Period, a Telegram, Facsimile Transmission or Letter Setting Forth the Name of the Holder, the Principal Amount of the Note the Holder Delivered for Purchase and a Statement That Such Holder is Withdrawing His Election to Have Such Note Purchased; (ix) That, in the Case of a Prepayment Offer, If the Aggregate Principal Amount of Notes Surrendered by Holders Exceeds the Offer Amount, the Company Shall Select the Notes to be Purchased On a Pro Rata Basis (With Such Adjustments as May be Deemed Appropriate by the Company So That Only Notes in Denominations of $1,000 or Integral Multiples Thereof Shall be Purchased); (x) That Holders Whose Notes Were Purchased Only in Part Shall be Issued New Notes Equal in Principal Amount to the Unpurchased Portion of the Notes Surrendered (Or Transferred by Book-entry Transfer); and (xi) Any Other Procedures the Holders Must Follow in Order to Tender Their Notes (Or Portions Thereof) for Payment and the Procedures That Holders Must Follow in Order to Withdraw an Election to Tender Notes (Or Portions Thereof) for Payment. (d) the Offer to Purchase Shall Remain Open for a Period of 20 Business Days Following Its Commencement and No Longer, Except to the Extent That a Longer Period is Required by Applicable Law (The "Offer Period"). No Later Than Five Business Days (And in Any Event No Later Than the 60Th Day Following the Change of Control) After the Termination of the Offer Period (The "Purchase Date"), the Company Shall Purchase the Principal Amount of Notes Required to be Purchased Pursuant to Section 4.12 or Section 4.17 Hereof (The "Offer Amount") Or, If Less Than the Offer Amount has Been Tendered, All Notes Tendered in Response to the Offer to Purchase. Payment for Any Notes So Purchased Shall be Made in the Same Manner as Interest Payments are Made. 43 (e) On or Prior to the Purchase Date, the Company Shall, to the Extent Lawful: (i) Accept for Payment (On a Pro Rata Basis to the Extent Necessary in Connection With a Prepayment Offer), the Offer Amount of Notes or Portions of Notes Properly Tendered and Not Withdrawn Pursuant to the Offer to Purchase, or If Less Than the Offer Amount has Been Tendered, All Notes Tendered; (ii) Deposit With the Paying Agent Funds in an Amount Equal to the Purchase Price in Respect of All Notes or Portions of Notes Properly Tendered; and (iii) Deliver or Cause to be Delivered to the Trustee the Notes Properly Accepted Together With an Officers' Certificate Stating the Aggregate Principal Amount of Notes or Portions of Notes Being Purchased by the Company and That Such Notes or Portions Thereof Were Accepted for Payment by the Company in Accordance With the Terms of This Section 3.09. (f) the Paying Agent Shall Promptly (But in the Case of a Change of Control Not Later Than 60 Days From the Date of the Change of Control) Execute and Issue a New Note, And, Upon Receipt of an Authentication Order in Accordance With Section 2.02 Hereof, the Trustee Shall Authenticate and Deliver (Or Cause to be Transferred by Book-entry) Such New Note to Such Holder, in a Principal Amount Equal to Any Unpurchased Portion of the Note Surrendered; Provided, However, That Each Such New Note Shall be in a Principal Amount of $1,000 or an Integral Multiple Thereof. Any Note Not So Accepted Shall be Promptly Mailed or Delivered by the Company to the Holder Thereof. (g) If the Purchase Date is On or After a Regular 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 Regular Record Date, and No Additional Interest Shall be Payable to Holders Who Tender Notes Pursuant to the Offer to Purchase. (h) the Company Shall Comply, to the Extent Applicable, With the Requirements of Rule 14E-1 Under the Exchange Act and Any Other Securities Laws and Regulations Thereunder to the Extent Those Laws and Regulations are Applicable in Connection With the Offer to Purchase. to the Extent That the Provisions of Any Securities Laws or Regulations Conflict With Sections 4.12 or 4.17, as Applicable, This Section 3.09 or Other Provisions of This Indenture, the Company Shall Comply With Applicable Securities Laws and Regulations and Shall Not be Deemed to Have Breached Its Obligations Under Sections 4.12 or 4.17, as Applicable, This Section 3.09 or Such Other Provision by Virtue of Such Compliance. (i) Other Than as Specifically Provided in This Section 3.09, Any Purchase Pursuant to This Section 3.09 Shall be Made in Accordance With the Provisions of Section 3.01 Through 3.06 Hereof. ARTICLE 4. COVENANTS --------- Section 4.01. Payment of Notes; Money for Note Payments to be Held in Trust. ------------------------------------------------------------- (a) The Company shall pay or cause to be paid the principal of, premium, if any, and interest on, the Notes on the dates and in the manner provided in the Notes. Principal, premium, if any, and interest shall be considered paid on the date due if the Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 11:00 a.m. Eastern Time on the due date money deposited by the Company in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest then due. The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is [1.0]% per annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods), from time to time on demand at the same rate to the extent lawful. 44 Interest shall be computed on the basis of a 360-day year of twelve 30-day months. (b) If the Company shall at any time act as its own Paying Agent, it will, on or before each due date of the principal of, or interest on any of the Notes, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal or interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act. Whenever the Company shall have one or more Paying Agents, it will, prior to each due date of the principal of, or interest on any of the Notes, deposit with a Paying Agent a sum sufficient to pay the principal or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act. The Company will cause each Paying Agent other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will: (1) Hold All Sums Held by It for the Payment of the Principal of or Interest On Notes in Trust for the Benefit of the Persons Entitled Thereto Until Such Sums Shall be Paid to Such Persons or Otherwise Disposed of as Herein Provided; (2) Give the Trustee Notice of Any Default by the Company (Or Any Other Obligor Upon the Notes) in the Making of Any Payment of Principal or Interest; and (3) At Any Time During the Continuance of Any Such Default, Upon the Written Request of the Trustee, Forthwith Pay to the Trustee All Sums So Held in Trust by Such Paying Agent. The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money. Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of or interest on any Note and remaining unclaimed for two years after such principal or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in the Borough of Manhattan, The City of New York, New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company. 45 Section 4.02. Maintenance of Office or Agency. -------------------------------- (a) the Company Shall Maintain an Office or Agency (Which May be an Office or Drop Facility of the Trustee or an Affiliate of the Trustee, Registrar or Co-registrar) Where Notes May be Presented or Surrendered for Registration of Transfer or for Exchange and Where Notices and Demands to or Upon the Company in Respect of the Notes and This Indenture May be Served. the Company Shall Give Prompt Written Notice to the Trustee of the Location, and Any Change in the Location, of Such Office or Agency. If At Any Time the Company Shall Fail to Maintain Any Such Required Office or Agency or Shall Fail to Furnish the Trustee With the Address Thereof, Such Presentations, Surrenders, Notices and Demands May be Made or Served At the Corporate Trust Office of the Trustee, and the Company Hereby Appoints the Trustee as Its Agent to Receive All Such Presentations, Surrenders, Notices and Demands. (b) the Company May Also From Time to Time Designate One or More Other Offices or Agencies Where the Notes May be Presented or Surrendered for Any or All Such Purposes and May From Time to Time Rescind Such Designations. the Company Shall Give Prompt Written Notice to the Trustee of Any Such Designation or Rescission and of Any Change in the Location of Any Such Other Office or Agency. (c) the Company Hereby Designates the Corporate Trust Office of the Trustee, as One Such Office, Drop Facility or Agency of the Company in Accordance With Section 2.04. Section 4.03. Reports. ------- (a) Notwithstanding That the Company May Not be Subject to the Reporting Requirements of Section 13 or 15(D) of the Exchange Act, So Long as Any Notes are Outstanding the Company Shall File With the Commission, to the Extent Such Submissions are Accepted for Filing With the Commission, and Shall Furnish to the Trustee, Within 15 Days After It is or Would Have Been Required to be Filed With the Commission: (i) All Quarterly and Annual Financial Information That Would be Required to be Contained in a Filing With the Commission On Forms 10-Q and 10-K If the Company Were Required to File Such Forms, Including a "Management's Discussion and Analysis of Financial Condition and Results of Operations" And, With Respect to the Annual Information Only, a Report On the Annual Financial Statements by the Company's Certified Independent Accountants; and (ii) All Information That Would be Required to be Filed With the Commission On Form 8-K If the Company Were Required to File Such Reports. (b) Delivery of Such Reports, Information and Documents to the Trustee is for Informational Purposes Only, and the Trustee's Receipt of Such Shall Not Constitute Constructive Notice of Any Information Contained Therein or Determinable From Information Contained Therein, Including the Company's Compliance With Any of Its Covenants Hereunder (As to Which the Trustee is Entitled to Rely Exclusively On Officers' Certificates). Section 4.04. Compliance Certificate. ----------------------- (a) the Company Shall Deliver to the Trustee, Within 90 Days After the End of Each Fiscal Year, an Officers' Certificate Stating That a Review of the Activities of the Company, the Subsidiary Guarantors and Their Respective Subsidiaries During the Preceding Fiscal Year has Been Made Under the Supervision of the Signing Officers With a View to Determining Whether the Company, the Subsidiary Guarantors and Their Respective Subsidiaries Have Kept, Observed, Performed and Fulfilled Their Obligations Under This Indenture, and Further Stating, as to Each Such Officer Signing Such Certificate, That to the Best of His or Her Knowledge the Company and Its Subsidiaries Have Kept, Observed, Performed and Fulfilled Each and Every Covenant Contained in This Indenture and is Not in Default in the Performance or Observance of Any of the Terms, Provisions and Conditions of This Indenture (Or, If a Default or Event of Default Shall Have Occurred, Describing All Such Defaults or Events of Default of Which He or She May Have Knowledge and What Action the Company is Taking or Proposes to Take With Respect Thereto) and That to the Best of His or Her Knowledge No Event has Occurred and Remains in Existence by Reason of Which Payments On Account of the Principal of or Interest On the Notes is Prohibited or If Such Event has Occurred, a Description of the Event and What Action the Company is Taking or Proposes to Take With Respect Thereto. 46 (b) the Company Shall Comply With Tia Ss.314(a)(2). (c) the Company Shall Deliver to the Trustee, Within 20 Business Days After Becoming Aware of the Occurrence Thereof, Written Notice in the Form of an Officers' Certificate of Any Default or Event of Default, Its Status and What Action the Company is Taking or Proposes to Take With Respect Thereto. Section 4.05. Taxes. ----- The Company shall pay or discharge, and shall cause each of its Restricted Subsidiaries to pay or discharge, prior to delinquency, all material taxes, assessments, and governmental levies; provided that neither the Company nor any such Restricted Subsidiary shall be required to pay or discharge, or cause to be paid or discharged, any such tax, assessment, charge or claim the amount, applicability or validity of which is being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP. Section 4.06. Stay, Extension and Usury Laws. ------------------------------- The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it shall not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law has been enacted. Section 4.07. Corporate Existence. -------------------- Subject to Article 5 hereof, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect (i) its corporate existence, and the corporate, partnership or other existence of each of its Restricted Subsidiaries, in accordance with the respective organizational documents (as the same may be amended from time to time) of the Company or any such Restricted Subsidiary and (ii) the rights (charter and statutory), licenses and franchises of the Company and its Restricted Subsidiaries; provided, however, that the Company shall not be required to preserve any such right, license or franchise, or the corporate, partnership or other existence of any of its Restricted Subsidiaries, if the Board of Directors shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and its Restricted Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any material respect to the Holders of the Notes. Section 4.08. Payments for Consent. --------------------- The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or otherwise, to or for the benefit of any Holder for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes unless such consideration is offered to be paid or is paid to all Holders that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement, which time frame shall in no event be less than ten Business Days following public announcement and mailing of notice thereof to the Holders. Section 4.09. Incurrence of Additional Debt ----------------------------- The Company shall not, and shall not permit any Restricted Subsidiary to, Incur, directly or indirectly, any Debt unless, after giving effect to the application of the proceeds thereof, no Event of Default would occur as a consequence of such Incurrence or be continuing following such Incurrence and either: (a) Such Debt is Debt of the Company or a Restricted Subsidiary and After Giving Effect to the Incurrence of Such Debt and the Application of the Proceeds Thereof, the Consolidated Interest Coverage Ratio Would be Greater Than 2.00 to 1.00, or 47 (b) Such Debt is Permitted Debt. Accrual of interest, accrual of dividends, the accretion of accreted value, the payment of interest in the form of additional Debt and the payment of dividends in the form of additional shares of Preferred Stock will not be deemed to be an incurrence of Debt for purposes of this Section 4.09. The amount of any Debt outstanding as of any date shall be (i) the accreted value of the Debt in the case of any Debt issued with original issue discount and (ii) the principal amount or liquidation preference thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Debt. For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Debt, the U.S. dollar-equivalent principal amount of Debt denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Debt was incurred, in the case of term Debt, or first committed, in the case of revolving credit Debt; provided, that if such Debt is incurred to refinance other Debt denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Debt does not exceed the principal amount of such Debt being refinanced. Notwithstanding any other provision of this Section 4.09, the maximum amount of Debt that the Company may incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in the exchange rate of currencies. The principal amount of any Debt incurred to refinance other Debt, if incurred in a different currency from the Debt being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such Debt is denominated that is in effect on the date of such refinancing. For purposes of determining compliance with this covenant in the event that an item of Debt meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (o) of the definition of Permitted Debt or is entitled to be incurred pursuant to clause (a) of the first paragraph of this covenant, the Company shall, in its sole discretion, classify (or later reclassify in whole or in part, in its sole discretion) such item of Debt in any manner that complies with this covenant. Section 4.10. Restricted Payments. -------------------- The Company shall not make, and shall not permit any Restricted Subsidiary to make, directly or indirectly, any Restricted Payment if at the time of, and after giving effect to, such proposed Restricted Payment, (a) an Event of Default Shall Have Occurred and be Continuing, (b) the Company Could Not Incur At Least $1.00 of Additional Debt Pursuant to Clause (A) of Section 4.09 Hereof; or (c) the Aggregate Amount of Such Restricted Payment and All Other Restricted Payments Declared or Made Since the Issue Date (The Amount of Any Restricted Payment, If Made Other Than in Cash, to be Based Upon Fair Market Value as Determined in Good Faith by the Company) Would Exceed an Amount Equal to the Sum Of: (1) 50.0% of the Aggregate Amount of Consolidated Net Income Accrued During the Period (Treated as One Accounting Period) From the Beginning of the First Fiscal Quarter After the Fiscal Quarter in Which the Effective Date Occurs to the End of the Most Recent Fiscal Quarter Ending for Which Financial Statements are Available (Or If the Aggregate Amount of Consolidated Net Income for Such Period Shall be a Deficit, Minus 100.0% of Such Deficit), Plus (2) Capital Stock Sale Proceeds, Plus (3) the Sum Of: 48 (a) the Aggregate Net Cash Proceeds Received by the Company or Any Restricted Subsidiary From the Issuance or Sale After the Issue Date of Convertible or Exchangeable Debt That has Been Converted Into or Exchanged for Capital Stock (Other Than Disqualified Stock) of the Company, and () the Aggregate Amount by Which Debt of the Company or Any Restricted Subsidiary is Reduced On the Company's Consolidated Balance Sheet On or After the Issue Date Upon the Conversion or Exchange of Any Debt Issued or Sold On or Prior to the Issue Date That is Convertible or Exchangeable for Capital Stock (Other Than Disqualified Stock) of the Company, excluding, in the case of clause (A) or (B): (x) any such Debt issued or sold to the Company or a Subsidiary of the Company, and (y) the aggregate amount of any cash or other Property distributed by the Company or any Restricted Subsidiary upon any such conversion or exchange, plus (4) In the Case of the Disposition or Repayment of Any Investment Constituting a Restricted Payment Made After the Issue Date, an Amount of the Net Available Cash Received Therefrom by the Company or a Restricted Subsidiary Equal to the Lesser of the Return of Capital With Respect to Such Investment and the Cost of Such Investment, in Either Case, Less the Cost of the Disposition of Such Investment; Plus (5) An Amount Equal to the Sum Of: (A) the net reduction in Investments in any Person other than the Company or a Restricted Subsidiary resulting from dividends, repayments of loans or advances or other transfers of Property, in each case to the Company or any Restricted Subsidiary from such Person, and (B) the portion (proportionate to the Company's equity interest in such Unrestricted Subsidiary) of the fair market value of the net assets of an Unrestricted Subsidiary at the time such Unrestricted Subsidiary is designated a Restricted Subsidiary as determined in good faith by the Company; provided, however, that the foregoing sum shall not exceed, in the case of any Person, the amount of Investments previously made (and treated as a Restricted Payment) by the Company or any Restricted Subsidiary in such Person. Notwithstanding the foregoing, the provisions set forth in the immediately preceding paragraph will not prohibit: (a) the Company and Any Restricted Subsidiary May Pay Dividends On Its Capital Stock Within 60 Days of the Declaration Thereof If, On Said Declaration Date, Such Dividends Could Have Been Paid in Compliance With the Indenture; Provided, However, That Such Dividend Shall be Included in the Calculation of the Amount of Restricted Payments; (b) the Incurrence, Renewal, Extension or Refinancing of Permitted Refinancing Debt; (c) the Exchange or Conversion of Any Debt of the Company or Any of Its Restricted Subsidiaries for or Into Qualified Capital Stock of the Company; 49 (d) So Long as No Event of Default Shall Have Occurred and be Continuing, Payments of Ordinary Dividends On the Company's Common Stock in an Aggregate Amount Per Year Not to Exceed $25.0 Million; (e) the Purchase, Repurchase, Redemption, Legal Defeasance, Acquisition or Retirement for Value Capital Stock of the Company or Subordinated Obligations of the Company or Any Restricted Subsidiary in Exchange For, or Out of the Proceeds of the Substantially Concurrent Sale Of, Capital Stock of the Company (Other Than Disqualified Stock and Other Than Capital Stock Issued or Sold to a Subsidiary of the Company); Provided, However, That (1) Such Purchase, Repurchase, Redemption, Legal Defeasance, Acquisition or Retirement Shall be Excluded in the Calculation of the Amount of Restricted Payments; and (2) the Capital Stock Sale Proceeds From Such Exchange or Sale Shall be Excluded From the Calculation Pursuant to Clause (C)(2) of the Preceding Paragraph of This Section 4.10; (f) Scheduled Dividends (Not Constituting a Return On Capital) On Preferred Stock of a Restricted Subsidiary or On Disqualified Stock of the Company Issued Pursuant to and in Compliance With Section 4.09 Hereof; (g) the Redemption, Repurchase, Retirement or Other Acquisition of Any Capital Stock or Subordinated Obligation of the Company or a Restricted Subsidiary in Exchange for or Out of the Net Cash Proceeds of the Substantially Concurrent Sale (Other Than to a Subsidiary of the Company) of Debt That is Subordinated to the Same Extent in Right of Payment to the Notes; Provided That the Proceeds of Such Sale of Such Indebtedness Shall Not be (And Have Not Been) Included in Clause (C) of the Preceding Paragraph of This Section 4.10; (h) Repurchases of Shares Of, or Options to Purchase Shares Of, Common Stock of the Company or Any of Its Subsidiaries (X) From Current or Former Officers, Directors or Employees of the Company or Any of Its Subsidiaries (Or Permitted Transferees of Such Current or Former Officers, Directors or Employees), Pursuant to the Terms of Agreements (Including Employment Agreements) or Plans (Or Amendments Thereto) Approved by the Board of Directors Under Which Such Individuals Purchase or Sell, or are Granted the Option to Purchase or Sell, Shares of Such Common Stock or (Y) Which are or are Intended to be Used to Satisfy Issuances of Equity Interests Upon Exercise of Employee or Director Stock Options or Exercise or Satisfaction of Other Similar Instruments Outstanding Under Employee or Director Benefit Plans of the Company or Any Subsidiary of the Company; Provided, However, That: (1) the Aggregate Amount of Such Repurchases Shall Not Exceed $1.0 Million in Any Calendar Year; and (2) No Event of Default Shall Have Occurred and be Continuing At the Time of Such Repurchase or Immediately Thereafter; (i) Repurchases of Capital Stock Deemed to Occur Upon the Exercise of Stock Options or Warrants If Such Capital Stock Represents a Portion of the Exercise Price Thereof; (j) So Long as No Event of Default Shall Have Occurred and be Continuing or Would Otherwise Result Therefrom, Payments of Intercompany Debt, the Incurrence of Which was Permitted Pursuant to Section 4.09 Hereof; (k) Payments Made to Purchase, Redeem, Defease or Otherwise Acquire or Retire for Value Any Capital Stock or Subordinated Obligation of the Company Pursuant to Provisions Requiring the Company to Offer to Purchase, Redeem, Defease or Otherwise Acquire or Retire for Value Such Capital Stock or Subordinated Obligation Upon the Occurrence of a "Change of Control" or With the Proceeds of "Asset Sales" as Defined in the Charter Provisions, Agreements or Instruments Governing Such Capital Stock or Subordinated Obligation; Provided, However, That the Company has Made a Change of Control Offer and has Purchased All Notes Tendered in Connection With That Change of Control Offer; 50 (l) Payments Required to be Made by the Plan of Reorganization; (m) Restricted Payments by the Company or Any of Its Restricted Subsidiaries Not Otherwise Permitted to be Made Under Clauses (A) Through (K) Above in an Aggregate Amount Not to Exceed $50.0 Million. Each Restricted Payment described in clauses (a), (j) and (k) of the previous sentence shall be taken into account (and the Restricted Payments described in the remaining clauses shall not be taken into account) for purposes of computing the aggregate amount of all Restricted Payments made pursuant to clause (c) of the preceding paragraph. Section 4.11. Liens. ----- The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, Incur or suffer to exist, any Lien (other than Permitted Liens) upon any of its Property (including Capital Stock of a Restricted Subsidiary), whether owned at the Issue Date or thereafter acquired, or any interest therein or any income or profits therefrom, unless it has made or will make effective provision whereby the Notes will be secured by such Lien equally and ratably with (or prior to) all other Debt of the Company or any Restricted Subsidiary secured by such Lien. Section 4.12. Asset Sales. ----------- The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Sale unless: (a) the Company or Such Restricted Subsidiary Receives Consideration At the Time of Such Asset Sale At Least Equal to the Fair Market Value of the Property Subject to Such Asset Sale (As Determined in Good Faith by the Company); and (b) At Least 75.0% of the Consideration Paid At Closing to the Company or Such Restricted Subsidiary in Connection With Such Asset Sale is in the Form of Cash or Cash Equivalents or the Assumption by the Purchaser of Liabilities of the Company or Any Restricted Subsidiary (Other Than Liabilities That are by Their Terms Subordinated to the Notes or Any Subsidiary Guarantee) as a Result of Which the Company and the Restricted Subsidiaries are No Longer Obligated With Respect to Such Liabilities and are Fully Released Therefrom, or Securities Received by the Company or Any Restricted Subsidiary From the Transferee That are Converted Within 90 Days of Receipt by the Company or Such Restricted Subsidiary Into Cash, to the Extent of the Cash Received in That Conversion. The Net Available Cash (or any portion thereof) from Asset Sales may be applied by the Company or a Restricted Subsidiary, to the extent the Company or such Restricted Subsidiary elects (or is required by the terms of any Debt): (a) to Repay Debt under Credit Facilities or, if issued, the Floating Rate Notes; or (b) to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary). Pending the final application of any such Net Available Cash, the Company or any Restricted Subsidiary may temporarily reduce the revolving credit debt under its Credit Facilities or otherwise invest such Net Available Cash in any manner that is not prohibited by the Indenture. Any Net Available Cash from an Asset Sale not applied in accordance with the preceding paragraph within 360 days from the date of the receipt of such Net Available Cash shall constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $25.0 million (taking into account income earned on such Excess Proceeds, if any), the Company will be required to make an offer to purchase (the "PREPAYMENT OFFER") the Notes which offer shall be in the amount of the Allocable Excess Proceeds, on a pro 51 rata basis according to principal amount at maturity, at a purchase price equal to 100.0% of the principal amount, plus accrued and unpaid interest, if any, to the purchase date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), in accordance with the procedures (including prorating in the event of oversubscription) set forth in Section 3.09 hereof. To the extent that any portion of the amount of Net Available Cash remains after compliance with the preceding sentence and provided that all holders of Notes have been given the opportunity to tender their Notes for purchase in accordance with the Indenture, the Company or such Restricted Subsidiary may use such remaining amount for any purpose permitted by the Indenture and the amount of Excess Proceeds will be reset to zero. The term "Allocable Excess Proceeds" will mean the product of: (a) the Excess Proceeds and (b) a fraction, (1) the Numerator of Which is the Aggregate Principal Amount of the Notes Outstanding On the Date of the Prepayment Offer, and (2) the Denominator of Which is the Sum of the Aggregate Principal Amount of the Notes Outstanding On the Date of the Prepayment Offer and the Aggregate Principal Amount of Other Debt of the Company Outstanding On the Date of the Prepayment Offer That is Pari Passu in Right of Payment With the Notes and Subject to Terms and Conditions in Respect of Asset Sales Similar in All Material Respects to the Covenant Described Hereunder and Requiring the Company to Make an Offer to Purchase Such Debt At Substantially the Same Time as the Prepayment Offer. Within five business days after the Company is obligated to make a Prepayment Offer as described in the preceding paragraph, the Company shall send a written notice, by first-class mail, to the holders of Notes, accompanied by such information regarding the Company and its Subsidiaries as the Company in good faith believes will enable such holders to make an informed decision with respect to such Prepayment Offer. Such notice shall comply with the applicable requirements of Section 3.09 and shall contain all instructions and materials necessary to enable such holders to tender the Notes pursuant to the Prepayment Offer and state, among other things, the purchase price and the purchase date. The Company will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Section 4.12. