sv4
As filed with the Securities and Exchange Commission on August 9, 2010
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-4
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
Prestige Brands, Inc.
GUARANTORS LISTED ON SCHEDULE A HERETO
(Exact name of registrant as specified in its charter)
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Delaware
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2834
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80-0091750 |
(State or other jurisdiction
of incorporation or organization)
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(Primary Standard Industrial
Classification Code Number)
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(I.R.S. Employer
Identification Number) |
Prestige Brands, Inc.
90 North Broadway
Irvington, New York 10533
Telephone: (914) 524-6810
(Address, including zip code, and telephone number, including area code, of registrants principal executive offices)
Eric S. Klee
Secretary and General Counsel
Prestige Brands Holdings, Inc.
90 North Broadway
Irvington, New York 10533
Telephone: (914) 524-6878
Facsimile: (914) 524-7488
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Mark F. McElreath
Alston & Bird LLP
90 Park Avenue
New York, New York 10016
Telephone: (212) 210-9595
Facsimile: (212) 210-9444
Approximate date of commencement of proposed sale of the securities to the public: As soon as
practicable after the effective date of this registration statement.
If the securities being registered on this Form are being offered in connection with the
formation of a holding company and there is compliance with General Instruction G, check the
following box. o
If this Form is filed to register additional securities for an offering pursuant to Rule
462(b) under the Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. o
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities
Act, check the following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. o
Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer,
a non-accelerated filer, or a smaller reporting company. See the definition of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act
Large
Accelerated filer o |
Accelerated filer þ |
Non-accelerated filer o (Do not check if a smaller reporting company) |
Smaller reporting company o |
If applicable, place an X in the box to designate the appropriate rule provision relied upon
in conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) o
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) o
CALCULATION OF REGISTRATION FEE
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Amount of |
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Title of Each Class of |
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Amount to be |
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Registration |
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Securities to be Registered |
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Registered |
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Fee (1) |
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8.25% Senior Notes due 2018 |
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$ |
150,000,000 |
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$ |
10,695 |
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Guarantees of 8.25% Senior Notes due 2018 |
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N/A |
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(2) |
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Total |
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$ |
150,000,000 |
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$ |
10,695 |
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(1) |
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The registration fee was computed pursuant
to Rule 457(o) under the Securities Act of
1933 based on the maximum aggregate
offering price. |
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(2) |
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No additional registration fee is due for
guarantees pursuant to Rule 457(n) under
the Securities Act of 1933. |
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The Registrant hereby amends this Registration Statement on such date or dates as may be
necessary to delay its effective date until the Registrant shall file a further amendment which
specifically states that this Registration Statement shall thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration
Statement shall become effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.
SCHEDULE A
GUARANTORS
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Primary Standard |
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Industrial |
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I.R.S. Employer |
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Classification |
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Jurisdiction of |
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Identification |
Exact Name of Additional Registrants* |
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Number |
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Formation |
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Number |
Prestige Brands Holdings, Inc. |
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2834 |
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Delaware |
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20-1297589 |
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Prestige Personal Care Holdings, Inc. |
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2834 |
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Delaware |
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80-0091757 |
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Prestige Personal Care, Inc. |
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2834 |
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Delaware |
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80-0091755 |
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Prestige Services Corp. |
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2834 |
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Delaware |
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26-0715445 |
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Prestige Brands Holdings, Inc. |
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2834 |
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Virginia |
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65-1026844 |
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Prestige Brands International, Inc. |
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2834 |
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Virginia |
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59-3606733 |
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Medtech Holdings, Inc. |
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2834 |
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Delaware |
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94-3335024 |
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Medtech Products Inc. |
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2834 |
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Delaware |
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83-0318374 |
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The Cutex Company |
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2834 |
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Delaware |
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74-2899000 |
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The Denorex Company |
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2834 |
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Delaware |
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75-2993424 |
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The Spic and Span Company |
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2834 |
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Delaware |
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06-1605546 |
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The address for each of the Additional Registrants is c/o Prestige Brands, Inc., 90
North Broadway, Irvington, New York 10533, telephone: (914) 524-6810. The name, address,
including zip code of the agent for service for each Additional Registrant is Eric S. Klee,
Secretary and General Counsel, Prestige Brands, Inc., 90 North Broadway, Irvington,
New York 10533, telephone: (914) 524-6878. |
The information in this prospectus is not complete and may be changed. These securities may not be
sold until the registration statement filed with the SEC is effective. This prospectus is not a
offer to sell these securities, nor a solicitation of an offer to buy these securities, in any
jurisdiction where the offering is not permitted.
Subject to Completion
Preliminary prospectus dated August 9, 2010
P R O S P E C T U S
Prestige Brands, Inc.
Exchange Offer for
$150,000,000
8.25% Senior Notes due 2018
We are offering to exchange:
up to $150,000,000 of our new 8.25% Senior Notes due 2018
for
a like amount of our outstanding 8.25% Senior Notes due 2018
We are offering to exchange up to $150,000,000 aggregate principal amount of our new
8.25% Senior Notes due 2018, which have been registered under the Securities Act of 1933, as
amended (or the Securities Act), referred to in this prospectus as the new notes, for any and all
of our outstanding unregistered 8.25% Senior Notes due 2018, referred to in this prospectus as the
old notes. We issued the old notes on March 24, 2010, in a transaction not requiring
registration under the Securities Act. We are offering you new notes, with terms substantially
identical to those of the old notes, in exchange for old notes in order to satisfy our registration
obligations from that previous transaction. The new notes and the old notes are collectively
referred to in this prospectus as the notes. The new notes are senior unsecured obligations and
are fully and unconditionally guaranteed on a senior unsecured basis by Prestige Brands Holdings,
Inc. and certain of its subsidiaries.
Investing in the notes involves risks. See Risk Factors starting on page 8 of this
prospectus for a discussion of risks associated with investing in the new notes and with the
exchange of old notes for the new notes offered hereby, as well as the risk factors regarding our
business beginning on page 15 of our Annual Report on Form 10-K for our year ended March 31, 2010,
which is incorporated herein by reference.
We will exchange new notes for all old notes that are validly tendered and not withdrawn
before expiration of the exchange offer. You may withdraw tenders of old notes at any time prior
to the expiration of the exchange offer. The exchange offer expires at 5:00 p.m., New York time,
on , 2010, unless extended. We currently do not intend to extend the expiration date.
The exchange procedure is more fully described in The Exchange Offer Procedures for
Tendering. If you fail to tender your old notes, you will continue to hold unregistered notes
that you will not be able to transfer freely.
The terms of the new notes are substantially identical to those of the old notes, except that
the transfer restrictions and registration rights applicable to the old notes do not apply to the
new notes. See Description of the New Notes for more details on the terms of the new notes. We
will not receive any proceeds from the exchange offer.
There is no established trading market for the new notes or the old notes. The exchange of
old notes for new notes in the exchange offer will not be a taxable transaction for United States
federal income tax purposes. See Certain U.S. Federal Income Tax Considerations. All
broker-dealers must comply with the registration and prospectus delivery requirements of the
Securities Act. See Plan of Distribution.
Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the adequacy or accuracy of this
prospectus. Any representation to
the contrary is a criminal offense. We are not asking you for a proxy and you are requested
not to send us a proxy.
The date of this prospectus is , 2010.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the Securities and
Exchange Commission, or the SEC. We may add, update or change in a prospectus supplement any
information contained in this prospectus. You should read this prospectus and any accompanying
prospectus supplement, as well as any post-effective amendments to the registration statement of
which this prospectus is a part, together with the additional information described under Where
You Can Find Additional Information and Information Incorporated by Reference before you make
any investment decision.
You should rely only on the information contained in this prospectus. We have not authorized
anyone to provide you with information different from that contained in this prospectus. We are
offering to exchange old notes for new notes only in jurisdictions where such offers are permitted.
The information contained in this prospectus is accurate only as of the date of this prospectus,
regardless of the time of delivery of this prospectus or any actual exchange of old notes for new
notes.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We have filed with the SEC a registration statement on Form S-4 under the Securities Act with
respect to the new notes offered hereby. This prospectus, which is a part of the registration
statement, does not contain all of the information set forth in the registration statement, as may
be amended from time to time, or the exhibits and schedules filed therewith. For further
information with respect to us and the new notes offered hereby, please see the registration
statement, as may be amended from time to time, and the exhibits and schedules filed with, and
incorporated by reference into, the registration statement. Statements contained in this
prospectus regarding the contents of any contract or any other document that is filed as an exhibit
to the registration statement are not necessarily complete, and each such statement is qualified in
all respects by reference to the full text of such contract or other document filed as an exhibit
to the registration statement, as applicable. A copy of the registration statement, as may be
amended from time to time, and the exhibits and schedules filed with, and incorporated by reference
into, the registration statement may be inspected without charge at the public reference room
maintained by the SEC, located at 100 F Street, NE, Washington, D.C. 20549, and copies of all or
any part of the registration statement may be obtained from such office upon the payment of the
fees prescribed by the SEC. Please call the SEC at 1-800-SEC-0330 for further information about
the public reference room.
In addition, our parent corporation, Prestige Brands Holdings, Inc., files annual, quarterly
and current reports, proxy statements and other information with the SEC. Such reports, proxy
statements and other information are available for inspection without charge at the SECs public
reference room. The SEC also maintains an internet website that contains reports, proxy and
information statements and other information regarding registrants that file electronically with
the SEC. The address of the SECs website is www.sec.gov.
INFORMATION INCORPORATED BY REFERENCE
The SECs rules allow us to incorporate by reference information into this prospectus, which
means that we can disclose important information to you by referring you to another document filed
separately with the SEC. Any information that we reference this way is considered part of this
prospectus. The information in this prospectus supersedes information incorporated by reference
that we have filed with the SEC prior to the date of this prospectus, while information that we
file with the SEC after the date of this prospectus that is incorporated by reference will
automatically update and supersede the information in this prospectus.
We incorporate by reference the documents listed below and all documents filed with the SEC by
Prestige Brands Holdings, Inc. under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act of
1934, as amended (or the Exchange Act) after the date of this prospectus (except for information
furnished under Item 2.02 or Item 7.01 of any Current Reports on Form 8-K, which is not deemed to
be filed and is not incorporated by reference herein) from their respective filing dates so long as
the registration statement of which this prospectus is a part remains effective:
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Prestige Brands Holdings, Inc.s Annual Report on Form 10-K for the fiscal year ended
March 31, 2010, filed with the SEC on June 11, 2010; |
ii
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Prestige Brands Holdings, Inc.s Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 2010, filed with the SEC on August 6, 2010; and |
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Our Current Reports on Form 8-K or Form 8-K/A, as the case may be, filed with the SEC on
April 5, 2010, April 19, 2010, May 17, 2010, July 27, 2010, August 4, 2010, and August 5,
2010 (except Exhibit 99.1 attached thereto and the information
furnished under Items 2.02
and 7.01 thereof). |
Any statement contained herein or in a document incorporated by reference shall be deemed to
be modified or superseded for purposes of this prospectus to the extent that a statement contained
in any subsequently filed document that also is incorporated by reference in this prospectus
modifies or supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this prospectus.
You may obtain a copy of the documents we file with the SEC as described under Where You Can
Find Additional Information. In addition, Prestige Brands Holdings, Inc. will provide a copy of
the documents it incorporates by reference (including any exhibits specifically incorporated by
reference in such documents), at no cost, to any person who receives this prospectus and makes a
written or oral request for such documents. To request a copy of any or all of these documents,
you should write or telephone Prestige Brands Holdings, Inc. at: 90 North Broadway, Irvington, New
York 10533, Attention: Secretary (telephone: 914-524-6810). Such documents are also available on
Prestige Brands Holdings, Inc.s website (http://www.prestigebrands.com). The information
found on Prestige Brands Holdings, Inc.s website is not incorporated by reference into this
prospectus and is mentioned for reference purposes only.
In order to obtain timely delivery, security holders must request the information no later
than , 2010, which is five business days before the expiration date of the exchange offer.
This exchange offer is not being made to, nor will we accept surrenders for exchange from,
holders of outstanding old notes in any jurisdiction in which this exchange offer or the acceptance
thereof would not be in compliance with the securities or blue sky laws of such jurisdiction.
PRESENTATION OF INFORMATION
In this prospectus, unless the context requires otherwise:
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When discussing the business, financial condition and operations in this prospectus, the
words Prestige Holdings, we, us, and our refer to Prestige Brands Holdings, Inc.
and its consolidated subsidiaries, including Prestige Brands, Inc.; |
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Only when discussing the terms of the notes and the exchange offer in this prospectus,
the words the issuer, we, us, and our refer to Prestige Brands, Inc., the issuer of
the notes and a wholly-owned subsidiary of Prestige Brands Holdings, Inc., and |
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initial purchasers refers to the firms who were the initial purchasers of the old
notes, Banc of America Securities LLC and Deutsche Bank Securities Inc. |
Our fiscal year ends on March 31. Fiscal years are identified in this prospectus according to
the calendar year in which such fiscal year ends. For example, the fiscal year ended March 31,
2010, is sometimes referred to herein as fiscal 2010 and fiscal year 2010.
Trademarks and tradenames used in this prospectus are the property of Prestige Brands
Holdings, Inc. or its subsidiaries, as the case may be, unless otherwise noted. We have utilized
the ® and TM symbols the first time each trademark or trade name appears in this
prospectus.
iii
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference herein contain forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995 (or the
PSLRA). The following cautionary statements are being made pursuant to the provisions of the PSLRA
with the intention of obtaining the benefits of the safe harbor provisions of the PSLRA.
Although we believe that our expectations are based on reasonable assumptions, actual results may
differ materially from those in the forward-looking statements.
Forward-looking statements speak only as of the date of this prospectus. Except as required
under federal securities laws and the rules and regulations of the SEC, we do not have any
intention to update any forward-looking statements to reflect events or circumstances arising after
the date of this prospectus, whether as a result of new information, future events or otherwise.
As a result of these risks and uncertainties, readers are cautioned not to place undue reliance on
forward-looking statements included or incorporated by reference in this prospectus or that may be
made elsewhere from time to time by, or on behalf of, us. All forward-looking statements
attributable to us are expressly qualified by these cautionary statements.
These forward-looking statements generally can be identified by the use of words or phrases
such as believe, anticipate, expect, estimate, project, will be, will continue, will
likely result, or other similar words and phrases. Forward-looking statements and our plans and
expectations are subject to a number of risks and uncertainties that could cause actual results to
differ materially from those anticipated, and our business in general is subject to such risks.
For more information, see the Risk Factors section of this prospectus and our Annual Report on
Form 10-K for the year ended March 31, 2010, which is incorporated by reference herein. In
addition, our expectations or beliefs concerning future events involve risks and uncertainties,
including, without limitation:
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general economic conditions affecting our products and their respective markets; |
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our ability to increase organic growth via new product introductions or line extensions; |
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the high level of competition in our industry and markets (including, without
limitation, vendor and SKU rationalization and the expansion of private label product
offerings); |
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our ability to invest in research and development; |
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our dependence on a limited number of customers for a large portion of our sales; |
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disruptions in our distribution center; |
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acquisitions, dispositions or other strategic transactions diverting managerial
resources, or incurrence of additional liabilities or integration problems associated with
such transactions; |
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changing consumer trends or pricing pressures which may cause us to lower our prices; |
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increases in supplier prices and transportation and fuel charges; |
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our ability to protect our intellectual property rights; |
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shortages of supply of sourced goods or interruptions in the manufacturing of our
products; |
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our level of indebtedness, and ability to service our debt; |
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any adverse judgments rendered in any pending litigation or arbitration; |
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our ability to obtain additional financing; and |
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the restrictions imposed by our senior secured credit facilities and the indenture on our
operations. |
iv
SUMMARY
The following summary contains important information about us and this exchange offer but may
not contain all of the information that may be important to you in making a decision to tender your
old notes. For a more complete understanding of our company and this exchange offer, we urge you
to read carefully this entire prospectus, including the Risk Factors and Cautionary Statement
Regarding Forward-Looking Statements sections and the consolidated financial statements and
related notes, and other information incorporated by reference herein, which are described under
Where You Can Find Additional Information and Information Incorporated by Reference.
Our Business
We sell well-recognized, brand name over-the-counter healthcare, household cleaning and
personal care products in a global marketplace. We use the strength of our brands, our established
retail distribution network, a low-cost operating model and our experienced management team to our
competitive advantage to compete in these categories and, as a result, grow our sales and profits.
Our ultimate success is dependent on our ability to:
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Develop effective sales, advertising and marketing programs; |
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Grow our existing product lines; |
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Develop innovative new products; |
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Acquire new brands; |
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Respond to the technological advances and product introductions of our competitors; and |
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Develop a larger presence in international markets. |
Our major brands, set forth in the table below, have strong levels of consumer awareness and
retail distribution across all major channels.
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Major Brands |
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Market Segment |
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Over-the-Counter Healthcare: |
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Chloraseptic® |
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Sore Throat Liquids/Lozenges |
Clear Eyes® |
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Eye Allergy/Redness Relief |
Compound W® |
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Wart Removal |
Wartner® |
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Wart Removal |
The Doctors® NightGuard® |
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Bruxism (Teeth Grinding) |
The Doctors® Brushpicks® |
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Interdental Picks |
Little Remedies® |
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Pediatric Healthcare |
Murine® |
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Personal Ear Care |
New-Skin® |
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Liquid Bandages |
Dermoplast® |
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Pain Relief Sprays |
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Household Cleaning: |
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Comet® |
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Abrasive Tub and Tile Cleaner |
Chore Boy® |
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Soap Free Metal Scrubbers |
Spic and Span® |
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Dilutable All Purpose Cleaner |
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Personal Care: |
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Cutex® |
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Nail Polish Remover |
Our products are sold through multiple channels, including mass merchandisers, drug, grocery,
dollar and club stores, which reduces our exposure to any single distribution channel.
1
While we perform the production planning and oversee the quality control aspects of the
manufacturing, warehousing and distribution of our products, we outsource the operating elements of
these functions to entities that offer expertise in these areas and cost efficiencies due to
economies of scale. Our operating model allows us to focus on our marketing programs and product
development and innovation, which we believe enables us to achieve attractive margins while
minimizing capital expenditures and working capital requirements.
We have developed our brand portfolio through the acquisition of strong and well-recognized
brands from larger consumer products and pharmaceutical companies, as well as other brands from
smaller private companies. While the brands we have purchased from larger consumer products and
pharmaceutical companies have long histories of support and brand development, we believe that at
the time we acquired them they were considered non-core by their previous owners. Consequently,
they did not benefit from the focus of senior level personnel or strong marketing support. We also
believe that the brands we have purchased from smaller private companies were constrained by the
limited financial resources of their prior owners. After adding a brand to our portfolio, we seek
to increase its sales, market share and distribution in both new and existing channels through our
established retail distribution network. We pursue this growth through increased advertising and
promotion, new sales and marketing strategies, improved packaging and formulations and innovative
new products. Our business and business model face various risks that are described in Risk
Factors section of our Annual Report on Form 10-K for the year ended March 31, 2010, which is
incorporated by reference herein.
2
THE EXCHANGE OFFER
On March 24, 2010, we completed the private offering of $150.0 million aggregate principal
amount of our 8.25% Senior Notes due 2018. As part of that offering, we entered into a
registration rights agreement with the initial purchasers of the old notes in which we agreed,
among other things, to complete an exchange offer for the old notes. The summary below describes
the principal terms of the exchange offer and the new notes. Certain of the terms and conditions
described below are subject to important limitations and exceptions. The Description of the New
Notes section of this prospectus contains a more detailed description of the terms and conditions
of the new notes.
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Old Notes
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8.25% Senior Notes due 2018. |
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New Notes
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Notes of the same series, the issuance of which has
been registered under the Securities Act. The terms
of the new notes are substantially identical to
those of the old notes, except that the transfer
restrictions, registration rights, and additional
interest provisions relating to the old notes do not
apply to the new notes. |
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Terms of the Exchange Offer
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We are offering to exchange a like amount of new
notes for our old notes in denominations of $2,000
and integral multiples of $1,000 in excess thereof.
In order to be exchanged, an old note must be
properly tendered and accepted. All old notes that
are validly tendered and not withdrawn will be
exchanged. As of the date of this prospectus, there
is $150.0 million aggregate principal amount of
8.25% Senior Notes due 2018 outstanding. We will
issue the new notes promptly after the expiration of
the exchange offer. |
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Expiration Date
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The exchange offer will expire at 5:00 p.m., New
York City time, on , 2010, unless
extended or earlier terminated. Expiration date
means such time and date or, if the exchange offer
is extended, the latest time and date to which the
exchange offer is so extended. We may extend the
expiration date, in our sole discretion, from time
to time as necessary. |
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How to Tender the Old Notes
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To validly tender your old notes pursuant to the
exchange offer, you must deliver the tendered old
notes, the letter of transmittal and the related
documents to the depositary (or comply with the
procedures of The Depository Trust Companys (which
we refer to as DTC) Automated Tender Offer Program
(which we refer to as ATOP)) on or before the
expiration date. |
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A holder whose old notes are held in
certificated form must properly complete and execute
the letter of transmittal, and deliver such letter
of transmittal and the tendered old notes to the
depositary, with any other required documents, on or
before the expiration date. |
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A holder whose old notes are held by a
custodian bank, broker, dealer, trust company or
other nominee must contact such nominee if such
holder desires to tender his, her or its old notes
and instruct such nominee to tender the old notes on
the holders behalf. |
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Holders who are DTC participants must tender
their beneficial interest in the old notes
electronically through ATOP. |
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See The Exchange Offer Procedures for Tendering. |
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Acceptance of Old Notes for
Exchange; Issuance of New Notes
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Subject to the conditions stated in The Exchange
Offer Conditions to the Exchange Offer, we will
accept for exchange any and all old notes which are
properly tendered in the exchange offer before the
expiration date. The new notes will be delivered
promptly after the expiration date. |
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Interest Payments on the New Notes
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The new notes will bear interest from the date
interest was most recently paid. If your old notes
are accepted for exchange, then you will receive
interest on the new notes (including any accrued but
unpaid additional interest on the old notes) and not
on the old notes. |
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Withdrawal Rights
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Old notes tendered pursuant to the exchange offer
may be validly withdrawn at any time prior to the
expiration date, but not thereafter, unless we are
otherwise required by applicable law to permit the
withdrawal or unless the exchange offer is
terminated without any old notes being purchased
thereunder, by following the procedures described
herein. See The Exchange Offer Withdrawal
Rights. |
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Conditions to the Exchange Offer
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The exchange offer is subject to customary
conditions. We may assert or waive these conditions
in our sole discretion. If we materially change the
terms of the exchange offer, we will resolicit
tenders of the old notes. See The Exchange Offer
Conditions to the Exchange Offer for more
information. |
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Resales of New Notes
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We believe that the new notes issued in the exchange
offer may be offered for resale, resold or otherwise
transferred by you without compliance with the
registration and prospectus delivery requirements of
the Securities Act as long as: |
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you are acquiring the new notes in the
ordinary course of your business; |
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you are not participating, do not intend to
participate and have no arrangement or understanding
with any person to participate in a distribution of
the new notes; |
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you are not an affiliate of ours; and |
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you are not a broker-dealer. |
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If you fail to satisfy any of the foregoing
conditions, you will not be permitted to tender your
old notes in the exchange offer and you must comply
with the registration and prospectus delivery
requirements of the Securities Act in connection
with any sale or other transfer of your old notes
unless such sale is made pursuant to an exemption
from such requirements. We will not assume, or
indemnify you against, any such liability. |
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Each broker or dealer that receives new notes for
its own account in exchange for old notes that were
acquired as a result of market-making or other
trading activities must acknowledge that it will
comply with the registration and prospectus delivery
requirements of the Securities Act in connection
with any offer to resell, resale or other transfer
of the new notes issued in the exchange offer. A
broker-dealer may use this prospectus for an offer
to resell or otherwise transfer the new notes. See
The Exchange Offer Resales of New Notes. |
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Exchange Agent
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U.S. Bank National Association is serving as the
exchange agent in connection with the exchange
offer. The address and telephone and facsimile
numbers of the exchange agent are listed under the
heading The Exchange Offer Exchange Agent. |
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Use of Proceeds
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We will not receive any proceeds from the issuance
of new notes in the exchange offer. We will pay all
expenses incident to the exchange offer. See Use
of Proceeds and The Exchange Offer Fees and
Expenses. |
Certain U.S. Federal Income Tax Considerations
The exchange of old notes for new notes in the exchange offer should not be a taxable
transaction for United States federal income tax purposes. See Certain U.S. Federal Income Tax
Considerations.