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.12, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the covenant described hereunder by virtue thereof. Section 4.13. Restrictions on Distributions from Restricted Subsidiaries. ---------------------------------------------------------- The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or suffer to exist any consensual restriction on the right of any Restricted Subsidiary to: (a) Pay Dividends, in Cash or Otherwise, or Make Any Other Distributions On or in Respect of Its Capital Stock, or Pay Any Debt or Other Obligation Owed, to the Company or Any Other Restricted Subsidiary, (b) Make Any Loans or Advances to the Company or Any Other Restricted Subsidiary or (c) Transfer Any of Its Property to the Company or Any Other Restricted Subsidiary. The foregoing limitations will not apply: (1) to encumbrances or restrictions existing under or by reason of applicable law or regulations; 52 (2) with respect to clauses (a), (b) and (c), to restrictions: (A) in effect on the Issue Date (after giving effect to the Plan of Reorganization); (B) relating to Debt Incurred under clause (j) of the definition of "Permitted Debt;" provided, however, that such restrictions shall not apply to the Company or any Domestic Subsidiaries; (C) relating to Debt of a Restricted Subsidiary and existing at the time it became a Restricted Subsidiary if such restriction was not created in connection with or in anticipation of the transaction or series of transactions pursuant to which such Restricted Subsidiary became a Restricted Subsidiary or was acquired by the Company, or (D) that result from the Refinancing of Debt Incurred pursuant to an agreement referred to in clause (2)(A), (B) or (C) above or in clause (3)(A) or (B) below, so long as such restriction is no less favorable to the holders of Notes than those under the agreement evidencing the Debt so Refinanced, and (3) with respect to clause (c) only, to restrictions: (A) relating to Debt that is permitted to be Incurred and secured without also securing the Notes pursuant to Sections 4.09 and 4.11 hereof that limit the right of the debtor to dispose of the Property securing such Debt, (B) encumbering Property at the time such Property was acquired by the Company or any Restricted Subsidiary, so long as such restriction relates solely to the Property so acquired and was not created in connection with or in anticipation of such acquisition, (C) resulting from customary provisions restricting subletting or assignment of leases or customary provisions in other agreements that restrict assignment of such agreements or rights thereunder, (D) any encumbrances or restrictions contained in security agreements or mortgages securing Debt of a Restricted Subsidiary to the extent such encumbrance or restriction restricts the transfer of the property subject to such security agreement or mortgage, (E) customary restrictions contained in asset sale agreements limiting the transfer of such Property pending the closing of such sale; and (4) customary restrictions contained in joint venture or similar agreements relating to Permitted Joint Ventures. Section 4.14. Affiliate Transactions. ----------------------- The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, conduct any business or enter into or suffer to exist any transaction or series of transactions (including the purchase, sale, transfer, assignment, lease, conveyance or exchange of any Property or the rendering of any service) with, or for the benefit of, any Affiliate of the Company (an "AFFILIATE TRANSACTION"), unless: (a) the Terms of Such Affiliate Transaction are No Less Favorable to the Company or Such Restricted Subsidiary, as the Case May Be, Than Those That Could be Obtained At the Time in a Comparable Arm's-length Transaction With a Person That is Not an Affiliate of the Company, 53 (b) If Such Affiliate Transaction Involves Aggregate Payments or Value in Excess of $5.0 Million, the Board of Directors (Including a Majority of the Disinterested Members of the Board of Directors) Approves Such Affiliate Transaction as Evidenced by a Board Resolution Promptly Delivered to the Trustee, and (c) If Such Affiliate Transaction Involves Aggregate Payments or Value in Excess of $15.0 Million, the Company Obtains a Written Opinion From an Independent Financial Advisor to the Effect That the Consideration to be Paid or Received in Connection With Such Affiliate Transaction is Fair, From a Financial Point of View, to the Company and the Restricted Subsidiaries. Notwithstanding the foregoing limitation, the Company or any Restricted Subsidiary may enter into or suffer to exist the following: (a) Any Transaction or Series of Transactions Between the Company and One or More Restricted Subsidiaries or Between Two or More Restricted Subsidiaries If Such Transaction is Not Otherwise Prohibited by the Terms of This Indenture; (b) Any Restricted Payment Permitted to be Made Pursuant to Section 4.10 Hereof; (c) the Payment of Compensation (Including Amounts Paid Pursuant to Employee Benefit Plans) and the Entering Into of Employee Benefit and Indemnification Arrangements for the Personal Services of Officers, Directors and Employees of the Company or Any of the Restricted Subsidiaries, So Long as the Board of Directors in Good Faith Shall Have Approved the Terms Thereof; (d) Loans and Advances to Employees Made in the Ordinary Course of Business of the Company or Such Restricted Subsidiary, as the Case May Be, So Long as Such Loans and Advances Do Not Exceed $5.0 Million in the Aggregate At Any One Time Outstanding; (e) Any Agreement as in Effect as of the Issue Date (Or Otherwise Contemplated by the Plan of Reorganization) or Any Amendment Thereto or Any Transaction Contemplated Thereby (Including Pursuant to Any Amendment Thereto) or in Any Replacement Agreement Thereto So Long as Any Such Amendment or Replacement Agreement is Not More Disadvantageous to the Holders of the Notes in Any Material Respect Than the Original Agreement as in Effect On the Issue Date; and (f) the Issuance and Sale of Any Qualified Capital Stock of the Company. Section 4.15. Sale and Leaseback Transactions. -------------------------------- The Company shall not, and shall not permit any Restricted Subsidiary to, enter into any Sale and Leaseback Transaction with respect to any Property unless the Company or such Restricted Subsidiary would be entitled to: (A) INCUR DEBT IN AN AMOUNT EQUAL TO THE ATTRIBUTABLE DEBT WITH RESPECT TO SUCH SALE AND LEASEBACK TRANSACTION PURSUANT TO SECTION 4.09 HEREOF, AND (B) CREATE A LIEN ON SUCH PROPERTY SECURING SUCH ATTRIBUTABLE DEBT WITHOUT ALSO SECURING THE NOTES PURSUANT TO SECTION 4.11 HEREOF. Section 4.16. Designation of Restricted and Unrestricted Subsidiaries. ------------------------------------------------------- The Company's Board of Directors may designate any of its Subsidiaries, including any newly formed Subsidiary or any Person that will become a Subsidiary by way of acquisition, to be an Unrestricted Subsidiary if that designation would not cause a Default. If any of the Company's Restricted Subsidiaries is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the newly designated Unrestricted Subsidiary will be deemed to be an Investment made as of the time of that designation and will either reduce the amount available for Restricted Payments under Section 4.10(a) 54 or 4.10(b) or reduce the amount available for future Investments under one or more clauses of the definition of "Permitted Investments," as the Company determines in its sole discretion. The designation of such a Subsidiary or Person as an "Unrestricted Subsidiary" will only be permitted if, in the case of a Restricted Subsidiary, the deemed Investment would be permitted at the time the Restricted Subsidiary is designated as an Unrestricted Subsidiary and, in any case, if that Subsidiary or Person otherwise satisfies the requirements set forth in the definition of "Unrestricted Subsidiary." Any designation of a Subsidiary of the Company as an Unrestricted Subsidiary will be evidenced to the Trustee by filing with the Trustee a certified copy of the Board Resolution of the Board of Directors of the Company giving effect to such designation and an Officers' Certificate certifying that such designation complied with the preceding conditions and was permitted by Section 4.10 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture, and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Company as of such date, and, if such Indebtedness is not permitted to be incurred as of such date under Section 4.09, the Company will be in default of such covenant. The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation will be deemed to be an incurrence of Indebtedness by one of the Company's Restricted Subsidiaries of any outstanding Indebtedness of such Unrestricted Subsidiary, and such designation will only be permitted if (1) such Indebtedness is permitted under Section 4.09(a), calculated on a pro forma basis as if such designation had occurred at the beginning of the four-quarter reference period; and (2) no Default or Event of Default would be in existence following such designation. Section 4.17. REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL. ------------------------------------------------------------ (a) Upon the Occurrence of a Change of Control, the Company Shall, Within 10 Days of a Change of Control, Make an Offer (The "Change of Control Offer") Pursuant to the Procedures Set Forth in Section 3.09. Each Holder Shall Have the Right to Accept Such Offer and Require the Company to Repurchase All or Any Portion (Equal to $1,000 or an Integral Multiple of $1,000) of Such Holder's Notes Pursuant to the Change of Control Offer At a Purchase Price, in Cash, Equal to 101% of the Aggregate Principal Amount of Notes Repurchased, Plus Accrued and Unpaid Interest (The "Change of Control Purchase Price") On the Notes Repurchased, to the Purchase Date (Subject to the Right of Holders of Record On the Relevant Regular Record Date) to Receive Interest To, But Excluding, the Purchase Date). (b) Prior to Complying With Any of the Provisions of This "Change of Control " Covenant, But in Any Event Within 90 Days Following a Change of Control, the Company Will Either Repay All Outstanding Senior Debt or Obtain the Requisite Consents, If Any, Under All Agreements Governing Outstanding Senior Debt to Permit the Repurchase of Notes Required by This Covenant. the Company Will Publicly Announce the Results of the Change of Control Offer On or as Soon as Practicable After the Change of Control Payment Date. (c) the Company Will Not be Required to Make a Change of Control Offer Upon a Change of Control If a Third Party Makes the Change of Control Offer in the Manner, At the Times and Otherwise in Compliance With the Requirements Set Forth in This Indenture Applicable to a Change of Control Offer Made by the Company and Purchases All Notes Properly Tendered and Not Withdrawn Under the Change of Control Offer. Section 4.18. Future Subsidiary Guarantors. ----------------------------- the Company Shall Cause Each Person That is or Becomes a Domestic Subsidiary to Execute and Deliver to the Trustee a Supplemental Indenture Pursuant to Which Such Domestic Subsidiary Will Fully and Unconditionally Guarantee Payment of the Notes On the Same Terms and Conditions as Those Set Forth in Article 10 Hereof. Section 4.19. Covenant Suspension. -------------------- (a) During Any Period of Time (A "Suspension Period") That: 55 (i) the Notes Have Investment Grade Ratings From Both Rating Agencies; and (ii) No Default or Event of Default Shall Have Occurred and be Continuing Under This Indenture, the Company and its Restricted Subsidiaries shall be released from their obligations to comply with Sections 4.09, 4.10, 4.12, 4.13, 4.14, 4.15, 4.16 and 4.17 (collectively, the "SUSPENDED COVENANTS") but shall remain obligated to comply with the following: (iii) Sections 4.01 Through 4.08 (iv) Section 4.11; and (v) Section 4.18. (b) the Company Shall Also, Upon Reaching Investment Grade Status, Remain Obligated to Comply With Section 5.01 (Other Than Clause (E) of the First Paragraph Thereunder). (c) in the Event That the Company and the Restricted Subsidiaries are Not Subject to the Suspended Covenants for Any Period of Time as a Result of the Preceding Clause (A) And, Subsequently, One or Both of the Rating Agencies Withdraws Its Ratings or Downgrades the Ratings Assigned to the Notes Below the Required Investment Grade Ratings or a Default or Event of Default Occurs and is Continuing, Then the Company and the Restricted Subsidiaries Will Thereafter Again be Subject to the Suspended Covenants. Compliance With the Suspended Covenants With Respect to Restricted Payments Made After the Time of Such Withdrawal, Downgrade, Default or Event of Default Will be Calculated in Accordance With Section 4.10 Hereof as Though Such Covenant Had Been in Effect During the Entire Period of Time From the Issue Date; Provided, However, That There Will Not be Deemed to Have Occurred a Default or Event of Default Under the Notes With Respect to the Suspended Covenants During the Suspension Period Solely as a Result of the Company's and Its Restricted Subsidiaries' Non-compliance With the Suspended Covenants During the Suspension Period. ARTICLE 5. SUCCESSORS ---------- Section 5.01. Merger, Consolidation and Sale of Assets. ----------------------------------------- The Company shall not merge, consolidate or amalgamate with or into any other Person (other than a merger of a Restricted Subsidiary into the Company) or sell, transfer, assign, lease, convey or otherwise dispose of all or substantially all its Property in any one transaction or series of transactions unless: (a) the Company Shall be the Surviving Person (The "Surviving Person") or the Surviving Person (If Other Than the Company) Formed by Such Merger, Consolidation or Amalgamation or to Which Such Sale, Transfer, Assignment, Lease, Conveyance or Disposition is Made Shall be a Corporation Organized and Existing Under the Laws of the United States of America, Any State Thereof or the District of Columbia; (b) the Surviving Person (If Other Than the Company) Expressly Assumes, by Supplemental Indenture in Form Satisfactory to the Trustee, Executed and Delivered to the Trustee by Such Surviving Person, the Due and Punctual Payment of the Principal Of, and Premium, If Any, and Interest On, All the Notes, According to Their Tenor, and the Due and Punctual Performance and Observance of All the Covenants and Conditions of the Indenture to be Performed by the Company; (c) in the Case of a Sale, Transfer, Assignment, Lease, Conveyance or Other Disposition of All or Substantially All the Property of the Company, Such Property Shall Have Been Transferred as an Entirety or Virtually as an Entirety to One Person; 56 (d) Immediately Before and After Giving Effect to Such Transaction or Series of Transactions On a Pro Forma Basis No Default or Event of Default Shall Have Occurred and be Continuing; (e) Immediately After Giving Effect to Such Transaction or Series of Transactions On a Pro Forma Basis, the Company or the Surviving Person, as the Case May Be, Would be Able to Incur At Least $1.00 of Additional Debt Under Clause (A) of Section 4.09 Hereof; and (f) the Company Shall Deliver, or Cause to be Delivered, to the Trustee, in Form and Substance Reasonably Satisfactory to the Trustee, an Officers' Certificate and an Opinion of Counsel, Each Stating That Such Transaction and the Supplemental Indenture, If Any, in Respect Thereto Comply With This Covenant and That All Conditions Precedent Herein Provided for Relating to Such Transaction Have Been Satisfied. The Company shall not permit any Subsidiary Guarantor to merge, consolidate or amalgamate with or into any other Person (other than a merger of a Restricted Subsidiary into the Subsidiary Guarantor) or sell, transfer, assign, lease, convey or otherwise dispose of all or substantially all its Property in any one transaction or series of transactions unless: (a) the Surviving Person (If Other Than the Subsidiary Guarantor) Formed by Such Merger, Consolidation or Amalgamation or to Which Such Sale, Transfer, Assignment, Lease, Conveyance or Disposition is Made Shall be a Corporation Organized and Existing Under the Laws of the United States of America, Any State Thereof or the District of Columbia; (b) the Surviving Person (If Other Than the Subsidiary Guarantor) Expressly Assumes, by Supplemental Indenture in Form Satisfactory to the Trustee, Executed and Delivered to the Trustee by Such Surviving Person, the Due and Punctual Payment of the Principal Of, and Premium, If Any, and Interest On, All the Notes, According to Their Tenor, and the Due and Punctual Performance and Observance of All the Obligations of Such Subsidiary Guarantor Under Its Subsidiary Guarantee; (c) in the Case of a Sale, Transfer, Assignment, Lease, Conveyance or Other Disposition of All or Substantially All the Property of Such Subsidiary Guarantor, Such Property Shall Have Been Transferred as an Entirety or Virtually as an Entirety to One Person; (d) Immediately Before and After Giving Effect to Such Transaction or Series of Transactions On a Pro Forma Basis (And Treating, for Purposes of This Clause (D), Any Debt That Becomes, or is Anticipated to Become, an Obligation of the Surviving Person, the Company or Any Restricted Subsidiary as a Result of Such Transaction or Series of Transactions as Having Been Incurred by the Surviving Person, the Company or Such Restricted Subsidiary At the Time of Such Transaction or Series of Transactions), No Default or Event of Default Shall Have Occurred and be Continuing; and (e) the Company Shall Deliver, or Cause to be Delivered, to the Trustee, in Form and Substance Reasonably Satisfactory to the Trustee, an Officers' Certificate and an Opinion of Counsel, Each Stating That Such Transaction and Such Subsidiary Guarantee, If Any, in Respect Thereto Comply With This Covenant and That All Conditions Precedent Herein Provided for Relating to Such Transaction Have Been Satisfied. This Section 5.01 Shall Not Prohibit Any Subsidiary Guarantor From Consolidating With, Merging Into or Transferring All or Part of Its Assets to the Company or Any Other Subsidiary Guarantor. in Addition, the Foregoing Provisions (Other Than Clause (D) in the First Paragraph of This Section 5.01) Shall Not Apply to Any Transactions Which Constitute an Asset Sale If the Company has Complied With Section 4.12 Hereof. Section 5.02. Successor Corporation Substituted. ---------------------------------- The Surviving Person shall succeed to, and be substituted for, and may exercise every right and power of the Company under this Indenture and the predecessor Company shall be released from this Indenture, but the predecessor Company in the case of: 57 (a) a Sale, Transfer, Assignment, Conveyance or Other Disposition (Unless Such Sale, Transfer, Assignment, Conveyance or Other Disposition is of All the Assets of the Company as an Entirety), or (b) a Lease, shall not be released from any of the obligations or covenants under this Indenture, including with respect to the payment of the Notes. ARTICLE 6. DEFAULTS AND REMEDIES --------------------- Section 6.01. Events of Default. ------------------ Each of the following is an "EVENT OF DEFAULT:" (a) Failure to Make the Payment of Any Interest On the Notes When the Same Becomes Due and Payable, and Such Failure Continues for a Period of 30 Days; (b) Failure to Make the Payment of Any Principal Of, or Premium, If Any, On, Any of the Notes When the Same Becomes Due and Payable At Its Stated Maturity, Upon Acceleration, Redemption, Optional Redemption, Required Repurchase or Otherwise; (c) Failure to Comply With the Provisions of Sections 4.12, 4.17 or 5.01 Hereof; (d) Failure to Comply With Any Other Covenant or Agreement in the Notes or in the Indenture (Other Than a Failure That is the Subject of the Foregoing Clause (A), (B) or (C)) and Such Failure Continues for 60 Days After Written Notice is Given to the Company as Provided Below; (e) a Default Under Any Debt by the Company or Any Restricted Subsidiary That is a Significant Subsidiary That Results in Acceleration of the Maturity of Such Debt, or Failure to Pay Any Such Debt At Maturity, in an Aggregate Amount Greater Than $25.0 Million or Its Foreign Currency Equivalent At the Time; (f) Any Judgment or Judgments for the Payment of Money in an Aggregate Amount in Excess of $25.0 Million (Or Its Foreign Currency Equivalent At the Time) in Excess of Amounts Which are Covered by Insurance Under Applicable Policies That Shall be Rendered Against the Company or Any Restricted Subsidiary That is a Significant Subsidiary and That Shall Not be Waived, Satisfied or Discharged for Any Period of 60 Consecutive Days During Which a Stay of Enforcement Shall Not be in Effect; and (g) the Company or Any of Its Restricted Subsidiaries That are Significant Subsidiaries Pursuant to or Within the Meaning of Any Bankruptcy Law: (A) Commences a Voluntary Case; (B) Consents to the Entry of an Order for Relief Against It in an Involuntary Case; (C) Consents to the Appointment of a Custodian of It or for All or Substantially All of Its Property; (D) Makes a General Assignment for the Benefit of Its Creditors; or (E) Admits in Writing Its Inability to Pay Its Debts as They Become Due; and 58 (h) a Court of Competent Jurisdiction Enters an Order or Decree Under Any Bankruptcy Law That: (A) is for Relief Against the Company or Any of Its Significant Subsidiaries in an Involuntary Case; or (B) Appoints a Custodian of the Company or Any of Its Significant Subsidiaries or for All or Substantially All of the Property of the Company or Any of Its Significant Subsidiaries; or (C) Orders the Liquidation of the Company or Any of Its Significant Subsidiaries; and the order or decree remains unstayed and in effect for 60 consecutive days; and (i) Any Guarantee of a Subsidiary Guarantor That is a Significant Subsidiary or a Group of Subsidiary Guarantors That, Taken as a Whole, Would Constitute a Significant Subsidiary Ceases to be in Full Force and Effect (Other Than in Accordance With the Terms of Such Guarantee) or Any Subsidiary Guarantor Denies or Disaffirms Its Obligations Under Its Guarantee. Section 6.02. Acceleration. ------------- If any Event of Default (other than those of the type described in Section 6.01(g) or (h) with respect to the Company) occurs and is continuing, the Trustee may, and the Trustee upon the request of Holders of 25.0% in principal amount of the outstanding Notes will, or the Holders of at least 25.0% in principal amount of outstanding Notes may, declare the principal of all the Notes, together with all accrued and unpaid interest, premium, if any, to be due and payable by notice in writing to the Company and the Trustee specifying the respective Event of Default and that such notice is a notice of acceleration (the "ACCELERATION NOTICE"), and the same shall become immediately due and payable. In the case of an Event of Default specified in Section 6.01(g) or (h) with respect to the Company, such amount with respect to all the Notes will become due and payable immediately without any declaration or other act on the part of the Trustee or the holders of the Notes. Holders may not enforce this Indenture or the Notes except as provided in this Indenture. At any time after a declaration of acceleration with respect to the Notes, the Holders of a majority in principal amount of the Notes then outstanding (by notice to the Trustee) may rescind and cancel that declaration and its consequences if: (a) the Rescission Would Not Conflict With Any Judgment or Decree of a Court of Competent Jurisdiction; (b) All Existing Defaults and Events of Default Have Been Cured or Waived Except Nonpayment of Principal of or Interest On the Notes That has Become Due Solely by Such Declaration of Acceleration; (c) to the Extent the Payment of Such Interest is Lawful, Interest (At the Same Rate Specified in the Notes) On Overdue Installments of Interest and Overdue Payments of Principal Which has Become Due Otherwise Than by Such Declaration of Acceleration has Been Paid; (d) the Company has Paid the Trustee Its Reasonable Compensation and Reimbursed the Trustee for Its Reasonable Expenses, Disbursements and Advances; and (e) in the Event of the Cure or Waiver of an Event of Default of the Type Described in Section 6.01(G) or (H), the Trustee has Received an Officers' Certificate That Such Event of Default has Been Cured or Waived. 59 Section 6.03. Other Remedies. --------------- If an Event of Default shall have occurred and be continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium, if any, and interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture. The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law. Section 6.04. Waiver of Past Defaults. The Holders of a majority in principal amount of the Notes may waive by consent (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes) any then existing or potential Default, and its consequences, except a default in the payment of the principal of or interest on any Notes. In the event of any Event of Default specified in clause (e) of the first paragraph of Section 6.01, such Event of Default and all consequences of that Event of Default, including without limitation any acceleration or resulting payment default, will be annulled, waived and rescinded, automatically and without any action by the Trustee or the Holders of the Notes, if within 60 days after the Event of Default arose: (a) the Debt That is the Basis for the Event of Default has Been Discharged; (b) the Holders of That Debt Have Rescinded or Waived the Acceleration, Notice or Action, as the Case May Be, Giving Rise to the Event of Default; or (c) If the Default That is the Basis for Such Event of Default has Been Cured. When a Default or Event of Default is waived, it is deemed cured, but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any consequent right. Section 6.05. Control by Majority. -------------------- Subject to Section 7.01, Section 7.02(f) (including the Trustee's receipt of the security or indemnification described therein) and Section 7.07, in case an Event of Default shall have occurred and be continuing, the Holders of a majority in aggregate principal amount of the Notes then outstanding will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the Notes. Section 6.06. Limitation on Suits. -------------------- No Holder will have any right to institute any proceeding with respect to this Indenture, or for the appointment of a receiver or trustee, or for any remedy thereunder, unless: (a) Such Holder has Previously Given to the Trustee Written Notice of a Continuing Event of Default, (b) Holders of At Least 25.0% in Aggregate Principal Amount of the Notes Then Outstanding Have Made Written Request and Offered Reasonable Indemnity to the Trustee to Institute Such Proceeding as Trustee, and (c) the Trustee Shall Not Have Received From the Holders of a Majority in Aggregate Principal Amount of the Notes Then Outstanding a Direction Inconsistent With Such Request and Shall Have Failed to Institute Such Proceeding Within 30 Days. 60 A Holder may not use this Indenture to affect, disturb or prejudice the rights of another Holder or to obtain a preference or priority over another Holder. Section 6.07. Rights of Holders to Receive Payment. ------------------------------------- Notwithstanding any other provision of this Indenture (including, without limitation, Section 6.06), the right of any Holder to receive payment of principal, premium, if any, and interest on the Notes held by such Holder, on or after the respective due dates expressed in the Notes (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder. Section 6.08. Collection Suit by Trustee. --------------------------- If an Event of Default specified in Section 6.01 (g) or (h) occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal of, premium, if any, and interest then due and owing (together with interest on overdue principal and, to the extent lawful, interest) and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. Section 6.09. Trustee May File Proofs of Claim. --------------------------------- The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor upon the Notes), its creditors or its property and shall be entitled and empowered to participate as a member, voting or otherwise, of any official committee of creditors appointed in such matter and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims, and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To the extent that any such compensation, expenses and advances of the Trustee and its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, moneys, securities and any other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. Section 6.10. Priorities. ----------- If the Trustee collects any money pursuant to this Article 6, it shall pay out the money in the following order: First: to the Trustee, its agents and attorneys for amounts due under Section 7.07 hereof, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection; Second: to Holders for amounts due and unpaid on the Notes for principal, premium, if any, and interest ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, and interest respectively; and 61 Third: to the Company or to such party as a court of competent jurisdiction shall direct. The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10. Section 6.11. Undertaking for Costs. ---------------------- In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by the Company, a suit by a Holder pursuant to Section 6.07 hereof, or a suit by Holders of more than 10.0% in principal amount of the then outstanding Notes. ARTICLE 7. TRUSTEE ------- Section 7.01. Duties of Trustee. (a) If an Event of Default Which the Trustee Has, or is Deemed to Have, Notice of Hereunder has Occurred and is Continuing, the Trustee Shall Exercise Such of the Rights and Powers Vested in It by This Indenture, and Use the Same Degree of Care and Skill in Its Exercise, as a Prudent Person Would Exercise or Use Under the Circumstances in the Conduct of Such Person's Own Affairs. (b) Except During the Continuance of an Event of Default: (1) the Duties of the Trustee Shall be Determined Solely by the Express Provisions of This Indenture, and the Trustee Need Perform Only Those Duties That are Specifically Set Forth in This Indenture and No Others, and No Implied Covenants or Obligations Shall be Read Into This Indenture Against the Trustee; and (2) in the Absence of Bad Faith On Its Part, the Trustee May Conclusively Rely, as to the Truth of the Statements and the Correctness of the Opinions Expressed Therein, Upon Certificates or Opinions Furnished to the Trustee and Conforming to the Requirements of This Indenture. However, the Trustee Shall Examine the Certificates and Opinions to Determine Whether or Not They Conform to the Requirements of This Indenture (But Need Not Confirm or Investigate the Accuracy of Mathematical Calculations or Other Facts Stated Therein or Otherwise Verify the Contents Thereof). (c) the Trustee May Not be Relieved From Liabilities for Its Own Negligent Action, Its Own Negligent Failure to Act, or Its Own Willful Misconduct, Except That: (1) This Paragraph Does Not Limit the Effect of Paragraph (B) of This Section; (2) the Trustee Shall Not be Liable for Any Error of Judgment Made in Good Faith by a Responsible Officer, Unless It is Proved That the Trustee was Negligent in Ascertaining the Pertinent Facts; (3) the Trustee Shall Not be Liable With Respect to Any Action It Takes or Omits to Take in Good Faith in Accordance With a Direction Received by It Pursuant to Section 6.05 Hereof; and 62 (4) No Provision of This Indenture Shall Require the Trustee to Expend or Risk Its Own Funds or Incur Any Liability. (d) Whether or Not Therein Expressly So Provided, Every Provision of This Indenture That in Any Way Relates to the Trustee is Subject to Paragraphs (A), (B) and (C) of This Section. (e) Except for Information Provided by the Trustee Concerning the Trustee, the Trustee Shall Have No Responsibility for Any Information in Any Prospectus or Other Disclosure Material Distributed With Respect to the Notes. Section 7.02. Rights of Trustee. ------------------ (a) the Trustee May Conclusively Rely Upon Any Document Believed by It to be Genuine and to Have Been Signed or Presented by the Proper Person. the Trustee Need Not Investigate Any Fact or Matter Stated in Any Such Document. Any Facsimile Signature of Any Person On a Document Required or Permitted in This Indenture to be Delivered to the Trustee Shall Constitute a Legal, Valid and Binding Execution Thereof by Such Person. (b) Before the Trustee Acts or Refrains From Acting, It May Require an Officers' Certificate or an Opinion of Counsel or Both. the Trustee Shall Not be Liable for Any Action It Takes or Omits to Take in Good Faith in Reliance On Such Officers' Certificate or Opinion of Counsel. the Trustee May Consult With Counsel, and the Written Advice of Such Counsel or Any Opinion of Counsel Shall be Full and Complete Authorization and Protection From Liability in Respect of Any Action Taken, Suffered or Omitted by It Hereunder in Good Faith and in Reliance Thereon. (c) the Trustee May Act Through Its Attorneys and Agents and Shall Not be Responsible for the Misconduct or Negligence of Any Agent Appointed With Due Care. (d) the Trustee Shall Not be Liable for Any Action It Takes or Omits to Take in Good Faith That It Believes to be Authorized or Within the Rights or Powers Conferred Upon It by This Indenture. (E) Unless Otherwise Specifically Provided in This Indenture, Any Demand, Request, Direction or Notice From the Company Shall be Sufficient If Signed by an Officer of the Company. (f) the Trustee Shall be Under No Obligation to Exercise Any of the Rights or Powers Vested in It by This Indenture At the Request or Direction of Any of the Holders Unless Such Holders Shall Have Offered to the Trustee Reasonable Security or Indemnity Against the Costs, Expenses and Liabilities That Might be Incurred by It in Compliance With Such Request or Direction. (g) the Trustee Shall Not be Deemed to Have Notice of Any Default or Event of Default Unless a Responsible Officer of the Trustee has Actual Knowledge Thereof or Unless Written Notice of Any Event Which is in Fact Such a Default or Event of Default is Received by a Responsible Officer of the Trustee At the Corporate Trust Office of the Trustee From the Company or the Holders of 25.0% in Aggregate Principal Amount of the Outstanding Notes, and Such Notice References the Specific Default or Event of Default, the Notes and This Indenture And, in the Absence of Any Such Notice, the Trustee May Conclusively Assume That No Such Default or Event of Default Exists. (h) Money Held by the Trustee in Trust Hereunder Need Not be Segregated From Other Funds Except to the Extent Required by Law. the Trustee Shall be Under No Liability for Interest On Any Money Received by It Hereunder Except as Otherwise Agreed in Writing With the Company. (i) the Trustee Shall Not be Required to Give Any Bond or Surety in Respect of the Performance of Its Power and Duties Hereunder. (j) the Trustee Shall Have No Duty to Inquire as to the Performance of the Company's Covenants Herein. 