Consequences of Not Exchanging Old Notes
If you do not exchange your old notes in the exchange offer, your old notes will continue to
be subject to the restrictions on transfer currently applicable to the old notes. In general, you
may offer or sell your old notes only:
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if they are registered under the Securities Act and applicable state securities laws; |
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if they are offered or sold under an exemption from registration under the Securities
Act and applicable state securities laws; or |
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if they are offered or sold in a transaction not subject to the Securities Act and
applicable state securities laws. |
After the exchange offer is closed, we will no longer have an obligation to register the old notes,
except in limited circumstances. Please see the risk factor entitled, If you fail to properly
exchange your old notes for new notes, you will continue to hold old notes which are subject to
transfer restrictions, and the liquidity of the trading market, if any, for any untendered old
notes may be substantially limited on page 8.
5
THE NEW NOTES
The summary below describes the principal terms of the new notes. Certain of the terms and
conditions described below are subject to important limitations and exceptions. The Description
of the New Notes section of this prospectus contains a more detailed description of the terms and
conditions of the new notes.
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Issuer
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Prestige Brands, Inc. |
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Notes Offered
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$150,000,000 aggregate principal amount of 8.25% Senior Notes due
2018. |
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Maturity Date
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April 1, 2018. |
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Interest
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Interest on the new notes will accrue at a rate of 8.25% per
year, payable semi-annually in cash in arrears on April 1 and
October 1 of each year, commencing October 1, 2010. |
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Guarantees
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The new notes will be fully and unconditionally guaranteed,
jointly and severally, on a senior unsecured basis, by Prestige
Holdings and all of its domestic subsidiaries, other than
Prestige Brands, Inc. |
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Ranking
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The new notes and guarantees will constitute senior unsecured
debt and will: |
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rank equally in right of payment with all of our and the
guarantors existing and future senior debt; |
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be senior in right of payment to all of our and the
guarantors existing and future subordinated debt; |
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be effectively junior to our and the guarantors existing
and future secured debt to the extent of the value of the assets
securing such debt; and |
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be structurally subordinated to all of the existing and
future liabilities of each of our subsidiaries that do not
guarantee the new notes. |
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As of June 30, 2010, we had $299.6 million of senior debt
outstanding (including the old notes), of which approximately
$149.6 million would have effectively ranked senior to the new
notes to the extent of the collateral securing such debt. In
addition, as of June 30, 2010, approximately $30 million was
available for borrowing under our revolving credit facility, all
of which would effectively rank senior to the new notes to the
extent of the collateral securing such debt. |
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Optional Redemption
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We may redeem some or all of the new notes at any time prior to
April 1, 2014, at a redemption price equal to 100% plus a
makewhole premium and on or after April 1, 2014, at the
redemption prices set forth under Description of the New Notes
Optional Redemption. |
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At any time prior to April 1, 2013, we may redeem up to 35% of |
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the aggregate principal amount of the new notes in an amount not
to exceed the amount of proceeds of one or more equity offerings,
at a price equal to 108.250% of the principal amount thereof,
plus accrued and unpaid interest, if any, to the redemption date;
provided that at least 65% of the original aggregate principal
amount of the new notes issued remains outstanding after the
redemption. |
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Change of Control
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Upon the occurrence of a change of control, you will have the
right, as a holder of new notes, to require us to repurchase all
of your new notes at a repurchase price equal to 101% of their
principal amount, plus accrued and unpaid interest, if any, to
the date of repurchase. See Description of the New Notes
Repurchase at the Option of Holders Upon a Change of Control. |
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Certain Covenants
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The indenture governing the new notes contains certain covenants
that limits, among other things, our ability and the ability of
our restricted subsidiaries (as defined in the indenture) to: |
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incur additional indebtedness; |
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pay dividends or make other restricted payments; |
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make certain investments; |
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create or permit certain liens; |
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sell assets; |
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create or permit restrictions on the ability of
our restricted subsidiaries to pay dividends or other
distributions to us; |
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engage in transactions with affiliates; and |
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consolidate or merge with or into other
companies or sell all or substantially all of our assets. |
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These covenants are subject to a number of important exceptions
and limitations, which are described under Description of the
New NotesCertain Covenants. |
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Use of Proceeds
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We will not receive proceeds from the issuance of the new notes
offered hereby. |
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Absence of an Established
Market for the New Notes
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The new notes will be a new class of securities for which there
is currently no market. We cannot assure you that a liquid
market for the new notes will develop. |
You should carefully consider all of the information set forth in this prospectus, and in
particular, should evaluate the specific factors set forth in the section entitled Risk Factors
for an explanation of certain risks of investing in the notes. For a description of risk related
to our industry and business, you should also evaluate the specific risk factors set forth in the
section entitled Risk Factors in our Annual Report on Form 10-K for the year ended March 31,
2010, which is incorporated by reference herein.
7
RISK FACTORS
Before you tender your old notes, you should consider the following risk factors in addition
to the other information included or incorporated by reference in this prospectus, including the
specific risk factors set forth in the section entitled Risk Factors in our Annual Report on Form
10-K for the fiscal year ended March 31, 2010. Any of the following risks could harm our business
and financial results and/or cause the value of the notes to decline, which in turn could cause you
to lose all or part of your investment. The risks below are not the only ones facing our company.
Risks Related to the New Notes and the Exchange Offer
If you fail to properly exchange your old notes for new notes, you will continue to hold old
notes which are subject to transfer restrictions, and the liquidity of the trading market, if any,
for any untendered old notes may be substantially limited.
We will only issue new notes in exchange for old notes that you timely and properly tender.
You should allow sufficient time to ensure timely delivery of the old notes, and you should
carefully follow the instructions on how to tender your old notes set forth under The Exchange
OfferProcedures for Tendering and in the letter of transmittal that accompanies this prospectus.
Neither we nor the exchange agent are required to notify you of any defects or irregularities
relating to your tender of old notes.
If you do not exchange your old notes for new notes in this exchange offer, the old notes you
hold will continue to be subject to the existing transfer restrictions. In general, you may not
offer or sell the old notes except under an exemption from, or in a transaction not subject to, the
Securities Act and applicable state securities laws. We do not plan to register the old notes
under the Securities Act. If you continue to hold any old notes after this exchange offer is
completed, you may have trouble selling them because of the restrictions on transfer.
Because we anticipate that most holders of old notes will elect to participate in this
exchange offer, we expect that the liquidity of the market for the old notes after completion of
this exchange offer may be substantially limited. Any old notes tendered and exchanged in the
exchange offer will reduce the aggregate principal amount at maturity of the old notes not
exchanged.
Our substantial level of indebtedness could materially adversely affect our ability to
generate sufficient cash to fulfill our obligations under the new notes, our ability to react to
changes in our business and our ability to incur additional indebtedness to fund future needs.
We have now and after giving effect to the exchange offer will continue to have a substantial
amount of debt, which requires significant interest and principal payments. As of June 30, 2010,
we had $299.6 million of senior debt outstanding (including the old notes), of which approximately
$149.6 million would have effectively ranked senior to the new notes to the extent of the
collateral securing such debt. In addition, as of June 30, 2010, approximately $30 million was
available for borrowing under our revolving credit facility, all of which would effectively rank
senior to the new notes to the extent of the collateral securing such debt. Subject to the limits
contained in the indenture governing the new notes and our other debt instruments, we may be able
to incur additional debt from time-to-time to finance working capital, capital expenditures,
investments or acquisitions, or for other purposes. If we do so, the risks related to our high
level of debt could intensify.
Our substantial level of indebtedness increases the possibility that we may be unable to
generate cash sufficient to pay, when due, the principal of, interest on or other amounts due in
respect of our indebtedness. Our substantial indebtedness, combined with our other financial
obligations and contractual commitments, could have important consequences for holders of our new
notes. For example, it could:
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make it more difficult for us to satisfy our obligations with respect to our
indebtedness, including the new notes, and any failure to comply with the obligations under
any of our debt instruments, including restrictive covenants, could result in an event of
default under the indenture governing the new notes and the agreements governing such other
indebtedness; |
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require us to dedicate a substantial portion of our cash flow from operations to
payments on our indebtedness, thereby reducing funds available for working capital, capital
expenditures, acquisitions, research and development and other purposes; |
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increase our vulnerability to adverse economic and industry conditions, which could
place us at a competitive disadvantage compared to our competitors that have relatively
less indebtedness; |
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limit our flexibility in planning for, or reacting to, changes in our business and the
industries in which we operate; |
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limit the rights of the holders of our new notes to receive payments under the new notes
if secured creditors have not been paid; |
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limit our ability to borrow additional funds for working capital, capital expenditures,
acquisitions, and other corporate purposes; and |
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prevent us from raising the funds necessary to repurchase all new notes tendered to us
upon the occurrence of certain changes of control, which would constitute a default under
the indenture governing the new notes. |
Restrictions imposed by our senior secured credit facilities may limit our ability to operate
our business and to finance our future operations or capital needs or to engage in other business
activities.
The terms of our senior secured credit facilities contain certain covenants that limit our
ability and that of our subsidiaries to create liens, merge or consolidate, dispose of assets,
incur indebtedness and guarantees, repurchase or redeem capital stock and indebtedness, make
certain investments or acquisitions, enter into certain transactions with affiliates or change the
nature of our business. The senior secured credit facilities also contain financial maintenance
covenants establishing a maximum leverage ratio, minimum interest coverage ratio and maximum
capital expenditures. See Description of Other Indebtedness.
As a result of these covenants and restrictions, we are limited in how we conduct our business
and we may be unable to raise additional debt or equity financing to compete effectively or to take
advantage of new business opportunities. The terms of any future indebtedness we may incur could
include more restrictive covenants. We cannot assure you that we will be able to maintain
compliance with these covenants in the future and, if we fail to do so, that we will be able to
obtain waivers from the lenders and/or amend the covenants.
We, including our subsidiaries, will have the ability to incur substantially more
indebtedness, including senior secured indebtedness.
Subject to the restrictions in our senior secured credit facilities and the indenture
governing the new notes, we, including our subsidiaries, may incur significant additional
indebtedness. Although the terms of the senior secured credit facilities and the indenture
governing the new notes contain restrictions on the incurrence of additional indebtedness, these
restrictions are subject to a number of important exceptions, and indebtedness incurred in
compliance with these restrictions could be substantial. If we and our restricted subsidiaries
incur significant additional indebtedness, the related risks that we face could intensify.
We may not be able to generate sufficient cash to service all of our indebtedness, including
the new notes, and may be forced to take other actions to satisfy our obligations under our
indebtedness, which may not be successful.
Our ability to make scheduled payments on or to refinance our debt obligations depends on our
financial condition and operating performance, which is subject to prevailing economic and
competitive conditions and to certain financial, business and other factors beyond our control. We
may not be able to maintain a level of cash flows from operating activities sufficient to permit us
to pay the principal, premium, if any, and interest on our indebtedness, including the new notes.
If our cash flows and capital resources are insufficient to fund our debt service obligations,
we may be forced to reduce or delay investments and other expenditures, or to sell assets, seek
additional capital or restructure
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or refinance our indebtedness, including the new notes. Our ability to restructure or
refinance our debt will depend on the condition of the capital markets and our financial condition
at such time. Any refinancing of our debt could be at higher interest rates and may require us to
comply with more onerous covenants, which could further restrict our business operations. The
terms of existing or future debt instruments and the indenture governing the new notes may restrict
us from adopting some of these alternatives. In addition, any failure to make payments of interest
and principal on our outstanding indebtedness on a timely basis would likely result in a reduction
of our credit rating, which could harm our ability to incur additional indebtedness. In the
absence of such operating results and resources, we could face substantial liquidity problems and
might be required to dispose of material assets or operations to meet our debt service and other
obligations. Our senior secured credit facilities and the indenture governing the new notes
restrict our ability to dispose of assets and use the proceeds from any such disposition. We may
not be able to consummate those dispositions or to obtain the proceeds that we could realize from
them and these proceeds may not be adequate to meet any debt service obligations then due. These
alternative measures may not be successful and may not permit us to meet our scheduled debt service
obligations.
Payment of principal and interest on the new notes will be effectively subordinated to our
secured debt to the extent of the value of the assets securing that debt.
The new notes will be effectively subordinated to claims of our secured creditors to the
extent of the value of the assets securing such claims, and the new note guarantees will be
effectively subordinated to the claims of our secured creditors as well as the secured creditors of
the guarantors. As of June 30, 2010, we had $299.6 million of senior debt outstanding (including
the old notes), of which approximately $149.6 million would have effectively ranked senior to the
new notes to the extent of the collateral securing such debt. In addition, as of June 30, 2010,
approximately $30 million was available for borrowing under our revolving credit facility, all of
which would effectively rank senior to the new notes to the extent of the collateral securing such
debt. Holders of our secured obligations, including obligations under our senior secured credit
facilities, will have claims that are prior to claims of the holders of the new notes with respect
to the assets securing those obligations. In the event of a liquidation, dissolution,
reorganization, bankruptcy or any similar proceeding, our assets and those of the guarantors will
be available to pay obligations on the new notes and the new note guarantees only after holders of
our senior secured debt have been paid the value of the assets securing such obligations.
Accordingly, there may not be sufficient funds remaining to pay amounts due on all or any of the
new notes. See Description of Other Indebtedness.
Repayment of our debt, including the new notes, is dependent on cash flow generated by our
subsidiaries and their ability to make distributions to us.
Our subsidiaries own a significant portion of our assets and conduct a significant portion of
our operations. Accordingly, repayment of our indebtedness, including the new notes, is dependent,
to a significant extent, on the generation of cash flow by our subsidiaries and their ability to
make such cash available to us, by dividend, debt repayment or otherwise. Unless they are
guarantors of the new notes, our subsidiaries do not have any obligation to pay amounts due on the
new notes or to make funds available for that purpose. Our subsidiaries may not be able to, or may
not be permitted to, make distributions to enable us to make payments in respect of our
indebtedness, including the new notes. Each subsidiary is a distinct legal entity and, under
certain circumstances, legal and contractual restrictions may limit our ability to obtain cash from
our subsidiaries. While our senior secured credit facilities and the indenture governing the new
notes will limit the ability of our subsidiaries to incur consensual restrictions on their ability
to pay dividends or make other intercompany payments to us, these limitations are subject to
certain qualifications and exceptions. In the event that we do not receive distributions from our
subsidiaries, we may be unable to make required principal and interest payments on our
indebtedness, including the new notes.
The new notes will be structurally subordinated to the existing and future liabilities of
certain of our subsidiaries which are not guaranteeing the new notes.
Certain of our subsidiaries will not guarantee the new notes. As a result, the new notes will
be structurally subordinated to all existing and future liabilities of such non-guarantor
subsidiaries. Our rights and the rights of our creditors to participate in the assets of any
non-guarantor subsidiary in the event that such a subsidiary is liquidated or reorganized will be
subject to the prior claims of such subsidiarys creditors. As a result, all indebtedness and
other liabilities, including trade payables, of our non-guarantor subsidiaries, whether secured or
unsecured, must be
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satisfied before any of the assets of such subsidiaries would be available for distribution,
upon a liquidation or otherwise, to us in order for us to meet our obligations with respect to the
new notes. To the extent that we may be a creditor with recognized claims against any
non-guarantor subsidiary, our claims would still be subject to the prior claims of such
subsidiarys creditors to the extent that they are secured or senior to those held by us. Subject
to restrictions contained in financing arrangements, our non-guarantor subsidiaries may incur
additional indebtedness and other liabilities, all of which would rank structurally senior to the
notes. As of June 30, 2010, our non-guarantor subsidiaries had approximately $1.3 million of total
indebtedness and other liabilities, including trade payables and accrued expenses, all of which
ranked structurally senior to the new notes. As of June 30, 2010, our non-guarantor subsidiaries
represented approximately 1.6% of our net income, approximately 0.8% of our total assets and
approximately 0.3% of our total liabilities.
If we default on our obligations to pay our other indebtedness, we may not be able to make
payments on the new notes.
Any default under the agreements governing our indebtedness (including a default under our
senior secured credit facilities and the indenture governing the new notes) that is not waived by
the required lenders, and the remedies sought by the holders of such indebtedness, could prevent us
from paying principal, premium, if any, and interest on the new notes and substantially decrease
the market value of the new notes. If we are unable to generate sufficient cash flow and are
otherwise unable to obtain funds necessary to meet required payments of principal, premium, if any,
and interest on our indebtedness, or if we otherwise fail to comply with the various covenants,
including financial and operating covenants in the instruments governing our indebtedness
(including covenants in our senior secured credit facilities and the indenture governing the new
notes), we could be in default under the terms of the agreements governing such indebtedness,
including our senior secured credit facilities and the indenture governing the new notes. In the
event of such default,
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the holders of such indebtedness may be able to cause all of our available cash flow to
be used to pay such indebtedness and, in any event, could elect to declare all the funds
borrowed thereunder to be due and payable, together with accrued and unpaid interest; |
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the lenders under our senior secured credit facilities and the indenture governing our
new notes could elect to terminate their commitments thereunder, cease making further loans
and institute foreclosure proceedings against our assets; and |
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we could be forced into bankruptcy or liquidation. |
If our operating performance declines, we may in the future need to obtain waivers from the
required lenders under our senior secured credit facilities and the indenture governing our new
notes to avoid being in default. If we breach our covenants under our senior secured credit
facilities and the indenture governing our new notes and seek a waiver, we may not be able to
obtain a waiver from the required lenders. If this occurs, we would be in default under our senior
secured credit facilities and the indenture governing our new notes, the lenders could exercise
their rights, as described above, and we could be forced into bankruptcy or liquidation.
We may not be able to repurchase the new notes upon a change of control.
Upon a change of control, as defined under the indenture governing the new notes, you will
have the right to require us to offer to purchase all of the new notes then outstanding at a price
equal to 101% of the principal amount of the new notes, plus accrued interest. In order to obtain
sufficient funds to pay the purchase price of the outstanding notes, we expect that we would have
to refinance the new notes. We cannot assure you that we would be able to refinance the new notes
on reasonable terms, if at all. Our failure to offer to purchase all outstanding new notes or to
purchase all validly tendered new notes would be an event of default under the indenture. Such an
event of default may cause the acceleration of our other debt. Our future debt also may contain
restrictions on repayment requirements with respect to specified events or transactions that
constitute a change of control under the indenture.
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Federal and state statutes allow courts, under specific circumstances, to void guarantees and
require noteholders to return payments received from guarantors.
If a bankruptcy case or lawsuit is initiated by unpaid creditors of any guarantor, the debt
represented by the guarantees entered into by the guarantors may be reviewed under the federal
bankruptcy law and comparable provisions of state fraudulent transfer laws. Under these laws, the
guarantee could be voided, or claims in respect of the guarantee could be subordinated to certain
obligations of a guarantor if, among other things, such guarantor, at the time it entered into the
guarantee:
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received less than reasonably equivalent value or fair consideration for entering into
the guarantee; and |
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either: |
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was insolvent or rendered insolvent by reason of entering into a guarantee; or |
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was engaged in a business or transaction for which the guarantors remaining assets
constituted unreasonably small capital; or |
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intended to incur, or believed that it would incur, debts or contingent liabilities
beyond its ability to pay such debts or contingent liabilities as they become due. |
In addition, any payment by a guarantor could be voided and required to be returned to such
guarantor, or to a fund for the benefit of the creditors of such guarantor under such
circumstances.
If a guarantee of a subsidiary were voided as a fraudulent conveyance or held unenforceable
for any other reason, holders of the new notes would be solely creditors of our company and
creditors of our other subsidiaries that have validly guaranteed the new notes. The new notes then
would be effectively subordinated to all obligations of the subsidiary whose guarantee was voided.
The measures of insolvency for purposes of these fraudulent transfer laws will vary depending
upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred.
Generally, however, a guarantor would be considered insolvent if:
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the sum of its debts, including contingent liabilities, were greater than the fair
saleable value of all of its assets; or |
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if the present fair saleable value of its assets were less than the amount that would be
required to pay its probable liability on its existing debts, including contingent
liabilities, as they become absolute and mature; or |
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it could not pay its debts or contingent liabilities as they become due. |
To the extent that the claims of the holders of the new notes against any subsidiary were
subordinated in favor of other creditors of such subsidiary, such other creditors would be entitled
to be paid in full before any payment could be made on the new notes. If one or more of the
guarantees is voided or subordinated, we cannot assure you that after providing for all prior
claims, there would be sufficient assets remaining to satisfy the claims of the holders of the new
notes.
Based upon financial and other information, we believe that the guarantees are being incurred
for proper purposes and in good faith and that each subsidiary that is a guarantor is solvent and
will continue to be solvent after this exchange offer is completed, will have sufficient capital
for carrying on its business after the exchange offer and will be able to pay its debts as they
mature. There can be no assurance, however, as to what standard a court would apply in making such
determinations or that a court would agree with our conclusions in this regard.
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Your ability to transfer the new notes may be limited by the absence of an active trading
market, and there is no assurance that any active trading market will develop for the new notes.
There is no established public market for the new notes, and we cannot assure you that an
active trading market for the new notes will develop. If no active trading market develops, you
may not be able to resell your new notes at their fair market value or at all. We do not intend to
apply for listing the new notes on any securities exchange. Future trading prices of the new notes
will depend on many factors, including, among other things, prevailing interest rates, our
operating results and the market for similar securities. We cannot assure you as to the
development or liquidity of any trading market for the new notes. The liquidity of any market for
the new notes will depend on a number of factors, including:
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the number of holders of new notes; |
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our operating performance and financial condition; |
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the market for similar securities; |
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the interest of securities dealers in making a market in the new notes; and |
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prevailing interest rates. |
Historically, the market for non-investment grade debt has been subject to disruptions that
have caused substantial volatility in the prices of securities similar to the new notes. We cannot
assure you that the market, if any, for the new notes will be free from similar disruptions or that
any such disruptions may not adversely affect the prices at which you may sell your new notes.
Therefore, we cannot assure you that you will be able to sell your new notes at a particular time
or the price that you receive when you sell will be favorable.
If you hold the new notes in book-entry form, you must rely on the procedures of the relevant
clearing systems to exercise any rights and remedies.
Unless and until definitive notes are issued in exchange for book-entry interests in the new
notes, owners of the book-entry interests will not be considered owners or holders of new notes.
Instead, the common depositary, or its nominee, will be the sole holder of the new notes. Payments
of principal and interest and any other amounts owing on or in respect of the new notes in global
form will be made to U.S. Bank National Association, as paying agent, which will make payments to
DTC. Thereafter, these payments will be credited to DTC participants accounts (including
Euroclear and Clearstream, Luxembourg) that hold book-entry interests in the new notes in global
form and credited by such participants to indirect participants. After payment to DTC or the
common depository, none of us, any of our affiliates, the trustee or any payment agent will have
any responsibility or liability for any aspect of the records relating to or payments of interest,
principal or other amounts to DTC, Euroclear and/or Clearstream, Luxembourg or to owners of
book-entry interests. Unlike holders of the new notes themselves, owners of book-entry interests
will not have the direct right to act upon solicitations for consents or requests for waivers or
other actions from holders of the new notes. Instead, if you own a book-entry interest, you will
be permitted to act only to the extent you have received appropriate proxies to do so from DTC,
Euroclear and/or Clearstream, Luxembourg or, if applicable, from a participant. We cannot assure
you that procedures implemented for the granting of such proxies will be sufficient to enable you
to vote on any requested actions on a timely basis.
The lack of physical certificates could also:
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result in payment delays on your new notes because the trustee will be sending
distributions on the new notes to DTC and Euroclear and Clearstream, Luxembourg instead of
directly to you; |
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make it difficult for you to pledge your new notes if physical certificates are required
by the party demanding the pledge; and |
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hinder your ability to resell your new notes because some investors may be unwilling to
buy securities that are not in physical form. |
13
THE EXCHANGE OFFER
Purpose and Effect of the Exchange Offer
In connection with the sale of the old notes, we entered into a registration rights agreement
with the initial purchasers of the old notes, pursuant to which we agreed to use commercially
reasonable efforts to file a registration statement with the SEC with respect to the exchange of
the old notes for the new notes. We are making the exchange offer to fulfill our contractual
obligations under that agreement. A copy of the registration rights agreement is included as an
exhibit to the registration statement of which this prospectus is a part.
Pursuant to the exchange offer, we will issue the new notes in exchange for old notes. The
terms of the new notes are substantially identical to those of the old notes, except that the new
notes (1) have been registered under the Securities Act and therefore will not be subject to
certain restrictions on transfer applicable to the old notes and (2) will not have registration
rights or provide for any increase in the interest rate related to the obligation to register. See
Description of the New Notes and Description of the Old Notes for more information on the terms
of the respective notes and the differences between them.
We are not making the exchange offer to, and will not accept tenders for exchange from,
holders of old notes in any jurisdiction in which an exchange offer or the acceptance thereof would
not be in compliance with the securities or blue sky laws of such jurisdiction. Unless the context
requires otherwise, the term holder in this section means any person in whose name the old notes
are registered on our books or any other person who has obtained a properly completed bond power
from the registered holder, or any person whose old notes are held of record by DTC who desires to
deliver such old notes by book-entry transfer at DTC.
We make no recommendation to the holders of old notes as to whether to tender or refrain from
tendering all or any portion of their old notes pursuant to the exchange offer. In addition, no
one has been authorized to make any such recommendation. Holders of old notes must make their own
decision whether to tender pursuant to the exchange offer and, if so, the aggregate amount of old
notes to tender after reading this prospectus and the letter of transmittal and consulting with
their advisers, if any, based on their own financial position and requirements.
Terms of the Exchange
Upon the terms and conditions described in this prospectus and in the accompanying letter of
transmittal, which together constitute the exchange offer, we will accept for exchange old notes
which are properly tendered at or before the expiration time and not withdrawn as permitted below.
As of the date of this prospectus, $150.0 million aggregate principal amount of old notes are
outstanding. This prospectus, together with the letter of transmittal, is first being sent on or
about the date on the cover page of the prospectus to all holders of old notes known to us. Old
notes tendered in the exchange offer must be in denominations of principal amount of $2,000 and any
integral multiples of $1,000 in excess thereof.
Our acceptance of the tender of old notes by a tendering holder will form a binding agreement
between the tendering holder and us upon the terms and subject to the conditions provided in this
prospectus and in the accompanying letter of transmittal.
Expiration, Extension and Amendment
The expiration time of the exchange offer is 5:00 p.m. New York City time on ,
2010; however, we may, in our sole discretion, extend the period of time for which the exchange
offer is open and set a later expiration date. The term expiration time as used herein means the
latest time and date to which we extend the exchange offer. If we decide to extend the exchange
offer period, we will then delay acceptance of any old notes by giving oral or written notice of an
extension to the holders of old notes as described below. During any extension period, all old
notes previously tendered will remain subject to the exchange offer and may be accepted for
exchange by us. Any old notes not accepted for exchange will be returned to the tendering holder
after the expiration or termination of the exchange offer.
14
Our obligation to accept old notes for exchange in the exchange offer is subject to the
conditions described below under Conditions to the Exchange Offer. We may decide to waive any
of the conditions in our sole discretion. Furthermore, we reserve the right to amend or terminate
the exchange offer, and not to accept for exchange any old notes not previously accepted for
exchange, upon the occurrence of any of the conditions of the exchange offer specified below under
the same heading. We will give oral or written notice of any extension, amendment, non-acceptance
or termination to the holders of the old notes as promptly as practicable. If we materially change
the terms of the exchange offer, we will resolicit tenders of the old notes, file a post-effective
amendment to the registration statement and provide notice to you. If the change is made less than
five business days before the expiration of the exchange offer, we will extend the offer so that
the holders have at least five business days to tender or withdraw. We will notify you of any
extension by means of a press release or other public announcement no later than , 2010,
the first business day after the previously scheduled expiration time.
Procedures for Tendering
Valid Tender
Except as described below, a tendering holder must, prior to the expiration time, transmit to
U.S. Bank National Association, the exchange agent, at the address listed under the heading
Exchange Agent:
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a properly completed and duly executed letter of transmittal, including all other
documents required by the letter of transmittal; or |
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if old notes are tendered in accordance with the book-entry procedures listed below, an
agents message. |
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In addition, a tendering holder must: |
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deliver certificates, if any, for the old notes to the exchange agent at or before the
expiration time; or |
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deliver a timely confirmation of book-entry transfer of the old notes into the exchange
agents account at DTC, the book-entry transfer facility, along with the letter of
transmittal or an agents message. |
The term agents message means a message, transmitted by DTC to and received by the exchange
agent and forming a part of a book-entry confirmation, that states that DTC has received an express
acknowledgment that the tendering holder agrees to be bound by the letter of transmittal and that
we may enforce the letter of transmittal against this holder.
If the letter of transmittal is signed by a person other than the registered holder of old
notes, the letter of transmittal must be accompanied by a written instrument of transfer or
exchange in satisfactory form duly executed by the registered holder with the signature guaranteed
by an eligible institution. The old notes must be endorsed or accompanied by appropriate powers of
attorney. In either case, the old notes must be signed exactly as the name of any registered
holder appears on the old notes.
If the letter of transmittal or any old notes or powers of attorney are signed by trustees,
executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting
in a fiduciary or representative capacity, these persons should so indicate when signing. Unless
waived by us, proper evidence satisfactory to us of their authority to so act must be submitted.
By tendering old notes pursuant to the exchange offer, each holder will represent to us that,
among other things, the new notes are being acquired in the ordinary course of business of the
person receiving the new notes, whether or not that person is the holder, and neither the holder
nor the other person has any arrangement or understanding with any person to participate in the
distribution of the new notes. In the case of a holder that is not a broker-dealer, that holder,
by tendering old notes pursuant to the exchange offer, will also represent to us that the holder is
not engaged in and does not intend to engage in a distribution of the new notes.
15
The method of delivery of old notes, letters of transmittal and all other required documents
is at your election and risk. If the delivery is by mail, we recommend that you use registered
mail, properly insured, with return receipt requested. In all cases, you should allow sufficient
time to assure timely delivery. You should not send letters of transmittal or old notes to us.
If you are a beneficial owner whose old notes are registered in the name of a broker, dealer,
commercial bank, trust company or other nominee, and you wish to tender your old notes, you should
promptly instruct the registered holder to tender on your behalf. Any registered holder that is a
participant in DTCs book-entry transfer facility system may make book-entry delivery of the old
notes by causing DTC to transfer the old notes into the exchange agents account, including by
means of ATOP.
Signature Guarantees
Signatures on a letter of transmittal or a notice of withdrawal must be guaranteed, unless the
old notes surrendered for exchange are tendered:
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by a registered holder of the old notes who has not completed the box entitled Special
Issuance/Delivery Instructions on the letter of transmittal, or |
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for the account of an eligible institution. |
If signatures on a letter of transmittal or a notice of withdrawal are required to be
guaranteed, the guarantees must be by an eligible institution. An eligible institution is an
eligible guarantor institution meeting the requirements of the registrar for the notes, 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 for the
notes in addition to, or in substitution for, STAMP, all in accordance with the Exchange Act.
Book-Entry Transfer
The exchange agent will make a request to establish an account for the old notes at DTC for
purposes of the exchange offer within two business days after the date of this prospectus. Any
financial institution that is a participant in DTCs systems must make book-entry delivery of old
notes by causing DTC to transfer those old notes into the exchange agents account at DTC in
accordance with DTCs procedure for transfer. The participant should transmit its acceptance to
DTC at or prior to the expiration time. DTC will verify this acceptance, execute a book-entry
transfer of the tendered old notes into the exchange agents account at DTC and then send to the
exchange agent confirmation of this book-entry transfer. The confirmation of this book-entry
transfer will include an agents message confirming that DTC has received an express acknowledgment
from this participant that this participant has received and agrees to be bound by the letter of
transmittal and that we may enforce the letter of transmittal against this participant.
Delivery of new notes issued in the exchange offer may be effected through book-entry transfer
at DTC. However, the letter of transmittal or facsimile of it or an agents message, with any
required signature guarantees and any other required documents, must be transmitted to and received
by the exchange agent at the address listed under Exchange Agent at or prior to the expiration
time.
Delivery of documents to DTC in accordance with DTCs procedures does not constitute delivery
to the exchange agent.
Determination of Validity
We will determine in our sole discretion all questions as to the validity, form and
eligibility of old notes tendered for exchange. This discretion extends to the determination of
all questions concerning the timing of receipts and acceptance of tenders. These determinations
will be final and binding. We reserve the right to reject any particular old note not properly
tendered or of which our acceptance might, in our judgment or our counsels judgment, be unlawful.
We also reserve the right to waive any defects or irregularities or conditions of the exchange
16
offer as to any particular old note either before or after the expiration time, including the
right to waive the ineligibility of any tendering holder. Our interpretation of the terms and
conditions of the exchange offer as to any particular old note either before or after the
expiration time, including the letter of transmittal and the instructions to the letter of
transmittal, will be final and binding on all parties. Unless waived, any defects or
irregularities in connection with tenders of old notes must be cured within a reasonable period of
time.
Neither we, the exchange agent nor any other person will be under any duty to give
notification of any defect or irregularity in any tender of old notes. Moreover, neither we, the
exchange agent nor any other person will incur any liability for failing to give notification of
any defect or irregularity.
Acceptance of Old Notes for Exchange; Issuance of New Notes
Upon the terms and subject to the conditions of the exchange offer, we will accept, promptly
after the expiration time, all old notes properly tendered. We will issue the new notes promptly
after acceptance of the old notes. For purposes of the exchange offer, we will be deemed to have
accepted properly tendered old notes for exchange when, as and if we have given oral or written
notice to the exchange agent, with prompt written confirmation of any oral notice.
In all cases, issuance of new notes for old notes will be made only after timely receipt by
the exchange agent of:
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certificates for the old notes, or a timely book-entry confirmation of the old notes,
into the exchange agents account at the book-entry transfer facility; |
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a properly completed and duly executed letter of transmittal or an agents message; and |
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all other required documents. |
Unaccepted or non-exchanged old notes will be returned without expense to the tendering holder
of the old notes. In the case of old notes tendered by book-entry transfer in accordance with the
book-entry procedures described above, the non-exchanged old notes will be credited to an account
maintained with DTC as promptly as practicable after the expiration or termination of the exchange
offer. For each old note accepted for exchange, the holder of the old note will receive a new note
having a principal amount equal to that of the surrendered old note.
Interest Payments on the New Notes
The new notes will bear interest from the date interest was most recently paid. Accordingly,
registered holders of new notes on the relevant record date for the first interest payment date
following the completion of the exchange offer will receive interest accruing from the most recent
date through which interest has been paid. Old notes accepted for exchange will cease to accrue
interest from and after the date of completion of the exchange offer. Holders of old notes whose
old notes are accepted for exchange will not receive any payment for accrued interest on the old
notes otherwise payable on any interest payment date, the record date for which occurs on or after
completion of the exchange offer and will be deemed to have waived their rights to receive the
accrued interest on the old notes.
Withdrawal Rights
Tenders of old notes may be withdrawn at any time before the expiration time.
For a withdrawal to be effective, the exchange agent must receive a written notice of
withdrawal at the address or, in the case of eligible institutions, at the facsimile number,
indicated under Exchange Agent before the expiration time. Any notice of withdrawal must:
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specify the name of the person, referred to as the depositor, having tendered the old
notes to be withdrawn;
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17
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identify the old notes to be withdrawn, including the certificate number or numbers and
principal amount of the old notes; |
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contain a statement that the holder is withdrawing its election to have the old notes
exchanged; |
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be signed by the holder in the same manner as the original signature on the letter of
transmittal by which the old notes were tendered, including any required signature
guarantees, or be accompanied by documents of transfer to have the trustee with respect to
the old notes register the transfer of the old notes in the name of the person withdrawing
the tender; and |
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specify the name in which the old notes are registered, if different from that of the
depositor. |
If certificates for old notes have been delivered or otherwise identified to the exchange
agent, then, prior to the release of these certificates the withdrawing holder must also submit the
serial numbers of the particular certificates to be withdrawn and signed notice of withdrawal with
signatures guaranteed by an eligible institution, unless this holder is an eligible institution.
If old notes have been tendered in accordance with the procedure for book-entry transfer described
above, any notice of withdrawal must specify the name and number of the account at the book-entry
transfer facility to be credited with the withdrawn old notes.
Any old notes properly withdrawn will be deemed not to have been validly tendered for
exchange. New notes will not be issued in exchange unless the old notes so withdrawn are validly
re-tendered. Properly withdrawn old notes may be re-tendered by following the procedures described
under Procedures for Tendering above at any time at or before the expiration time.
We will determine all questions as to the validity, form and eligibility, including time of
receipt, of notices of withdrawal in our sole discretion.
Conditions to the Exchange Offer
Despite any other term of this exchange offer, we will not be required to exchange any old
notes and may terminate this exchange offer as provided in this prospectus before an acceptance of
any old notes if any of the following conditions has occurred or exists:
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there is a change in the current interpretation by the staff of the SEC, which now
permits the new notes issued pursuant to the exchange offer in exchange for old notes to be
offered for resale, resold and otherwise transferred by the holders (other than
broker-dealers and any holder which is an affiliate) without compliance with the
registration and prospectus delivery provisions of the Securities Act, provided that such
new notes are acquired in the ordinary course of such holders business and such holders
have no arrangement or understanding with any person to participate in the distribution of
the new notes; |
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any action or proceeding has been instituted or threatened in any court or by or before
any governmental agency or body with respect to the exchange offer which, in our judgment,
would reasonably be expected to impair our ability to proceed with the exchange offer; |
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any law, statute, rule or regulation has been adopted or enacted which, in our judgment,
would reasonably be expected to impair our ability to proceed with the exchange offer; |
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a banking moratorium has been declared by United States federal or New York State
authorities which, in our judgment, would reasonably be expected to impair our ability to
proceed with the exchange offer; |
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trading on the New York Stock Exchange or generally in the United States
over-the-counter market has been suspended by order of the SEC or any other governmental
authority which, in our judgment, would reasonably be expected to impair our ability to
proceed with the exchange offer; |
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an attack on the United States, an outbreak or escalation of hostilities or acts of
terrorism involving the United States, or any declaration by the United States of a
national emergency or war has occurred; |
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a stop order has been issued by the SEC or any state securities authority suspending the
effectiveness of the registration statement of which this prospectus is a part or
proceedings have been initiated or, to our
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18
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knowledge, threatened for that purpose or any governmental approval has not been obtained,
which approval we, in our sole discretion, deem necessary for the consummation of the
exchange offer; or |
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any change, or any development involving a prospective change, in our business or
financial affairs or any of our subsidiaries has occurred which is or may be adverse to us
or we have become aware of facts that have or may have an adverse impact on the value of
the old notes or the new notes, which in our sole judgment in any case makes it inadvisable
to proceed with the exchange offer and/or with the acceptance for exchange or with the
exchange. |
If we determine in our sole discretion that any of the foregoing events or conditions has
occurred or exists, we may, subject to applicable law, terminate the exchange offer, whether or not
any old notes have been accepted for exchange, or may waive any such condition or otherwise amend
the terms of the exchange offer in any respect. See Expiration, Extension and Amendment above.
Resales of New Notes
Based on interpretations by the staff of the SEC, as described in no-action letters issued to
third parties, we believe that the new notes issued in the exchange offer in exchange for old notes
may be offered for resale, resold or otherwise transferred by holders of the old notes without
compliance with the registration and prospectus delivery provisions of the Securities Act, if:
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the new notes are acquired in the ordinary course of the holders business; |
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the holders have no arrangement or understanding with any person to participate in the
distribution of the new notes; and |
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the holders are not affiliates of ours within the meaning of Rule 405 under the
Securities Act. |
However, the SEC has not considered the exchange offer described in this prospectus in the
context of a no-action letter. We cannot assure you that the staff of the SEC would make a similar
determination with respect to the exchange offer as in the other circumstances. Each holder who
wishes to exchange old notes for new notes will be required to represent that it meets the above
three requirements.
Any holder who is an affiliate of ours or who intends to participate in the exchange offer for
the purpose of distributing new notes or any broker-dealer who purchased old notes directly from us
to resell pursuant to Rule 144A or any other available exemption under the Securities Act:
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may not rely on the applicable interpretations of the staff of the SEC described above; |
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will not be permitted or entitled to tender the old notes in the exchange offer; and |
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must comply with the registration and prospectus delivery requirements of the Securities
Act in connection with any resale transaction. |
Each broker-dealer that receives new notes for its own account in exchange for old notes,
where such securities were acquired by such broker-dealer as a result of market making activities
or other trading activities, must acknowledge that it will deliver a prospectus that meets the
requirements of the Securities Act in connection with any resale of the new notes. The letter of
transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an underwriter within the meaning of the Securities Act. See
Plan of Distribution.
In addition, to comply with state securities laws, the new notes may not be offered or sold in
any state unless they have been registered or qualified for sale in such state or an exemption from
registration or qualification, with which there has been compliance, is available. The offer and
sale of the new notes to qualified institutional buyers, as defined under Rule 144A of the
Securities Act, is generally exempt from registration or qualification under the state securities
laws. We currently do not intend to register or qualify the sale of new notes in any state where
an exemption from registration or qualification is required and not available.
19
Exchange Agent
U.S. Bank National Association has been appointed as the exchange agent for the exchange
offer. All executed letters of transmittal and any other required documents should be directed to
the exchange agent at the address or facsimile number set forth below. Questions and requests for
assistance, requests for additional copies of this prospectus or of the letter of transmittal and
requests for notices of guaranteed delivery should be directed to the exchange agent addressed as
follows:
U.S. BANK NATIONAL ASSOCIATION
AS EXCHANGE AGENT
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By facsimile transmission: |
In person, by registered or certified mail or overnight courier:
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(For eligible institutions only) |
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60 Livingston Avenue
St. Paul, Minnesota 55107
Attn: Specialized Finance Department
Tel (Toll-Free): 800-934-6802
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651-495-8158
Attn: Specialized Finance Department |
Delivery of the letter of transmittal to an address other than as set forth above or
transmission of the letter of transmittal via a facsimile transmission to a number other than as
set forth above will not constitute a valid delivery of the letter of transmittal. Delivery of
documents to DTC does not constitute delivery to the exchange agent.
Regulatory Approval
Other than the federal securities laws, there are no federal or state regulatory requirements
that we must comply with and there are no approvals that we must obtain in connection with the
exchange offer.
Fees and Expenses
We have agreed to pay the exchange agent reasonable and customary fees for its services and
will reimburse it for its reasonable out-of-pocket expenses in connection with the exchange offer.
We will also pay brokerage houses and other custodians, nominees and fiduciaries the reasonable
out-of-pocket expenses incurred by them in forwarding copies of this prospectus and related
documents to the beneficial owners of old notes, and in handling or tendering for their customers.
We will not make any payment to brokers, dealers or others for soliciting acceptances of the
exchange offer.
Holders who tender their old notes for exchange will not be obligated to pay any transfer
taxes on the exchange. If, however, new notes are to be delivered to, or are to be issued in the
name of, any person other than the registered holder of the old notes tendered, or if a transfer
tax is imposed for any reason other than the exchange of old notes in connection with the exchange
offer, then the amount of any such transfer taxes (whether imposed on the registered holder or any
other persons) will be payable by the tendering holder. If satisfactory evidence of payment of
such taxes or exemption therefrom is not submitted with the letter of transmittal, the amount of
such transfer taxes will be billed directly to such tendering holder.