63 (k) the Trustee's Immunities and Protections From Liability and Its Right to Indemnification in Connection With the Performance of Its Duties Under This Indenture Shall Extend to the Trustee's Officers, Directors, Agents, Attorneys and Employees. Such Immunities and Protections and Right to Indemnification, Together With the Trustee's Right to Compensation, Shall Survive the Trustee's Resignation or Removal, the Defeasance or Discharge of This Indenture and Final Payment of the Notes. (l) the Right of the Trustee to Take the Actions Permitted by This Indenture Shall Not be Construed as an Obligation or Duty to Do So. Section 7.03. Individual Rights of Trustee. ----------------------------- The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest, it must eliminate such conflict within 90 days, apply to the Commission for permission to continue as Trustee or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof. Section 7.04. Trustee's Disclaimer. --------------------- The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not be accountable for the Company's use of the proceeds from the Notes or any money paid to the Company or upon the Company's direction under any provision of this Indenture, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication. Section 7.05. Notice of Defaults. ------------------- If a Default or Event of Default shall have occurred and be continuing and if it is known to the Trustee, the Trustee shall mail to Holders a notice of the Default or Event of Default within 90 days after it occurs unless such Default or Event of Default has since been cured. Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest on any Note, the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders. Section 7.06. Reports by Trustee to Holders. ------------------------------ Within 60 days after each May 15 beginning with the May 15 following the date of this Indenture, and for so long as Notes remain outstanding, the Trustee shall mail to the Holders a brief report dated as of such reporting date that complies with TIA ss.313(a) (but if no event described in TIA ss.313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA ss.313(b)(2). The Trustee shall also transmit by mail all reports as required by TIA ss.313(c). A copy of each report at the time of its mailing to the Holders shall be mailed to the Company and filed with the Commission and each stock exchange on which the Notes are listed in accordance with TIA ss.313(d). The Company shall promptly notify the Trustee when the Notes are listed on any stock exchange and any delisting thereof. Section 7.07. Compensation and Indemnity. --------------------------- The Company shall pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder as the Company and the Trustee shall agree in writing. The Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee's agents and counsel. 64 The Company shall indemnify the Trustee (in its capacity as Trustee) or any predecessor Trustee (in its capacity as Trustee) against any and all losses, claims, damages, penalties, fines, liabilities or expenses, including incidental and out-of-pocket expenses and reasonable attorneys' fees ("LOSSES") incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture, including the costs and expenses of enforcing this Indenture against the Company (including this Section 7.07) and defending itself against any claim (whether asserted by the Company or any Holder or any other person) or liability in connection with the exercise or performance of any of its powers or duties hereunder. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim, and the Trustee shall cooperate in the defense. The Trustee may have separate counsel if the Trustee has been reasonably advised by counsel that there may be one or more legal defenses available to it that are different from or additional to those available to the Company and in the reasonable judgment of such counsel it is advisable for the Trustee to engage separate counsel, and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. The Company need not reimburse any expense or indemnify against any loss incurred by the Trustee through the Trustee's own willful misconduct, gross negligence or bad faith. The obligations of the Company under this Section 7.07 shall survive the satisfaction and discharge of this Indenture, the resignation or removal of the Trustee and payment in full of the Notes. To secure the Company's payment obligations in this Section, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal, premium, if any, and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of this Indenture. When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(g) or (h) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law. Section 7.08. Replacement of Trustee. ----------------------- A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee's acceptance of appointment as provided in this Section. The Trustee may resign in writing at any time upon 30 days' prior notice to the Company and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in principal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and the Company in writing. The Company may remove the Trustee if: (a) the Trustee Fails to Comply With Section 7.10 Hereof; (b) the Trustee is Adjudged a Bankrupt or an Insolvent or an Order for Relief is Entered With Respect to the Trustee Under Any Bankruptcy Law; (c) a Custodian or Public Officer Takes Charge of the Trustee or Its Property; or (d) the Trustee Becomes Incapable of Acting. If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Company. 65 If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company, or the Holders of at least 10.0% in principal amount of the then outstanding Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee. If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.10, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. Subject to the Lien provided for in Section 7.07 hereof, the retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Company's obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee. Section 7.09. Successor Trustee by Merger, etc. --------------------------------- If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation or banking association, the successor corporation or banking association without any further act shall, if such successor corporation or banking association is otherwise eligible hereunder, be the successor Trustee. Section 7.10. Eligibility; Disqualification. ------------------------------ There shall at all times be a Trustee hereunder that is a Person organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and surplus of at least $50.0 million (or a wholly-owned subsidiary of a bank or trust company, or of a bank holding company, the principal subsidiary of which is a bank or trust company having a combined capital and surplus of at least $50.0 million) as set forth in its most recent published annual report of condition. This Indenture shall always have a Trustee who satisfies the requirements of TIA ss.310(a)(1), (2) and (5). The Trustee is subject to TIA ss.310(b). Section 7.11. Preferential Collection of Claims Against Company. ------------------------------------------------- The Trustee is subject to TIAss.311(a), excluding any creditor relationship listed in TIAss.311(b). A Trustee who has resigned or been removed shall be subject to TIAss. 311(a) to the extent indicated therein. ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE ---------------------------------------- Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance. -------------------------------------------------------- The Company may, at its option and at any time, elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance with the conditions set forth below in this Article 8. 66 Section 8.02. Legal Defeasance and Discharge. ------------------------------- Upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.02, the Company shall, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to have been discharged from its obligations with respect to all outstanding Notes on the date the conditions set forth below are satisfied (hereinafter, "LEGAL DEFEASANCE") and each Subsidiary Guarantor shall be released from all of its obligations under its Subsidiary Guarantee. For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Debt represented by the outstanding Notes, which shall thereafter be deemed to be "outstanding" only for the purposes of Section 8.05 hereof and the other Sections of this Indenture referred to in (a), (b), (c) and (d) below, and to have satisfied all its other obligations under the Notes and this Indenture (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive solely from the trust fund described in Section 8.04 hereof, and as more fully set forth in such Section, payments in respect of the principal of, premium, if any, or interest on such Notes when such payments are due, (b) the Company's obligations with respect to such Notes under Article 2 and Sections 4.01 and 4.02 hereof, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder (including claims of, or payments to, the Trustee pursuant to Section 7.07 hereunder) and the Company's and each Subsidiary Guarantor's obligations in connection therewith and (d) this Article 8. If the Company exercises under Section 8.01 hereof the option applicable to this Section 8.02, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, payment of the Notes may not be accelerated because of an Event of Default. Subject to compliance with this Article 8, the Company may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03 hereof. Section 8.03. Covenant Defeasance. -------------------- Upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, the Company shall, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be released from its obligations under the covenants contained in Section 4.03 and Sections 4.09 through 4.17 hereof, and the operation of clause (e) of the first paragraph of Section 5.01 hereof, with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.04 are satisfied (hereinafter, "COVENANT DEFEASANCE"), and each Subsidiary Guarantor shall be released from all of its obligations under its Subsidiary Guarantee with respect to such covenants in connection with such outstanding Notes, and the Notes shall thereafter be deemed not "outstanding" for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed "outstanding" for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby. If the Company exercises under Section 8.01 hereof the option applicable to this Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, payment of the Notes may not be accelerated because of an Event of Default specified in clauses (d), (e), (f) hereof or because of the Company's failure to comply with clause (e) of the first paragraph of Section 5.01 hereof. Section 8.04. Conditions to Legal or Covenant Defeasance. ------------------------------------------ The following shall be the conditions to the application of either Section 8.02 or 8.03 hereof to the outstanding Notes. The Legal Defeasance or Covenant Defeasance may be exercised only if: (a) the Company Irrevocably Deposits With the Trustee, in Trust (The "Defeasance Trust"), for the Benefit of the Holders of the Notes, Cash in U.s. Dollars, Non-callable U.s. Government Securities, or a Combination of Cash in U.s. Dollars and Non-callable U.s. Government Securities, Sufficient, in the Opinion of a Firm of Independent Public Accountants of Recognized International Standing, to Pay the Principal, Premium, If Any, and Interest On the Outstanding Notes On the Stated Maturity or On the Next Available Redemption Date, as the Case May Be, and the Company Must Specify Whether the Notes are Being Defeased to Maturity or to That Particular Redemption Date; 67 (b) in the Case of Legal Defeasance, the Company Delivers to the Trustee an Opinion of Counsel Reasonably Acceptable to the Trustee Confirming That (X) the Company has Received From, or There has Been Published By, the Internal Revenue Service a Ruling or (Y) Since the Date Hereof, There has Been a Change in the Applicable Federal Income Tax Law, in Either Case to the Effect That, and Based Thereon Such Opinion of Counsel Will Confirm That, the Holders of the Outstanding Notes Will Not Recognize Income, Gain or Loss for Federal Income Tax Purposes as a Result of Such Legal Defeasance and Will be Subject to Federal Income Tax On the Same Amounts, in the Same Manner and At the Same Times as Would Have Been the Case If Such Legal Defeasance Had Not Occurred; (c) in the Case of Covenant Defeasance, the Company Delivers to the Trustee an Opinion of Counsel Reasonably Acceptable to the Trustee Confirming That the Holders of the Outstanding Notes Will Not Recognize Income, Gain or Loss for Federal Income Tax Purposes as a Result of Such Covenant Defeasance and Will be Subject to Federal Income Tax On the Same Amounts, in the Same Manner and At the Same Times as Would Have Been the Case If Such Covenant Defeasance Had Not Occurred; (d) No Event of Default Under Sections 6.01(G) or (H) Hereof Shall Have Occurred With Respect to the Company At Any Time in the Period Ending On the 91St Day After the Cash And/or Non-callable U.s. Government Securities Have Been Deposited in the Defeasance Trust; (e) Such Legal Defeasance or Covenant Defeasance Will Not Result in a Breach or Violation Of, or Constitute a Default Under, Any Material Agreement or Instrument (Other Than This Indenture) to Which the Company or Any of Its Restricted Subsidiaries is a Party or by Which the Company or Any of Its Restricted Subsidiaries is Bound; (f) the Company Delivers to the Trustee an Opinion of Counsel, Subject to Customary Exceptions, to the Effect That On the 91St Day Following the Deposit, the Defeasance Trust Funds Will Not be Subject to the Effect of Any Applicable Bankruptcy, Insolvency, Reorganization or Similar Laws Generally Affecting Creditors' Rights; (g) the Company Delivers to the Trustee an Officers' Certificate Stating That the Deposit was Not Made by the Company With the Intent of Preferring the Holders of Notes Over the Company's Other Creditors With the Intent of Defeating, Hindering, Delaying or Defrauding Any Other Creditors of the Company; and (h) the Company Delivers to the Trustee an Officers' Certificate and an Opinion of Counsel, Each Stating That All Conditions Precedent Relating to the Legal Defeasance or the Covenant Defeasance Have Been Complied With. (i) Notwithstanding the Foregoing, the Opinion of Counsel Required by Clause (B) Above With Respect to a Legal Defeasance Need Not be Delivered If All Notes Not Theretofore Delivered to the Trustee for Cancellation (A) Have Become Due and Payable, (B) Will Become Due and Payable On the Maturity Date Within One Year or (C) as to Which a Redemption Notice has Been Given Calling the Notes for Redemption Within One Year, Under Arrangements Satisfactory to the Trustee for the Giving of Notice of Redemption by the Trustee in the Name, and At the Expense, of the Company. Section 8.05. Deposited Cash and U.S. Government Securities to Be Held in ----------------------------------------------------------- Trust; Other Miscellaneous Provisions. -------------------------------------- Subject to Section 8.06 hereof, all cash and non-callable U.S. Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.05, the "TRUSTEE") pursuant to Section 8.04 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of all sums due and to become due thereon in respect of principal, premium, if any, and interest, but such cash and securities need not be segregated from other funds except to the extent required by law. 68 The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or U.S. Government Securities deposited pursuant to Section 8.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes. Anything in this Article 8 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any cash or non-callable U.S. Government Securities held by it as provided in Section 8.04 hereof which, in the opinion of a nationally recognized firm of independent certified public accountants of recognized international standing expressed in a written certification thereof delivered to the Trustee (which may be the certification delivered under Section 8.04(a) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance. Section 8.06. Repayment to Company. --------------------- Any cash or non-callable U.S. Government Securities deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal, premium, if any, or interest on any Note and remaining unclaimed for two years after such principal, premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in The New York Times and The Wall Street Journal (national edition), notice that such cash and securities remain unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash and securities then remaining shall be repaid to the Company. Section 8.07. Reinstatement. -------------- If the Trustee or Paying Agent is unable to apply any cash or non-callable U.S. Government Securities in accordance with Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company's obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is permitted to apply all such cash and securities in accordance with Section 8.02 or 8.03 hereof, as the case may be; provided, however, that, if the Company makes any payment of principal of, premium, if any, or interest on any Note following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders to receive such payment from the cash and securities held by the Trustee or Paying Agent. ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER -------------------------------- Section 9.01. Without Consent of Holders of Notes. ------------------------------------ Notwithstanding Section 9.02 of this Indenture, the Company, the Subsidiary Guarantors and the Trustee may amend or supplement this Indenture, the Notes or the Subsidiary Guarantees without the consent of any Holder to: (a) Cure Any Ambiguity, Omission, Defect or Inconsistency; (b) Provide for the Assumption by a Successor Corporation of the Obligations of the Company Under This Indenture; 69 (c) Provide for Uncertificated Notes in Addition to or in Place of Certificated Notes (Provided That the Uncertificated Notes are Issued in Registered Form for Purposes of Section 163(F) of the Code, or in a Manner Such That the Uncertificated Notes are Described in Section 163(F)(2)(b) of the Code); (d) Add Subsidiary Guarantees or Additional Obligors With Respect to the Notes; (e) Secure the Notes; (f) Add to the Covenants of the Company for the Benefit of the Holders of the Notes or to Surrender Any Right or Power Conferred Upon the Company; (g) Make Any Other Change That Does Not Adversely Affect the Legal Rights Hereunder of Any Such Holder; or (h) Make Any Change to Comply With Any Requirement of the Commission in Order to Effect or Maintain the Qualification of This Indenture Under the Tia. Section 9.02. With Consent of Holders of Notes. --------------------------------- Except as provided below in this Section 9.02, the Company, the Subsidiary Guarantors and the Trustee may amend or supplement this Indenture, the Notes and the Subsidiary Guarantees with the consent of the Holders of a majority in principal amount of the Notes then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of Default (except a continuing Default or Event of Default in the payment of principal, premium, if any, or interest on the Notes) or compliance with any provision of this Indenture or the Notes (except for certain covenants and provisions of this Indenture which cannot be amended without the consent of each Holder) may be waived with the consent of the Holders of a majority in principal amount of the Notes then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes). Without the consent of each Holder, an amendment or waiver under this Section 9.02 may not (with respect to any Notes held by a non-consenting Holder): (a) Reduce the Principal Amount of Notes Whose Holders Must Consent to an Amendment, Supplement or Waiver or Make Any Change in the Provisions Requiring Each Holder's Consent Under This Section 9.02; (b) Reduce the Rate of or Extend the Time for Payment of Interest, Including Defaulted Interest, On Any Notes; (c) Reduce the Principal of or Extend the Fixed Maturity of Any Notes, or Change the Date On Which Any Notes May be Subject to Redemption or Repurchase, or Reduce the Redemption or Repurchase Price for Those Notes; (d) Make Any Note Payable in Money Other Than That Stated in the Note and This Indenture; (e) Impair the Right of Any Holder to Receive Payment of Principal, Premium or Interest On That Holder's Notes On or After the Due Dates for Those Payments, or to Bring Suit to Enforce That Payment On or With Respect to Such Holder's Notes; (f) Modify Sections 4.08 or 6.04 Hereof; (g) Release Any Subsidiary Guarantor From Any of Its Obligations Under Its Subsidiary Guarantee or This Indenture Other Than in Accordance With the Provisions of This Indenture, or Amend or Modify Any Provision Relating to Such Release; 70 (h) Amend This Indenture or Any Subsidiary Guarantee to Subordinate the Notes or Such Subsidiary Guarantee to Any Other Obligation of the Company or the Applicable Subsidiary Guarantor; (i) Reduce the Premium Payable Upon a Change of Control Or, At Any Time After a Change of Control has Occurred, Change the Time At Which the Change of Control Offer Relating Thereto Must be Made or At Which the Notes Must be Repurchased Pursuant to Such Change of Control Offer; (j) At Any Time After the Company is Obligated to Make a Prepayment Offer With the Excess Proceeds From Asset Sales, Change the Time or Price At Which Such Prepayment Offer Must be Made or At Which the Notes Must be Repurchased Pursuant Thereto. The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Persons entitled to consent to any supplemental indenture. If a record date is fixed, the Holders on such record date, or their duly designated proxies, and only such Persons, shall be entitled to consent to such supplemental indenture, whether or not such Holders remain Holders after such record date; provided that unless such consent shall have become effective by virtue of the requisite percentage having been obtained prior to the date which is 120 days after such record date, any such consent previously given shall automatically and without further action by any Holder be cancelled and of no further effect. It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment or waiver, but it shall be sufficient if such consent approves the substance thereof. After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Company shall mail to the Holder of each Note affected thereby to such Holder's address appearing in the Note Register a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver. Section 9.03. Compliance with Trust Indenture Act. ------------------------------------ Every amendment or supplement to this Indenture or the Notes shall be set forth in an amended or supplemental indenture that complies with the TIA as then in effect. Section 9.04. Revocation and Effect of Consents. ---------------------------------- Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or portion thereof that evidences the same debt as the consenting Holder's Note, even if notation of the consent is not made on any Note. However, any such Holder or subsequent Holder may revoke the consent as to its Note or portion thereof if the Trustee receives written notice of revocation before the date the waiver, supplement or amendment becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder. Section 9.05. Notation on or Exchange of Notes. --------------------------------- The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Company in exchange for all Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate new Notes that reflect the amendment, supplement or waiver. Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver. 71 Section 9.06. Trustee to Sign Amendments, etc. -------------------------------- The Trustee shall sign any amended or supplemental indenture authorized pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. None of the Company nor any Subsidiary Guarantor may sign an amendment or supplemental indenture until its Board of Directors approves it. In executing any amended or supplemental indenture, the Trustee shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully protected in relying upon an Officer's Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Indenture and that such amended or supplemental indenture is the legal, valid and binding obligations of the Company enforceable against it in accordance with its terms, subject to customary exceptions and that such amended or supplemental indenture complies with the provisions hereof (including Section 9.03). ARTICLE 10. GUARANTEES ---------- Section 10.01. Subsidiary Guarantees. ---------------------- Subject to this Article 10, each of the Subsidiary Guarantors hereby unconditionally guarantees to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns that: (a) the principal of, premium, if any, and interest on the Notes shall be promptly paid in full when due, subject to any applicable grace period, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of, and interest on, the Notes, if lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder shall be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration pursuant to Section 6.02 hereof, redemption or otherwise. Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Subsidiary Guarantors shall be jointly and severally obligated to pay the same immediately. Each Subsidiary Guarantor agrees that this is a guarantee of payment and not a guarantee of collection. Each Subsidiary Guarantor hereby agrees that its obligations with regard to this Subsidiary Guarantee shall be joint and several and unconditional, irrespective of the validity or enforceability of the Notes or the obligations of the Company under this Indenture, the absence of any action to enforce the same, the recovery of any judgment against the Company or any other obligor with respect to this Indenture, the Notes or the Obligations of the Company under this Indenture or the Notes, any action to enforce the same or any other circumstances (other than complete performance) that might otherwise constitute a legal or equitable discharge or defense of a Subsidiary Guarantor. Each Subsidiary Guarantor further, to the extent permitted by law, waives and relinquishes all claims, rights and remedies accorded by applicable law to guarantors and agrees not to assert or take advantage of any such claims, rights or remedies, including but not limited to: (a) any right to require any of the Trustee, the Holders or the Company (each a "BENEFITED Party"), as a condition of payment or performance by such Subsidiary Guarantor, to (1) proceed against the Company, any other guarantor (including any other Subsidiary Guarantor) of the Obligations under the Subsidiary Guarantees or any other Person, (2) proceed against or exhaust any security held from the Company, any such other guarantor or any other Person, (3) proceed against or have resort to any balance of any deposit account or credit on the books of any Benefited Party in favor of the Company or any other Person, or (4) pursue any other remedy in the power of any Benefited Party whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of the Company including any defense based on or arising out of the lack of validity or the unenforceability of the Obligations under the Subsidiary Guarantees or any agreement or instrument relating thereto or by reason of the cessation of the liability of the Company from any cause other than payment in full of the Obligations under the Subsidiary Guarantees; (c) any defense based upon any statute or rule of law that provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (d) any defense based upon any Benefited Party's errors or omissions in the administration of the Obligations under the Subsidiary Guarantees, except behavior which amounts to bad faith; (e)(1) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms of the 72 Subsidiary Guarantees and any legal or equitable discharge of such Subsidiary Guarantor's obligations hereunder, (2) the benefit of any statute of limitations affecting such Subsidiary Guarantor's liability hereunder or the enforcement hereof, (3) any rights to set-offs, recoupments and counterclaims and (4) promptness, diligence and any requirement that any Benefited Party protect, secure, perfect or insure any security interest or lien or any property subject thereto; (f) notices, demands, presentations, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance of the Subsidiary Guarantees, notices of default under the Notes or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Obligations under the Subsidiary Guarantees or any agreement related thereto, and notices of any extension of credit to the Company and any right to consent to any thereof; (g) to the extent permitted under applicable law, the benefits of any "One Action" rule and (h) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms of the Subsidiary Guarantees. Except to the extent expressly provided herein, including Sections 8.02, 8.03 and 10.05, each Subsidiary Guarantor hereby covenants that its Subsidiary Guarantee shall not be discharged except by complete performance of the obligations contained in its Subsidiary Guarantee and this Indenture. If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Subsidiary Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Subsidiary Guarantors any amount paid by either to the Trustee or such Holder, this Subsidiary Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect. Each Subsidiary Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until indefeasible payment in full of all obligations guaranteed hereby. Each Subsidiary Guarantor further agrees that, as between the Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Section 6.02 hereof for the purposes of this Subsidiary Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby and (y) in the event of any declaration of acceleration of such obligations as provided in Section 6.02 hereof, such obligations (whether or not due and payable) shall forthwith become due and payable by the Subsidiary Guarantors for the purpose of this Subsidiary Guarantee. The Subsidiary Guarantors shall have the right to seek contribution from any non-paying Subsidiary Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Subsidiary Guarantee. Section 10.02. Limitation on Subsidiary Guarantor Liability. --------------------------------------------- Each Subsidiary Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such parties that the Subsidiary Guarantee of such Subsidiary Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law or Canadian federal or provincial law to the extent applicable to any Subsidiary Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Subsidiary Guarantors hereby irrevocably agree that the obligations of such Subsidiary Guarantor under this Article 10 shall be limited to the maximum amount as shall, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Subsidiary Guarantor that are relevant under such laws, including, if applicable, its guarantee of all obligations under Credit Facilities, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary Guarantor under this Article 10, result in the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee not constituting a fraudulent transfer or conveyance. Section 10.03. Execution and Delivery of Subsidiary Guarantee. ---------------------------------------------- To evidence its Subsidiary Guarantee set forth in Section 10.01 hereof, each Subsidiary Guarantor hereby agrees that a notation of such Subsidiary Guarantee in substantially the form included in Exhibit E shall be endorsed by an Officer of such Subsidiary Guarantor on each Note authenticated and delivered by the Trustee and that this Indenture shall be executed on behalf of such Subsidiary Guarantor by an Officer of such Subsidiary Guarantor. 73 Each Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee set forth in Section 10.01 hereof shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee. If an Officer whose signature is on this Indenture or on the Subsidiary Guarantee no longer holds that office at the time the Trustee authenticates the Note on which a Subsidiary Guarantee is endorsed, the Subsidiary Guarantee shall be valid nevertheless. The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee set forth in this Indenture on behalf of the Subsidiary Guarantors. Section 10.04. Subsidiary Guarantors May Consolidate, etc. on Certain Terms. ------------------------------------------------------------- Except as otherwise provided in Section 10.05 hereof, no Subsidiary Guarantor may consolidate with or merge with or into (whether or not such Subsidiary Guarantor is the surviving Person) another Person whether or not affiliated with such Subsidiary Guarantor unless: (a) Subject to Section 10.05 Hereof, the Person Formed by or Surviving Any Such Consolidation or Merger (If Other Than a Subsidiary Guarantor or the Company) Unconditionally Assumes All the Obligations of Such Subsidiary Guarantor, Pursuant to a Supplemental Indenture in Form and Substance Reasonably Satisfactory to the Trustee On the Terms Set Forth Herein or Therein; and (b) the Subsidiary Guarantor Complies With the Requirements of Article 5 Hereof. In case of any such consolidation, merger, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the Subsidiary Guarantee endorsed upon the Notes and the due and punctual performance of all of the covenants and conditions of this Indenture to be performed by the Subsidiary Guarantor, such successor Person shall succeed to and be substituted for the Subsidiary Guarantor with the same effect as if it had been named herein as a Subsidiary Guarantor. Such successor Person thereupon may cause to be signed any or all of the Subsidiary Guarantees to be endorsed upon all of the Notes issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee. All the Subsidiary Guarantees so issued shall in all respects have the same legal rank and benefit under this Indenture as the Subsidiary Guarantees theretofore and thereafter issued in accordance with the terms of this Indenture as though all of such Subsidiary Guarantees had been issued at the date of the execution hereof. Except as set forth in Articles 4 and 5 hereof, and notwithstanding clauses (a) and (b) above, nothing contained in this Indenture or in any of the Notes shall prevent any consolidation or merger of a Subsidiary Guarantor with or into the Company or another Subsidiary Guarantor, or shall prevent any sale or conveyance of the property of a Subsidiary Guarantor as an entirety or substantially as an entirety to the Company or another Subsidiary Guarantor. Section 10.05. Releases Following Sale of Assets, Etc. --------------------------------------- In the event of (i) the redesignation of a Subsidiary Guarantor as an Unrestricted Subsidiary in accordance with the provisions of Section 4.16 of this Indenture, or (ii) a sale or other disposition of all of the assets of any Subsidiary Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the capital stock of any Subsidiary Guarantor, in each case to a Person that is not (either before or after giving effect to such transactions) a Subsidiary of the Company, then such Subsidiary Guarantor (in the event of a sale or other disposition, by way of merger, consolidation or otherwise, of all of the capital stock of such Subsidiary Guarantor) or the corporation acquiring the property (in the event of a sale or other disposition of all or substantially all of the assets of such Subsidiary Guarantor) shall be released and relieved of any obligations under its Subsidiary Guarantee; provided that, in the case of clause (ii) of this Section, the net proceeds of such sale or other disposition are applied in accordance with the applicable provisions of this Indenture, including without limitation Section 4.12 hereof. Upon delivery by the Company to the Trustee of an Officers' Certificate and an 74 Opinion of Counsel to the effect that such sale or other disposition was made by the Company in accordance with the provisions of this Indenture, including without limitation Section 4.12 or Section 4.16 hereof, as applicable, the Trustee shall execute any documents reasonably required in order to evidence the release of any Subsidiary Guarantor from its obligations under its Subsidiary Guarantee. Any Subsidiary Guarantor not released from its obligations under its Subsidiary Guarantee shall remain liable for the full amount of principal of and interest on the Notes and for the other obligations of any Subsidiary Guarantor under this Indenture as provided in this Article 10. ARTICLE 11. SATISFACTION AND DISCHARGE -------------------------- Section 11.01. Satisfaction and Discharge. This Indenture will be discharged and will cease to be of further effect, except as to surviving rights of registration of transfer or exchange of the Notes, as to all Notes issued hereunder, when: (a) Either: (i) All Notes That Have Been Previously Authenticated (Except Lost, Stolen or Destroyed Notes That Have Been Replaced or Paid and Notes for Whose Payment Money has Previously Been Deposited in Trust or Segregated and Held in Trust by the Company and is Thereafter Repaid to the Company or Discharged From the Trust) Have Been Delivered to the Trustee for Cancellation; or (ii) All Notes That Have Not Been Previously Delivered to the Trustee for Cancellation (A) Have Become Due and Payable or (B) Will Become Due and Payable At Their Maturity Within One Year or (C) are to be Called for Redemption Within One Year Under Arrangements Satisfactory to the Trustee for the Giving of a Notice of Redemption by the Trustee, and the Company has Irrevocably Deposited or Caused to be Deposited With the Trustee as Trust Funds in Trust Solely for the Benefit of the Holders, Cash in U.s. Dollars, Non-callable U.s. Government Securities, or a Combination Thereof, in Such Amounts as Will be Sufficient Without Consideration of Any Reinvestment of Interest, to Pay and Discharge the Entire Debt On the Notes Not Previously Delivered to the Trustee for Cancellation for Principal, Premium, If Any, and Interest On the Notes to the Date of Deposit, in the Case of Notes That Have Become Due and Payable, or to the Stated Maturity or Redemption Date, as the Case May Be; (b) the Company has Paid or Caused to be Paid All Other Sums Payable by It Under This Indenture; and (c) the Company Delivers to the Trustee an Officers' Certificate and Opinion of Counsel Stating That All Conditions Precedent Under This Indenture Relating to the Satisfaction and Discharge of This Indenture Have Been Satisfied. Section 11.02. Deposited Cash and U.S. Government Securities to Be Held in ----------------------------------------------------------- Trust; Other Miscellaneous Provisions. --------------------------------------- Subject to Section 11.03 hereof, all cash and non-callable U.S. Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 11.02, the "Trustee") pursuant to Section 11.01 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and interest but such cash and securities need not be segregated from other funds except to the extent required by law. 75 Section 11.03. Repayment to Company. --------------------- Any cash or non-callable U.S. Government Securities deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or interest on, any Note and remaining unclaimed for two years after such principal, and premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in The New York Times and The Wall Street Journal (national edition), notice that such cash and securities remain unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash and securities then remaining will be repaid to the Company. ARTICLE 12. MISCELLANEOUS ------------- Section 12.01. Trust Indenture Act Controls. ----------------------------- If any provision of this Indenture limits, qualifies or conflicts with another provision that is required to be included in this Indenture by the TIA, the provision required by the TIA shall control. Section 12.02. Notices. -------- Any notice or communication by the Company, the Subsidiary Guarantors or the Trustee to the other is duly given if in writing and delivered in person or mailed by first class mail (registered or certified, return receipt requested), telecopier or overnight air courier guaranteeing next-day delivery, to the other's address: If to the Company or any Subsidiary Guarantor: Attention: Telecopier No.: With a copy to: If to the Trustee: Attention: Telecopier No.: The Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications. All notices and communications (other than those sent to the Trustee) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next-day delivery. All notices and communications to the Trustee shall be deemed duly given and effective only upon receipt. Any notice or communication to a Holder shall be mailed by first class mail, certified or registered, return receipt requested, or by overnight air courier guaranteeing next-day delivery to its address shown on the Note Register. Any notice or communication shall also be so mailed to any Person described in TIA ss. 313(c), to the extent required by the TIA. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. 76 If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. If the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time. Section 12.03. Communication by Holders of Notes with Other Holders of Notes. ------------------------------------------------------------- Holders may communicate pursuant to TIAss.312(b) with other Holders with respect to their rights under this Indenture or the Notes. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA ss.312(c). Section 12.04. Certificate and Opinion as to Conditions Precedent. -------------------------------------------------- Upon any request or application by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee: (a) an Officers' Certificate in Form and Substance Reasonably Satisfactory to the Trustee (Which Shall Include the Statements Set Forth in Section 12.05 Hereof) Stating That, in the Opinion of the Signers, All Conditions Precedent and Covenants, If Any, Provided for in This Indenture Relating to the Proposed Action Have Been Complied With; and (b) an Opinion of Counsel in Form and Substance Reasonably Satisfactory to the Trustee (Which Shall Include the Statements Set Forth in Section 12.05 Hereof) Stating That, in the Opinion of Such Counsel, All Such Conditions Precedent and Covenants Have Been Complied With. Section 12.05. Statements Required in Certificate or Opinion. --------------------------------------------- Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA ss.314(a)(4)) shall comply with the provisions of TIA ss.314(e) and shall include: (a) a Statement That the Person Making Such Certificate or Opinion has Read Such Covenant or Condition; (b) a Brief Statement as to the Nature and Scope of the Examination or Investigation Upon Which the Statements or Opinions Contained in Such Certificate or Opinion are Based; (c) a Statement That, in the Opinion of Such Person, He or She has Made Such Examination or Investigation as is Necessary to Enable Such Person to Express an Informed Opinion as to Whether or Not Such Covenant or Condition has Been Complied With; and (d) a Statement as to Whether or Not, in the Opinion of Such Person, Such Condition or Covenant has Been Complied With. With respect to matters of fact, an Opinion of Counsel may rely on an Officers' Certificate or certificates of public officials. Section 12.06. Rules by Trustee and Agents. ---------------------------- The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions. 77 Section 12.07. No Personal Liability of Directors, Officers, Employees and ----------------------------------------------------------- Stockholders ------------ No past, present or future director, officer, employee, incorporator or stockholder of the Company, or any Subsidiary Guarantor, as such, shall have any liability for any obligations of the Company or the Subsidiary Guarantors under the Notes, the Subsidiary Guarantees, this Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Section 12.08. Governing Law. -------------- THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. Section 12.09. No Adverse Interpretation of Other Agreements. --------------------------------------------- This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. Section 12.10. Successors. ----------- All covenants and agreements of the Company in this Indenture and the Notes shall bind its successors. All covenants and agreements of the Trustee in this Indenture shall bind its successors. Section 12.11. Severability. ------------- In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. Section 12.12. Counterpart Originals. ---------------------- The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. Section 12.13. Table of Contents, Headings, etc. --------------------------------- The Table of Contents, Cross-Reference Table and Headings in this Indenture have been inserted for convenience of reference only, are not to be considered a part of this Indenture and shall in no way modify or restrict any of the terms or provisions hereof. Section 12.14. Qualification of this Indenture. -------------------------------- The Company shall qualify this Indenture under the TIA and shall pay all reasonable costs and expenses (including attorneys' fees and expenses for the Company, the Trustee and the Holders) incurred in connection therewith, including, but not limited to, costs and expenses of qualification of this Indenture and the Notes and printing this Indenture and the Notes. The Trustee shall be entitled to receive from the Company any such Officers' Certificates, Opinions of Counsel or other documentation as it may reasonably request in connection with any such qualification of this Indenture under the TIA. [Signatures on following page] 78 SIGNATURES Dated as of [ ], 2003 COMPANY: ARMSTRONG WORLD INDUSTRIES, INC. By: ----------------------------- Name: Title: [SUBSIDIARY GUARANTORS]: By: ------------------------------ Name: Title: TRUSTEE: Wells Fargo Bank Minnesota, N.A. By: ------------------------------------- Name: Title: EXHIBIT A ================================================================================ (Face of Note) [ ]% SENIOR NOTES DUE 201[ ] CUSIP _____________ NO. $_____________ ARMSTRONG WORLD INDUSTRIES, INC. promises to pay to CEDE & CO., INC. or registered assigns, the principal sum of _________________ Dollars ($______________) on [ ], [ ]. Interest Payment Dates: [ ] and [ ], commencing [ ], 20[ ]. Record Dates: [ ] and [ ]. Dated: ______________, 20[ ]. A-1 IN WITNESS WHEREOF, the Company has caused this Note to be signed manually or by facsimile by its duly authorized officer. ARMSTRONG WORLD INDUSTRIES, INC. By: --------------------------------- Name: Title: This is one of the Global Notes referred to in the within-mentioned Indenture: [NAME OF TRUSTEE], as Trustee By: --------------------------------------- Authorized Signatory Dated _____________, 2003 A-2 (Back of Note) [ ]% SENIOR NOTES DUE 201[ ] [Insert the Global Note Legend, if applicable pursuant to the terms of the Indenture] [Insert the Private Placement Legend, if applicable pursuant to the terms of the Indenture] Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated. 1. INTEREST. Armstrong World Industries, Inc., a Pennsylvania corporation (the "COMPANY"), promises to pay interest on the principal amount of this Note at [ ](10)% per annum until maturity. The Company shall pay interest semi-annually on [ ] and [ ] of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each an "INTEREST PAYMENT DATE"). Interest on the Notes shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of original issuance; provided, however, that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided, further, that the first Interest Payment Date shall be the first of [ ] or [ ] to occur after the date of issuance. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1.0% per annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods), from time to time on demand at the same rate to the extent lawful. 2. METHOD OF PAYMENT. The Company shall pay interest on the Notes (except defaulted interest) to the Persons who are Holders at the close of business on the [ ] or [ ] next preceding the Interest Payment Date, even if such Notes are cancelled after such record date and on or before such Interest Payment Date, except as provided in Section 2.09 of the Indenture with respect to defaulted interest. The Notes shall be payable as to principal, premium, if any, and interest, if any, at the office or agency of the Company maintained for such purpose, or, at the option of the Company, payment of interest may be made by check mailed to the Holders at their addresses set forth in the Note Register; provided, however, that payment by wire transfer of immediately available funds shall be required with respect to principal of and interest, if any, and premium, if any, on all Global Notes and all other Notes the Holders of which shall have provided wire transfer instructions to the Company or the Paying Agent. Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 3. PAYING AGENT AND REGISTRAR. Initially, [ ], the Trustee under the Indenture, shall act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company or any of its subsidiaries may act in any such capacity. 4. INDENTURE. The Company issued the Notes under an Indenture dated as of [ ], 2003 ("INDENTURE") among the Company, the Subsidiary Guarantors party thereto and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are obligations of the Company unlimited in aggregate principal amount. - ---------------- (10) See footnote 4. A-3 5. OPTIONAL REDEMPTION. (a) From the Issue Date through [ ], 2004, (11) the Company may redeem all or any portion of the Notes, at once or over time, at a redemption price expressed as a percentage of principal amount) equal to 100.0% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to the redemption date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date). (B) AT ANY TIME AND FROM TIME TO TIME DURING THE TWELVE-MONTH PERIOD COMMENCING ON [ ] OF THE YEARS INDICATED BELOW, THE COMPANY MAY REDEEM ALL OR ANY PORTION OF THE NOTES AT THE REDEMPTION PRICES (EXPRESSED AS PERCENTAGES OF PRINCIPAL AMOUNT) SET FORTH BELOW, PLUS ACCRUED AND UNPAID INTEREST ON THE NOTES REDEEMED, TO THE APPLICABLE REDEMPTION DATE (SUBJECT TO THE RIGHT OF HOLDERS OF RECORD ON THE RELEVANT RECORD DATE TO RECEIVE INTEREST DUE ON THE RELEVANT INTEREST PAYMENT DATE): Year Percentage ---- ---------- 2009.......................................................[ ]% 2010.......................................................[ ]% 2011 and thereafter........................................[100.0]% (C) AT ANY TIME AND FROM TIME TO TIME PRIOR TO [ ], 20[ ], THE COMPANY MAY REDEEM UP TO 35.0% OF THE AGGREGATE PRINCIPAL AMOUNT OF THE NOTES ISSUED UNDER THIS INDENTURE AT A REDEMPTION PRICE (EXPRESSED AS A PERCENTAGE OF PRINCIPAL AMOUNT) EQUAL TO [ ]% (12) OF THE PRINCIPAL AMOUNT THEREOF, PLUS ACCRUED AND UNPAID INTEREST TO THE REDEMPTION DATE (SUBJECT TO THE RIGHT OF HOLDERS OF RECORD ON THE RELEVANT RECORD DATE TO RECEIVE INTEREST DUE ON THE RELEVANT INTEREST PAYMENT DATE) WITH THE NET CASH PROCEEDS OF ONE OR MORE EQUITY OFFERINGS BY THE COMPANY OR THE DIRECT OR INDIRECT PARENT OF THE COMPANY (TO THE EXTENT, IN THE CASE OF THE DIRECT OR INDIRECT PARENT, THAT THE NET CASH PROCEEDS OF THE EQUITY OFFERINGS ARE CONTRIBUTED TO THE COMMON OR NON-REDEEMABLE PREFERRED EQUITY CAPITAL THAT IS NOT CONVERTIBLE OR EXCHANGEABLE FOR DEBT OR DISQUALIFIED STOCK OF THE COMPANY); PROVIDED, HOWEVER, THAT AFTER GIVING EFFECT TO ANY SUCH REDEMPTION, AT LEAST 65.0% OF THE AGGREGATE PRINCIPAL AMOUNT OF THE NOTES INITIALLY ISSUED UNDER THIS INDENTURE (EXCLUDING NOTES HELD BY THE COMPANY AND ITS SUBSIDIARIES) REMAINS OUTSTANDING IMMEDIATELY AFTER GIVING EFFECT TO SUCH REDEMPTION. ANY SUCH REDEMPTION SHALL BE MADE WITHIN 75 DAYS OF SUCH EQUITY OFFERING UPON NOT LESS THAN 30 NOR MORE THAN 60 DAYS' PRIOR NOTICE. (D) ANY PREPAYMENT PURSUANT TO THIS PARAGRAPH SHALL BE MADE PURSUANT TO THE PROVISIONS OF SECTIONS 3.01 THROUGH 3.06 OF THE INDENTURE. 6. MANDATORY REDEMPTION. Except as set forth in Sections 4.12 and 4.17 of the Indenture, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Notes. 7. REPURCHASE AT OPTION OF HOLDER. (a) Upon the occurrence of a Change of Control, each Holder shall have the right to require the Company to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000) of such Holder's Notes (a "CHANGE OF CONTROL OFFER") at a purchase price, in cash, equal to 101% of the aggregate principal amount of the Notes repurchased, plus accrued and unpaid interest, if any, on the Notes repurchased to the Purchase Date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest to, but excluding the Purchase Date). (b) If the Company or one of its Restricted Subsidiaries consummates any Asset Sales, any Net Available Cash from Asset Sales that are not applied or invested as provided in Section 4.12 of the Indenture will constitute "EXCESS (11) 180 days after the Issue Date. (12) Par plus coupon. A-4 PROCEEDS." When the aggregate amount of Excess Proceeds exceeds $25.0 million, the Company will make an offer to all Holders of Notes to purchase the maximum principal amount of Notes and, if the Company is required to do so under the terms of any other Indebtedness that is pari passu with the Notes, such other Indebtedness on a pro rata basis with the Notes, that may be purchased out of the Excess Proceeds (a "PREPAYMENT OFFER"). The offer price in any Prepayment Offer will be equal to 100% of principal amount plus accrued and unpaid interest and Additional Interest, if any, to the date of purchase, and will be payable in cash. If any Excess Proceeds remain after consummation of the purchase of all properly tendered and not withdrawn Notes pursuant to a Prepayment Offer, the Company may use such remaining Excess Proceeds for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and other pari passu Indebtedness tendered into such Prepayment Offer exceeds the amount of Excess Proceeds, the Trustee will select the Notes and such other pari passu Indebtedness to be purchased on a pro rata basis. Upon completion of each Prepayment Offer, the amount of Excess Proceeds will be reset at zero. Holders of Notes that are the subject of an offer to purchase will receive a Prepayment Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" on the reverse of the Notes. 8. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at its registered address. Notes in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the redemption date interest ceases to accrue on Notes or portions thereof called for redemption. 9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in denominations of $1,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents, and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before the mailing of a notice of redemption of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date. 10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner for all purposes. 11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Company, the Subsidiary Guarantors and the Trustee may amend or supplement the Indenture, the Notes or the Subsidiary Guarantees with the consent of the Holders of a majority in principal amount of the then outstanding Notes voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 of the Indenture, any existing Default or Event of Default (except a continuing Default or Event of Default in the payment of principal, premium, if any, or interest on the Notes) or compliance with any provision of the Indenture or the Notes (except for certain covenants and provisions of the Indenture that cannot be amended without the consent of each Holder) may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes). Without the consent of any Holder, the Company, the Subsidiary Guarantors and the Trustee may amend or supplement the Indenture, the Notes or the Subsidiary Guarantees to cure any ambiguity, omission, defect or inconsistency, to provide for the assumption by a successor corporation, partnership or limited liability company of the obligations of the Company under the Indenture, to provide for uncertificated Notes in addition to or in place of certificated Notes, to secure the Notes, to add to the covenants of the Company for the benefit of the Holders of the Notes or to surrender any right or power conferred upon the Company, to make any change that would provide any additional rights or benefits to the Holders of Notes or that does not adversely affect the legal rights under the Indenture of any such Holder, or to make any change to comply with any requirement of the Commission in order to effect or maintain the qualification of the Indenture under the TIA. 12. DEFAULTS AND REMEDIES. Each of the following is an Event of Default under the Indenture: (i) failure to make the payment of any interest on the Notes when the same becomes due and payable, and such failure continues for A-5 a period of 30 days; (ii) failure to make the payment of any principal of, or premium, if any, on, any of the Notes when the same becomes due and payable at its Stated Maturity, upon acceleration, redemption, optional redemption, required repurchase or otherwise; (iii) failure to comply with the provisions of Sections 4.12, 4.17 or 5.01 of the Indenture; (iv) failure to comply with any other covenant or agreement in the Notes or in the Indenture (other than a failure that is the subject of the foregoing clause (i), (ii) or (iii)) and such failure continues for 60 days after written notice is given to the Company as provided below; (v) a default under any Debt by the Company or any Restricted Subsidiary that is a Significant Subsidiary that results in acceleration of the maturity of such Debt, or failure to pay any such Debt at maturity, in an aggregate amount greater than $25.0 million or its foreign currency equivalent at the time; (vi) any judgment or judgments for the payment of money in an aggregate amount in excess of $25.0 million (or its foreign currency equivalent at the time) in excess of amounts which are covered by insurance under applicable policies that shall be rendered against the Company or any Restricted Subsidiary that is a Significant Subsidiary and that shall not be waived, satisfied or discharged for any period of 60 consecutive days during which a stay of enforcement shall not be in effect; (vii) certain events of bankruptcy, insolvency or reorganization affecting the Company or any of Restricted Subsidiary that is a Significant Subsidiary; and (viii) any guarantee of a Subsidiary Guarantor that is a Significant Subsidiary or a group of Subsidiary Guarantors that, taken as a whole, would constitute a Significant Subsidiary ceases to be in full force and effect (other than in accordance with the terms of such guarantee) or any Subsidiary Guarantor denies or disaffirms its obligations under its guarantee. If any Event of Default shall have occurred and be continuing, the Trustee or the Holders of at least 25.0% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency described in the Indenture with respect to the Company, all outstanding Notes shall become due and payable without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest) if it determines that withholding notice is in their interest. The Holders of a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest on, or the principal of, the Notes. The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default. 13. TRUSTEE DEALINGS WITH COMPANY. Subject to certain limitations, the Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee. 14. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator or stockholder of the Company or any Subsidiary Guarantor shall have any liability for any obligations of the Company or any Subsidiary Guarantor under the Indenture, the Notes or any Subsidiary Guarantee or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. 15. AUTHENTICATION. This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent. 16. ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act). 17. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes, and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. A-6 The Company shall furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to: 18. GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. A-7 OPTION OF HOLDER TO ELECT PURCHASE If you want to elect to have this Note purchased by the Company pursuant to Section 4.12 or 4.17 of the Indenture, check the box below: Section 4.12 [ ] Section 4.17 [ ] If you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.12 or Section 4.17 of the Indenture, state the amount you elect to have purchased: $_____________________ Date:_________________ Your Signature:________________________________ (Sign exactly as your name appears on the Note) Tax Identification No.: ______________________ SIGNATURE GUARANTEE: _______________________________________________ Signatures must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. A-8 ASSIGNMENT FORM To assign this Note, fill in the form below: (I) or (we) assign and transfer this Note to ________________________________________________________________________________ (Insert assignee's social security or other tax I.D. no.) ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Print or type assignee's name, address and zip code) and irrevocably appoint_________________________________________________________ as agent to transfer this Note on the books of the Company. The agent may substitute another to act for him. ________________________________________________________________________________ Date: ______________ Your Signature:_______________________________ (Sign exactly as your name appears on the face of this Note) Signature Guarantee:__________________________ A-9 SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made: Principal Amount Amount of of this Global Note Signature of decrease in Amount of increase following such authorized signatory Principal Amount in Principal Amount decrease (or of Trustee or Date of Exchange of this Global Note of this Global Note increase) Custodian ---------------- ------------------- ------------------- --------- ---------