Accounting Treatment
We will record the new notes at the same carrying value as the old notes, as reflected in our
accounting records on the date of the exchange. Accordingly, we will not recognize any gain or
loss for accounting purposes. The expenses of the exchange offer will be amortized over the term of
the new notes.
20
USE OF PROCEEDS
This exchange offer is intended to satisfy our obligations under the registration rights
agreement that we entered into when we issued the old notes. We will not receive any cash proceeds
from this exchange offer. In exchange for old notes that you tender pursuant to this exchange
offer, you will receive new notes in like principal amount. The old notes surrendered in exchange
for the new notes will be retired and cancelled by us upon receipt and cannot be reissued.
Accordingly, the issuance of the new notes under this exchange offer will not result in any change
in our capitalization.
21
SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA
The following table provides our selected historical consolidated financial data as of and for
each of the fiscal years in the five-year period ended March 31, 2010. The data as of and for each
of the fiscal years in the five-year period ended March 31, 2010 have been derived from our audited
financial statements. You should consider the financial statement data provided below in
conjunction with Managements Discussion and Analysis of Financial Condition and Results of
Operations and the consolidated financial statements and related notes in Prestige Brands
Holdings, Inc.s Annual Report on Form 10-K for the fiscal year ended March 31, 2010, incorporated
herein by reference.
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Year Ended March 31, |
(In thousands, except per share data) |
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2010 |
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2009 |
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2008 |
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2007 |
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2006 |
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Income Statement Data: |
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Total revenues |
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$ |
302,023 |
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$ |
303,147 |
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$ |
315,107 |
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$ |
306,127 |
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$ |
282,577 |
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Cost of sales (1) |
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144,587 |
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144,196 |
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151,811 |
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146,570 |
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132,218 |
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Gross profit |
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157,436 |
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158,951 |
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163,296 |
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159,557 |
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150,359 |
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Advertising and promotion expenses |
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31,236 |
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37,777 |
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34,243 |
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31,500 |
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31,278 |
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Depreciation and amortization |
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10,552 |
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|
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9,423 |
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|
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9,219 |
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|
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8,589 |
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8,053 |
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General and administrative |
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34,195 |
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31,888 |
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31,414 |
|
|
|
28,417 |
|
|
|
21,137 |
|
Impairment of goodwill and intangibles |
|
|
2,751 |
|
|
|
249,285 |
|
|
|
|
|
|
|
|
|
|
|
1,892 |
|
Interest expense, net |
|
|
22,935 |
|
|
|
28,436 |
|
|
|
37,393 |
|
|
|
39,536 |
|
|
|
36,387 |
|
Other (income) expense |
|
|
2,656 |
|
|
|
|
|
|
|
(187 |
) |
|
|
(30 |
) |
|
|
(41 |
) |
|
|
|
Income (loss) from continuing operations before
income taxes |
|
|
53,111 |
|
|
|
(197,858 |
) |
|
|
51,214 |
|
|
|
51,545 |
|
|
|
51,653 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes |
|
|
21,849 |
|
|
|
(9,905 |
) |
|
|
19,168 |
|
|
|
17,841 |
|
|
|
23,114 |
|
|
|
|
Income (loss) from continuing operations |
|
|
31,262 |
|
|
|
(187,953 |
) |
|
|
32,046 |
|
|
|
33,704 |
|
|
|
28,539 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from discontinued operations,
net of
income tax |
|
|
696 |
|
|
|
1,177 |
|
|
|
1,873 |
|
|
|
2,375 |
|
|
|
(2,262 |
) |
Gain on sale of discontinued operations, net of
income tax |
|
|
157 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cumulative preferred dividends |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) available to common stockholders |
|
$ |
32,115 |
|
|
$ |
(186,776 |
) |
|
$ |
33,919 |
|
|
$ |
36,079 |
|
|
$ |
26,277 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
0.63 |
|
|
$ |
(3.76 |
) |
|
$ |
0.64 |
|
|
$ |
0.68 |
|
|
$ |
0.58 |
|
|
|
|
Net income (loss) |
|
$ |
0.64 |
|
|
$ |
(3.74 |
) |
|
$ |
0.68 |
|
|
$ |
0.73 |
|
|
$ |
0.54 |
|
|
|
|
Diluted earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
|
$ |
0.62 |
|
|
$ |
(3.76 |
) |
|
$ |
0.64 |
|
|
$ |
0.67 |
|
|
$ |
0.57 |
|
|
|
|
Net income (loss) |
|
$ |
0.64 |
|
|
$ |
(3.74 |
) |
|
$ |
0.68 |
|
|
$ |
0.72 |
|
|
$ |
0.53 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
50,013 |
|
|
|
49,935 |
|
|
|
49,751 |
|
|
|
49,460 |
|
|
|
48,908 |
|
|
|
|
Diluted |
|
|
50,085 |
|
|
|
49,935 |
|
|
|
50,039 |
|
|
|
50,020 |
|
|
|
50,008 |
|
|
|
|
22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended March 31, |
Other Financial Data: |
|
2010 |
|
2009 |
|
2008 |
|
2007 |
|
2006 |
|
|
|
Capital expenditures |
|
$ |
673 |
|
|
$ |
481 |
|
|
$ |
488 |
|
|
$ |
540 |
|
|
$ |
519 |
|
Cash provided by (used in): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities |
|
|
59,427 |
|
|
|
66,679 |
|
|
|
44,989 |
|
|
|
71,899 |
|
|
|
53,861 |
|
Investing activities |
|
|
7,320 |
|
|
|
(4,672 |
) |
|
|
(537 |
) |
|
|
(31,051 |
) |
|
|
(54,163 |
) |
Financing activities |
|
|
(60,831 |
) |
|
|
(32,904 |
) |
|
|
(52,132 |
) |
|
|
(35,290 |
) |
|
|
3,168 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of earnings to fixed charges (2) |
|
|
3.29x |
|
|
|
|
|
|
|
2.34x |
|
|
|
2.27x |
|
|
|
2.39x |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, |
Balance Sheet Data: |
|
2010 |
|
2009 |
|
2008 |
|
2007 |
|
2006 |
|
|
|
Cash and cash equivalents |
|
$ |
41,097 |
|
|
$ |
35,181 |
|
|
$ |
6,078 |
|
|
$ |
13,758 |
|
|
$ |
8,200 |
|
Total assets |
|
|
791,412 |
|
|
|
801,381 |
|
|
|
1,049,156 |
|
|
|
1,063,416 |
|
|
|
1,038,645 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total long-term debt, including current maturities |
|
|
328,087 |
|
|
|
378,337 |
|
|
|
411,225 |
|
|
|
463,350 |
|
|
|
498,630 |
|
Stockholders equity |
|
|
329,059 |
|
|
|
294,385 |
|
|
|
479,073 |
|
|
|
445,334 |
|
|
|
409,407 |
|
|
|
|
(1) |
|
For 2006 and 2007, cost of sales included $248,000 and $276,000, respectively, of charges
related to the step-up of inventory. |
|
(2) |
|
For the purposes of computing the ratio of earnings to fixed charges, earnings consist of
income (loss) from continuing operations before income taxes plus fixed charges. Fixed charges
consist of interest expense on indebtedness, capitalized fees associated with indebtedness, and
estimated interest on rental expense. For the purpose of computing interest on rental expense the
company used a reasonable approximation of the interest factor. For the year ended March 31, 2009,
earnings were insufficient to cover fixed charges primarily due to a non-cash impairment charge
against goodwill and intangible assets of $249.3 million. |
23
DESCRIPTION OF OTHER INDEBTEDNESS
The following is a summary of our indebtedness that is currently outstanding. The following
descriptions do not purport to be complete and are qualified in their entirety by reference to the
full text of such contract or other document filed as an exhibit to the registration statement, or
incorporated by reference herein.
Existing Outstanding Indebtedness
As of June 30, 2010, we had an aggregate of $299.6 million of outstanding indebtedness, which
consisted of the following:
|
|
|
$149.6 million of borrowings under our senior secured credit facilities; and |
|
|
|
|
$150.0 million of senior notes. |
As of June 30, 2010, we had an additional $30 million available for borrowing under our
revolving credit facilities.
This exchange offer will not alter our existing indebtedness. We will not receive proceeds
from the issuance of the new notes offered hereby. In consideration for issuing the new notes in
exchange for old notes as described in this prospectus, we will receive old notes of like principal
amount. The old notes surrendered in exchange for the new notes will be retired and cancelled by
us upon receipt and cannot be reissued. For a more complete description of the terms of our
existing indebtedness, see Managements Discussion and Analysis of Financial Condition and Results
of Operations in Prestige Brands Holdings, Inc.s Annual Report on Form 10-K for the fiscal year
ended March 31, 2010, incorporated herein by reference.
Senior Secured Credit Facilities
On March 24, 2010, Prestige Brands, Inc. (for purposes of this description, the borrower) and
Prestige Brands Holdings, Inc. entered into senior secured credit facilities, which we refer to as
the senior secured credit facilities, with Bank of America, N.A., as administrative agent, Deutsche
Bank Securities Inc., as syndication agent, and a syndicate of financial institutions and
institutional lenders.
The senior secured credit facilities provide for:
|
|
|
a senior secured term loan facility in an aggregate principal amount of $150 million;
and |
|
|
|
|
a non-amortizing senior secured revolving credit facility in an aggregate principal
amount of up to $30 million (a portion of this facility is available for swing loans and
for the issuance of letters of credit). |
A portion of the net proceeds of the senior secured credit facilities, along with cash on hand
and the proceeds of the offering of the old notes, were used to purchase, redeem or otherwise
retire all of our 91/4% senior subordinated notes due 2012 and to repay all amounts under our former
credit facility and terminate the associated credit agreement. We may use the revolving credit
facility for working capital and general corporate needs.
Uncommitted Incremental Increases. The borrower has the right to increase the commitments
under the senior secured credit facilities by up to $200.0 million, provided certain conditions are
met. None of the lenders under the senior secured credit facilities has committed or is obligated
to provide any such increase in the commitments.
Collateral and Guarantees. All obligations of the borrower under the senior secured credit
facilities and any exposure in respect of secured cash management transactions incurred on behalf
of the borrower or any other loan party, or under any secured interest rate agreement or other
secured hedging arrangements entered into with any of the lenders, is unconditionally guaranteed by
the guarantors party thereto, including Prestige Brands Holdings, Inc., and, under certain limited
circumstances, certain of Prestige Brands Holdings, Inc.s future foreign subsidiaries.
24
Except as provided below, the obligations under the senior secured credit facilities are
secured by a first-priority security interest in substantially all of the assets of the borrower
and each guarantor party thereto, including but not limited to:
|
|
|
a perfected, first-priority pledge of all of the capital stock held by the borrower or
any guarantor party thereto, except for 35% of the voting stock of certain non-U.S.
subsidiaries, to the extent that such pledge would result in adverse tax consequences to
the borrower or a guarantor party thereto, and |
|
|
|
|
perfected first-priority security interests in substantially all other tangible and
intangible assets of the borrower and the guarantors party thereto.
|
|
|
|
|
Interest and Fees. All loans will bear interest, at the option of the borrower, at one of the
following rates: |
|
|
|
|
Base Rate Loans. (1) at a rate per annum equal at all times to the highest of (a) Bank
of America N.A.s prime rate; (b) 0.50% per annum plus the Federal Funds Rate; and (c)
the Eurodollar Rate for an interest period of one month plus 1.00% plus (2) the applicable
margin then in effect.
|
|
|
|
|
Eurodollar Rate Loans. At a rate per annum equal to the sum of (a) the Eurodollar Rate
determined for the applicable interest period and (b) the applicable margin then in effect. |
Default Interest. During the continuance of a material event of default or, upon (i) receipt
by the borrower of a notice from the administrative agent or (ii) receipt by the administrative
agent of a notice from the requisite lenders, during the continuance of any other event of default,
loans shall bear interest at an additional 2.0% per annum.
Unused Commitment Fee. An unused commitment fee equal to 0.50% per annum of the daily average
unused portion of the revolving credit facility will accrue, payable quarterly in arrears and at
maturity of the revolving credit facility.
Repayment; Prepayments. The term loan facility will mature on March 24, 2016. Each loan
thereunder will amortize during the period such loan is outstanding in quarterly installments that
shall each be equal to 0.25% of the initial principal amount of the loans made under the term loan
facility with the balance of such loan payable on the maturity date.
The revolving credit facility will mature, and the revolving credit commitments relating
thereto will terminate, on March 24, 2015.
Optional prepayments of borrowings under the senior secured credit facilities, and optional
reductions of the unutilized portion of the revolving credit facility commitments, will be
permitted at any time, in minimum principal amounts, without premium or penalty, subject to
reimbursement of the lenders redeployment costs in the case of a prepayment of Eurodollar Rate
borrowings other than a prepayment made on the last day of the relevant interest period.
Mandatory Prepayments. The senior secured credit facilities require, subject to certain
exceptions, prepayments from excess cash flow, and from the proceeds of certain asset sales,
issuances of debt, and insurance.
Certain Covenants. The senior secured credit facilities require the borrower to meet certain
financial tests, including without limitation, a maximum leverage ratio, a minimum interest
coverage ratio and a maximum capital expenditures covenant. In addition, the senior secured credit
facilities contain certain representations and warranties and affirmative and negative covenants
which, among other things, limit the incurrence of additional indebtedness, guarantees,
investments, distributions, transaction with affiliates, asset sales, acquisitions, capital
expenditures, mergers and consolidations, prepayment of other indebtedness, liens and encumbrances
and other matters customarily restricted in such agreements.
Events of Default. The senior secured credit facilities contain customary events of default,
including, without limitation, payment defaults, breaches of representations and warranties,
covenant defaults, cross-defaults to
25
certain other indebtedness in excess of specified amounts, certain events of bankruptcy and
insolvency, certain ERISA events, judgment defaults in excess of specified amounts, failure of any
guaranty or security document or any subordination provision supporting the senior secured credit
facilities to be in full force and effect and change in control.
For a more complete description of the terms of the senior secured credit facilities, please refer
to the credit agreement, a copy of which is filed as an exhibit to Prestige Brand Holdings, Inc.s
Annual Report on Form 10-K for the fiscal year ended March 31, 2010, incorporated herein by
reference.
26
DESCRIPTION OF THE NEW NOTES
You can find the definitions of certain terms used in this description under the subheading
Certain Definitions. In this description, the word Company refers only to Prestige Brands,
Inc. and any successor entity, the issuer of the notes, and not to any of its Subsidiaries, and
Parent refers to Prestige Brands Holdings, Inc. and any successor entity (the owner of 100% of
the outstanding capital stock of the Company) and not to any of its Subsidiaries.
The Company issued the old notes under an indenture dated as of March 24, 2010, among the
Company, the Guarantors and U.S. Bank National Association, as 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. Any old notes that remain outstanding after completion of the
exchange offer, together with the new notes issued in the exchange offer, will be treated as a
single class of securities under the indenture.
You are advised to read the indenture because it, and not this description, defines your
rights as a holder of the notes. A copy of the indenture is available upon request to us at the
address indicated under Where You Can Find Additional Information.
Principal, Maturity and Interest
The Company is issuing $150.0 million aggregate principal amount of new notes in the exchange
offer and, subject to compliance with the limitations described under Certain Covenants
Limitation on Debt, an unlimited principal amount of additional notes at later dates under the
same indenture. The Company can issue the additional notes as part of the same series or as an
additional series. Any additional notes that the Company issues in the future will be identical in
all respects to the new notes, except that notes issued in the future will have different issuance
dates and may have different issuance prices. The Company will issue notes only in fully
registered form without coupons, in denominations of $2,000 and integral multiples of $1,000.
The notes will mature on April 1, 2018.
Interest on the notes will accrue at a rate of 8.25% per annum and will be payable
semi-annually in arrears on each April 1 and October 1, commencing on October 1, 2010. The Company
will pay interest to those persons who were holders of record on the March 15 or September 15
immediately preceding each interest payment date.
Interest on the notes will accrue from the date of original issuance or, if interest has
already been paid, from the date it was most recently paid. Interest will be computed on the basis
of a 360-day year comprised of twelve 30-day months.
The Notes
The notes will be:
|
|
|
senior unsecured obligations of the Company; |
|
|
|
|
guaranteed on a senior unsecured basis by the Guarantors; |
|
|
|
|
effectively junior in right of payment to all existing and future secured
obligations of the Company and the Guarantors, including the Companys and the
Guarantors obligations under the Senior Secured Credit Facilities, to the extent of
the collateral securing such obligations; |
|
|
|
|
equal (pari passu) in right of payment with all existing and future unsecured
indebtedness of the Company and the Guarantors (other than Subordinated Debt); and |
|
|
|
|
senior in right of payment to all future Subordinated Debt of the Company and the
Guarantors. |
A portion of the operations of the Parent and the Company are conducted through their
Subsidiaries. Therefore, the Companys ability to service its debt, including the notes, is
partially dependent upon the cash flows
27
of the Subsidiaries of the Company and the Parent and, to the extent they are not Guarantors,
their ability to distribute those cash flows as dividends, loans or other payments to the Company.
Certain laws may restrict the ability of the Parents and the Companys Subsidiaries to pay them
dividends or make loans and advances to them. If these restrictions are applied to Subsidiaries
that are not Guarantors, then the Company would not be able to use the cash flows of those
Subsidiaries to make payments on the notes. Furthermore, under certain circumstances, bankruptcy
fraudulent conveyance laws or other similar laws could invalidate the Guarantees of the Parent
and of Guarantors that are Subsidiaries of the Parent. If this were to occur, the Company would
also be unable to use the cash flows of these Guarantors to the extent they face restrictions on
distributing funds to the Company. Any of the situations described above could make it more
difficult for the Company to service its debt.
In addition, the Company only has a stockholders claim in the assets of its Subsidiaries.
This stockholders claim is junior to the claims that creditors of the Companys Subsidiaries have
against those Subsidiaries. Holders of the notes will only be creditors of the Company and those
Subsidiaries of the Parent that are Guarantors. In the case of Subsidiaries of the Parent that are
not Guarantors, all the existing and future liabilities of those Subsidiaries, including any claims
of trade creditors and preferred stockholders, will be effectively senior to the notes.
The Guarantors and the Parents non-Guarantor Subsidiaries have other liabilities, including
contingent liabilities, that may be significant. The indenture contains limitations on the amount
of additional Debt that the Parent and its Restricted Subsidiaries may Incur. However, the amounts
of such Debt could nevertheless be substantial and may be Incurred either by Guarantors or by the
Parents non-Guarantor Subsidiaries.
Because certain indebtedness of the Company or the Guarantors is secured, including
obligations under the Senior Secured Credit Facilities, certain holders of certain senior debt of
the Company or the Guarantors may recover disproportionately more than the holders of the notes
recover in a bankruptcy or similar proceeding relating to the Company or a Guarantor. This could
apply even if the notes or the applicable Guarantee rank pari passu with the other creditors
claims. In such a case, there may be insufficient assets, or no assets, remaining to pay the
principal of or interest on the notes.
Note Guarantees
The obligations of the Company under the indenture, including the repurchase obligation
resulting from a Change of Control, will be fully and unconditionally guaranteed, jointly and
severally, on a senior unsecured basis, by the Parent and all of its existing and future Domestic
Restricted Subsidiaries (other than the Company). See Certain Covenants Future Guarantors.
If the Parent, the Company or a Guarantor, sells or otherwise disposes of either:
(1) all of the Capital Stock of a Guarantor, or
(2) all or substantially all the assets of such Guarantor,
in each case, to a Person that is not a Subsidiary of the Parent, then in any such case, such
Guarantor will be released from all its obligations under its Guarantee. Also, if we defease the
notes, as provided under Defeasance, all Guarantors will be released from their obligations
under the Guarantees. In addition, if the Company redesignates a Guarantor as an Unrestricted
Subsidiary, which the Company can do under certain circumstances, the redesignated Guarantor will
be released from all its obligations under its Guarantee. See Certain Covenants Designation
of Restricted and Unrestricted Subsidiaries, Limitation on Issuance or Sale of Capital Stock
of Restricted Subsidiaries and Merger, Consolidation and Sale of Property.
Optional Redemption
Except as set forth below, the notes will not be redeemable at the option of the Company prior
to April 1, 2014. Starting on that date, the Company may redeem all or any portion of the notes,
at once or over time, after giving the required notice under the indenture. The notes may be
redeemed at the redemption prices set forth below,
28
plus accrued and unpaid interest, including Special Interest, if any, to but excluding 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). The following prices are for notes redeemed
during the 12-month period commencing on April 1 of the years set forth below, and are expressed as
percentages of principal amount:
|
|
|
|
|
Year |
|
Redemption Price |
2014 |
|
|
104.125 |
% |
2015 |
|
|
102.063 |
% |
2016 and thereafter |
|
|
100.000 |
% |
At any time prior to April 1, 2014, the Company may redeem all or any portion of the notes, at
once or over time, after giving the required notice under the indenture at a redemption price equal
to the greater of:
(a) 100% of the principal amount of the notes to be redeemed, and
(b) the sum of the present values of (1) the redemption price of the notes at April 1,
2014 (as set forth in the preceding paragraph) and (2) the remaining scheduled payments of
interest from the redemption date through, April 1, 2014, but excluding accrued and unpaid
interest through the redemption date, discounted to the redemption date (assuming a 360 day
year consisting of twelve 30 day months), at the Treasury Rate plus 50 basis points, plus,
in either case, accrued and unpaid interest, including Special Interest, if any, to but
excluding 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).
In addition, at any time and from time to time, prior to April 1, 2013, the Company may redeem
up to a maximum of 35% of the original aggregate principal amount of the notes (including the
original aggregate principal amount of any additional notes) with the proceeds of one or more
Equity Offerings, at a redemption price equal to 108.250% of the principal amount thereof, plus
accrued and unpaid interest, including Special Interest thereon, if any, to but excluding 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); provided, however, that after giving effect to
any such redemption, at least 65% of the original aggregate principal amount of the notes issued on
the Issue Date (and the original aggregate principal amount of any additional notes) remains
outstanding. Any such redemption shall be made within 90 days of such Equity Offering upon not
less than 30 nor more than 60 days prior notice.
Any notice to holders of notes of such a redemption shall include the appropriate calculation
of the redemption price, but need not include the redemption price itself. The actual redemption
price, calculated as described above, shall be set forth in an Officers Certificate delivered to
the Trustee no later than two business days prior to the redemption date unless clause (b) of the
definition of Comparable Treasury Price is applicable, in which case such Officers Certificate
should be delivered on the redemption date.
Sinking Fund
There will be no mandatory sinking fund payments for the notes.
Repurchase at the Option of Holders Upon a Change of Control
Upon the occurrence of a Change of Control, each holder of notes shall have the right to
require the Company to repurchase all or any part of such holders notes pursuant to the offer
described below at a purchase price equal to 101% of the principal amount of notes repurchased,
plus accrued and unpaid interest, including Special Interest, if any, to the repurchase date
(subject to the right of holders of record on the relevant record date to receive interest due on
the relevant interest payment date).
Within 30 days following any Change of Control, the Company shall:
(a) cause a notice of the Change of Control offer to be sent at least once to the Dow
Jones News Service or similar business news service in the United States; and
29
(b) send, by first-class mail, with a copy to the Trustee, to each holder of notes, at
such holders address appearing in the security register of the Company, a notice stating:
(1) that a Change of Control has occurred and a Change of Control offer is
being made pursuant to the covenant entitled Repurchase at the Option of Holders
Upon a Change of Control and that all notes timely tendered will be accepted for
payment;
(2) the Change of Control purchase price and the repurchase date, which shall
be, subject to any contrary requirements of applicable law, a business day no
earlier than 30 days nor later than 60 days from the date such notice is mailed;
(3) the circumstances and relevant facts regarding the Change of Control; and
(4) the procedures that holders of notes must follow in order to tender their
notes (or portions of notes) for payment, and the procedures that holders of notes
must follow in order to withdraw an election to tender notes (or portions of notes)
for payment.
The Company will not be required to make a Change of Control offer following a Change of
Control if (i) a third party makes the Change of Control offer in the manner, at the times and
otherwise in compliance with the requirements set forth in the indenture applicable to a Change of
Control offer made by the Company and purchases all notes validly tendered and not withdrawn under
such Change of Control offer or (ii) an irrevocable notice of redemption for all outstanding notes
has been given in accordance with the indenture. A Change of Control offer may be made in advance
of a Change of Control, conditional upon the Change of Control, if a definitive agreement is in
place for the Change of Control at the time the Change of Control offer is made.
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 a Change of Control offer. To the extent that the provisions of any securities
laws or regulations conflict with the provisions of this covenant, the Company will comply with the
applicable securities laws and regulations and will not be deemed to have breached its obligations
under this covenant by virtue of such compliance.
Management has no present intention to engage in a transaction involving a Change of Control,
although it is possible that the Parent or the Company would decide to do so in the future. Subject
to certain covenants described below, the Parent or the Company could, in the future, enter into
certain transactions, including acquisitions, refinancings or other recapitalizations, that would
not constitute a Change of Control under the indenture, but that could increase the amount of debt
outstanding at such time or otherwise affect the Parents or the Companys capital structure or
credit ratings.
The definition of Change of Control includes a phrase relating to the sale, transfer, lease,
conveyance or other disposition of all or substantially all the Property of the Parent and its
Restricted Subsidiaries, considered as a whole. Although there is a developing body of case law
interpreting the phrase substantially all, there is no precise established definition of the
phrase under applicable law. Accordingly, if the Parent and its Restricted Subsidiaries,
considered as a whole, dispose of less than all this Property by any of the means described above,
the ability of a holder of notes to require the Company to repurchase its notes may be uncertain.
In such a case, holders of the notes may not be able to resolve this uncertainty without resorting
to legal action.
The Senior Secured Credit Facilities provide that the occurrence of certain of the events that
would constitute a Change of Control would constitute a default under the Senior Secured Credit
Facilities. Additionally, other future debt of the Parent and its Subsidiaries may contain
prohibitions of certain events which would constitute a Change of Control or require such debt to
be repurchased upon a Change of Control. The exercise by holders of notes of their right to
require the Company to repurchase such notes could cause a default under the Senior Secured Credit
Facilities or future debt of the Parent and its Subsidiaries, even if the Change of Control itself
does not, due to the financial effect of such repurchase on the Company. Finally, the Companys
ability to pay cash to holders of notes upon a repurchase may be limited by the Companys then
existing financial resources. The Company cannot assure you that sufficient funds will be
available when necessary to make any required repurchases. The Companys
30
failure to repurchase notes in connection with a Change of Control would result in a default
under the indenture. Such a default would, in turn, constitute a default under the Senior Secured
Credit Facilities and may constitute a default under future debt as well. The Companys obligation
to make an offer to repurchase the notes as a result of a Change of Control may be waived or
modified at any time prior to the occurrence of such Change of Control with the written consent of
the holders of at least a majority in aggregate principal amount of the notes. See Amendments
and Waivers.
Certain Covenants
Limitation on Debt. The Parent and the Company shall not, and shall not permit any of their
respective Restricted Subsidiaries to, Incur, directly or indirectly, any Debt, including any
Acquired Debt (other than Permitted Debt) unless, after giving effect to the application of the
proceeds of the Debt, no Default or Event of Default would occur as a consequence of such
Incurrence or be continuing following such Incurrence and such Debt is Debt of the Company or a
Guarantor and, after giving effect to the Incurrence of such Debt and the application of the
proceeds of the Debt, the Consolidated Interest Coverage Ratio would be at least 2.00 to 1.00.
Permitted Debt is defined to include the following:
(a)(i) Debt of the Company evidenced by the old notes, the new notes, any additional notes and
any notes issued in exchange for any additional notes, and (ii) Debt of the Guarantors evidenced by
Guarantees relating to the old notes, the new notes, any additional notes and any notes issued in
exchange for any additional notes;
(b) Debt of the Parent or a Restricted Subsidiary of the Parent under Credit Facilities;
provided that the aggregate principal amount of all such Debt under Credit Facilities at any one
time outstanding shall not exceed $380.0 million; provided, further, that such amount shall be
permanently reduced by (x) the amount of Net Available Cash used to Repay Debt under Credit
Facilities (to the extent, in the case of any revolving credit Debt, such Repayment effects a
corresponding commitment reduction thereunder) and not subsequently reinvested in Additional Assets
or used to purchase notes or Repay other Debt, pursuant to the covenant described under
Limitation on Asset Sales and (y) any amounts outstanding under Permitted Receivables Financings;
(c) Debt of the Parent 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 of the Debt) of the Property acquired, constructed or leased,
and
(2) the aggregate principal amount of all Debt Incurred and then outstanding pursuant
to this clause (c) (together with all Permitted Refinancing Debt Incurred and then
outstanding in respect of Debt previously Incurred pursuant to this clause (c)) does not
exceed $20.0 million;
(d) Debt of the Parent owing to and held by any Restricted Subsidiary and Debt of a Restricted
Subsidiary owing to and held by the Parent or any Restricted Subsidiary; provided, 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 Parent or a Restricted Subsidiary) shall be deemed, in each case, to constitute
the Incurrence of such Debt by the issuer of the Debt; provided, further, however, that if the
Company or any Guarantor is the obligor on any such Debt and the lender is not an obligor on the
notes, such Debt must be expressly subordinated in right of payment to the prior payment in full of
all obligations with respect to the notes and the Guarantees, as the case may be;
(e) Acquired Debt of a Restricted Subsidiary outstanding on the date on which such Restricted
Subsidiary is acquired by the Parent or a Restricted Subsidiary or otherwise becomes a Restricted
Subsidiary (other than Acquired Debt Incurred as consideration in, or to provide all or any portion
of the funds or credit support utilized to consummate, the transaction or series of transactions
pursuant to which such Restricted Subsidiary became a Subsidiary of the Parent or another
Restricted Subsidiary or was otherwise acquired by the Parent or another Restricted Subsidiary);
provided that at the time such Restricted Subsidiary is acquired by the Parent or another
31
Restricted Subsidiary or otherwise becomes a Restricted Subsidiary and after giving effect to
the Incurrence of such Acquired Debt, the Company would have been able to Incur $1.00 of additional
Debt pursuant to the first paragraph of this covenant;
(f) Debt of the Parent or any Restricted Subsidiary under Interest Rate Agreements entered
into for the purpose of fixing, hedging or swapping interest rate risk in the ordinary course of
the financial management of the Parent or such Restricted Subsidiary and not for speculative
purposes; provided that the obligations under such agreements are directly related to payment
obligations on Debt otherwise permitted by the terms of this covenant;
(g) Debt of the Parent or any Restricted Subsidiary under Currency Exchange Protection
Agreements entered into for the purpose of fixing, hedging or swapping currency exchange rate risks
directly related to transactions entered into by the Parent or such Restricted Subsidiary in the
ordinary course of business and not for speculative purposes;
(h) Debt of the Parent or any Restricted Subsidiary under Commodity Price Protection
Agreements entered into in the ordinary course of the financial management of the Parent or such
Restricted Subsidiary and not for speculative purposes;
(i) Debt in connection with one or more standby letters of credit or performance or surety
bonds issued by the Parent 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;
(j) the guarantee by the Parent or any Restricted Subsidiary of Debt of the Parent or any
Restricted Subsidiary that was permitted to be incurred by another provision of the indenture;
(k) Debt represented by agreements of the Parent or a Restricted Subsidiary providing for
indemnification, adjustment of purchase price, earn out or similar obligations, or from guarantees
or letters of credit, surety bonds, escrow accounts or performance bonds securing any obligation of
the Parent or a Restricted Subsidiary pursuant to such agreements, in each case, incurred in
connection with the acquisition or disposition of any business or assets otherwise permitted under
the indenture; provided that the maximum liability in respect of all such Debt shall at no time
exceed the gross proceeds actually received by the Parent and its Restricted Subsidiaries in
connection with such acquisition or disposition;
(l) Debt arising from the honoring by a bank or other financial institution of a check, draft
or similar instrument inadvertently drawn against insufficient funds in the ordinary course of
business; provided, however, that such Debt is extinguished within five business days of
incurrence;
(m) the Incurrence by a Securitization Subsidiary of Non-Recourse Debt in connection with or
pursuant to a Permitted Receivables Financing;
(n) Debt of a Foreign Restricted Subsidiary that is Incurred solely for working capital
purposes; provided that the aggregate principal amount of all Debt Incurred and outstanding under
this clause (n) (together with all Permitted Refinancing Debt Incurred and then outstanding under
this clause (n)) does not exceed $10.0 million;
(o) Debt of the Parent or a Restricted Subsidiary outstanding on the Issue Date not otherwise
described in clauses (a) through (n) above;
(p) Debt of the Company or a Guarantor not otherwise permitted under the preceding clauses (a)
through (o) in an aggregate principal amount (or accreted value, as applicable) outstanding at any
one time not to exceed $20.0 million; and
(q) Permitted Refinancing Debt Incurred in respect of Debt Incurred pursuant to the first
paragraph of this covenant and clauses (a), (c), (e), (n) and (o) above.
Notwithstanding anything to the contrary contained in this covenant,
32
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(1) |
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the Parent and the Company shall not, and shall not permit any Guarantor to,
Incur any Debt pursuant to paragraph (q) of this covenant if the proceeds of the Debt
are used, directly or indirectly, to Refinance any Subordinated Debt unless such Debt
shall be subordinated to the notes or the applicable Guarantee, as the case may be, to
at least the same extent as such Subordinated Debt; |
|
|
(2) |
|
the Parent shall not permit any Restricted Subsidiary that is not the Company
or a Guarantor to Incur any Debt pursuant to paragraph (q) of this covenant if the
proceeds of the Debt are used, directly or indirectly, to Refinance any Subordinated
Debt of the Company or any Guarantor; |
|
|
(3) |
|
accrual of interest, accretion or amortization of original issue discount and
the payment of interest or dividends in the form of additional Debt, will be deemed not
to be an Incurrence of Debt for purposes of this covenant; and |
|
|
(4) |
|
the maximum amount of Debt that the Parent or any Restricted Subsidiary of the
Parent shall not be deemed exceeded solely as a result of fluctuations in exchange
rates or currency values occurring after such Debt was Incurred. |
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 (q) above or is entitled to be incurred pursuant to 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. Debt under
the Senior Secured Credit Facilities outstanding on the date on which the notes are first issued
under the indenture shall be deemed to have been incurred on such date in reliance on the exception
provided by clause (b) above. The principal amount of any Debt supported by a letter of credit
issued under a Credit Facility in accordance with clause (b) above will not constitute a separate
incurrence of Debt for purposes of this covenant to the extent of the stated amount of the letter
of credit.
The Parent and its Restricted Subsidiaries will not incur or suffer to exist any Debt that is
subordinated in right of payment to any other Debt of the Parent and its Restricted Subsidiaries
unless such Debt is at least equally subordinated in right of payment to the notes and the
Guarantees.
Limitation on Restricted Payments. The Parent shall not make, and shall not permit any of its
Restricted Subsidiaries to make, directly or indirectly, any Restricted Payment if at the time of,
and after giving effect to, such proposed Restricted Payment,
(a) a Default or Event of Default shall have occurred and be continuing,
(b) the Company could not Incur at least $1.00 of additional Debt pursuant to the first
paragraph of the covenant described under Limitation on Debt, or
(c) the aggregate amount of such Restricted Payment and all other Restricted Payments
declared or made since January 1, 2010 (the amount of any Restricted Payment, if made other
than in cash, to be based upon Fair Market Value at the time of such Restricted Payment)
would exceed an amount equal to the sum of:
(1) 50% of the aggregate amount of Consolidated Net Income accrued during the
period (treated as one accounting period) from January 1, 2010 to the end of the
most recent fiscal quarter for which financial statements are available (or if the
aggregate amount of Consolidated Net Income for such period shall be a deficit,
minus 100% of such deficit), plus
(2) 100% of Capital Contributions (other than Excluded Contributions), plus
(3) the sum of:
33
(A) the aggregate net cash proceeds received by the Parent or any
Restricted Subsidiary from the issuance or sale after January 1, 2010 of
convertible or exchangeable Debt that has been converted into or exchanged
for Capital Stock (other than Disqualified Stock) of the Parent, and
(B) the aggregate amount by which Debt (other than Subordinated Debt)
of the Parent or any Restricted Subsidiary is reduced on the Parents
consolidated balance sheet on or after January 1, 2010 upon the conversion
or exchange of any Debt issued or sold on or prior to January 1, 2010 that
is convertible or exchangeable for Capital Stock (other than Disqualified
Stock) of the Parent,
excluding, in the case of clause (A) or (B):
(x) any such Debt issued or sold to the Parent or a Subsidiary of the
Parent or an employee stock ownership plan or trust established by the
Parent or any such Subsidiary for the benefit of their employees, and
(y) the aggregate amount of any cash or other Property distributed by
the Parent or any Restricted Subsidiary upon any such conversion or
exchange, plus
(4) an amount equal to the sum of:
(A) the amount received from any Investments in any Person since
January 1, 2010 other than the Parent or a Restricted Subsidiary resulting
from dividends, repayments of loans or advances or other transfers of
Property, in each case to the Parent or any Restricted Subsidiary from such
Person, and
(B) the portion (proportionate to the Parents 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 or has been merged or consolidated with
or into or transfers all of its assets into the Parent or another Restricted
Subsidiary; provided, however, that the preceding sum shall not exceed, in
the case of any Person, the amount of Investments previously made (and
treated as a Restricted Payment) by the Parent or any Restricted Subsidiary
in such Person, plus
(5) $50,000,000.
The provisions of the first paragraph of this covenant does not prohibit:
(a) the payment of any dividends within 60 days of the declaration of the
dividends if, on the declaration date, such dividends could have been paid in
compliance with the indenture; provided, however, that at the time of such payment
of such dividend, no other Default or Event of Default shall have occurred and be
continuing (or result therefrom); provided, further, however, that such dividend
shall be included in the calculation of the amount of Restricted Payments;
(b) the purchase, repurchase, redemption, legal defeasance, acquisition or
retirement for value of Capital Stock of the Parent or Subordinated Debt in exchange
for, or out of the proceeds of the sale within 30 days of, Capital Stock of the
Parent (other than Disqualified Stock and other than Capital Stock issued or sold to
a Subsidiary of the Parent or an employee stock ownership plan or trust established
by the Parent or any such Subsidiary for the benefit of their employees); 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
34
(2) the Capital Contributions from such exchange or sale shall be
excluded from the calculation pursuant to clause (c)(2) above;
(c) the purchase, repurchase, redemption, legal defeasance, acquisition or
retirement for value of any Subordinated Debt in exchange for, or out of the
proceeds of the sale within 30 days of, Permitted Refinancing Debt; provided,
however, that such purchase, repurchase, redemption, legal defeasance, acquisition
or retirement shall be excluded in the calculation of the amount of Restricted
Payments;
(d) the repurchase of shares or units of, or options to purchase shares of,
common stock or common units, as the case may be, of the Parent or any of its
Subsidiaries from current or former officers, directors or employees of the Parent
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 common units; provided, however,
that the aggregate amount of such repurchases shall not exceed $2.0 million in any
calendar year and at the time of such repurchase, no other Default or Event of
Default shall have occurred and be continuing (or result therefrom); provided,
further, that unused amounts may carry over and be used in subsequent calendar
years, in addition to the amounts permitted for such calendar year, up to a maximum
of $5.0 million in any calendar year; provided, further, however, that such
repurchases shall be included in the calculation of the amount of Restricted
Payments;
(e) the repurchase of Capital Stock deemed to occur upon the exercise of stock
options to the extent such Capital Stock represented a portion of the exercise price
of those stock options; provided, however, that such payments will be excluded in
the calculation of the amount of Restricted Payments;
(f) so long as no Default or Event of Default has occurred and is continuing or
would be caused thereby, the declaration of any payment of regularly scheduled or
accrued dividends to (i) holders of any class or series of Disqualified Stock of the
Parent issued on or after the date of the indenture pursuant to the first paragraph
of the covenant described under Limitation on Debt and (ii) holders of any
class or series of Preferred Stock (other than Disqualified Stock) of the Parent
issued after the date of the indenture; provided that at the time of the issuance of
such stock and after giving pro forma effect thereto (treating the aggregate
liquidation preference of such Preferred Stock as Debt), the Company would have been
able to incur at least $1.00 of additional Debt pursuant to the first paragraph of
the covenant described under Limitation on Debt; provided, however, that such
payments will be excluded in the calculation of the amount of Restricted Payments;
(g) so long as no Default or Event of Default has occurred and is continuing or
would be caused thereby, upon the occurrence of a Change of Control and within 90
days after completion of the offer to repurchase notes pursuant to the provisions
described under Repurchase at the Option of Holders Upon a Change of Control
(including the purchase of all notes tendered), any repurchase or redemption of Debt
of the Parent or any of its Restricted Subsidiaries subordinated to the notes that
is required to be repurchased or redeemed pursuant to the terms of the Debt as a
result of such Change of Control, at a purchase price not greater than 101% of the
outstanding principal amount of the Debt (plus accrued and unpaid interest and
liquidated damages, if any); provided that such redemptions or repurchases shall be
included in the calculation of the amount of Restricted Payments;
(h) so long as no Default or Event of Default has occurred and is continuing or
would be caused thereby, within 90 days after completion of any offer to repurchase
notes pursuant to the covenant described under Limitation on Asset Sales
(including the purchase of all notes tendered), any repurchase or redemption of Debt
of the Parent or any of its Restricted Subsidiaries subordinated to the notes that
is required to be repurchased or redeemed pursuant to the terms of
35
the Debt as a result of such Asset Sale, at a purchase price not greater than
100% of the outstanding principal amount thereof (plus accrued and unpaid interest
and liquidated damages, if any); provided that such redemptions or repurchases shall
be included in the calculation of the amount of Restricted Payments;
(i) the redemption, repurchase or other acquisition for value of Capital Stock
of the Parent representing fractional shares of such Capital Stock in connection
with a merger, consolidation, amalgamation or other combination involving the
Company or any direct or indirect parent entity of the Company; provided that such
redemptions, repurchases or other acquisitions shall be included in the calculation
of the amount of Restricted Payments;
(j) Investments that are made with Excluded Contributions; provided that such
payments shall be excluded in the calculation of the amount of Restricted Payments;
and
(l) so long as no Default or Event of Default has occurred and is continuing or
would be caused thereby, Restricted Payments not otherwise permitted under the
preceding clauses (a) through (k) in an amount not to exceed $15.0 million; provided
that such amounts shall be excluded in the calculation of the amount of Restricted
Payments.
For purposes of determining compliance with this covenant, in the event that a Restricted
Payment meets the criteria of more than one of the categories described in clauses (a) through (l)
above or is entitled to be made pursuant to 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 Restricted Payment in any manner that complies with this covenant.
Limitation on Liens. The Parent and the Company shall not, and shall not permit any of their
respective Restricted Subsidiaries 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 in its
Property or any income or profits from its Property, unless:
(a) if such Lien secures Debt ranking pari passu with the notes, the notes or the
applicable Guarantee are secured on an equal and ratable basis with such Debt; and
(b) if such Lien secures Subordinated Debt, such Lien shall be subordinated to a Lien
securing the notes or the applicable Guarantee in the same Property as that securing such
Lien to the same extent as such Subordinated Debt is subordinated to the notes and the
Guarantees.
Limitation on Asset Sales. The Parent and the Company shall not, and shall not permit any of
their respective Restricted Subsidiaries to, directly or indirectly, consummate any Asset Sale
unless:
(a) the Parent or a 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;
(b) at least 75% of the consideration paid to the Parent or a 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 Parent or any Restricted Subsidiary (other than
contingent liabilities or liabilities that are by their terms subordinated to the notes or
the applicable Guarantee) as a result of which the Parent and the Restricted Subsidiaries
are no longer obligated with respect to such liabilities; and
(c) the Company delivers an Officers Certificate to the Trustee certifying that such
Asset Sale complies with the preceding clauses (a) and (b).
For purposes of this provision, each of the following shall be deemed to be cash:
36
(a) any securities, notes or other obligations received by the Parent or the Restricted
Subsidiary from a transferee that are converted by the Parent or such Restricted Subsidiary
into cash (to the extent of the cash received) within 90 days following the closing of such
Asset Sale; and
(b) any Designated Noncash Consideration received by the Parent or any of its
Restricted Subsidiaries in such Asset Sale having an aggregate Fair Market Value (measured
at the time received and without giving effect to subsequent changes in value), taken
together with all other Designated Noncash Consideration received pursuant to this clause
(b) then outstanding, not to exceed $20.0 million.
The Net Available Cash (or any portion thereof) from Asset Sales may be applied by the Parent
or a Restricted Subsidiary, to the extent the Parent or such Restricted Subsidiary elects (or is
required by the terms of any Debt):
(a) to Repay Debt outstanding under Credit Facilities; 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 Parent or
Restricted Subsidiary).