EXHIBIT B FORM OF CERTIFICATE OF TRANSFER Armstrong World Industries, Inc. [address] Attention: Chief Financial Officer and Corporate Secretary [Trustee] [address] Attention: Telecopier No.: Re: [ ]% Senior Notes due 2010 ---------------------------- Reference is hereby made to the Indenture, dated as of , 2003 (the "Indenture"), among Armstrong World Industries, Inc., as issuer (the "Company"), the Subsidiary Guarantors party thereto and _________________, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. ___________________, (the "Transferor") owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $___________ in such Note[s] or interests (the "Transfer"), to ___________________________ (the "Transferee"), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that: [CHECK ALL THAT APPLY] 1. [ ] Check if Transferee will take delivery of a beneficial interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor hereby further certifies that the beneficial interest in the Global Note or Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest in the Global Note or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a "qualified institutional buyer" within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States and applicable securities laws of any other applicable jurisdiction. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest in the Global Note or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Note and/or the Definitive Note and in the Indenture and the Securities Act. 2. [ ] Check if Transferee will take delivery of a beneficial interest in the Regulation S Global Note or a Definitive Note pursuant to Regulation S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a Person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(a) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Distribution Compliance Period, the transfer is not being made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Global Note and/or the Definitive Note and in the Indenture and the Securities Act. B-1 3. [ ] Check and complete if Transferee will take delivery of a beneficial interest in the IAI Global Note or a Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States and the securities laws of any other applicable jurisdiction, and accordingly the Transferor hereby further certifies that (check one): (a) [ ] such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act; or (b) [ ] such Transfer is being effected to the Company or a subsidiary thereof; or (c) [ ] such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act; or (d) [ ] such Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption from the registration requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Note or Restricted Definitive Notes and the requirements of the exemption claimed, which certification is supported by (1) a certificate executed by the Transferee in the form of Exhibit D to the Indenture and (2) an Opinion of Counsel provided by the Transferor or the Transferee (a copy of which the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the IAI Global Note and/or the Definitive Notes and in the Indenture and the Securities Act. 4. [ ] Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Note or of an Unrestricted Definitive Note. (a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and the securities laws of any other applicable jurisdiction and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. (b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and the securities laws of any other applicable jurisdiction and (ii) the restrictions on transfer contained in the Indenture B-2 and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. (c)[ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and the securities laws of any other applicable jurisdiction and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture. This certificate and the statements contained herein are made for your benefit and the benefit of the Company. ________________________________________ [Insert Name of Transferor] By: _____________________________________ Name: Title: Dated: ______________________ B-3 ANNEX A TO CERTIFICATE OF TRANSFER 1. The Transferor owns and proposes to transfer the following: [CHECK ONE OF (a) OR (b)] (a) [ ] a beneficial interest in the: (i) [ ] 144A Global Note (CUSIP _________), or (ii) [ ] Regulation S Global Note (CUSIP _________), or (iii)[ ] IAI Global Note (CUSIP _________); or (b) [ ] a Restricted Definitive Note. 2. After the Transfer the Transferee will hold: [CHECK ONE OF (a), (b) OR (c)] (a) [ ] a beneficial interest in the: (i) [ ] 144A Global Note (CUSIP _________), or (ii) [ ] Regulation S Global Note (CUSIP _________), or (iii)[ ] IAI Global Note (CUSIP _________); or (iv) [ ] Unrestricted Global Note (CUSIP _________); or (b) [ ] a Restricted Definitive Note; or (c) [ ] an Unrestricted Definitive Note, in accordance with the terms of the Indenture. B-4 EXHIBIT C FORM OF CERTIFICATE OF EXCHANGE Armstrong World Industries, Inc. [address] Attention: Chief Financial Officer and Corporate Secretary [Trustee] [address] Attention: Telecopier No.: Re: [ ]% Senior Notes due 2010 Reference is hereby made to the Indenture, dated as of ______________, 2003 (the "Indenture"), among Armstrong World Industries, Inc., as issuer (the "Company"), the Subsidiary Guarantors party thereto and ___________________, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. __________________________, (the "Owner") owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of $____________ in such Note[s] or interests (the "Exchange"). In connection with the Exchange, the Owner hereby certifies that: 1. Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Note and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (b)[ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Note and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (d)[ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance C-1 with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. 2. Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owner's own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act. (b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange of the Owner's Restricted Definitive Note for a beneficial interest in the [CIRCLE ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Definitive Note and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act. This certificate and the statements contained herein are made for your benefit and the benefit of the Company. ____________________________________ [Insert Name of Transferor] By:_________________________________ Name: Title: Dated: ______________________ C-2 EXHIBIT D FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR Armstrong World Industries, Inc. [address] Attention: Chief Financial Officer and Corporate Secretary [Trustee] [address] Attention: Telecopier No.: Re: [ ]% Senior Notes due 2010 ------------------------------ Reference is hereby made to the Indenture, dated as of _______________, 2003 (the "Indenture"), among Armstrong World Industries, Inc., as issuer (the "Company"), the Subsidiary Guarantors party thereto and ____________________, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. In connection with our proposed purchase of $____________ aggregate principal amount of: (a) [ ] a beneficial interest in a Global Note, or (b) [ ] a Definitive Note, we confirm that: 1. We understand that any subsequent transfer of the Notes or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes or any interest therein except in compliance with, such restrictions and conditions and the United States Securities Act of 1933, as amended (the "Securities Act"). 2. We understand that the offer and sale of the Notes have not been registered under the Securities Act, and that the Notes and any interest therein may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell the Notes or any interest therein, we will do so only (A) to the Company or any subsidiary thereof, (B) for so long as the Notes are eligible for resale pursuant to Rule 144A under the Securities Act to a person we reasonably believe is a "qualified institutional buyer" (as defined therein), (C) to an institutional "accredited investor" (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you and to the Company a signed letter substantially in the form of this letter and, if such transfer is in respect of a principal amount of Notes, at the time of transfer of less than US $250,000, an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such transfer is in compliance with the Securities Act, (D) to persons outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or (F) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any Person purchasing the Definitive Note or beneficial interest in a Global Note from us in a transaction meeting the requirements of clauses (A) through (E) of this paragraph a notice advising such purchaser that resales thereof are restricted as stated herein. 3. We understand that, on any proposed resale of the Notes or beneficial interest therein, we will be required to furnish to you and the Company such certifications, legal opinions and other information as you and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that the Notes purchased by us will bear a legend to the foregoing effect. D-1 4. We are an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we and any accounts for which we are acting are each able to bear the economic risk of our or its investment. We have had access to such financial and other information and have been afforded the opportunity to ask such questions of representatives of the Company and receive answers thereto, as we deem necessary in connection with our decision to purchase the Notes. 5. We are acquiring the Notes or beneficial interest therein purchased by us for our own account or for one or more accounts (each of which is an institutional "accredited investor") as to each of which we exercise sole investment discretion and are not acquiring the Notes with a view to any distribution thereof in a transaction that would violate the Securities Act of the securities laws of any state of the United States or any other applicable jurisdiction. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. This letter shall be governed by, and construed in accordance with, the laws of the State of New York. ____________________________________ [Insert Name of Accredited Investor] By:_________________________________ Name: Title: Dated: _______________________ D-2 EXHIBIT E FORM OF NOTATION OF SUBSIDIARY GUARANTEE For value received, each Subsidiary Guarantor (which term includes any successor Person under the Indenture), jointly and severally, unconditionally guarantees, to the extent set forth in the Indenture and subject to the provisions in the Indenture, dated as of [ ] (the "Indenture"), among ARMSTRONG WORLD INDUSTRIES, INC., as issuer (the "Company"), the Subsidiary Guarantors listed on the signature pages thereto and [ ], as trustee (the "Trustee"), (a) the due and punctual payment of the principal of and premium, if any, on the Notes, whether at maturity, by acceleration, redemption or otherwise, the due and punctual payment of interest on overdue principal and premium, if any, and, to the extent permitted by law, interest and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms of the Indenture and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. The obligations of the Subsidiary Guarantors to the Holders of Notes and to the Trustee pursuant to the Subsidiary Guarantee and the Indenture are expressly set forth in Article 10 of the Indenture and reference is hereby made to the Indenture for the precise terms of the Subsidiary Guarantee. This Subsidiary Guarantee is subject to release as and to the extent set forth in Sections 8.02, 8.03 and 10.05 of the Indenture. Each Holder of a Note, by accepting the same, agrees to and shall be bound by such provisions. [SUBSIDIARY GUARANTORS] By: __________________________ Name: Title: E-1 EX-99 11 jd9-5ex99_9.txt 99.9 Exhibit 99.9 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------- ) EXHIBIT 1.109 STOCKHOLDER AND REGISTRATION RIGHTS AGREEMENT FORM OF STOCKHOLDER AND REGISTRATION RIGHTS AGREEMENT (SEPT. 5, 2003) --------------------------------------------------------------------- STOCKHOLDER AND REGISTRATION RIGHTS AGREEMENT BY AND BETWEEN ARMSTRONG WORLD INDUSTRIES, INC. AND ARMSTRONG WORLD INDUSTRIES, INC. ASBESTOS PERSONAL INJURY SETTLEMENT TRUST DATED AS OF _________ __, 200_
TABLE OF CONTENTS PAGE ARTICLE I DEFINITIONS.....................................................................................2 ARTICLE II EQUITY REGISTRATION RIGHTS......................................................................8 2.1 Equity Security Demand Registration..................................................................8 2.2 Piggyback Registration..............................................................................10 2.3 Registration Procedures.............................................................................11 2.4 Expenses............................................................................................13 2.5 Indemnification and Contribution....................................................................14 2.6 Rule 144............................................................................................17 2.7 Duration of Equity Registration Rights..............................................................17 2.8 "Market Stand-Off" Agreement........................................................................17 2.9 Transfer of Registration Rights.....................................................................17 2.10 Granting of Additional Registration Rights..........................................................18 ARTICLE III DEBT REGISTRATION RIGHTS.......................................................................18 3.1 Debt Security Demand Registration...................................................................18 3.2 Shelf Registration..................................................................................20 3.3 Registration Procedures.............................................................................20 3.4 Expenses............................................................................................22 3.5 Indemnification and Contribution....................................................................23 3.6 Rule 144............................................................................................26 3.7 Duration of Debt Registration Rights................................................................26 3.8 "Market Stand-Off" Agreement........................................................................26 3.9 Transfer of Registration Rights.....................................................................27 3.10 Granting of Additional Registration Rights..........................................................27 ARTICLE IV TAG-ALONG RIGHTS...............................................................................27 4.1 Restrictions on Transfer of Shares of Common Stock by the Trust.....................................27 4.2 Offer to Other Stockholders.........................................................................28 4.3 Third Party Beneficiary Rights......................................................................28 ARTICLE V CERTAIN COVENANTS OF THE COMPANY...............................................................29 5.1 Approval Requirements Respecting A Shareholder Rights Plan..........................................29 i TABLE OF CONTENTS (CONTINUED) PAGE ARTICLE VI VOTING AGREEMENT AND RELATED COVENANTS OF THE TRUST............................................29 6.1 Independent Directors...............................................................................29 6.2 Approval of New Long-term Incentive Plan............................................................29 6.3 Certain Director Elections..........................................................................30 6.4 Third Party Beneficiary Rights......................................................................30 ARTICLE VII MISCELLANEOUS PROVISIONS.......................................................................30 7.1 Successor Securities................................................................................30 7.2 Equitable Relief....................................................................................31 7.3 No Inconsistent Agreements..........................................................................31 7.4 Amendments and Waivers..............................................................................31 7.5 Notice Generally....................................................................................31 7.6 Successors and Assigns..............................................................................32 7.7 Headings............................................................................................33 7.8 Governing Law; Jurisdiction; Jury Waiver............................................................33 7.9 Severability........................................................................................33 7.10 Entire Agreement....................................................................................33 7.11 Counterparts........................................................................................33
ii STOCKHOLDER AND REGISTRATION RIGHTS AGREEMENT --------------------------------------------- Stockholder and Registration Rights Agreement, dated as of ________, ___, 200_, by and between Armstrong World Industries, Inc., a Pennsylvania corporation (the "COMPANY"), and the Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust (the "TRUST") established pursuant to the Trust Agreement (as hereinafter defined). W I T N E S S E T H : WHEREAS, the Company filed its Fourth Amended Plan of Reorganization dated May 23, 2003 with the United States Bankruptcy Court for the District of Delaware (the "COURT") pursuant to and in accordance with chapter 11 of the U.S. Bankruptcy Code (as filed with the Court and as may be amended from time to time in accordance with its terms, the "PLAN"), which was confirmed by the Court on __ , 2003; and WHEREAS, capitalized terms used herein and not defined above shall have the meaning provided by Article I hereof or otherwise provided below; and WHEREAS, pursuant to the Plan, (i) on the Effective Date, all previously outstanding shares of the Company will be cancelled, (ii) on the Effective Date, the Trust will receive new shares of Common Stock to be issued by the Company, and on the Initial Distribution Date the holders of Allowed Unsecured Claims will receive new shares of Common Stock to be issued by the Company, representing 65.57% and 34.43%, respectively, of the shares of Common Stock to be outstanding on the Initial Distribution Date, (iii) on the Initial Distribution Date, Plan Notes may be issued to the Trust and to the holders of Allowed Unsecured Claims, upon the terms and in accordance with certain provisions of the Plan and (iv) in accordance with the Plan, the Warrants will be issued to Holdings and the New Long Term Incentive Plan will be established; and WHEREAS, in accordance with the Plan, the Company and the Trust are entering into this Agreement on the Effective Date (i) to provide for certain rights and obligations of the Trust with respect to shares of Common Stock held by the Trust, including certain obligations for the benefit of the holders of shares of Common Stock issued to holders of Allowed Unsecured Claims (and any transferees, other than the Trust, of the shares of Common Stock of such holders) and other future holders of shares of Common Stock (other than any such holder whose shares are Beneficially Owned by the Trust) (all such holders, including but not limited to those who are holders of Allowed Unsecured Claims, collectively, the "OTHER STOCKHOLDERS") with respect to certain transactions by the Trust in shares of Common Stock held by the Trust, and certain consent rights for the benefit of the Trust, (ii) to provide registration rights for the Trust with respect to its holding of shares of Common Stock, and (iii) to provide registration rights for the Trust with respect to its holdings of Plan Notes, if they are issued under the Plan; NOW, THEREFORE, in consideration of the premises and the covenants hereinafter contained, it is hereby agreed as follows: ARTICLE I DEFINITIONS As used in this Agreement, the following capitalized terms shall have the meanings ascribed thereto below (such meanings being equally applicable to both the singular and plural form of the terms defined): "ACTION" shall have the meaning provided by Section 2.5(e) or 3.5(e) hereof, as the case may be. "AFFILIATE," with respect to a Person, means any other Person which directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person, within the meaning of Rule 12b-2 under the Exchange Act. "AGREEMENT" shall mean this Stockholder and Registration Rights Agreement, as the same may from time to time be amended, modified and supplemented in accordance with its terms. "ALLOWED UNSECURED CLAIMS" shall have the meaning provided in the Plan. "ARTICLES OF INCORPORATION" shall mean the Amended and Restated Articles of Incorporation of the Company, as in effect on the Effective Date and as the same may from time to time be amended or restated in accordance with its terms. "BUSINESS DAY" shall mean any day on which commercial banks are required to be open for business in New York, New York "BENEFICIALLY OWNED" or "BENEFICIAL OWNERSHIP" shall have the meaning prescribed by Regulation 13D-G under the Exchange Act, as amended and from time to time in effect. "BYLAWS" shall mean the amended and restated bylaws of the Company, as in effect on the Effective Date and as the same may from time to time be amended or restated in accordance with their terms. 2 "CHANGE IN CONTROL" with respect to the Company shall mean the acquisition by any person, or any group (within the meaning of Section 13(d) of the Exchange Act), of either Beneficial Ownership of more than 25% of the Voting Stock or the right, by contract, voting power or otherwise (or any combination thereof), to designate more than one-third of the members of the board of directors of the Company (assuming no vacancy on the board of directors). "CHAPTER 11 CASE" shall mean the chapter 11 case of Armstrong World Industries, Inc., pending in the Court as In re Armstrong World Industries, Inc., et al., Case No. 00-4471 (RJN) (Jointly Administered). "COMMON STOCK" shall meaning the common shares, $0.01 par value per share, of the Company, as authorized by the Articles of Incorporation on the Effective Date, and any successor security as provided by Section 7.1 hereof. "DEBT SECURITY DEMAND REGISTRATION" shall have the meaning provided by Section 3.1(a) hereof. "DEMANDING EQUITY SECURITY HOLDERS" shall have the meaning provided by Section 2.2(a) hereof. "DEMANDING OTHER DEBT SECURITY HOLDERS" shall have the meaning provided by Section 3.2(a) hereof. "DISINTERESTED DIRECTOR" shall mean, in respect of a transaction or potential transaction (or category of immaterial transactions), a director who is not Affiliated with the Trust and who has no personal financial interest in the transaction (other than the same interest, if a shareholder of the Corporation, as the other shareholders of the Corporation). "EFFECTIVE DATE" shall mean the first Business Day of the month (or other day permitted by the Plan or by order of the Court as the date for the effectiveness of the Plan) immediately following the date by which all of the conditions precedent to the effectiveness of the Plan specified in Section 7.17 of the Plan have been satisfied or waived or, if a stay of the order entered by the Court confirming the Plan in accordance with chapter 11 of the U.S. Bankruptcy Code is in effect on such date, the first Business Day of the month (or such other day permitted by the Plan or by order of the Court) immediately following the date of the expiration, dissolution, or lifting of such stay. The Effective Date for purposes of this Agreement shall be the same as the Effective Date for purposes of the Plan. "EQUITY SECURITY DEMAND REGISTRATION" shall have the meaning set forth in Section 2.1 (a) hereof. "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended, or any successor federal statute, and the rules and regulations of the SEC promulgated thereunder, all as the same may be amended and shall be in effect from time to time. 3 "INDEMNIFIED PARTY" shall have the meaning provided by Section 2.5(e) or 3.5(e) hereof, as the case may be. "INDEMNIFYING PARTY" shall have the meaning provided by Section 2.5(e) or 3.5(e) hereof, as the case may be. "INDEPENDENT DIRECTOR" shall mean a director who (i) qualifies as an "independent director" within the meaning of the corporate governance listing standards from time to time adopted by the NYSE or Nasdaq with respect to the composition of the board of directors of a listed company (without regard to any independence criteria applicable under such standards only to the members of a committee of the board of directors), as applicable to whichever market the shares of Common Stock are to be listed on for trading upon the issuance of such shares pursuant to the Plan and, thereafter, are from time to time listed for trading on) and (ii) satisfies the minimum requirements of director independence of SEC Rule 10A-3(b)(1) under the Exchange Act [1]; provided, however, that, to the extent that any requirements in addition to those required in order for a director to be considered independent in accordance with such listing standards must be satisfied in order for a director of the Company to qualify as an "outside director" for purposes of Rule 16b-3 under the Exchange Act or for purposes of Section 162(m) of the Internal Revenue Code, at least three directors of the Company must also qualify as such under such additional requirements in order for the Company to be considered to have Independent Directors in satisfaction of clause (i) of subparagraph (a) of Article VI hereof. "INITIAL DISTRIBUTION DATE" shall mean a date on or after the Effective Date that is selected by the Company in its discretion but, in any event, is within fifteen (15) days after the Effective Date, or such later date as the Court may establish upon request by the Company, for cause shown, as permitted by the Plan; provided, however, that in no event shall the Initial Distribution Date be more than forty-five days after the Effective Date. "INTERNAL REVENUE CODE" shall mean the Internal Revenue Code of 1986, as amended from time to time, and any applicable rulings, Treasury Regulations, judicial decisions, and notices, announcements, and other releases of the United States Treasury Department or the IRS. "IRS" shall mean the United States Internal Revenue Service. - ------------------ [1] [The text of this paragraph assumes that listing standards, substantially as proposed by the NYSE on April 3, 2003 or as proposed by Nasdaq on April 11, 2003, in either case by its filing with the SEC under Section 19(b) of the Exchange Act, are adopted and effective in accordance with Section 19 of the Exchange Act by the Effective Date. If not, a slight change in the wording to refer to the then current status of the proposed listing standards will be made.] 4 "NASD" shall mean the National Association of Securities Dealers, Inc., or any successor corporation thereto. "NASDAQ" shall mean the Nasdaq Stock Market. "NEW LONG-TERM INCENTIVE PLAN" shall mean the New Long-Term Incentive Plan of the Company, substantially in the form of Exhibit 1.90 attached to the Plan. "NYSE" shall mean the New York Stock