Any Net Available Cash from an Asset Sale not applied in accordance with the preceding
paragraph within 365 days from the date of the receipt of such Net Available Cash or that is not
segregated from the general funds of the Company for investment in identified Additional Assets in
respect of a project that shall have been commenced, and for which binding contractual commitments
have been entered into, prior to the end of such 365-day period and that shall not have been
completed or abandoned shall constitute Excess Proceeds; provided, however, that if during such
365-day period after the receipt of any such Net Available Cash the Parent (or the applicable
Restricted Subsidiary) enters into a definitive binding agreement committing it to apply such Net
Available Cash in accordance with the requirements of clause (b) of the preceding paragraph after
such 365th day, such 365-day period will be extended with respect to the amount of Net Available
Cash so committed for a period not to exceed 120 days until such Net Available Cash is applied in
accordance with such agreement (or, if earlier, until termination of such agreement); provided,
further, however, that the amount of any Net Available Cash that ceases to be so segregated as
contemplated above and any Net Available Cash that is segregated in respect of a project that is
abandoned or completed shall also constitute Excess Proceeds at the time any such Net Available
Cash ceases to be so segregated or at the time the relevant project is so abandoned or completed,
as applicable; provided, further, however, that the amount of any Net Available Cash that continues
to be segregated for investment in identified Additional Assets and that is not actually so
invested within 365 days (as extended with respect to the amount of Net Available Cash committed to
be applied in accordance with a definitive binding agreement as described above) from the date of
the receipt of such Net Available Cash shall also constitute Excess Proceeds.
When the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company will be
required to make an offer to repurchase the notes, which offer shall be in the amount of the
Allocable Excess Proceeds (rounded to the nearest $1,000), on a pro rata basis according to
principal amount, at a purchase price equal to 100% of the principal amount of repurchased notes,
plus accrued and unpaid interest, including Special Interest, if any, to the repurchase 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 the indenture, and which offer will be referred to by us as
a prepayment offer. 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 repurchase in accordance with the indenture, the Parent
or a 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.
Allocable Excess Proceeds shall mean the product of:
(a) the Excess Proceeds and
(b) a fraction,
37
(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 this covenant and requiring the Company to make an offer to repurchase 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 Parent, the Company and
their respective 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 state, among
other things, the purchase price and the repurchase date, which shall be, subject to any contrary
requirements of applicable law, a business day no earlier than 30 days nor later than 60 days from
the date such notice is mailed.
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 covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, the Company will comply with the applicable
securities laws and regulations and will not be deemed to have breached its obligations under this
covenant by virtue of its compliance with such securities laws or regulations.
Limitation on Restrictions on Distributions from Restricted Subsidiaries. The Parent and the
Company shall not, and shall not permit any of their respective Restricted Subsidiaries to,
directly or indirectly, create or otherwise cause or suffer to exist any consensual restriction on
the right of any of their respective Restricted Subsidiaries 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 any Restricted
Subsidiary or, in the case of a Restricted Subsidiary that is not owned, directly or
indirectly by the Company or any Guarantor, to the Parent or any Restricted Subsidiary,
(b) make any loans or advances to the Parent or any Restricted Subsidiary, or
(c) transfer any of its Property to the Parent or any Restricted Subsidiary.
The preceding limitations will not apply:
(1) with respect to clauses (a), (b) and (c), to restrictions:
(A) in effect on the Issue Date (including, without limitation,
restrictions pursuant to the notes, the indenture and the Senior Secured
Credit Facilities);
(B) 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 Parent or the Company;
(C) that result from the Refinancing of Debt Incurred pursuant to an
agreement referred to in clause (1)(A) or (B) above or in clause (2)(A) or
(B) below; provided such restrictions are not more restrictive, taken as a
whole, than those contained in the agreement evidencing the Debt so
Refinanced;
38
(D) contained in any agreement for the sale or other disposition of a
Restricted Subsidiary in accordance with the terms of the indenture that
restricts distributions by that Restricted Subsidiary pending such sale or
other disposition;
(E) relating to Debt or other contractual requirements or restrictions
of a Securitization Subsidiary in connection with a Permitted Receivables
Financing; provided that such restrictions only apply to such Securitization
Subsidiary;
(F) contained in any agreement governing Debt incurred by a Foreign
Restricted Subsidiary permitted under the covenant described above under
Limitation on Debt; provided that such restrictions only apply to such
Foreign Restricted Subsidiary; provided, further, that such Debt is not
guaranteed by the Parent or any of its Domestic Restricted Subsidiaries;
(G) customary restrictions contained in any Interest Rate Agreement,
Currency Protection Agreement, Commodity Price Protection Agreement or other
similar agreement or arrangement to the extent the related Hedging
Obligation is otherwise permitted under the indenture; and
(2) 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 or the applicable Guarantee pursuant to the
covenants described under Limitation on Debt and Limitation on
Liens 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
Parent or any Restricted Subsidiary, so long as such restrictions relate
solely to the Property so acquired and were 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) customary restrictions contained in asset sale agreements,
sale-leaseback agreements, stock sale agreements and other similar
agreements limiting the transfer of such Property pending the closing of
such sale;
(E) customary restrictions contained in joint venture and similar
agreements entered into in the ordinary course of business and otherwise not
prohibited by the indenture;
(F) customary non-assignment provisions in leases entered into in the
ordinary course of business; and
(G) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business.
Limitation on Transactions with Affiliates. The Parent and the Company shall not, and shall
not permit any of their respective Restricted Subsidiaries to, directly or indirectly, enter into
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 Parent or the Company (such transaction or series of transactions
being referred to as an affiliate transaction), unless:
(a) the terms of such affiliate transaction are:
39
(1) set forth in writing, and
(2) no less favorable to the Parent or such Restricted Subsidiary, as the case
may be, than those that could be obtained in a comparable arms-length transaction
with a Person that is not an Affiliate of the Parent or such Restricted Subsidiary,
(b) if such affiliate transaction involves aggregate payments or value in excess of
$2.5 million, the Company delivers an Officers Certificate to the Trustee certifying that
such transaction or series of related transactions complies with clause (a)(2) above, and
(c) if such affiliate transaction involves aggregate payments or value in excess of
$15.0 million, either
(1) such affiliate transaction has been approved by a majority of the
Disinterested Directors of the Board of Directors, or in the event there is only one
Disinterested Director, by such Disinterested Director, or
(2) 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 Parent and its
Restricted Subsidiaries.
Notwithstanding the preceding limitation, the Parent or any Restricted Subsidiary may enter
into or suffer to exist the following:
(a) any transaction or series of transactions between the Parent and one or more
Restricted Subsidiaries or between two or more Restricted Subsidiaries in the ordinary
course of business;
(b) any Restricted Payment permitted to be made pursuant to the covenant described
under Limitation on Restricted Payments or any Permitted Investment;
(c) the payment of compensation (including amounts paid pursuant to employee benefit
plans) for the personal services of officers, directors and employees of the Parent or any
of its Restricted Subsidiaries, so long as the Board of Directors in good faith shall have
approved the terms of the compensation and deemed the services theretofore or thereafter to
be performed for such compensation to be fair consideration therefor;
(d) loans and advances to non-executive employees made in the ordinary course of
business and consistent with the past practices of the Parent or such Restricted Subsidiary,
as the case may be; provided that such loans and advances do not exceed $2.0 million in the
aggregate at any one time outstanding;
(e) agreements in effect on the Issue Date and described in the offering memorandum
pursuant to which the old notes were issued or in this prospectus and any modifications,
extensions or renewals thereto that are no less favorable to the Parent or any Restricted
Subsidiary than such agreements as in effect on the Issue Date;
(f) customary indemnification agreements with officers and directors of the Parent or
its Restricted Subsidiaries;
(g) transactions with a Person (other than an Unrestricted Subsidiary of the Parent)
that is an Affiliate of the Parent solely because the Parent owns, directly or through a
Restricted Subsidiary, Capital Stock in or controls such Person;
(h) any payments or other transactions pursuant to any tax sharing agreement between
Parent or the Company and any other Person with which Parent or the Company files a
consolidated tax return or with which Parent or the Company is part of a consolidated group
for tax purposes;
40
(i) the issuance of Capital Stock (other than Disqualified Stock) of the Parent to any
Affiliate; and
(j) transactions between a Securitization Subsidiary and the Parent or one or more
Restricted Subsidiaries in connection with a Permitted Receivables Financing.
Designation of Restricted and Unrestricted Subsidiaries. The Board of Directors of the Company
may designate any of the Parents Subsidiaries to be an Unrestricted Subsidiary if the Parent or a
Restricted Subsidiary, as the case may be, is permitted to make such Investment in such Subsidiary
and such Subsidiary:
(a) does not own any Capital Stock or Debt of, or own or hold any Lien on any Property
of, the Parent or any Restricted Subsidiary;
(b) has no Debt other than Non-Recourse Debt; provided, however, that the Parent or a
Restricted Subsidiary may loan, advance, extend credit to, or guarantee the Debt of an
Unrestricted Subsidiary at any time at or after such Subsidiary is designated as an
Unrestricted Subsidiary in accordance with the covenant described under Limitation on
Restricted Payments;
(c) except as would be permitted by the covenant described above under Limitations
on Transactions with Affiliates, is not party to any agreement, contract, arrangement or
understanding with the Parent or any Restricted Subsidiaries unless the terms of any such
agreement, contract, arrangement or understanding are no less favorable, taken as a whole,
to the Parent or such Restricted Subsidiary than those that might be obtained at the time
from Persons who are not Affiliates of the Parent or the Company;
(d) is a Person with respect to which neither the Parent nor any Restricted
Subsidiaries has any direct or indirect obligation (1) to subscribe for additional Capital
Stock or (2) to maintain or preserve such Persons financial condition or to cause such
Person to achieve any specified levels of operating results; and
(e) has not guaranteed or otherwise directly or indirectly provided credit support for
any Debt of the Parent or its Restricted Subsidiaries.
Unless so designated as an Unrestricted Subsidiary, any Person that becomes a Subsidiary of the
Parent will be classified as a Restricted Subsidiary; provided, however, that such Subsidiary shall
not be designated a Restricted Subsidiary and shall be automatically classified as an Unrestricted
Subsidiary if either of the requirements set forth in clauses (x) and (y) of the second immediately
following paragraph will not be satisfied after giving pro forma effect to such classification or
if such Person is a Subsidiary of an Unrestricted Subsidiary.
Except as provided in the first sentence of the preceding paragraph, no Restricted Subsidiary
may be redesignated as an Unrestricted Subsidiary, and neither the Parent nor any Restricted
Subsidiary shall at any time be directly or indirectly liable for any Debt that provides that the
holder of the Debt may (with the passage of time or notice or both) declare a default on the Debt
or cause the payment of the Debt to be accelerated or payable prior to its Stated Maturity upon the
occurrence of a default with respect to any Debt, Lien or other obligation of any Unrestricted
Subsidiary (including any right to take enforcement action against such Unrestricted Subsidiary).
Upon designation of a Restricted Subsidiary as an Unrestricted Subsidiary in compliance with this
covenant, such Restricted Subsidiary shall, by execution and delivery of a supplemental indenture
in form satisfactory to the Trustee, be released from any Guarantee previously made by such
Restricted Subsidiary.
The Board of Directors of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary if, immediately after giving pro forma effect to such designation,
|
(x) |
|
the Company could Incur at least $1.00 of additional Debt
pursuant to the first paragraph of the covenant described under Limitation
on Debt, and |
|
|
(y) |
|
no Default or Event of Default shall have occurred and be
continuing or would result therefrom. |
41
Any such designation or redesignation by the Board of Directors will be evidenced to the
Trustee by filing with the Trustee a resolution of the Board of Directors giving effect to such
designation or redesignation and an Officers Certificate that:
(a) certifies that such designation or redesignation complies with the preceding
provisions, and
(b) gives the effective date of such designation or redesignation,
such filing with the Trustee to occur within 45 days after the end of the fiscal quarter of the
Parent in which such designation or redesignation is made (or, in the case of a designation or
redesignation made during the last fiscal quarter of the Parents fiscal year, within 90 days after
the end of such fiscal year).
Future Guarantors. The Parent and the Company shall cause each Person that becomes a Domestic
Restricted Subsidiary (other than a Securitization Subsidiary) following the Issue Date to execute
and deliver to the Trustee a Guarantee at the time such Person becomes a Domestic Restricted
Subsidiary. In addition, the Parent and the Company will cause each of its respective existing
non-Guarantor Subsidiaries and each of its respective Foreign Restricted Subsidiaries created or
acquired after the Issue Date which has guaranteed or which guarantees any Debt of the Parent or
any of its Domestic Restricted Subsidiaries, to execute and deliver to the Trustee a Guarantee
pursuant to which such non-Guarantor Subsidiary or Foreign Restricted Subsidiary will guarantee
payment of the Companys obligations under the notes on the same terms and conditions as set forth
in the guarantee of such other Debt of the Parent or any Domestic Restricted Subsidiary given by
such non-Guarantor Subsidiary or Foreign Restricted Subsidiary; provided that if such Debt is by
its express terms subordinated in right of payment to the notes, any such guarantee of such
non-Guarantor Subsidiary or Foreign Restricted Subsidiary with respect to such Debt will be
subordinated in right of payment to such non-Guarantor Subsidiarys or Foreign Restricted
Subsidiarys Guarantee with respect to the notes substantially to the same extent as such Debt is
subordinated to the notes; provided, further, however, that any such Guarantee shall also provide
by its terms that it will be automatically and unconditionally released upon the release or
discharge of such guarantee of payment of such other Debt (except a discharge by or as a result of
payment under such guarantee).
Merger, Consolidation and Sale of Property
The Company shall not merge, consolidate or amalgamate with or into any other Person (other
than a merger of a Wholly Owned 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 in such merger, consolidation or
amalgamation, 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, partnership or limited liability company
organized and existing under the laws of the United States of America, any State of the
United States of America or the District of Columbia; provided, however, that if such Person
is a limited liability company or partnership, a corporate Wholly Owned Restricted
Subsidiary of such Person becomes a co-issuer of the notes in connection therewith;
(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;
(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) and clause
(e) below, any Debt that becomes, or is
42
anticipated to become, an obligation of the Surviving Person or any Restricted
Subsidiary as a result of such transaction or series of transactions as having been Incurred
by the Surviving Person 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;
(e) immediately after giving effect to such transaction or series of transactions on a
pro forma basis, either (1) the Company or the Surviving Person, as the case may be, would
be able to Incur at least $1.00 of additional Debt under the first paragraph of the covenant
described under Certain Covenants Limitation on Debt or (2) the Consolidated
Interest Coverage Ratio would not be lower than the Consolidated Interest Coverage Ratio
immediately prior to giving effect to such transaction or series of transactions; 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 or series of transactions 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 or series of transactions have
been satisfied.
The Parent shall not, and the Parent and the Company shall not permit any Guarantor to merge,
consolidate or amalgamate with or into any other Person (other than a merger of a Wholly Owned
Restricted Subsidiary into the Parent, the Company or such 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 (other than a sale, transfer, assignment, lease, conveyance or other
disposition between or among the Company and any Guarantor) unless:
(a) the Surviving Person (if not such 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, company (including a limited liability company)
or partnership organized and existing under the laws of the United States of America, any
State of the United States of America or the District of Columbia;
(b) the Surviving Person (if other than such 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 performance and observance of all the
obligations of such Guarantor under its Guarantee;
(c) in the case of a sale, transfer, assignment, lease, conveyance or other disposition
of all or substantially all the Property of such 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) and clause
(e) below, any Debt that becomes, or is anticipated to become, an obligation of the
Surviving Person, the Parent or any Restricted Subsidiary as a result of such transaction or
series of transactions as having been Incurred by the Surviving Person, the Parent 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;
(e) immediately after giving effect to such transaction or series of transactions on a
pro forma basis, either (1) the Company would be able to Incur at least $1.00 of additional
Debt under the first paragraph of the covenant described under Certain Covenants
Limitation on Debt or (2) the Consolidated Interest Coverage Ratio would not be lower than
the Consolidated Interest Coverage Ratio immediately prior to giving effect to such
transaction or series of transactions; 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 or series of transactions and such Guarantee, if
any, in respect thereto comply with this
43
covenant and that all conditions precedent herein provided for relating to such
transaction or series of transactions have been satisfied.
The preceding provisions (other than clause (d) in each of the first and second paragraphs
hereof ) shall not apply to any transaction or series of transactions which constitute an Asset
Sale if the Parent and the Company have complied with the covenant described under Certain
CovenantsLimitation on Asset Sales.
The Surviving Person shall succeed to, and be substituted for, and may exercise every right
and power of the Company under the indenture (or of the Guarantor under the Guarantee, as the case
may be), but the predecessor entity in the case of:
(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 Parent or
the Company as an entirety or virtually as an entirety), or
(b) a lease,
shall not be released from any of the obligations or covenants under the indenture, including with
respect to the payment of the notes and the obligations under the Guarantees.
Payments for Consents
The Parent and the Company will not, and will not permit any of its Subsidiaries to, directly
or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or
otherwise, to any holder of any notes for or as an inducement to any consent, waiver or amendment
of any of the terms or provisions of the indenture or the notes unless such consideration is
offered to be paid or is paid to all holders of the notes that consent, waive or agree to amend in
the time frame set forth in the solicitation documents relating to such consent, waiver or
agreement.
SEC Reports
Whether or not required by the Commission, so long as any notes are outstanding, the Parent
will furnish to the holders of notes, within the time periods specified in the Commissions rules
and regulations for a company subject to reporting under Section 13(a) or 15(d) of the Exchange
Act:
(1) all quarterly and annual financial information of the Parent that would be required
to be contained in a filing with the Commission on Forms 10-Q and 10-K if the Parent were
required to file such Forms, including a Managements 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 Parents certified independent accountants;
and
(2) all current reports that would be required to be filed with the Commission on Form
8-K if the Parent were required to file such reports.
In addition, whether or not required by the Commission, the Parent will file a copy of all of the
information and reports referred to in clauses (1) and (2) above with the SEC for public
availability within the time periods specified in the Commissions rules and regulations for a
company subject to reporting under Section 13(a) or 15(d) of the Exchange Act (unless the
Commission will not accept such a filing) and make such information available to securities
analysts and prospective investors upon request. Notwithstanding the preceding, to the extent the
Parent files the information and reports referred to in clauses (1) and (2) above with the
Commission and such information is publicly available on the Internet, the Parent shall be deemed
to be in compliance with its obligations to furnish such information to the holders of the notes
and to make such information available to securities analysts and prospective investors.
44
Events of Default
Each of the following is an Event of Default:
(1) failure to make the payment of any interest, if any, on the notes when the same
becomes due and payable, and such failure continues for a period of 30 days;
(2) 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;
(3) failure to comply with the covenant described under Merger, Consolidation and
Sale of Property;
(4) 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 preceding clause (1), (2) or
(3)), and such failure continues for 30 days after written notice is given to the Company as
provided below;
(5) a default under any Debt by the Parent or any Restricted Subsidiary that results in
acceleration of the maturity of such Debt, or failure to pay any such Debt at final
maturity, in an aggregate amount greater than $10.0 million or its foreign currency
equivalent at the time, which we refer to as the cross acceleration provisions;
(6) any final judgment or judgments for the payment of money in an aggregate amount in
excess of $10.0 million (or its foreign currency equivalent at the time) (net of any amounts
that a reputable and creditworthy insurance company shall have acknowledged liability for in
writing) that shall be rendered against the Parent or any Restricted Subsidiary and that
shall not be waived, satisfied or discharged for any period of 30 consecutive days during
which a stay of enforcement shall not be in effect, which we refer to as the judgment
default provisions;
(7) certain events involving bankruptcy, insolvency or reorganization of the Parent,
the Company or any of their respective Significant Restricted Subsidiaries, which we refer
to as the bankruptcy provisions; and
(8) any Guarantee of the Parent or a Significant Restricted Subsidiary ceases to be in
full force and effect (other than in accordance with the terms of such Guarantee) or any
Guarantor denies or disaffirms its obligations under its Guarantee, which we refer to as the
guarantee provisions.
A Default under clause (4) is not an Event of Default until the Trustee or the holders of not
less than 25% in aggregate principal amount of the notes then outstanding notify the Company of the
Default and the Company does not cause such Default to be cured within the time specified after
receipt of such notice. Such notice must specify the Default, demand that it be remedied and state
that such notice is a Notice of Default.
In the event of a declaration of acceleration of the notes because an Event of Default
described in clause (5) above has occurred and is continuing, the declaration of acceleration of
the notes shall be automatically annulled if the event of default or payment default triggering
such Event of Default shall be remedied or cured by the Parent or a Restricted Subsidiary or waived
by the holders of the relevant Debt within 30 days after the declaration of acceleration with
respect thereto and if (1) the annulment of the acceleration of the notes would not conflict with
any judgment or decree of a court of competent jurisdiction and (2) all existing Events of Default,
except non-payment of principal, premium or interest on the notes that became due solely because of
the acceleration of the notes have been cured or waived.
The Company shall deliver to the Trustee, written notice in the form of an Officers
Certificate, within 30 days after the occurrence, of any event that with the giving of notice or
the lapse of time or both would become an Event of Default, its status and what action the Company
is taking or proposes to take with respect thereto.
45
If an Event of Default with respect to the notes (other than an Event of Default resulting
from certain events involving bankruptcy, insolvency or reorganization described in clause (7)
above) shall have occurred and be continuing, the Trustee or the registered holders of not less
than 25% in aggregate principal amount of the notes then outstanding may declare to be immediately
due and payable the principal amount of all the notes then outstanding, plus accrued but unpaid
interest to the date of acceleration. In case an Event of Default resulting from certain events of
bankruptcy, insolvency or reorganization described in clause (7) above shall occur, such amount
with respect to all the notes shall be due and payable immediately without any declaration or other
act on the part of the Trustee or the holders of the notes. After any such acceleration, but before
a judgment or decree based on acceleration is obtained by the Trustee, the registered holders of at
least a majority in aggregate principal amount of the notes then outstanding may, under certain
circumstances, rescind and annul such acceleration if all Events of Default, other than the
nonpayment of accelerated principal, premium or interest, have been cured or waived as provided in
the indenture.
Subject to the provisions of the indenture relating to the duties of the Trustee, in case an
Event of Default shall occur and be continuing, the Trustee will be under no obligation to exercise
any of its rights or powers under the indenture at the request or direction of any of the holders
of the notes, unless such holders shall have offered to the Trustee reasonable indemnity
satisfactory to the Trustee. Subject to such provisions for the indemnification of the Trustee, the
holders of at least 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.
No holder of notes will have any right to institute any proceeding with respect to the
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 or the Trustee receives the notice from the Company;
(b) the registered holders of at least 25% in aggregate principal amount of the notes
then outstanding have made a 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 registered holders of at least 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 60
days.
However, such limitations do not apply to a suit instituted by a holder of any note for enforcement
of payment of the principal of, and premium, if any, or interest, including Special Interest, if
any, on, such note on or after the respective due dates expressed in such note.
Amendments and Waivers
Subject to certain exceptions, the Company and the Trustee with the consent of the registered
holders of at least a majority in aggregate principal amount of the notes then outstanding
(including consents obtained in connection with a tender offer or exchange offer for the notes) may
amend the indenture, the notes and the Guarantees, and the registered holders of at least a
majority in aggregate principal amount of the notes outstanding may waive any past default or
compliance with any provisions of the indenture, the notes and the Guarantees (except a default in
the payment of principal, premium, interest, including Special Interest, if any, and certain
covenants and provisions of the indenture which cannot be amended without the consent of each
holder of an outstanding note). However, without the consent of each holder of an outstanding note,
no amendment may, among other things,
(1) reduce the amount of notes whose holders must consent to an amendment or waiver,
(2) reduce the rate of, or extend the time for payment of, interest, including Special
Interest, if any, on, any note,
46
(3) reduce the principal of, or extend the Stated Maturity of, any note,
(4) make any note payable in money other than that stated in the note,
(5) make any change in provisions of the indenture protecting the right of any holder
of the notes to receive payment of principal of, premium, if any, and interest, including
Special Interest, if any, on, such holders notes on or after the due dates therefor or to
institute suit for the enforcement of any payment on or with respect to such holders notes
or any Guarantee,
(6) reduce the premium payable upon the redemption of any Note or change the time at
which any Note may be redeemed, as described under Optional Redemption,
(7) 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,
(8) at any time after the Company is obligated to make a prepayment offer with the
Excess Proceeds from Asset Sales, change the time at which such prepayment offer must be
made or at which the notes must be repurchased pursuant thereto,
(9) expressly subordinate the notes or any Guarantee to any other Indebtedness of the
Company or any Guarantor, or
(10) make any change in any Guarantee that would adversely affect the holders of the
notes.
The indenture, the notes and the Guarantees may be amended by the Company and the Trustee
without the consent of any holder of the notes to:
(1) cure any ambiguity, omission, defect or inconsistency in any manner that is not
adverse in any material respect to any holder of the notes,
(2) provide for the assumption by a Surviving Person of the obligations of the Parent
or a Restricted Subsidiary under the indenture,
(3) 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),
(4) add additional Guarantees with respect to the notes or release Guarantors from
Guarantees as provided or permitted by the terms of the indenture,
(5) secure the notes, add to the covenants of the Parent and the Company for the
benefit of the holders of the notes or surrender any right or power conferred upon the
Parent or the Company,
(6) make any change that does not adversely affect the rights of any holder of the
notes,
(7) comply with any requirement of the Commission in connection with the qualification
of the indenture under the Trust Indenture Act,
(8) add a co-issuer of the notes as contemplated under Certain CovenantsMerger,
Consolidation and Sale of Property, or
(9) provide for the issuance of additional notes in accordance with the indenture.
47
The consent of the holders of the notes is not necessary to approve the particular form of any
proposed amendment. It is sufficient if such consent approves the substance of the proposed
amendment. After an amendment becomes effective, the Company will be required to mail to each
registered holder of the notes at such holders address appearing in the security register of the
Company for the notes a notice briefly describing such amendment. However, the failure to give
such notice to all holders of the notes, or any defect in such notice, will not impair or affect
the validity of the amendment.
Defeasance
The Company at any time may terminate all its obligations under the notes and the indenture
and all of the obligations of the Guarantors (we refer to this as legal defeasance), except for
certain obligations, including those respecting the defeasance trust and obligations to register
the transfer or exchange of the notes, to replace mutilated, destroyed, lost or stolen notes and to
maintain a registrar and paying agent in respect of the notes. In addition, the Company at any
time may terminate:
(1) the obligations of the Company and its Restricted Subsidiaries under the covenants
described under Repurchase at the Option of Holders Upon a Change of Control and
Certain Covenants,
(2) the operation of the cross acceleration provisions, the judgment default provisions
and the bankruptcy provisions with respect to Significant Restricted Subsidiaries and the
guarantee provisions described under Events of Default above, and
(3) the limitations contained in clause (e) under the first and second paragraph of
Merger, Consolidation and Sale of Property above (we refer to this as covenant defeasance).
The Company may exercise its legal defeasance option notwithstanding its prior exercise of its
covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the notes may not be
accelerated because of an Event of Default with respect thereto. If the Company exercises its
covenant defeasance option, payment of the notes may not be accelerated because of an Event of
Default specified in clause (4) (with respect to the covenants described under Certain
Covenants), (5), (6), (7) (with respect only to Significant Restricted Subsidiaries) or (8) under
Events of Default above or because of the failure of the Company or the Parent to comply with
clause (e) under the first and second paragraph of, Merger, Consolidation and Sale of Property
above. If the Company exercises its legal defeasance option or its covenant defeasance option,
each Guarantor will be released from all its obligations under its Guarantee.
The legal defeasance option or the covenant defeasance option may be exercised only if:
(a) the Company irrevocably deposits in trust with the Trustee money or U.S. Government
Obligations for the payment of principal of, premium, if any, and interest, including
Special Interest, if any, on the notes to maturity or redemption, as the case may be;
(b) the Company delivers to the Trustee a certificate from a nationally recognized firm
of independent certified public accountants expressing their opinion that the payments of
principal, premium, if any, and interest when due and without reinvestment on the deposited
U.S. Government Obligations plus any deposited money without investment will provide cash at
such times and in such amounts as will be sufficient to pay principal, premium, if any, and
interest when due on all the notes to be defeased to maturity or redemption, as the case may
be;
(c) the Company must deliver to the trustee an Officers Certificate stating that the
deposit was not made by the Company with the intent of preferring the holders of the notes
over the other creditors of the Company with the intent of defeating, hindering, delaying or
defrauding creditors of the Company or others;
48
(d) no Default or Event of Default has occurred and is continuing on the date of such
deposit and after giving effect thereto (other than a Default resulting from the borrowing
of funds to be applied to such deposit);
(e) such deposit does not constitute a default under any other material agreement or
instrument binding on the Company (other than the indenture);
(f) in the case of the legal defeasance option, the Company delivers to the Trustee an
Opinion of Counsel stating that:
(1) the Company has received from the Internal Revenue Service a ruling, or
(2) since the date of the indenture there has been a change in the applicable
Federal income tax law, to the effect, in either case, that, and based thereon such
Opinion of Counsel shall confirm that, the holders of the notes will not recognize
income, gain or loss for Federal income tax purposes as a result of such defeasance
and will be subject to Federal income tax on the same amounts, in the same manner
and at the same time as would have been the case if such defeasance has not
occurred;
(g) in the case of the covenant defeasance option, the Company delivers to the Trustee
an Opinion of Counsel to the effect that the holders of the 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; and
(h) the Company delivers to the Trustee an Officers Certificate and an Opinion of
Counsel, each stating that all conditions precedent to the defeasance and discharge of the
notes have been complied with as required by the indenture.
Governing Law
The indenture and the notes are governed by the internal laws of the State of New York without
reference to principles of conflicts of law.
The Trustee
U.S. Bank National Association is the Trustee under the indenture.
Except during the continuance of an Event of Default, the Trustee will perform only such
duties as are specifically set forth in the indenture. During the existence of an Event of
Default, the Trustee will exercise such of the rights and powers vested in it under the indenture
and use the same degree of care and skill in its exercise as a prudent person would exercise under
the circumstances in the conduct of such persons own affairs.
Certain Definitions
Set forth below is a summary of certain of the defined terms used in the indenture. Reference
is made to the indenture for the full definition of all such terms as well as any other capitalized
terms used herein for which no definition is provided. Unless the context otherwise requires, an
accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP.
Acquired Debt means Debt of a Person outstanding on the date on which such Person becomes a
Restricted Subsidiary (including by way or merger, consolidation or amalgamation) or assumed in
connection with the acquisition of assets from such Person.
Additional Assets means:
49
(a) any Property (other than cash, Cash Equivalents and securities) to be owned by the
Parent or any of its Restricted Subsidiaries and used in a Permitted 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 Parent or a Restricted Subsidiary from any Person
other than the Parent or a Subsidiary of the Parent; provided, however, that such Restricted
Subsidiary is primarily engaged in a Permitted 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; and the terms controlling and
controlled have meanings correlative to the preceding.
Asset Sale means any sale, lease, transfer, issuance or other disposition (or series of
related sales, leases, transfers, issuances or dispositions) by the Parent or any of its Restricted
Subsidiaries, 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 Property of the Parent or any Restricted Subsidiary outside of the
ordinary course of business of the Parent or such Restricted Subsidiary, other than, in the
case of clause (a) or (b) above,
(1) any disposition by a Restricted Subsidiary to the Parent or by the Parent
or a Restricted Subsidiary to a Wholly Owned Restricted Subsidiary,
(2) any disposition that constitutes a Permitted Investment or Restricted
Payment permitted by the covenant described under Certain CovenantsLimitation
on Restricted Payments,
(3) any disposition effected in compliance with the first paragraph of the
covenant described under Merger, Consolidation and Sale of Property),
(4) any disposition in a single transaction or a series of related transactions
of Property for aggregate consideration of less than $2.5 million,
(5) the disposition of cash or Cash Equivalents,
(6) the disposition of accounts receivable and related assets (including
contract rights) to a Securitization Subsidiary in connection with a Permitted
Receivables Financing,
(7) any foreclosure upon any assets of the Parent or any of its Restricted
Subsidiaries in connection with the exercise of remedies by a secured lender
pursuant to the terms of Debt otherwise permitted to be incurred under the
indenture,
(8) the surrender or waiver of contractual rights or the settlement, release or
surrender of contract, tort or other claims of any kind, and
(9) the sale of the Capital Stock, Debt or other securities of an Unrestricted
Subsidiary.
Attributable Debt in respect of a Sale and Leaseback Transaction means, at any date of
determination,
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(a) if such Sale and Leaseback Transaction is a Capital Lease Obligation, the amount of
Debt represented thereby according to the definition of Capital Lease Obligations, and
(b) in all other instances, the greater of:
(1) the Fair Market Value of the Property subject to such Sale and Leaseback
Transaction, and
(2) 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).
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.
Board of Directors means the board of directors of the Parent or a Restricted Subsidiary, as
the case may be.
Capital Contributions means either (i) the aggregate cash proceeds received by the Parent
from the issuance or sale (other than to a Subsidiary of the Parent or an employee stock ownership
plan or trust established by the Parent or any such Subsidiary for the benefit of their employees)
by the Parent of its Capital Stock (other than Disqualified Stock and Preferred Stock) since
January 1, 2010, 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 by the Parent as a result of
such issuance or sale or from any capital contribution received by the Parent from any holder of
its Capital Stock or (ii) the Fair Market Value of any assets or Property contributed to the Parent
or acquired through the issuance of Capital Stock (other than Disqualified Stock) of the Parent
since January 1, 2010; provided that such assets or Property are used or useful in a Permitted
Business.
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 of such Debt 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 Certain Covenants
Limitation on Liens, 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.
Cash Equivalents means any of the following:
(a) Investments in U.S. Government Obligations maturing within 365 days of the date of
acquisition of such U.S. Government Obligation;
51
(b) Investments in time deposit accounts, certificates of deposit and money market
deposits maturing within 365 days of the date of acquisition of such time deposit account,
certificate of deposit or money market deposit, as applicable, issued by a bank or trust
company organized under the laws of the United States of America or any state of the United
States of America having capital, surplus and undivided profits aggregating in excess of
$500 million and whose long-term debt is rated A-3 or A_ or higher according to Moodys
or S&P (or such similar equivalent rating by at least one nationally recognized statistical
rating organization (as defined in Rule 436 under the Securities Act));
(c) repurchase obligations with a term of not more than 180 days for underlying
securities of the types described in clause (a) entered into with:
(1) a bank meeting the qualifications described in clause (b) above, or
(2) 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 365 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 with a rating at the time as of
which any Investment in such commercial paper is made of P-1 (or higher) according to
Moodys or A-1 (or higher) according to S&P (or such similar equivalent rating by at least
one nationally recognized statistical rating organization (as defined in Rule 436 under the
Securities Act));
(e) direct obligations (or certificates representing an ownership interest in such
obligations) of any state of the United States of America (including any agency or
instrumentality of the United States of America) for the payment of which the full faith and
credit of such state is pledged; provided that:
(1) the long-term debt of such state is rated A-3 or A_ or higher according
to Moodys or S&P (or such similar equivalent rating by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act)), and
(2) such obligations mature within 365 days of the date of acquisition of such
obligation;
(f) interests in investment companies or money market funds at least 95% of the assets
of which on the date of acquisition constitute Cash Equivalents of the kinds described in
clauses (a) through (e) of this definition; and
(g) in the case of any Foreign Restricted Subsidiary:
(1) direct obligations of the sovereign nation (or agency of the sovereign
nation) in which such Foreign Restricted Subsidiary is organized and is conducting
business or obligations fully and unconditionally guaranteed by such sovereign
nation (or any agency of the sovereign nation);
(2) investments of the type and maturity described in clauses (a) through (f)
above of foreign obligors, which investments or obligors have ratings described in
such clauses or equivalent ratings from comparable foreign ratings agencies; and
(3) investments of the type and maturity described in clauses (a) through (f)
above of foreign obligors, which investments or obligors are not rated as provided
in such clauses or in (2) above but which are, in the reasonable judgment of the
Parent as evidenced by a board resolution, comparable in investment quality to such
investments and obligors; provided that the amount of such investments pursuant to
this clause (g)(3) outstanding at any one time shall not exceed $15.0 million.
Change of Control means the occurrence of any of the following events:
52
(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 preceding), 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, 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 35%
or more of the total voting power of the Voting Stock of the Parent or the Company (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 so long as such person or group
beneficially owns, directly or indirectly, in the aggregate at least 35% of the total voting
power of the Voting Stock of such parent corporation; or
(b) the sale, transfer, lease, conveyance or other disposition, directly or indirectly,
of all or substantially all the Property of the Parent and its 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), shall have occurred, or the Parent
or the Company merges, consolidates or amalgamates with or into any other Person or any
other Person merges, consolidates or amalgamates with or into the Parent or the Company, in
any such event pursuant to a transaction in which the outstanding Voting Stock of such
entity is reclassified into or exchanged for cash, securities or other Property, other than
any such transaction where:
(1) the outstanding Voting Stock of such entity is reclassified into or
exchanged for other Voting Stock of such entity or for Voting Stock of the Surviving
Person; and
(2) the holders of the Voting Stock of such entity immediately prior to such
transaction own, directly or indirectly, not less than a majority of the Voting
Stock of such entity or the Surviving Person immediately after such transaction and
in substantially the same proportion as before the transaction; or
(c) the stockholders of the Parent or the Company shall have approved any plan of
liquidation or dissolution of the Parent or the Company.
Code means the Internal Revenue Code of 1986, as amended.
Commission means the U.S. 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 for the purpose of fixing, hedging or swapping the price risk related to fluctuations in
commodity prices.
Comparable Treasury Issue means the United States treasury security selected by an
Independent Investment Banker as having a maturity comparable to the remaining term of the notes
that would be utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable maturity to the
remaining term of such notes.
Comparable Treasury Price means, with respect to any redemption date:
(a) the average of the bid and ask prices for the Comparable Treasury Issue (expressed
in each case as a percentage of its principal amount) on the third business day preceding
such redemption date, as set forth in the most recently published statistical release
designated H.15(519) (or any successor release) published by the Board of Governors of the
Federal Reserve System and which establishes yields on actively traded United States
treasury securities adjusted to constant maturity under Treasury Constant Maturities, or
53
(b) if such release (or any successor release) is not published or does not contain
such prices on such business day, the average of the Reference Treasury Dealer Quotations
for such redemption date.
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 consolidated financial statements are available prior to 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 Parent 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 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 Parent 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 Parent 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,
(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 Parent or any
Restricted Subsidiary since the beginning of such period) shall have made
such an Asset Sale, investment or acquisition,
then 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 had occurred on the
first day of such period (giving effect to any Pro Forma Cost Savings in connection with any such
acquisition).
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 in excess of 12 months). In the event the Capital
Stock of any Restricted Subsidiary is sold during the period, the Parent 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 Parent 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
Parent and its consolidated Restricted Subsidiaries, plus, to the extent not included in such total
interest expense, and to the extent Incurred by the Parent or its Restricted Subsidiaries,
54
(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
(other than amortization or write-off of debt issuance costs incurred in connection with or
as a result of the Transactions),
(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 payments and receipts (if any) 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 Parent or any Restricted Subsidiary, and
(k) the cash contributions to any employee 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 Parent) in connection with Debt Incurred by such plan or trust.
Consolidated Net Income means, for any period, the net income (loss) of the Parent and its
consolidated Restricted Subsidiaries (and before any reduction in respect of Preferred Stock
Dividends that are Restricted Payments); provided, however, that there shall not be included in
such Consolidated Net Income:
(a) any net income (loss) of any Person (other than the Parent) if such Person is not a
Restricted Subsidiary, except that, subject to the exclusion contained in clause (c) below,
equity of the Parent and its consolidated Restricted Subsidiaries 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 Parent 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 (b) below),
(b) any net income (loss) of any Restricted Subsidiary if such Restricted Subsidiary is
subject to restrictions, directly or indirectly, on the payment of dividends or the making
of distributions, directly or indirectly, to the Company in the case of a Restricted
Subsidiary of the Company or to the Parent in the case of a Restricted Subsidiary of the
Parent that is not a Restricted Subsidiary of the Company, except that:
(1) subject to the exclusion contained in clause (c) below, the equity of the
Parent and its consolidated Restricted Subsidiaries 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 distributed by such Restricted Subsidiary
during such period to the Parent or one of its Restricted Subsidiaries 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), and
55
(2) the equity of the Parent and its consolidated Restricted Subsidiaries in a
net loss of any such Restricted Subsidiary for such period shall be included in
determining such Consolidated Net Income,
(c) any gain or loss realized upon the sale or other disposition of any Property of the
Parent or any of its consolidated Restricted Subsidiaries (including pursuant to any Sale
and Leaseback Transaction) that is not sold or otherwise disposed of in the ordinary course
of business,
(d) any net after-tax extraordinary gain or loss (including all fees and expenses
relating thereto),
(e) the cumulative effect of a change in accounting principles;
(f) any non-cash compensation charges or other non-cash expenses or charges arising
from the grant, issuance, vesting or repricing of stock, stock options or other equity-based
awards or any amendment, modification, substitution or change in any such stock, stock
options or other equity-based awards;
(g) any restructuring charges or other non-recurring costs and expenses incurred (x) in
connection with the Transactions or (y) incurred prior to the Issue Date;
(h) any non-cash goodwill or other asset impairment charges incurred subsequent to the
Issue Date resulting from the application of Statement of Financial Accounting Standards No.
142;
(i) any net after-tax income or loss from discontinued operations and net after-tax
gains or losses on disposal of discontinued operations; and
(j) any unrealized gains and losses due solely to fluctuations in currency values and
the related tax effects according to GAAP.
Notwithstanding the preceding, for purposes of the covenant described under Certain Covenants
Limitation on Restricted Payments only, there shall be excluded from Consolidated Net Income any
dividends, repayments of loans or advances or other transfers of Property from Unrestricted
Subsidiaries to the Parent 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)(4) of the first paragraph of such covenant.
Credit Facilities means, with respect to the Parent or any Restricted Subsidiary, one or
more debt or commercial paper facilities or indentures with banks or other institutional lenders or
investors (including without limitation the Senior Secured Credit Facilities) providing for
revolving credit loans, term loans, notes, debentures or other debt securities, 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 Refinancings
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 for the purpose of fixing, hedging or swapping currency exchange rate risk.
Debt means, with respect to any Person on any date of determination (without duplication):
(a) the principal of and premium (if any) in respect of:
(1) debt of such Person for money borrowed, and
(2) debt evidenced by notes, debentures, bonds or other similar instruments for
the payment of which such Person is responsible or liable;
56
(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 representing the deferred and unpaid purchase price
of Property, except to the extent such balance constitutes a trade accounts payable or
similar obligation to a trade creditor arising in the ordinary course of business;
(d) all obligations of such Person for the reimbursement of any obligor on any letter
of credit, bankers 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 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) above 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,
including by means of any Guarantee;
(g) all obligations of the type referred to in clauses (a) through (f) above 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 Fair Market Value of such Property and the amount of the obligation so secured; and
(h) to the extent not otherwise included in this definition, the net amount paid under
any Hedging Obligations of such Person with respect to any Interest Rate Agreement.
The amount of Debt of any Person at any date shall be the outstanding balance, or the accreted
value of such Debt in the case of Debt issued with original issue discount, 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. The amount
of Debt represented by a Hedging Obligation shall be equal to:
(1) zero if such Hedging Obligation has been Incurred pursuant to clause (f), (g) or
(h) of the second paragraph of the covenant described under Certain
CovenantsLimitation on Debt, or
(2) the notional amount of such Hedging Obligation if not Incurred pursuant to such
clauses.
Default means any event which is, or after notice or passage of time or both would be, an
Event of Default.
Designated Noncash Consideration means any non-cash consideration received by the Parent or
one of its Restricted Subsidiaries in connection with an Asset Sale that is designated as
Designated Noncash Consideration pursuant to an Officers Certificate executed by the Chief
Financial Officer of the Parent. Such Officers Certificate shall state the Fair Market Value of
such non-cash consideration and the basis of such valuation. A particular item of Designated
Noncash Consideration shall no longer be considered to be outstanding to the extent it has been
sold or liquidated for cash (but only to the extent of the cash received).
Disinterested Director means, with respect to any transaction or series of related
transactions, a member of the Board of Directors who does not have any material direct or indirect
financial interest in or with respect to such transaction or series of related transactions.
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Disqualified Stock means any Capital Stock of the Parent or any of its Restricted
Subsidiaries 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 of such Capital Stock
for Debt or Disqualified Stock,
on or prior to, in the case of clause (a), (b) or (c), the date that is 91 days after the Stated
Maturity of the notes; provided, however, that only the portion of the Capital Stock which so
matures or is so mandatorily redeemable, is so convertible or exchangeable or is so redeemable at
the option of the holder of such Capital Stock prior to such date, shall be deemed to be
Disqualified Stock; provided, further, that any Capital Stock that would constitute Disqualified
Stock solely because the holders of such Capital Stock have the right to require the Parent or a
Restricted Subsidiary to repurchase such Capital Stock upon the occurrence of a change of control
or asset sale (each defined in a substantially identical manner to the corresponding definitions in
the indenture) shall not constitute Disqualified Stock if the terms of such Capital Stock (and all
such securities into which it is convertible or for which it is exchangeable) provide that the
Parent and the Restricted Subsidiaries may not repurchase or redeem any such Capital Stock (and all
such securities into which it is convertible or for which it is exchangeable) pursuant to such
provision prior to compliance by the Company with the provisions of the indenture described under
Repurchase at the Option of Holders Upon a Change of Control and Certain Covenants Limitation
on Asset Sales and such repurchase or redemption complies with the covenant described under
Certain CovenantsLimitation on Restricted Payments.