Exchange. "OTHER STOCKHOLDERS" shall have the meaning set forth in the fourth recital of this Agreement. "PERSON" shall mean any individual, partnership (general, limited or limited liability), corporation, limited liability company, trust, unincorporated organization or other legal entity, and a government or agency or political subdivision thereof. "PLAN NOTE INDENTURES" shall mean the indentures, substantially in the form of Exhibit 1.96 to the Plan and qualified under the Trust Indenture Act of 1939, as amended, entered into by and between the Company, as the issuer, and a trustee selected by the Company, pursuant to which, if issued or to be issued, Plan Notes have been or will be issued. "PLAN NOTES" shall mean, if issued or to be issued, the unsecured notes issued or to be issued by the Company pursuant to the Plan Note Indentures as provided by Sections 3.2(f) and (g) of the Plan. "PROPOSED PURCHASER" shall have the meaning set forth in Section 4.1 hereof. "PROSPECTUS" shall mean the prospectus included in any Registration Statement (including, without limitation, a prospectus that discloses information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A under the Act), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Equity Securities covered by such Registration Statement, and all amendments and supplements thereto and all material incorporated by reference therein. "REGISTRABLE DEBT SECURITIES" shall mean (i) the Plan Notes issued to the Trust pursuant to the Plan (if any), (ii) any other debt security issued by the Company in exchange for, upon conversion of or as a result of a reclassification of or otherwise in respect of the Plan Notes or any other debt security issued by the Company that is a Registrable Debt Security, and (iii) any debt security issued by the Company in exchange for, as a reclassification of or otherwise in respect of any Registrable Equity Security, in each case for so long as such debt security is owned by the Trust or a permitted transferee of the Trust's rights under Article III hereof in accordance with Section 3.9 hereof. For the avoidance of doubt, it is understood and agreed that any particular Registrable Debt Security shall cease to be such when (A) a Registration Statement with respect to the sale of such security shall have become effective under the Securities Act and such security shall have been disposed of in accordance with such Registration Statement, (B) such security shall have been sold pursuant to Rule 144 or (C) such security shall have ceased to be outstanding. "REGISTRABLE EQUITY SECURITIES" shall mean (i) the shares of Common Stock issued to the Trust pursuant to the Plan, (ii) any additional shares of Common Stock or other Voting Stock or other equity securities issued by the Company to the Trust as a dividend upon or a distribution in respect of, or upon conversion of or in exchange for or as a result of any reclassification of, any such shares of Common Stock or any other equity security that is a Registrable Equity Security, (iii) any equity security issued upon exercise of any warrant, right or option which is a Registrable Equity Security, (iv) any equity security issued by the Company in exchange for, as a reclassification of or otherwise in respect of any Registrable Debt Security and (v) any other equity security which is considered a successor security in respect of any such security as provided in Section 7.1 hereof, in each case for so long as such equity security is owned by the Trust or a permitted transferee of the Trust's rights under Article II hereof in accordance with Section 2.9 hereof. For the avoidance of doubt, it is 5 understood and agreed that any particular Registrable Equity Security shall cease to be such when (A) a Registration Statement with respect to the sale of such security shall have become effective under the Securities Act and such security shall have been disposed of in accordance with such Registration Statement, (B) such security shall have been sold pursuant to Rule 144 or (C) such security shall have ceased to be outstanding. "REGISTRATION STATEMENT" shall mean a registration statement of the Company as it may be amended or supplemented from time to time, including without limitation, all exhibits, financial statements, schedules and attachments thereto. "RULE 144" shall mean Rule 144 promulgated by the SEC under the Securities Act, or any similar rule or regulation permitting the sale of securities without registration under the Securities Act, hereafter adopted by the SEC, as the same may be amended and shall be in effect from time to time. "SEC" shall mean the Securities and Exchange Commission or any other federal agency then administering the Securities Act and other federal securities laws. "SECURITIES ACT" shall mean the Securities Act of 1933, as amended, or any successor federal statute, and the rules and regulations of the SEC promulgated thereunder, all as the same may be amended and shall be in effect from time to time. "TRANSFER" shall mean directly or indirectly transfer, sell, assign, donate, contribute, place in trust (including a voting trust), or otherwise voluntarily or involuntarily dispose. 6 "TREASURY REGULATIONS" shall mean the regulations (including temporary and proposed regulations) promulgated under the Internal Revenue Code by the United States Treasury Department, as amended from time to time. "TRUST" shall have the meaning set forth in the introductory paragraph of this Agreement. "TRUST AGREEMENT" shall mean the Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust Agreement, dated as of December ___, 200_, and entered into by the Company, the Legal Representative for Asbestos-Related Future Claimants and the Official Committee of Asbestos Creditors (each as appointed by the Court in the Chapter 11 Case) and the trustees and members of the PI Trust Advisory Committee identified on the signature page thereof. "TRUST PRO RATA SHARE", for purposes of Section 2.2(b) hereof, shall mean the ratio of (i) the number of shares of Common Stock owned by the Trust to (ii) the total number of shares of Common Stock owned by the Trust and each Other Stockholder for whose benefit shares of Common Stock will be included in the Registration Statement, such ratio calculated as of the date of filing of the applicable Registration Statement pursuant to Section 2.2(b) and, for purposes of Section 3.2(b) hereof, shall mean the ratio of (i) the aggregate principal amount of Registrable Debt Securities owned by the Trust to (ii) the sum of the aggregate principal amount of Registrable Debt Securities owned by the Trust plus the aggregate principal amount of debt securities of Demanding Other Debt Security Holders whose debt securities will be included in the Registration Statement, such ratio calculated as of the date of filing of the applicable Registration Statement pursuant to Section 3.2(b) . "VOTING STOCK" shall mean shares of the Company, of any class or series, entitled to vote for the election of directors of the Company, including shares of Common Stock (other than preferred shares entitled to vote for the election of directors who are to be elected only by the holders of a particular class or series of shares, or collectively by the holders of two or more classes or series of shares, and only in the event of an arrearage in payment of dividends on such class or series of shares and who constitute less than one-third of all the directors (assuming no vacancies on the board of directors)) and any successor security as provided in Section 7.1 hereof. "WARRANTS" shall mean the warrants to purchase shares of Common Stock issued pursuant to the Warrant Agreement in accordance with Section 3.2(l) of the Plan. "WARRANT AGREEMENT" shall mean the Warrant Agreement, dated as _____, 200_, between the Company and [American Stock Transfer & Trust Company], as Warrant Agent, substantially in the form of Exhibit 1.91 to the Plan. "WARRANT SHARES" shall mean the shares of Common Stock issued or issuable, as the context may require, upon exercise of the Warrants. Other terms are defined herein and shall have the meanings elsewhere provided herein. 7 ARTICLE II EQUITY REGISTRATION RIGHTS 2.1 Equity Security Demand Registration. (a) Request for Equity Security Demand Registration. If at any time after the Effective Date, the Company receives a written request (a "DEMAND NOTICE") from the Trust requesting that the Company effect a registration under the Securities Act of Registrable Equity Securities and specifying the intended method or methods of disposition thereof, the Company shall, as promptly as practicable, but in no event later than 60 days following receipt of the Demand Notice, prepare and cause to be filed with the SEC a Registration Statement on the appropriate form relating to resales of such Registrable Equity Securities ("EQUITY SECURITY DEMAND REGISTRATION") and shall use its reasonable best efforts to cause the Equity Security Demand Registration to become effective within 90 days following the date on which it receives the Demand Notice (including, without limitation, appropriate qualification under applicable blue sky or other state securities laws and appropriate compliance with applicable regulations issued under the Securities Act and any other governmental requirements or regulations). The obligations of the Company under this Section 2.1(a) are subject to the provisions of Section 2.(b) hereof. (b) Conditions on Requirement to Effect Equity Security Demand Registration. The obligations of the Company set forth in Section 2.1(a) are subject to each of the following limitations, conditions and qualifications: (i) The Company shall not be required to take any action to effect an Equity Security Demand Registration unless the anticipated aggregate offering price of the Registrable Equity Securities to be offered and sold pursuant to such registration is at least $100,000,000 (or, if the anticipated aggregates offering price for all Registrable Equity Securities owned by the Trust at the time such demand is made is less than $100,000,000, such lesser amount). (ii) The Company shall not be required to take any action to effect an Equity Security Demand Registration pursuant to Section 2.1(a) more than once in any nine month period or at such time when the Trust is not permitted to sell shares in accordance with Section 2.8 hereof. (iii) The Company shall be entitled to postpone, for a reasonable period of time (which shall be as short as practicable), during no more than two periods aggregating not more than 90 days in any twelve-month period, the filing or effectiveness of, or suspend the right of the Trust to make sales pursuant to, any Registration Statement otherwise required to be prepared, filed and made and kept effective by it under the registration covenants described in Section 2.1 or 2.2 hereof, in the event that (i) (A) an event has occurred or a circumstance exists as a result of which such Registration Statement, any 8 related Prospectus or any document incorporated therein by reference as then amended or supplemented or proposed to be filed would, in the Company's good faith judgment, contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (in which case the Company will be obligated to file an appropriate amendment to the Registration Statement as contemplated in Section 2.3(k) hereof at such time as required by this paragraph), and (B) either (x) the Company has determined in its good faith judgment that the disclosure of the event or circumstance at that time would materially and adversely affect, interfere with or hinder the success of any financing, acquisition, merger or similar transaction involving the Company or (y) after consultation with the Trust concerning the matter, the Company has reasonably determined that the disclosure would otherwise have a material adverse effect on the business, operations or prospects of the Company or (ii) the Company shall have received a notice issued by the SEC of a stop order suspending the effectiveness of the Registration Statement or the initiation of any proceedings for that purpose. If the Company shall so postpone the filing or effectiveness of, or suspend the rights of the Trust to make sales pursuant to, a Registration Statement it shall promptly notify the Trust in writing of such determination (a "SUSPENSION NOTICE"). The Suspension Notice shall contain a statement of the reasons for such suspension and an approximation of the anticipated delay. Upon receipt of such Suspension Notice, to the extent applicable, the Trust will forthwith discontinue disposition of Registrable Equity Securities pursuant to the Registration Statement until (i) the Trust has received copies of the supplemented or amended Prospectus contemplated by Sections 2.3(b) and (k) hereof, or (ii) the Trust is advised in writing by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus (in each case, the "RECOMMENCEMENT DATE"). The time period provided in Section 2.3(a) hereof for which the Company is required to maintain the effectiveness of any Registration Statement shall be extended by the aggregate number of days by which sales of securities pursuant to any Registration Statement that has been declared effective has been delayed, postponed or suspended by the Company pursuant to this Section 2.1(b) (iii). (iv) If the Company receives a request for a Equity Security Demand Registration during a "lock-up" period (the "LOCK-UP Period") agreed to by the Trust pursuant to Section 2.8 of this Agreement pursuant to or in connection with any underwriting or purchase agreement relating to an offering under Rule 144A under the Securities Act (or any successor rule or regulation, as the same may be amended or in effect from time to time) or a registered public offering of Common Stock or securities convertible into or exchangeable for Common Stock, the Company shall not be required to file a Registration Statement under Section 2.1 of this Agreement prior to the end of the Lock-Up Period. (v) The Company's obligations shall be subject to the obligations of the Trust to furnish all information and materials and to take any and all actions as may be required of it under Federal and state securities laws and regulations to permit the Company to comply with all applicable requirements of the SEC and to obtain any acceleration of the effective date of such Registration Statement. Without limiting the generality of the forgoing, the 9 Trust shall furnish to the Company in writing, promptly after receipt of a request therefore, the information specified in Item 507 or 508 of Regulation S-K, as applicable, of the Securities Act for use in connection with any Registration Statement or Prospectus or preliminary Prospectus included therein. The Trust agrees to promptly furnish additional information required to be disclosed in order to make the information previously furnished to the Company by the Trust not materially misleading. (vi) The Company shall not be obligated to cause any special audit to be undertaken in connection with any Registration Statement pursuant to this Agreement. (c) Underwriting. The managing underwriter for any underwritten offering of Registrable Equity Securities pursuant to an Equity Securities Demand Registration under his Section 2.1 shall be selected by the Company and shall be reasonably acceptable to the Trust, and the co-managing underwriter shall be selected by the Trust and shall be reasonably acceptable to the Company. 2.2 Piggyback Registration. (a) If the Company at any time proposes to file on its behalf and/or on behalf of any of its holders of equity securities other than the Trust (collectively, the "DEMANDING OTHER EQUITY SECURITY HOLDERS") a Registration Statement under the Securities Act on any form (other than a Registration Statement on Form S-4 or S-8, or any successor form, for securities to be offered in a transaction of the type referred to in Rule 145 under the Securities Act or to employees of the Company pursuant to any employee benefit plan, respectively, and other than a Registration Statement with respect to the Warrants or the Warrants Shares required to be filed by the Company under the Warrant Agreement) which may be used for the registration of shares of Common Stock, it will give written notice of such proposed filing to the Trust at least 20 Business Days before the initial filing with the SEC of such Registration Statement (the "PIGGYBACK NOTICE"), which Piggyback Notice shall set forth the number of securities proposed to be offered and a description of the intended method of disposition of such securities. The Piggyback Notice shall offer to include in such filing such number of Registrable Equity Securities as the Trust may request. If the registration of which the Company gives notice is for a registered public offering involving an underwriting, the Company shall so advise the Trust as part of the Piggyback Notice. In such event, the right of the Trust to include its Registrable Equity Securities in the registration shall be conditioned upon the Trust entering into an underwriting agreement in customary form, which shall be the same for all selling shareholders, with the managing underwriter selected for such underwriting by the Company. (b) The Trust shall advise the Company in writing within 10 Business Days after the date of receipt of the Piggyback Notice from the Company, of its election to accept the Company's offer to include its Registrable Equity Securities in the Registration Statement to be filed by the Company pursuant to Section 2.2(a), setting forth the amount of such Registrable Equity Securities for which registration is requested. The Company shall thereupon include in such 10 filing the number of Registrable Equity Securities for which registration is so requested; provided, however, that, (i) if the managing underwriter of a proposed underwritten offering shall advise the Company in writing that, in its opinion, the distribution of the Registrable Equity Securities requested to be included in the registration concurrently with the securities being registered by the Company or a Demanding Other Equity Security Holder would adversely affect the distribution by the Company of the shares of Common Stock of the Company or such Other Demanding Equity Security Holder, then the Company and its underwriters shall be entitled to reduce the number of Registrable Equity Securities to be registered by the Trust; and provided, further, however, that, if after such reduction any shares of Common Stock are to be included in such Registration Statement on behalf of Demanding Other Equity Security Holders, the number of Registrable Equity Securities to be included in such Registration Statement on behalf of the Trust shall be no less than the Trust Pro Rata Share of all securities to be included in such Registration Statement on behalf of all selling shareholders, and (ii) in connection with piggyback rights in a secondary offering by a selling Demanding Other Equity Security Holder, the number of Registrable Equity Securities to be included in such Registration Statement on behalf of the Trust shall be no less than the Trust Pro Rata Share of all securities to be included in such Registration Statement. (c) The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 2.2 prior to the effectiveness of such registration whether or not the Trust has elected to include securities in such registration. 2.3 Registration Procedures. If the Company is required by the provisions of Article II to effect the registration of any Registrable Equity Securities under the Securities Act, the Company will, as promptly as practicable: (a) prepare and file in accordance with this Article II with the SEC a Registration Statement with respect to such securities and use it reasonable best efforts to cause such Registration Statement to become and remain effective for at least one hundred and eighty (180) days or until the distribution described in the Registration Statement has been completed; (b) prepare and file with the SEC such amendments (including post-effective amendments) to such Registration Statement, and such supplements to the related prospectus, as may be required by the applicable rules, regulations or instructions under the Securities Act during the applicable period in accordance with the intended methods of disposition specified by the Trust, (ii) make generally available earnings statements satisfying the provisions of Section 11(a) of the Securities Act (provided that the Company shall be deemed to have complied with this clause if it has complied with Rule 158 under the Securities Act) and (iii) cause the related prospectus as so supplemented to be filed pursuant to Rule 424 under the Securities Act; (c) notify the Trust promptly and, if requested, confirm such notice in writing (i) when a prospectus, prospectus supplement or post-effective amendment has been filed and, with respect to such Registration Statement or any post-effective amendment, when the same has become effective, (ii) of any 11 request by the SEC for amendments or supplements to such Registration Statement or the related Prospectus or for additional information regarding the Trust or any Other Stockholder whose shares are registered pursuant to such Registration Statement, (iii) of the issuance by the SEC of any stop order suspending the effectiveness of such Registration Statement or the initiation of any proceedings for the purpose, and (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Equity Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; (d) use reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of such Registration Statement, or the lifting of any suspension of the qualification or exemption from qualification of any Registrable Equity Securities for sale in any jurisdiction in the United States; (e) furnish to the Trust, counsel for the Trust and each managing underwriter, if any, without charge, such number of copies of the Registration Statement as initially filed with the SEC and of each pre-effective and post-effective amendment or supplement thereto (in each case including at least one copy of all exhibits thereto and all documents incorporated by reference therein) and of the Prospectus included therein, including the preliminary Prospectus and any summary Prospectus, and any other Prospectus filed under Rule 424 under the Securities Act in connection with the disposition of any Registrable Equity Securities covered by such Registration Statement, and such other documents as the Trust may reasonably request; (f) use its reasonable best efforts to register or qualify the Registrable Equity Securities covered by such Registration Statement under such other securities or blue sky laws of such jurisdictions within the United States and Puerto Rico as the Trust may reasonably request (provided, however, that the Company shall not be obligated to qualify as a foreign corporation to do business under the laws of any jurisdiction in which it is not then qualified or to file any general consent to service of process to effect such registration), and do such other reasonable acts and things as may be required of it to enable the Trust to consummate the disposition in such jurisdiction of the Registrable Equity Securities covered by such Registration Statement; (g) in the event of any underwritten public offering, use its reasonable best efforts to furnish, at the request of the Trust, on the date that such Registrable Equity Securities are delivered to the underwriters for sale pursuant to such registration, (1) an opinion, dated such date, of the independent counsel representing the Company for the purposes of such registration, addressed to the underwriters and covering matters of the type customarily covered in such legal opinions; (2) a comfort letter dated such date, and updates thereof, from the independent certified public accountants who have issued an audit report on the Company's financial statements included or incorporated by reference in the Registration Statement, addressed to the underwriters and covering matters of the type customarily covered by such comfort letters and as the underwriters shall reasonably request and (3) if requested and if an underwriting agreement is entered into, indemnification of the underwriters pursuant to provisions and procedures reasonably requested by the underwriters; the procedures referred to in this paragraph shall be followed at each closing under such underwriting or similar agreement, as and to the extent required thereunder; 12 (h) enter into customary agreements (including an underwriting agreement in customary form) and take such other actions as are reasonably required in order to expedite or facilitate the disposition of such Registrable Equity Securities; (i) cooperate with the Trust, the underwriters participating in the offering and their counsel in any due diligence investigation reasonably requested by the Trust or the underwriters in connection therewith, and participate, to the extent reasonably requested by the managing underwriter for the offering or the Trust, in efforts to sell the Registrable Equity Securities in the offering (including, without limitation, participating in "roadshow" meetings with prospective investors) that would be customary for underwritten primary offerings of a comparable amount of equity securities by the Company; (j) use its reasonable best efforts to cause the Registrable Equity Securities covered by a Registration Statement to be listed on each national securities exchange or Nasdaq, as applicable, on which the Company's equity securities are then listed at the time of the sale of such Registrable Equity Securities pursuant to such Registration Statement; (k) notify the Trust, at any time when a Prospectus is required to be delivered under the Securities Act, upon discovery that, or upon the happening of any event as a result of which, such Prospectus (as then in effect) contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein (including in a document incorporated by reference therein), in light of the circumstances under which they were made, not misleading, and promptly prepare a supplement or post-effective amendment to such Registration Statement or the related prospectus or a supplement or amendment to any document incorporated or deemed to be incorporated therein by reference, and file with the SEC any other required document so that, as thereafter delivered to the purchasers of such Registrable Equity Securities, such Prospectus shall not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and (l) on or before the effective date of such Registration Statement, provide the transfer agent of the Company for the Registrable Equity Securities with printed certificates for the Registrable Equity Securities by such Registration Statement, which are in a form eligible for deposit with The Depository Trust Company. 2.4 Expenses. All expenses incurred in complying with Article II, including, without limitation, all SEC or stock exchange registration or filing fees (including all expenses incident to filing with the NASD), stock exchange listing fees, Nasdaq quotation fees, printing expenses (including all expenses of printing certificates for Registrable Equity Securities and of printing prospectuses if the printing of prospectuses is requested by the Trust or the managing underwriter, if any), fees and disbursements of counsel for the Company, the reasonable fees and expenses of one counsel for the Trust and all 13 other selling security holders (selected by those holding a majority of the Registrable Equity Securities being registered), fees of the Company's independent public accountants and the expenses of any special audit work incident to or required for any such registration (including expenses of any "cold comfort" letters required in connection with this Article II), but subject to Section 2.1(b)(vi) hereof, the expenses of complying with the securities or blue sky laws of any jurisdiction and fees and disbursements of underwriters customarily paid by the issuers or sellers of securities (including reasonable fees of counsel to the underwriters), shall be paid by the Company except that any discounts, commissions or brokers' fees or fees of similar securities industries professionals and transfer taxes relating to the disposition of the Registrable Equity Securities will be payable by the Trust (or other securityholders participating in such registered offering) and the Company will have no obligation to pay any such amounts. 2.5 Indemnification and Contribution. (a) In the event of any registration of any Registrable Equity Securities under the Securities Act pursuant to this Agreement, the Company shall indemnify and hold harmless the Trust, the Trust's Affiliates, trustees, officers and agents, and each other Person (including each underwriter) who participated in the offering of such Registrable Equity Securities and each other Person, if any, who controls the Trust or such participating person within the meaning of the Securities Act, against any losses, claims, damages or liabilities, joint or several, to which the Trust or any such Affiliate, trustee, officer, agent or participating person or controlling person may become subject under the Securities Act or any other statute or at common law, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of any material fact contained in any Registration Statement under which such Registrable Equity Securities were registered under the Securities Act, any preliminary Prospectus or final Prospectus contained therein, or any amendment or supplement thereto, or (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse the Trust or such Affiliate, director, officer, agent or participating person or controlling person for any legal or any other expenses reasonably incurred by the Trust or such Affiliate, director, officer, agent or participating person or controlling person in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any actual or alleged untrue statement or actual or alleged omission made in such Registration Statement, preliminary Prospectus, Prospectus or amendment or supplement in reliance upon and in conformity with written information furnished to the Company by the Trust specifically for use therein or (in the case of any registration pursuant to Section 2.1) so furnished for such purposes by any underwriter. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Trust or such Affiliate, director, officer, agent or participating person or controlling person, and shall survive the transfer of such Registrable Equity Securities by the Trust. (b) The Trust, by acceptance hereof, agrees to indemnify and hold harmless the Company, its directors and officers and each other person, if any, who controls the Company within the meaning of the Securities Act against any 14 losses, claims, damages or liabilities, joint or several, to which the Company or any such director or officer or any such person may become subject under the Securities Act or any other statute or at common law, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of any material fact contained in any Registration Statement under which Registrable Equity Securities were registered under the Securities Act, any preliminary Prospectus or final Prospectus contained therein, or any amendment or supplement thereto or (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, if in any such case such statement or alleged statement or omission or alleged omission was made in reliance on and in conformity with information in writing provided to the Company by the Trust specifically for use in such Registration Statement, preliminary Prospectus or final Prospectus or any amendment or supplement thereto. Notwithstanding the provisions of this paragraph (b) or paragraph (c) below, the Trust shall not be required to indemnify any person pursuant to this Section 2.5 nor to contribute pursuant to paragraph (c) below in an amount in excess of the amount of the aggregate net proceeds received by the Trust in connection with any such registration under the Securities Act. (c) If the indemnification provided for in this Section 2.5 from the Indemnifying Party (as defined in Section 2.5(e) hereof) is unavailable to an Indemnified Party (as defined in Section 2.5(e) hereof) hereunder in respect of any losses, claims, damages, liabilities or expenses referred to therein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Parties in connection with the actions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of such Indemnifying Party and Indemnified Parties shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact, has been made by, or relates to information supplied by, such Indemnifying Party or Indemnified Parties, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such action. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include any legal or other fees or expenses reasonably incurred by such party in connection with any investigation or proceeding. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 2.5(c) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in this paragraph. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. If indemnification is available under this Section 2.5, the Indemnifying Party shall indemnify the Indemnified Party to the full extent provided in Section 2.5(a) or 2.5(b) hereof, as applicable, without regard to the relative fault of the Indemnifying Party or the Indemnified Party or any other equitable consideration provided for in this Section 2.5(c). 15 (d) The indemnification and contribution required by this Section 2.5 shall be made by periodic payment of the amount thereof during the course of the investigation or defense, as and when bills are received or expenses are incurred. (e) The party seeking indemnification pursuant to this Section 2.5 is referred to as the "INDEMNIFIED PARTY" and the party from whom indemnification is sought under this Section 2.5 is referred to as the "INDEMNIFYING PARTY." The Indemnified Party shall give prompt written notice to the Indemnifying Party of the commencement of any action or proceeding involving a matter referred to in Section 2.5(a) or 2.5(b) (an "ACTION"), if an indemnification claim in respect thereof is to be made against the Indemnifying Party; provided, however, that the failure to give such prompt notice shall not relieve the Indemnifying Party of its indemnity obligations hereunder with respect to such Action, except to the extent that the Indemnifying Party is materially prejudiced by such failure. The Indemnifying Party shall be entitled to participate in and to assume the defense of such Action, with counsel selected by the Indemnifying Party and reasonably satisfactory to the Indemnified Party; provided, however, that (i) the Indemnifying Party, within a reasonable period of time after the giving of notice of such indemnification claim by the Indemnified Party, (x) notifies the Indemnified Party of its intention to assume such defense and (y) appoints such counsel, and (ii) the Indemnifying Party may not, without the consent of the Indemnified Party, consent to entry of any judgment or enter into any settlement unless (A) there is as part thereof no finding or admission of any violation of any rights of any person and no effect adverse to the Indemnified Party on any other claims that may be made against the Indemnified Party, (B) the sole relief provided is monetary damages that are paid in full by the Indemnifying Party and (C) such judgment or settlement includes as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release, in form and substance reasonably satisfactory to the Indemnified Party, from all liability in respect of such claim or litigation for which such Indemnified Party would be entitled to indemnification hereunder. If the Indemnifying Party so assumes the defense of any such Action, (A) the Indemnifying Party shall pay all costs associated with, any damages awarded in, and all expenses arising from the defense or settlement of such Action, and (B) the Indemnified Party shall have the right to employ separate counsel and to participate in (but not control) the defense, compromise or settlement of such Action, but the fees and expenses of such counsel shall be at the expense of the Indemnified Party except that if (x) the Indemnified Party has been advised by its counsel that there are likely to be one or more defenses available to it which are different from or additional to those available to the Indemnifying Party, or (z) such counsel has been selected by the Indemnified Party solely due to a conflict of interest which exists between counsel selected by the Indemnifying Party and the Indemnified Party, the Indemnifying Party shall pay in any such case that portion of the reasonable fees and expenses of one separate counsel per Action for an Indemnified Party (or Indemnified Parties in the aggregate, as the case may be), that are reasonably related to matters covered by the indemnity provided in this Section 2.5. If the Indemnifying Party does not so assume the defense of such Action, the Indemnified Party shall be entitled to exercise control of the defense, compromise or settlement of such Action. No Indemnified Party shall settle or compromise any Action for which it is entitled to indemnification under this Agreement without the prior written consent of the Indemnifying Party (which consent may not be unreasonably withheld or delayed). The other party shall cooperate with the party assuming the defense, compromise or settlement of any Action in accordance with this Agreement in any manner that such party reasonably may request and the party assuming the defense, compromise or settlement of any Action shall keep the other party fully informed in the defense of such Action. 16 2.6 Rule 144. So long as the Company has securities registered under the Exchange Act, it shall take all actions reasonably necessary to enable the Trust to sell Registrable Equity Securities without registration under the Securities Act within the limitations of the exemptions provided by Rule 144, including, without limiting the generality of the foregoing, filing on a timely basis all reports required to be filed by the Exchange Act. 2.7 Duration of Equity Registration Rights. The rights and obligations provided for under this Article II (except for the indemnification and contribution obligations in Section 2.5) shall terminate on the date which is the earlier of (i) the date on which the Trust (or, in the case of a permitted transferee of the Trust's rights under this Article II, such transferee), in the reasonable opinion of the Trust and the Company, may sell pursuant to Rule 144(k) any and all of the Registrable Equity Securities owned by it and (ii) such time as the Trust (and, in the case of any permitted transferee or transferees of the Trust's rights under this Article II, all such permitted transferees) no longer own any Registrable Equity Securities. 2.8 "Market Stand-Off" Agreement. The Trust hereby agrees that during the 90-day period following the effective date of a Registration Statement of the Company filed under the Securities Act relating to the sale of Common Stock or any other equity security of the Company for the benefit of the Company (provided that a 180-day period shall apply in the case of a Registration Statement related to the first registered public offering of equity by the Company after the Effective Date, other than such an offering that is registered on Form S-4 or S-8 or any similar form), it shall not, directly or indirectly, to the extent reasonably requested by the Company and any underwriter, sell, pledge, transfer, loan, or otherwise transfer or dispose of (other than to donees who agree to be similarly bound) any Common Stock held by it an any time during such period except Common Stock included in such registration; provided, that all executive officers and directors of the Company shall enter into written agreements in a form satisfactory to the Company and applicable underwriter, to be similarly bound; and provided further, however, that the market stand-off agreement contemplated by this Section 2.8 shall not apply to any Registrable Equity Securities in respect of which the Trust is entitled to and has exercised its demand registration rights under Section 2.1 hereof (unless and until the Registration Statement required thereby has been declared effective and such securities have not been sold pursuant thereto during the effective period thereof). In order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Registrable Equity Securities of the Trust (and the shares or securities of every other person subject to the foregoing restriction) until the end of such period. 2.9 Transfer of Registration Rights. The rights of the Trust under this Article II may be transferred by the Trust to a transferee of Registrable Equity Securities, and by such a transferee to a subsequent transferee of Registrable Equity Securities, but only where the transfer is not made pursuant to an effective Registration Statement or Rule 144 and only to such a transferee, provided that the transferee agrees in a writing executed by such transferee to assume the applicable obligations of the Trust under this Article II. 17 2.10 Granting of Additional Registration Rights. The Company shall not, without the Trust's prior written consent, grant to any third party piggyback registration rights with respect to an Equity Security Demand Registration. ARTICLE III DEBT REGISTRATION RIGHTS 3.1 Debt Security Demand Registration. (a) Request for Debt Security Demand Registration. If at any time after the Effective Date, the Company receives a written request (a "DEBT SECURITY DEMAND NOTICE") from the Trust requesting that the Company effect a registration under the Securities Act of Registrable Debt Securities and specifying the intended method or methods of disposition thereof, the Company shall, as promptly as practicable, but in no event later than 60 days following receipt of the Debt Demand Notice, prepare and cause to be filed with the SEC a Registration Statement on the appropriate form relating to resales of such Registrable Debt Securities ("DEBT SECURITY DEMAND REGISTRATION") and shall use its reasonable best efforts to cause the Debt Security Demand Registration to become effective within 90 days following the date on which it receives the Debt Demand Notice (including, without limitation, appropriate qualification under applicable blue sky or other state securities laws and appropriate compliance with applicable regulations issued under the Securities Act and any other governmental requirements or regulations). The obligations of the Company under this Section 3.1(a) are subject to the provisions of Section 3.2(b) hereof. (b) Conditions on Requirement to Effect Debt Security Demand Registration. The obligations of the Company set forth in Section 3.1(a) are subject to each of the following limitations, conditions and qualifications: (i) The Company shall not be required to take any action to effect a Debt Security Demand Registration unless the anticipated aggregate offering price of the Registrable Debt Securities to be offered and sold pursuant to such registration is at least $100,000,000 (or, if the anticipated aggregate offering price for all Registrable Debt Securities owned by the Trust at the time such demand is made is less than $100,000,000, such lesser amount). (ii) The Company shall not be required to take any action to effect a Debt Security Demand Registration pursuant to Section 3.1(a) more than once in any nine month period or at such time when the Trust is not permitted to sell debt securities in accordance with Section 3.8 hereof. The Company shall be entitled to postpone, for a reasonable period of time (which shall be as short as practicable), during no more than two periods aggregating not more than 90 days in any twelve-month period, the filing or 18 effectiveness of, or suspend the right of the Trust to make sales pursuant to, any Registration Statement otherwise required to be prepared, filed and made and kept effective by it under the registration covenants described in Section 3.1 or 3.2 hereof, in the event that (i) (A) an event has occurred or a circumstance exists as a result of which such Registration Statement, any related Prospectus or any document incorporated therein by reference as then amended or supplemented or proposed to be filed would, in the Company's good faith judgment, contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (in which case the Company will be obligated to file an appropriate amendment to the Registration Statement as contemplated in Section 2.3(k) hereof at such time as required by this paragraph), and (B) either (x) the Company has determined in its good faith judgment that the disclosure of the event or circumstance at that time would materially and adversely affect, interfere with or hinder the success of any financing, acquisition, merger or similar transaction involving the Company or (y) after consultation with the Trust concerning the matter, the Company has reasonably determined that the disclosure would otherwise have a material adverse effect on the business, operations or prospects of the Company or (ii) the Company shall have received a notice issued by the SEC of a stop order suspending the effectiveness of the Registration Statement or the initiation of any proceedings for that purpose. If the Company shall so postpone the filing or effectiveness of, or suspend the rights of the Trust to make sales pursuant to, a Registration Statement it shall promptly notify the Trust in writing of such determination (a "DEBT OFFERING SUSPENSION NOTICE"). The Debt Offering Suspension Notice shall contain a statement of the reasons for such suspension and an approximation of the anticipated delay. Upon receipt of such Debt Offering Suspension Notice, to the extent applicable, the Trust will forthwith discontinue disposition of Registrable Debt Securities pursuant to the Registration Statement until (i) the Trust has received copies of the supplemented or amended Prospectus contemplated by Section 3.3(b) hereof, or (ii) the Trust is advised in writing by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus (in each case, the "DEBT OFFERING RECOMMENCEMENT DATE"). The time period provided in Section 3.3(a) hereof for which the Company is required to maintain the effectiveness of any Registration Statement shall be extended by the aggregate number of days by which sales of securities pursuant to any Registration Statement that has been declared effective has been delayed, postponed or suspended by the Company pursuant to this Section 3.1(b) (iii). (iii) If the Company receives a request for a Debt Security Demand Registration during a "lock-up" period (the "DEBT OFFERING LOCK-UP PERIOD") agreed to by the Trust pursuant to Section 3.8 hereof pursuant to or in connection with any underwriting or purchase agreement relating to an offering under Rule 144A under the Securities Act (or any successor rule or regulation, as the same may be amended or in effect from time to time) or a registered public offering of debt securities of the Company , the Company shall not be required to file a Registration Statement under Section 3.1 of this Agreement prior to the end of the Debt Offering Lock-Up Period. 19 (iv) The Company's obligations shall be subject to the obligations of the Trust to furnish all information and materials and to take any and all actions as may be required of it under Federal and state securities laws and regulations to permit the Company to comply with all applicable requirements of the SEC and to obtain any acceleration of the effective date of such Registration Statement. Without limiting the generality of the forgoing, the Trust shall furnish to the Company in writing, promptly after receipt of a request therefore, the information specified in Item 507 or 508 of Regulation S-K, as applicable, of the Securities Act for use in connection with any Registration Statement or Prospectus or preliminary Prospectus included therein. The Trust agrees to promptly furnish additional information required to be disclosed in order to make the information previously furnished to the Company by the Trust not materially misleading. (v) The Company shall not be obligated to cause any special audit to be undertaken in connection with any Registration Statement pursuant to this Agreement. (c) Underwriting. The managing underwriter for any underwritten offering of Registrable Debt Securities pursuant to an Debt Securities Demand Registration under his Section 3.1 shall be selected by the Company and shall be reasonably acceptable to the Trust, and the co-managing underwriter shall be selected by the Trust and shall be reasonably acceptable to the Company. 3.2 Shelf Registration. At such time as the Company is eligible to register the Trust's Registrable Debt Securities on a Registration Statement on Form S-3, upon written request from the Trust, the Company shall file a Registration Statement pursuant to Rule 415 under the Securities Act (the "SHELF REGISTRATION STATEMENT"). 3.3 Registration Procedures. If the Company is required by the provisions of Article III to effect the registration of any Registrable Debt Securities under the Securities Act, the Company will, as promptly as practicable: (a) prepare and file in accordance with this Article III with the SEC a Registration Statement with respect to such securities and use its reasonable best efforts to cause such Registration Statement to become and remain effective for at least one hundred and eighty (180) days (or in the case of a Shelf Registration Statement, for two years) or until the distribution described in the Registration Statement has been completed; (b) prepare and file with the SEC such amendments (including post-effective amendments) to such Registration Statement, and such supplements to the related prospectus, as may be required by the applicable rules, regulations or instructions under the Securities Act during the applicable period in accordance with the intended methods of disposition specified by the Trust, (ii) make generally available earnings statements satisfying the provisions of Section 11(a) of the Securities Act (provided that the Company shall be deemed to have complied with this clause if it has complied with Rule 158 under the Securities Act) and (iii) cause the related prospectus as so supplemented to be filed pursuant to Rule 424 under the Securities Act; 20 (c) notify the Trust promptly and, if requested, confirm such notice in writing (i) when a prospectus, prospectus supplement or post-effective amendment has been filed and, with respect to such Registration Statement or any post-effective amendment, when the same has become effective, (ii) of any request by the SEC for amendments or supplements to such Registration Statement or the related Prospectus or for additional information regarding the Trust or any other securityholder whose securities are registered pursuant to such Registration Statement, (iii) of the issuance by the SEC of any stop order suspending the effectiveness of such Registration Statement or the initiation of any proceedings for the purpose, and (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Debt Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; (d) use reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of such Registration Statement, or the lifting of any suspension of the qualification or exemption from qualification of any Registrable Debt Securities for sale in any jurisdiction in the United States; (e) furnish to the Trust, counsel for the Trust and each managing underwriter, if any, without charge, such number of copies of the Registration Statement as initially filed with the SEC and of each pre-effective and post-effective amendment or supplement thereto (in each case including at least one copy of all exhibits thereto and all documents incorporated by reference therein) and of the Prospectus included therein, including the preliminary Prospectus and any summary Prospectus, and any other Prospectus filed under Rule 424 under the Securities Act in connection with the disposition of any Registrable Debt Securities covered by such Registration Statement, and such other documents as the Trust may reasonably request; (f) use its reasonable best efforts to register or qualify the Registrable Debt Securities covered by such Registration Statement under such other securities or blue sky laws of such jurisdictions within the United States and Puerto Rico as the Trust may reasonably request (provided, however, that the Company shall not be obligated to qualify as a foreign corporation to do business under the laws of any jurisdiction in which it is not then qualified or to file any general consent to service of process to effect such registration), and do such other reasonable acts and things as may be required of it to enable the Trust to consummate the disposition in such jurisdiction of the Registrable Debt Securities covered by such Registration Statement; (g) in the event of any underwritten public offering, use its reasonable best efforts to furnish, at the request of the Trust, on the date that such Registrable Debt Securities are delivered to the underwriters for sale pursuant to such registration, (1) an opinion, dated such date, of the independent counsel representing the Company for the purposes of such registration, addressed to the underwriters and covering matters of the type customarily covered in such legal opinions; (2) a comfort letter dated such date, and updates thereof, from the independent certified public accountants who have issued an audit report on the Company's financial statements included or incorporated by reference in the Registration Statement, addressed to the 21 underwriters and covering matters of the type customarily covered by such comfort letters and as the underwriters shall reasonably request and (3) if requested and if an underwriting agreement is entered into, indemnification of the underwriters pursuant to provisions and procedures reasonably requested by the underwriters; the procedures referred to in this paragraph shall be followed at each closing under such underwriting or similar agreement, as and to the extent required thereunder; (h) enter into customary agreements (including an underwriting agreement in customary form) and take such other actions as are reasonably required in order to expedite or facilitate the disposition of such Registrable Debt Securities; (i) cooperate with the Trust, the underwriters participating in the offering and their counsel in any due diligence investigation reasonably requested by the Trust or the underwriters in connection therewith, and participate, to the extent reasonably requested by the managing underwriter for the offering or the Trust, in efforts to sell the Registrable Debt Securities in the offering (including, without limitation, participating in "roadshow" meetings with prospective investors) that would be customary for underwritten primary offerings of a comparable amount of debt securities by the Company; (j) use its reasonable best efforts to cause the Registrable Debt Securities covered by a Registration Statement to be listed on each national securities exchange on which the Company's debt securities are then listed at the time of the sale of such Registrable Debt Securities pursuant to such Registration Statement; (k) notify the Trust, at any time when a Prospectus is required to be delivered under the Securities Act, upon discovery that, or upon the happening of any event as a result of which, such Prospectus (as then in effect) contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein (including in a document incorporated by reference therein), in light of the circumstances under which they were made, not misleading, and promptly prepare a supplement or post-effective amendment to such Registration Statement or the related prospectus or a supplement or amendment to any document incorporated or deemed to be incorporated therein by reference, and file with the SEC any other required document so that, as thereafter delivered to the purchasers of such Registrable Debt Securities, such Prospectus shall not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (l) on or before the effective date of such Registration Statement, provide the transfer agent of the Company for the Registrable Debt Securities with printed certificates for the Registrable Debt Securities by such Registration Statement, which are in a form eligible for deposit with The Depository Trust Company; and (m) to the extent necessary, qualify the indenture under which the Registrable Debt Securities were issued under the Trust Indenture Act of 1939, as amended. 3.4 Expenses. All expenses incurred in complying with Article III, including, without limitation, all SEC or stock exchange registration or filing fees (including all expenses incident to filing with the NASD), stock exchange 22 listing fees, Nasdaq quotation fees, printing expenses (including all expenses of printing certificates for Registrable Debt Securities and of printing prospectuses if the printing of prospectuses is requested by the Trust or the managing underwriter, if any), fees and disbursements of counsel for the Company, the reasonable fees and expenses of one counsel for the Trust and all other selling security holders (selected by those holding a majority of the Registrable Debt Securities being registered), fees of the Company's independent public accountants and the expenses of any special audit work incident to or required for any such registration (including expenses of any "cold comfort" letters required in connection with this Article III), but subject to Section 3.1(b)(vi) hereof, the expenses of complying with the securities or blue sky laws of any jurisdiction and fees and disbursements of underwriters customarily paid by the issuers or sellers of securities (including reasonable fees of counsel to the underwriters), shall be paid by the Company except that any discounts, commissions or brokers' fees or fees of similar securities industries professionals and transfer taxes relating to the disposition of the Registrable Debt Securities will be payable by the Trust (or other securityholders participating in such registered offering) and the Company will have no obligation to pay any such amounts. 3.5 Indemnification and Contribution. (a) In the event of any registration of any Registrable Debt Securities under the Securities Act pursuant to this Agreement, the Company shall indemnify and hold harmless the Trust, the Trust's Affiliates, trustees, officers and agents, and each other Person (including each underwriter) who participated in the offering of such Registrable Debt Securities and each other Person, if any, who controls the Trust or such participating person within the meaning of the Securities Act, against any losses, claims, damages or liabilities, joint or several, to which the Trust or any such Affiliate, trustee, officer, agent or participating person or controlling person may become subject under the Securities Act or any other statute or at common law, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of any material fact contained in any Registration Statement under which such Registrable Debt Securities were registered under the Securities Act, any preliminary Prospectus or final Prospectus contained therein, or any amendment or supplement thereto, or (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse the Trust or such Affiliate, director, officer, agent or participating person or controlling person for any legal or any other expenses reasonably incurred by the Trust or such Affiliate, director, officer, agent or participating person or controlling person in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any actual or alleged untrue statement or actual or alleged omission made in such Registration Statement, preliminary Prospectus, Prospectus or amendment or supplement in reliance upon and in conformity with written information furnished to the Company by the Trust specifically for use therein or (in the case of any registration pursuant to Section 3.1) so furnished for such purposes by any underwriter. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Trust or such Affiliate, director, officer, agent or participating person or controlling person, and shall survive the transfer of such Registrable Debt Securities by the Trust. 23 (b) The Trust, by acceptance hereof, agrees to indemnify and hold harmless the Company, its directors and officers and each other person, if any, who controls the Company within the meaning of the Securities Act against any losses, claims, damages or liabilities, joint or several, to which the Company or any such director or officer or any such person may become subject under the Securities Act or any other statute or at common law, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of any material fact contained in any Registration Statement under which Registrable Debt Securities were registered under the Securities Act, any preliminary Prospectus or final Prospectus contained therein, or any amendment or supplement thereto or (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, if in any such case such statement or alleged statement or omission or alleged omission was made in reliance on and in conformity with information in writing provided to the Company by the Trust specifically for use in such Registration Statement, preliminary Prospectus or final Prospectus or any amendment or supplement thereto. Notwithstanding the provisions of this paragraph (b) or paragraph (c) below, the Trust shall not be required to indemnify any person pursuant to this Section 3.5 nor to contribute pursuant to paragraph (c) below in an amount in excess of the amount of the aggregate net proceeds received by the Trust in connection with any such registration under the Securities Act. (c) If the indemnification provided for in this Section 3.5 from an Indemnifying Party (as defined in Section 3.5(e) hereof) is unavailable hereunder to an Indemnified Party (as defined in Section 3.5(e) hereof) in respect of any losses, claims, damages, liabilities or expenses referred to herein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Parties in connection with the actions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of such Indemnifying Party and Indemnified Parties shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact, has been made by, or relates to information supplied by, such Indemnifying Party or Indemnified Parties, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such action. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include any legal or other fees or expenses reasonably incurred by such party in connection with any investigation or proceeding. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 3.5(c) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in this paragraph. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was 24 not guilty of such fraudulent misrepresentation. If indemnification is available under this Section 3.5, the Indemnifying Party shall indemnify the Indemnified Party to the full extent provided in Section 3.5(a) or 3.5(b) hereof, as applicable, without regard to the relative fault of the Indemnifying Party or the Indemnified Party or any other equitable consideration provided for in this Section 3.5(c). (d) The indemnification and contribution required by this Section 3.5 shall be made by periodic payment of the amount thereof during the course of the investigation or defense, as and when bills are received or expenses are incurred. (e) The party seeking indemnification pursuant to this Section 3.5 is referred to in this Section 3.5 as the "INDEMNIFIED Party" and the party from whom indemnification is sought under this Section 3.5 is referred to as the "INDEMNIFYING PARTY." The Indemnified Party shall give prompt written notice to the Indemnifying Party of the commencement of any action or proceeding involving a matter referred to in Section 3.5(a) or 3.5(b) (an "ACTION"), if an indemnification claim in respect thereof is to be made against the Indemnifying Party; provided, however, that the failure to give such prompt notice shall not relieve the Indemnifying Party of its indemnity obligations hereunder with respect to such Action, except to the extent that the Indemnifying Party is materially prejudiced by such failure. The Indemnifying Party shall be entitled to participate in and to assume the defense of such Action, with counsel selected by the Indemnifying Party and reasonably satisfactory to the Indemnified Party; provided, however, that (i) the Indemnifying Party, within a reasonable period of time after the giving of notice of such indemnification claim by the Indemnified Party, (x) notifies the Indemnified Party of its intention to assume such defense and (y) appoints such counsel, and (ii) the Indemnifying Party may not, without the consent of the Indemnified Party, consent to entry of any judgment or enter into any settlement unless (A) there is as part thereof no finding or admission of any violation of any rights of any person and no effect adverse to the Indemnified Party on any other claims that may be made against the Indemnified Party, (B) the sole relief provided is monetary damages that are paid in full by the Indemnifying Party and (C) such judgment or settlement includes as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release, in form and substance reasonably satisfactory to the Indemnified Party, from all liability in respect of such claim or litigation for which such Indemnified Party would be entitled to indemnification hereunder. If the Indemnifying Party so assumes the defense of any such Action, (A) the Indemnifying Party shall pay all costs associated with, any damages awarded in, and all expenses arising from the defense or settlement of such Action, and (B) the Indemnified Party shall have the right to employ separate counsel and to participate in (but not control) the defense, compromise or settlement of such Action, but the fees and expenses of such counsel shall be at the expense of the Indemnified Party except that if (x) the Indemnified Party has been advised by its counsel that there are likely to be one or more defenses available to it which are different from or additional to those available to the Indemnifying Party, or (z) such counsel has been selected by the Indemnified Party solely due to a conflict of interest which exists between counsel selected by the Indemnifying Party and the Indemnified Party, the Indemnifying Party shall pay in any such case that portion of the reasonable fees and expenses of one separate counsel per Action for an Indemnified Party (or Indemnified Parties in the aggregate, as the case may be), that are reasonably related to matters covered by the indemnity provided in this Section 3.5. If the Indemnifying Party does not so assume the defense of such 25 Action, the Indemnified Party shall be entitled to exercise control of the defense, compromise or settlement of such Action. No Indemnified Party shall settle or compromise any Action for which it is entitled to indemnification under this Agreement without the prior written consent of the Indemnifying Party (which consent may not be unreasonably withheld or delayed). The other party shall cooperate with the party assuming the defense, compromise or settlement of any Action in accordance with this Agreement in any manner that such party reasonably may request and the party assuming the defense, compromise or settlement of any Action shall keep the other party fully informed in the defense of such Action. 3.6 Rule 144. So long as the Company has securities registered under the Exchange Act, it shall take all actions reasonably necessary to enable the Trust to sell Registrable Debt Securities without registration under the Securities Act within the limitations of the exemptions provided by Rule 144, including, without limiting the generality of the foregoing, filing on a timely basis all reports required to be filed by the Exchange Act. 3.7 Duration of Debt Registration Rights. The rights and obligations provided for under this Article III (except for the indemnification and contribution obligations in Section 3.5) shall terminate on the date which is the earlier of (i) the date on which the Trust (or, in the case of a permitted transferee of the Trust's rights under this Article III, such transferee), in the reasonable opinion of the Trust and the Company, may sell pursuant to Rule 144(k) any and all of the Registrable Debt Securities owned by it and (ii) such time as the Trust (and, in the case of any permitted transferee or transferees of the Trust's rights under this Article III, all such permitted transferees) no longer own any Registrable Debt Securities. 3.8 "Market Stand-Off" Agreement. The Trust hereby agrees that during the 90-day period following (x) the effective date of a Registration Statement of the Company filed under the Securities Act relating to a public offering of debt securities of the Company for the benefit of the Company (but not including any Registration Statement filed in connection with a new issue of debt securities to be offered in exchange for debt securities issued under Rule 144A of the Securities Act) or (y) the date on which the Company executes a purchase agreement relating to an offering by the Company of its debt securities under Rule 144A of the Securities Act, it shall not, directly or indirectly, to the extent reasonably requested by the Company and any underwriter (or in the case of a Rule 144A offering, any initial purchaser), sell, pledge, transfer, loan, or otherwise transfer or dispose of (other than to donees who agree to be similarly bound) any debt securities held by it at any time during such period except debt securities included in such registration; provided however, that the market stand-off agreement contemplated by this Section 3.8 shall not apply to any Registrable Debt Securities in respect of which the Trust is entitled to and has exercised its demand registration rights under Section 3.1 hereof (unless and until the Registration Statement required thereby has been declared effective and such securities have not been sold pursuant thereto during the effective period thereof). In order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Registrable Debt Securities of the Trust (and the shares or securities of every other person subject to the foregoing restriction) until the end of such period. 26 3.9 Transfer of Registration Rights. The rights of the Trust under this Article III may be transferred by the Trust to a transferee of Registrable Debt Securities, and by such a transferee to a subsequent transferee of Registrable Debt Securities, but only where the transfer is not made pursuant to an effective Registration Statement or Rule 144 and only to such a transferee, provided that the transferee agrees in a writing executed by such transferee to assume the applicable obligations of the Trust under this Article III. 3.10 Granting of Additional Registration Rights. The Company shall not, without the Trust's prior written consent, grant to any third party piggyback registration rights with respect to any Debt Security Demand Registration. ARTICLE IV TAG-ALONG RIGHTS 4.1 Restrictions on Transfer of Shares of Common Stock by the Trust. Until such time as the Trust ceases to own 20% or more of the Voting Stock, the Trust will not Transfer, in one transaction or a series of related transactions, any shares of Common Stock representing more than five percent of the outstanding shares of Common Stock (or any shares of Voting Stock entitling the holders thereof to cast more than five percent of all the votes which the holders of all outstanding shares of Voting Stock are entitled to cast in the election of directors of the Company) to any Person (a "PROPOSED PURCHASER") who, after giving effect to the transaction or series of related transactions, would Beneficially Own shares of Voting Stock entitling the holders thereof to cast more than 35% of the votes which the holders of all outstanding shares of Voting Stock are entitled to cast in the election of directors of the Company or more of such votes than the Trust is entitled to cast), and the Company shall not be required to register or give effect to any such Transfer, unless (A) such Transfer is (1) pursuant to a bona fide public distribution made under an effective Registration Statement under the Securities Act, (2) in a transaction satisfying the requirements of Regulation S under the Securities Act, or (3) in a transaction satisfying the requirements of Rule 144 under the Securities Act, other than by reason of satisfying the provisions of Rule 144(k) thereof or (4) is effected through "brokers' transactions" within the meaning of Section 4(4) of the Securities Act or a transaction with a "market maker" as defined in Section 3(c)(38) of the Exchange Act, or (B) all Other Stockholders are afforded the opportunity to participate in the transaction or series of transactions on the same terms as the Trust, which requirement shall be deemed satisfied if the Other Stockholders are provided an opportunity to sell the shares of Voting Stock they own in accordance with the provisions of Section 4.2 below, or (C) in the case of a disposition of shares of Voting Stock by the Trust pursuant to a merger, consolidation, recapitalization or similar corporate transaction involving the Company, the material terms of the transaction have been approved by a majority of the Disinterested Directors or such vote of the holders of the shares of Common Stock of the Company is required by law, the Articles of Incorporation or the Bylaws or applicable listing standards; provided, however, that, if the transaction would result in the Trust receiving a type or amount of 27 consideration per share in respect of its shares that is different from the Other Stockholders, the transaction has been approved by the affirmative vote of the holders of a majority of the shares of Common Stock not Beneficially Owned by the Settlement Trust (in addition to approval by any other shareholder vote required). The entry by the Settlement Trust into a prepaid variable share forward contract or other derivative contract (such as those known as TRACES or SAILS) shall not constitute a Transfer of shares for purposes of this paragraph, even if it relates to shares of Voting Stock entitling the holders thereof to cast more than five percent of all the votes which the holders of all outstanding shares of Voting Stock are entitled to cast in the election of directors of the Corporation), to the extent such contract is a legitimate hedging transaction and neither such contract nor the settlement thereof will result in a counterparty becoming the Beneficial Owner of shares of Voting Stock entitling the holders thereof to cast more than 35% of the votes which the holders of all outstanding shares of Voting Stock are entitled to cast in the election of directors of the Corporation or more of such votes than the Settlement Trust is entitled to cast). 4.2 Offer to Other Stockholders. The terms and conditions of a Transfer by the Trust of shares of Common Stock to a Proposed Purchaser will be deemed permitted by clause (B) of the first sentence of Section 4.1 hereof if, in connection with such Transfer, the Proposed Purchaser shall have publicly undertaken to commence a tender offer in accordance with the Exchange Act and the applicable regulations thereunder, which shall be scheduled to close not later than 60 days after the Transfer of the Trust's shares (subject to any extension where required to satisfy conditions established by such tender offer), pursuant to which the Other Stockholders will have the right to tender for purchase for the same type and amount of consideration per share available to the Trust in the Transfer, at each Other Stockholder's option, a number of shares of Common Stock equal to the product of (i) the total number of the shares of Common Stock owned by the Other Stockholder and (ii) a fraction, the numerator of which shall be the number of shares of Common Stock that the Trust proposes so to Transfer to the Proposed Purchaser and the denominator of which shall be the total number of shares of Common Stock then owned by the Trust. 4.3 Third Party Beneficiary Rights. The Other Stockholders are intended to be, and shall be, third party beneficiaries of the covenants and agreements of this Article IV, which shall inure to the benefit of the Other Stockholders, who, individually or as a class, shall be entitled to rely on and, subject to the limitations set forth herein, enforce such covenants and agreements, to the same extent as if they were a party to this Agreement. The provisions of this Article IV may not be amended in such a way as to extinguish or alter the rights of the Other Stockholders under this Article IV without the consent of Other Stockholders representing at least two-thirds of the shares of Common Stock not beneficially owned by the Trust; provided that, if any payment is to be made to any Other Stockholder for its consent, such amendment shall not be binding on any Other Stockholder who does not consent. 28 ARTICLE V CERTAIN COVENANTS OF THE COMPANY 5.1 Approval Requirements Respecting A Shareholder Rights Plan. Until such time as the Trust ceases to own 20% or more of the Voting Stock, the Company shall not, without the prior written approval of the Trust, adopt or maintain a shareholder rights plan, "poison pill" or any similar plan (however designated) which provides some, but not all, holders of shares of Common Stock, in the event of the acquisition by any person or group of persons acting in concert of shares of Voting Stock constituting more than a specified level of ownership of the Corporation and with or without additional conditions or exceptions (an "ACQUIRING PERSON"), the right to acquire securities of the Company or of any successor company, or of any controlling person thereof, on more favorable terms than available to the Acquiring Person, or which is otherwise designed to, or has the effect of, similarly making acquisition of additional shares of the Company's Voting Stock by an Acquiring Person more difficult or expensive than would be the case in the absence of such shareholder rights or similar plan by providing to other shareholders any right or benefit which the Acquiring Person is not accorded. ARTICLE VI VOTING AGREEMENT AND RELATED COVENANTS OF THE TRUST 6.1 Independent Directors. Until the earlier of (i) the tenth anniversary of the Effective Date and (ii) such time as the Trust ceases to Beneficially Own 20% or more of the Voting Stock, the Trust shall not, in connection with any election of directors of the Company, knowingly nominate for election or vote, or cause to be voted, any shares of Voting Stock Beneficially Owned by the Trust or which the Trust has the power to vote (whether shares now owned or hereafter acquired by the Trust) in favor of the election as a director of an individual, if, to the best knowledge of the Trust, by reason of such individual's election, a majority of the members of the Board of Directors of the Company would cease to be Independent Directors. The foregoing provisions of this section shall not prevent the Trust from withholding its vote from any nominee for election as a director or voting in favor of the removal of any director, even if, as a result of such individual's election or removal, a majority of the members of the Board of Directors would cease to be Independent Directors; provided, however, that the Trust, in good faith, shall not engage in a pattern of removal of directors so as knowingly to cause the composition of the Board of Directors to fail on an on-going basis to include a majority of Independent Directors. The Trust may conclusively rely on the determination of the Board of Directors as to whether or not any individual is an Independent Director but shall not be bound by the determination of the Board of Directors with respect thereto. 6.2 Approval of New Long-term Incentive Plan. The Trust shall vote any shares of Voting Stock Beneficially Owned by the Trust so that the New Long-Term Incentive Plan is authorized, approved and/or ratified by the shareholders of the Company as may from time to time be required by any legal regulation or listing standard or to satisfy any tax requirement; provided, however, that such vote is sought not later than June 30, 2005. 29 6.3 Certain Director Elections. In connection with the election of directors of the Company at the annual meeting of shareholders of the Company first held in 2005, the Trust shall vote any shares of Voting Stock Beneficially Owned by the Trust in favor of the re-election of the two initial directors of the Company as of the Effective Date identified on Schedule 6.3 hereto (or in each case his successors if he has not served his full initial term of office), if such individual is nominated (whether by the Board or any shareholder if the Board shall not have nominated such individual) for election as a director and such individual is available and willing to serve as such, or, in the case of either of such individuals, if he is not nominated for re-election (by the Board or any shareholder) or is not available or willing to serve as a director, for the nominee of the Board of Directors nominated in accordance with the provisions of Section 4B of Article II of the Bylaws. In addition, in the event a director is to be elected by the shareholders to fill a vacancy in the position on the Board of Directors filled by such individual, or his successor, occurring before the first annual meeting of shareholders held in 2006, the Trust shall likewise vote any shares of Voting Stock Beneficially Owned by the Trust in favor of the election of the individual nominated by the Board to fill such vacancy in accordance with Section 4B of Article II of the Bylaws. 6.4 Third Party Beneficiary Rights. The Other Stockholders are intended to be, and shall be, third party beneficiaries of the covenants and agreements contained in Section 6.3 hereof, which shall inure to the benefit of the Other Stockholders, who, individually or as a class, shall be entitled to rely on and, subject to the limitations set forth herein, enforce such covenants and agreements, to the same extent as if they were a party to this Agreement. The provisions of this Article VI may not be amended in such a way as to extinguish or alter the rights of the Other Stockholders under this Article VI without the consent of Other Stockholders representing at least two-thirds of the shares of Common Stock not beneficially owned by the Trust; provided that, if any payment is to be made to any Other Stockholder for its consent, such amendment shall not be binding on any Other Stockholder who does not consent. ARTICLE VII MISCELLANEOUS PROVISIONS 7.1 Successor Securities. The provisions of this Agreement pertaining to shares of Common Stock or Voting Stock shall apply equally to any additional shares of Common Stock authorized after the Effective Date and any shares of the Company, regardless of class, series, designation or par value, that are issued as a dividend on or in any other distribution in respect of, or as a result of a reclassification (including a change in par value) in respect of, shares of Common Stock or any other shares of Voting Stock or other shares of the Company which, as provided by this section, are considered as shares of Common Stock for purposes of this Agreement and shall also apply to any voting equity security (or, in the case of Article II, any equity security even if not voting) issued by any company that succeeds, by merger, consolidation, a share exchange, a 30 reorganization of the Company or any similar transaction, to all or substantially all the business of the Company, or to the ownership thereof, if such security was issued in exchange for or otherwise as consideration for or in respect of shares of Common Stock (or other shares considered as shares of Common Stock, as provided by this Section) in connection with such succession transaction. 7.2 Equitable Relief. It is hereby acknowledged that irreparable harm would occur in the event that any of the provisions of this Agreement were not performed fully by the parties hereto in accordance with the terms specified herein, and that monetary damages are an inadequate remedy for breach of this Agreement because of the difficulty of ascertaining and quantifying the amount of damage that will be suffered by the parties relying hereon in the event that the undertakings and provisions contained in this Agreement were breached or violated. Accordingly, each party hereto hereby agrees that each other party hereto shall be entitled to an injunction or injunctions to restrain, enjoin and prevent breaches of the undertakings and provisions hereof and to enforce specifically the undertakings and provisions hereof in any court of the United States or any state having jurisdiction over the matter; it being understood that such remedies shall be in addition to, and not in lieu of, any other rights and remedies available at law or in equity. 7.3 No Inconsistent Agreements. The Company has not previously, or simultaneously, entered into any agreement with respect to any of its securities granting any registration rights to any person (other than the Warrant Agreement). The Company shall not hereafter enter into any agreement with respect to its securities which is inconsistent with the rights granted to the Trust in this Agreement or which violates any of the covenants of the Company made in this Agreement. The Trust has not previously, or simultaneously, entered into any agreement which is inconsistent with the performance of its obligations hereunder and shall not do so. 7.4 Amendments and Waivers. The provisions of this Agreement may be amended, modified or supplemented, and waivers or consents to departure from the provisions hereof may be given, only in a writing executed by the Company and the Trust. To the extent permitted by law, no failure to exercise, and no delay on the part of the Trust or the Company in exercising any power or right in connection with this Agreement, or available at law or in equity, shall operate as a waiver thereof, and no single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, shall preclude any other or further exercise thereof or the exercise of any other rights or powers. Any written modification or waiver of any provision of this Agreement shall be effective only in the specific instance and for the purpose for which it is given. 7.5 Notice Generally. Any notice, demand, request, consent, approval, declaration, delivery or other communication to be made pursuant to the provisions of this Agreement or in connection herewith shall be deemed delivered, served and received: (i) when delivered by hand to the recipient named below, (ii) on the date of delivery to the address indicated below, properly addressed, as confirmed by the agency or firm making delivery if the notice is delivered by regularly operating overnight delivery service, such as Federal Express, (iii) on the date of delivery to the address indicated below, 31 properly addressed, if sent via the United States Postal Service when sent by either registered or certified mail, postage prepaid, return receipt requested, (iv) if on a business day, on the date sent via telecopy, provided such delivery is confirmed (via a fax confirmation report), or (v) five business days after having been deposited with the United States Postal Service, properly addressed and postage prepaid. Notices shall be addressed by name and address to the recipient, as follows: if to the Trust, at: Armstrong World Industries, Inc. Asbestos Personal Injury Settlement Trust [address] [Attention: ] [Telecopier:], with a copy similarly sent to: [RESERVED], or if to the Company, at: Armstrong World Industries, Inc. 2500 Columbia Avenue Lancaster, Pennsylvania 17603 Attention: General Counsel Telecopier: with a copy similarly sent to: Weil, Gotshal & Manges LLP 767 Fifth Avenue New York, New York 10153 Attention: Robert L. Messineo, Esq. Telecopier: 212-310-8007, or at such other address as may be substituted by notice given as herein provided. The giving of any notice required hereunder may be waived in writing by the party entitled to receive such notice. 7.6 Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon a successor company to the Company by merger, consolidation, reorganization or any like transaction. Except in respect of a successor company to the Company and except as provided in respect of the rights and obligations of the Trust under Articles II and III hereof, the rights and obligations of the parties hereunder shall not be assignable. 32 7.7 Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. 7.8 Governing Law; Jurisdiction; Jury Waiver. This Agreement shall be governed by, construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania without giving effect to the conflict or choice of laws provisions thereof. Each of the parties hereby submits to the non-exclusive personal jurisdiction of, and waives any objection as to venue in respect of any litigation respecting this agreement in, the Court of Common Pleas of the County of , Commonwealth of Pennsylvania, the Court or the federal district court of the Eastern District of Pennsylvania . Service of process on the parties in any action arising out of or relating to this Agreement shall be effective if mailed to the parties in accordance with Section 7.5 hereof. EACH PARTY HERETO WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHT HEREUNDER. 7.9 Severability. Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity only, without invalidating the remainder of such provision or the remaining provisions of this Agreement. 7.10 Entire Agreement. This Agreement represents the complete agreement and understanding of the parties hereto in respect of the subject matter contained herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to the subject matter hereof. 7.11 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same agreement. IN WITNESS WHEREOF, the Company and the Trust have executed this Agreement as of the date first above written. ARMSTRONG WORLD INDUSTRIES, INC. By: ------------------------------------------- Name: An authorized officer thereof ARMSTRONG WORLD INDUSTRIES, INC. ASBESTOS PERSONAL INJURY SETTLEMENT TRUST By: ------------------------------------------- Name: A trustee thereof 33 Schedule 6.3 ------------ James J. Gaffney Robert C. Garland EX-99 12 jd9-5ex99_10.txt 99.10 Exhibit 99.10 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - -------------------------------------) EXHIBIT 7.2 INDIVIDUALS APPOINTED AS ASBESTOS PI TRUSTEES ARMSTRONG WORLD INDUSTRIES, INC. INDIVIDUALS APPOINTED AS ASBESTOS PI TRUSTEES --------------------------------------------- The Asbestos PI Claimants' Committee and the Future Claimants' Representative have jointly selected the individuals named below to serve as the Asbestos PI Trustees for the Asbestos PI Trust. The named individuals will be appointed by the Bankruptcy Court on the Confirmation Date, effective as of the Effective Date. The following individuals have been selected for appointment as the Asbestos PI Trustees: 1. Paul Knuti* 2. Anne Ferazzi 3. Thomas Tully 4. Lewis Sifford* 5. Harry Huge - ---------------- *These two individuals will serve a two-year term only. At the end of the initial two year term, the TAC and/or the Future Claimants' Representative will assign the three remaining trustees their respective remaining terms for one, two, or three years. 2 EX-99 13 jd9-5ex99_11.txt 99.11 Exhibit 99.11 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - -------------------------------------) EXHIBIT 7.21 BOARD OF DIRECTORS OF REORGANIZED AWI BOARD OF DIRECTORS OF REORGANIZED AWI ------------------------------------- On the Effective Date, the Board of Directors of Reorganized AWI shall consist of the individuals named below. Each of the members of the Board of Directors of Reorganized AWI listed below shall serve in accordance with the Amended and Restated Articles of Incorporation, the Amended and Restated By-laws, and the Stockholder and Registration Rights Agreement. The following individuals will serve as members of the Board of Directors of Reorganized AWI: 1. Joseph L. Castle, II 2. James J. Gaffney 3. Robert C. Garland 4. Judith R. Haberkorn 5. Michael D. Lockhart 6. Scott D. Miller 7. Arthur J. Pergament 8. John J. Roberts 9. Alexander M. Sanders, Jr. 2 EX-99 14 jd9-5ex99_12.txt 99.12 Exhibit 99.12 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------- ) EXHIBIT 8.8-A IDENTITY OF PERSONS ENTERING INTO MANAGEMENT AGREEMENTS AWI does not intend to enter into any new employment agreements with management in connection with consummation of its chapter 11 plan of reorganization. EX-99 15 jd9-5ex99_13.txt 99.13 Exhibit 99.13 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re ) ) ) ARMSTRONG WORLD INDUSTRIES, ) Chapter 11 INC., et al., ) Case No. 00-4471 (RJN) ) (Jointly Administered) Debtors ) - ------------------------------------- ) EXHIBIT 8.8-B FORM OF MANAGEMENT AGREEMENT AWI does not intend to enter into any new employment agreements with management in connection with consummation of its chapter 11 plan of reorganization. -----END PRIVACY-ENHANCED MESSAGE-----