Disqualified Stock Dividends means all dividends with respect to Disqualified Stock of the
Parent held by Persons other than a Wholly Owned Restricted Subsidiary; provided that Disqualified
Stock Dividends shall not include dividends paid or payable through the issuance of additional
shares of Capital Stock (other than Disqualified Stock). The amount of any such dividend shall be
equal to the quotient of such dividend divided by the difference between one and the effective
federal income tax rate (expressed as a decimal number between 1 and 0) then applicable to the
Parent.
Domestic Restricted Subsidiary means any Restricted Subsidiary other than (a) a Foreign
Restricted Subsidiary or (b) a Subsidiary of a Foreign Restricted Subsidiary.
EBITDA means, for any period, an amount equal to, for the Parent and its consolidated
Restricted Subsidiaries:
(a) the sum of Consolidated Net Income for such period, plus the following to the
extent reducing 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 of intangibles,
(5) any other non-cash items (including, without limitation, charges arising
from fair value accounting required by Statement of Financial Accounting Standards
No. 133) (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),
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(6) any restructuring charges (without duplication) as disclosed on the
financial statements or the notes related thereto in accordance with GAAP,
including, without limitation, $2.5 million identified as the cost of severance for
termination of employees associated with downsizing and cost of replacing CEO in
footnote (b) to the Adjusted EBITDA presentation as set forth in this offering, and
(7) any fees, expenses, costs or charges relating to any acquisition, asset
sale, or incurrence or amendment of Debt permitted to be incurred or amended, as the
case may be, by the indenture, whether or not successful, including fees, expenses,
costs and charges relating to this offering and the other Transactions; minus
(b) all non-cash items increasing Consolidated Net Income for such period (other than
(i) any such non-cash item to the extent that it will result in the receipt of cash payments
in any future period and (ii) reversals of prior accruals or reserves for non-cash items
previously excluded from the calculation of EBITDA pursuant to clause (5) of this
definition).
Notwithstanding the preceding clause (a), the provision for taxes and the depreciation,
amortization and noncash 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 Parent
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 Offering means any public or private sale of common stock or common units, as the
case may be, of the Parent.
Event of Default has the meaning set forth under Events of Default.
Exchange Act means the Securities Exchange Act of 1934, as amended.
Excluded Contributions mean the net cash proceeds received by the Parent after the date of
the indenture from (a) contributions to its common equity capital and (b) the sale (other than to a
Subsidiary or pursuant to any management equity plan or stock option plan or any other management
or employee benefit plan or agreement of the Parent or any of its Subsidiaries) of Capital Stock
(other than Disqualified Stock) of the Parent, in each case, designated within 30 days of the
receipt of such net cash proceeds as Excluded Contributions pursuant to an Officers Certificate;
provided that such net cash proceeds shall be excluded from the calculation set forth in clause
(c)(2) of the first paragraph of the covenant described above under the heading Certain Covenants
Limitation on Restricted Payments.
Fair Market Value means, with respect to any Property, the price that could reasonably be
negotiated in an arms-length transaction, for cash, between a willing seller and a willing buyer,
neither of whom is under undue pressure or compulsion to complete the transaction. Fair Market
Value shall be determined, except as otherwise provided,
(a) if such Property has a Fair Market Value equal to or less than $5.0 million, by any
Officer of the Company, or
(b) if such Property has a Fair Market Value in excess of $5.0 million, by at least a
majority of the Board of Directors and evidenced by a resolution of the Board of Directors,
dated within 30 days of the relevant transaction, delivered to the Trustee.
Foreign Restricted Subsidiary means any Restricted Subsidiary which is not organized under
the laws of the United States of America or any State of the United States of America or the
District of Columbia.
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GAAP means United States generally accepted accounting principles as in effect on the Issue
Date, including those set forth in:
(a) the opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants,
(b) the statements and pronouncements of the Financial Accounting Standards Board,
(c) 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.
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, or to maintain financial statement conditions or otherwise), or
(b) entered into for the purpose of assuring in any other manner the obligee against
loss in respect of such Debt (in whole or in part);
provided, however, that the term guarantee shall not include:
(1) endorsements for collection or deposit in the ordinary course of business, or
(2) 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. The term guarantor shall mean
any Person guaranteeing any obligation.
Guarantee means a Guarantee on the terms set forth in the indenture by a Guarantor of the
Companys obligations with respect to the notes.
Guarantor means the Parent, each Domestic Restricted Subsidiary (other than the Company) and
any other Person that becomes a Guarantor pursuant to the covenant described under Certain
Covenants Future Guarantors or who otherwise executes and delivers a supplemental indenture to
the Trustee providing for a Guarantee.
Hedging Obligation of any Person means any obligation of such Person pursuant to any
Interest Rate Agreement, Currency Exchange Protection Agreement, Commodity Price Protection
Agreement or any other similar agreement or arrangement.
holder means a Person in whose name a Note is registered.
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
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balance sheet of such Person (and Incurrence and Incurred shall have meanings correlative
to the preceding); provided 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 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. Solely for purposes of determining compliance with the covenant described under
Certain Covenants Limitation on Debt, the 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 accreted value of such Debt.
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 Parent or the Company.
Independent Investment Banker means one of the Reference Treasury Dealers appointed by the
Trustee after consultation with the Company.
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 for the
purpose of fixing, hedging or swapping interest rate risk.
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 (other than advances to employees for travel and
other business expenses in the ordinary course of business) 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. For purposes of the covenants described under Certain
CovenantsLimitation on Restricted Payments and Certain CovenantsDesignation of Restricted
and Unrestricted Subsidiaries and the definition of Restricted Payment, the term Investment
shall include the portion (proportionate to the Parents equity interest in such Subsidiary) of the
Fair Market Value of the net assets of any Subsidiary of the Parent at the time that such
Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation
of such Subsidiary as a Restricted Subsidiary, the Parent shall be deemed to continue to have a
permanent Investment in an Unrestricted Subsidiary of an amount (if positive) equal to:
(a) the Parents Investment in such Subsidiary at the time of such redesignation, less
(b) the portion (proportionate to the Parents equity interest in such Subsidiary) of
the Fair Market Value of the net assets of such Subsidiary at the time of such
redesignation.
Investment shall also include the issuance, sale or other disposition of Capital Stock of any
Restricted Subsidiary to a Person other than the Parent or another Restricted Subsidiary if the
result of such issuance, sale or other disposition is that such Restricted Subsidiary shall cease
to be a Restricted Subsidiary, in which event the amount of such Investment shall be the Fair
Market Value of the remaining interest, if any, in such former Restricted Subsidiary held by the
Parent and the other Restricted Subsidiaries. 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.
Issue Date means the date on which the notes are initially issued.
Lien means, with respect to any Property of any Person, any mortgage or deed of trust,
pledge, hypothecation, security interest, lien, charge, easement (other than any easement not
materially impairing usefulness or marketability), encumbrance or other security agreement 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 preceding or
any Sale and Leaseback Transaction); provided that in no event shall an operating lease be deemed
to constitute a Lien.
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Moodys means Moodys Investors Service, Inc. or any successor to the rating agency business
of Moodys Investors.
Net Available Cash from any Asset Sale means cash payments received from such Asset Sale
(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 fees and
expenses 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 or in respect of any Debt that is secured by any Property
subject to such Asset Sale (other than with respect to the Senior Secured Credit
Facilities), in accordance with the terms of any Lien upon 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 of in
such Asset Sale and retained by the Parent or any Restricted Subsidiary after such Asset
Sale, including, without limitation, pension and other post-employment benefit liabilities,
liabilities relating to environmental matters and liabilities under any indemnification
liabilities associated with an Asset Sale.
Non-Recourse Debt, with respect to any Person, means Debt of such Person for which the sole
legal recourse for collection of principal and interest on such Debt is against the specific
property identified in the instruments evidencing or securing such Debt.
Officer means the Chief Executive Officer, the President, the Chief Financial Officer, any
Vice President or Secretary 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 acceptable to the
Trustee. The counsel may be an employee of or counsel to the Company.
Permitted Business means any business that is reasonably related, ancillary or complementary
to the businesses of the Parent and the Restricted Subsidiaries on the Issue Date or other business
that is a reasonable extension or expansion of such businesses.
Permitted Investment means any Investment by the Parent or a Restricted Subsidiary in:
(a) the Parent or any Restricted Subsidiary,
(b) 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 Permitted
Business;
(c) 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 Parent
or a Restricted Subsidiary; provided that such Persons primary business is a Permitted
Business;
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(d) cash and Cash Equivalents;
(e) receivables owing to the Parent or a Restricted Subsidiary and prepaid expenses, in
each case, created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms; provided, however, that such trade
terms may include such concessionary trade terms as the Parent or such Restricted Subsidiary
deems reasonable under the circumstances;
(f) 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;
(g) loans and advances to employees made in the ordinary course of business; provided
that such loans and advances do not exceed $2.0 million in the aggregate at any one time
outstanding;
(h) Investments received in settlement, compromise or resolution of (i) debts created
in the ordinary course of business and owing to the Parent or a Restricted Subsidiary or
(ii) litigation, arbitration or other disputes with Persons;
(i) any Investment made as a result of the receipt of non-cash consideration received
in connection with (A) an Asset Sale consummated in compliance with the covenant described
under Certain Covenants Limitation on Asset Sales, or (B) any disposition of
Property not constituting an Asset Sale;
(j) any Investment acquired solely in exchange for the issuance of Capital Stock (other
than Disqualified Stock) of Parent;
(k) Investments existing on the Issue Date;
(1) any Hedging Obligation;
(m) Investments in a Securitization Subsidiary that are necessary to effect a Permitted
Receivables Financing;
(n) advances, loans or extensions of credit to suppliers and vendors in the ordinary
course of business;
(o) Investments resulting from the acquisition of a Person that at the time of such
acquisition held instruments constituting Investments that were not acquired in
contemplation of the acquisition of such Person;
(p) guarantees not otherwise permitted under clause (a) above which are permitted by
the covenant described under Certain Covenants Limitation on Debt that do not exceed
$5.0 million in the aggregate outstanding at any one time; and
(q) Investments not otherwise permitted under clauses (a) through (p) above made for
Fair Market Value that do not exceed $20.0 million in the aggregate outstanding at any one
time.
For purposes of determining Permitted Investments, in the event that an Investment meets the
criteria of more than one of the categories of (a) through (q) above, the Company shall, in its
sole discretion, classify (or later reclassify in whole or in part, in its sole discretion) such
Investment in any manner that complies with the preceding definition.
Permitted Liens means:
(a) Liens to secure Debt permitted to be Incurred under clause (b) of the second
paragraph of the covenant described under Certain CovenantsLimitation on Debt;
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(b) Liens to secure Debt permitted to be Incurred under clause (c) of the second
paragraph of the covenant described under Certain CovenantsLimitation on Debt;
provided that any such Lien may not extend to any Property of the Parent 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;
(c) Liens to secure Debt permitted to be Incurred under clause (n) of the second
paragraph of the covenant described under Certain CovenantsLimitation on Debt;
(d) Liens for taxes, assessments or governmental charges or levies on the Property of
the Parent or any Restricted Subsidiary if the same shall not at the time be delinquent or
thereafter can be paid without penalty, or are being contested in good faith and by
appropriate proceedings promptly instituted and diligently concluded; provided that any
reserve or other appropriate provision that shall be required in conformity with GAAP shall
have been made therefor;
(e) Liens imposed by law, such as carriers, warehousemens and mechanics Liens and
other similar Liens, on the Property of the Parent or any Restricted Subsidiary arising in
the ordinary course of business;
(f) Liens on the Property of the Parent or any Restricted Subsidiary Incurred in the
ordinary course of business to secure performance of obligations with respect to statutory
or regulatory requirements, performance or return-of-money bonds, surety bonds or other
obligations of a like nature, in each case which are not Incurred in connection with the
borrowing of money, the obtaining of advances or credit or the payment of the deferred
purchase price of Property and which do not in the aggregate impair in any material respect
the use of Property in the operation of the business of the Parent and the Restricted
Subsidiaries taken as a whole;
(g) Liens on Property at the time the Parent or any Restricted Subsidiary acquired such
Property, including any acquisition by means of a merger or consolidation with or into the
Parent or any Restricted Subsidiary; provided, however, that any such Lien may not extend to
any other Property of the Parent or any Restricted Subsidiary; provided, further, however,
that such Liens shall not have been Incurred in anticipation of or in connection with the
transaction or series of transactions pursuant to which such Property was acquired by the
Parent or any Restricted Subsidiary;
(h) Liens on the Property of a Person at the time such Person becomes a Restricted
Subsidiary; provided, however, that any such Lien may not extend to any other Property of
the Parent or any other Restricted Subsidiary that is not a direct Subsidiary of such
Person; provided, further, however, that any such Lien was not Incurred in anticipation of
or in connection with the transaction or series of transactions pursuant to which such
Person became a Restricted Subsidiary;
(i) pledges or deposits by the Parent or any Restricted Subsidiary under workers
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 Parent or any Restricted Subsidiary is party, or deposits to secure
public or statutory obligations of the Parent or the Company, or deposits for the payment of
rent, in each case Incurred in the ordinary course of business;
(j) utility easements, building restrictions and such other encumbrances or charges
against real Property as are of a nature generally existing with respect to properties of a
similar character;
(k) Liens existing on the Issue Date not otherwise described in clauses (a) through (j)
above;
(l) Liens on the Property of the Parent or any Restricted Subsidiary to secure any
Refinancing, in whole or in part, of any Debt secured by Liens referred to in clause (g),
(h) or (k) 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:
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(1) the outstanding principal amount, or, if greater, the committed amount, of
the Debt secured by Liens described under clause (g), (h) or (k) 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 Parent or such Restricted Subsidiary in connection
with such Refinancing;
(m) Liens in favor of the Parent or any of its Restricted Subsidiaries;
(n) Liens securing Hedging Obligations which Hedging Obligations relate to Debt that is
otherwise permitted to be Incurred under the terms of the indenture;
(o) Liens on assets transferred to a Securitization Subsidiary on assets of a
Securitization Subsidiary Incurred in connection with a Permitted Receivables Financing;
(p) Liens arising from filing Uniform Commercial Code financing statements regarding
leases;
(q) judgment Liens not giving rise to an Event of Default;
(r) Liens securing the notes together with any additional notes and any note
guarantees; and
(s) Liens not otherwise permitted by clauses (a) through (r) above securing Debt in an
amount not to exceed $10.0 million.
Permitted Receivables Financing means any receivables financing facility or arrangement
pursuant to which a Securitization Subsidiary purchases or otherwise acquires accounts receivable
and any assets related thereto, including without limitation, all collateral securing such accounts
receivable and other assets (including contract rights) and all guarantees and other obligations in
respect of such accounts receivable, proceeds of such accounts receivable and other assets
(including contract rights) which are customarily transferred or in respect of which security
interests are granted, including with respect to asset securitization transactions, of the Parent
or any Restricted Subsidiary and enters into a third party financing thereof on terms that the
Board of Directors has concluded as evidenced by a board resolution are customary and market terms
fair to the Parent and its Restricted Subsidiaries.
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 accrued interest on the Debt being
Refinanced and any fees and expenses, including premiums and defeasance costs,
related to such Refinancing,
(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, and
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(d) the new Debt shall be subordinated in right of payment to the notes or guarantees
as applicable, if the Debt that is being Refinanced was subordinated in right of payment to
the notes or guarantees, as applicable;
provided, however, that Permitted Refinancing Debt shall not include:
(x) Debt of a Subsidiary of the Parent that is not a Guarantor (other than the Company)
that Refinances Debt of the Company or a Guarantor, or
(y) Debt of the Parent or a Restricted Subsidiary that Refinances Debt of an
Unrestricted Subsidiary.
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 of any government or any agency or any other entity.
Preferred Stock means any Capital Stock of a Person, however designated, which entitles the
holder of such Capital Stock 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 Parent or a Wholly Owned Restricted Subsidiary or
dividends paid or payable through the issuance of additional shares of Capital Stock (other than
Disqualified Stock). The amount of any such dividend shall be equal to the quotient of such
dividend divided by the difference between one and the effective federal income rate (expressed as
a decimal number between 1 and 0) then applicable to the issuer of such Preferred Stock.
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, as interpreted in good faith by the Board of Directors after consultation
with the independent certified public accountants of the Company, or otherwise a calculation made
in good faith by the Board of Directors after consultation with the independent certified public
accountants of the Company, as the case may be.
Pro Forma Cost Savings means, with respect to any period, the reduction in net costs and
related adjustments that (1) were directly attributable to an acquisition that occurred during the
four-quarter period or after the end of the four-quarter period and on or prior to the
determination date and calculated on a basis that is consistent with Regulation S-X under the
Securities Act as in effect and applied as of the Issue Date; (2) were actually implemented with
respect to the acquisition within six months after the date of the acquisition and prior to the
determination date that are supportable and quantifiable by underlying accounting records; or (3)
relate to the acquisition and that the Board of Directors of the Company reasonably determines are
probable and based upon specifically identifiable actions to be taken within six months of the date
of the acquisition and, in the case of each of (1), (2) and (3), are described as provided below in
an Officers Certificate, as if all such reductions in costs had been effected as of the beginning
of such period. Pro Forma Cost Savings described above shall be established by a certificate
delivered to the Trustee from the Chief Financial Officer of the Company that outlines the specific
actions taken or to be taken and the net cost savings achieved or to be achieved from each such
action and, in the case of clause (3) above, that states such savings have been determined to be
probable.
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.
Purchase Money Debt means Debt:
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(a) consisting of the deferred purchase price of Property (including Debt issued
to any Person owning such Property), conditional sale obligations, obligations under any
title retention agreement, other purchase money obligations and obligations in respect of
industrial revenue bonds, in each case where the maturity of such Debt does not exceed the
anticipated useful life of the Property being financed, and
(b) Incurred to finance the acquisition (whether through the direct purchase of
Property or the Capital Stock of any Person owning such Property), construction or lease by
the Parent or a Restricted Subsidiary of such Property, including additions and improvements
thereto;
provided, however, that such Debt is Incurred within 180 days after the acquisition, construction
or lease of such Property by the Parent or such Restricted Subsidiary.
Reference Treasury Dealer means Banc of America Securities LLC or Deutsche Bank Securities
Inc. and their respective successors; provided, however, that if any of the preceding shall cease
to be a primary U.S. Government Securities dealer in New York City, the Company shall substitute
therefor another primary treasury dealer.
Reference Treasury Dealer Quotations means, with respect to each Reference Treasury Dealer
and any redemption date, the average, as determined by the Trustee, of the bid and ask prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the third
business day preceding such redemption date.
Refinance means, in respect of any Debt, to refinance, extend, modify, restate, substitute,
amend, renew, refund or Repay, or to issue other Debt, in exchange or replacement for, such Debt.
Refinanced and Refinancing shall have correlative meanings.
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 the covenant described under Certain Covenants Limitation on Asset Sales 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.
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 Parent or any
Restricted Subsidiary (including any payment in connection with any merger or consolidation
with or into the Parent or any Restricted Subsidiary), except for any dividend or
distribution that is made solely to the Parent 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 Parent 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 Parent;
(b) the purchase, repurchase, redemption, acquisition or retirement for value of any
Capital Stock of the Parent or any Restricted Subsidiary (other than from the Parent, a
Restricted Subsidiary or any non-Affiliate of the Company that owns Capital Stock of the
Parent or any Restricted Subsidiary) or any securities exchangeable for or convertible into
any such Capital Stock, including the exercise of any option to exchange any Capital Stock
(other than for or into Capital Stock of the Parent that is not Disqualified Stock);
(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, of any Subordinated Debt (other than the purchase, repurchase or other acquisition
of any Subordinated Debt purchased in
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anticipation of satisfying a scheduled maturity, sinking fund or amortization or other
installment obligation, in each case due within one year of the date of acquisition); or
(d) any Investment (other than Permitted Investments) in any Person.
Restricted Subsidiary means the Company and any other Subsidiary of the Parent other than an
Unrestricted Subsidiary.
S&P means Standard & Poors Ratings Services or any successor to the rating agency business
of Standard & Poors Rating Services.
Sale and Leaseback Transaction means any direct or indirect arrangement relating to Property
now owned or hereafter acquired whereby the Parent or a Restricted Subsidiary transfers such
Property to another Person and the Parent or a Restricted Subsidiary leases it from such Person.
Securities Act means the Securities Act of 1933, as amended.
Securitization Subsidiary means a Subsidiary of the Parent:
(a) that is designated a Securitization Subsidiary by the Board of Directors;
(b) that does not engage in, and whose charter documents prohibit it from engaging in,
any activities other than Permitted Receivables Financings and any activities necessary,
incidental or related thereto;
(c) no portion of the Debt or any other obligation, contingent or otherwise, of which:
(A) is guaranteed by the Parent or any Restricted Subsidiary;
(B) is recourse to or obligates the Parent or any Restricted Subsidiary in any
way; or
(C) subjects any Property or asset of the Parent or any Restricted Subsidiary,
directly or indirectly, contingently or otherwise, to the satisfaction thereof,
other than Standard Securitization Undertakings;
(d) with respect to which neither the Parent nor any Restricted Subsidiary (other than
an Unrestricted Subsidiary) has any obligation to maintain or preserve its financial
condition or cause it to achieve certain levels of operating results other than, in respect
of clauses (c) and (d), pursuant to customary representations, warranties, covenants and
indemnities entered into in connection with a Permitted Receivables Financing.
Senior Secured Credit Facilities means the Debt represented by:
(1) the credit agreement, dated as of the date of the indenture, among the Company, as
borrower thereunder, the Parent, Bank of America, N.A. as administrative agent, Deutsche
Bank Securities Inc., as syndication agent, joint lead arranger and joint book-running
manager, Banc of America Securities LLC, as joint lead arranger and joint book-running
manager and the lenders and issuers party thereto, together with the related documents
thereto (including, without limitation, any guarantee agreements and security documents), as
the same may be amended, supplemented or otherwise modified from time to time, including
amendments, supplements, or modifications relating to the addition or elimination of
Subsidiaries of the Company as borrowers, guarantors or other credit parties thereunder; and
(2) any renewal, extension, refunding, restructuring, replacement or refinancing of the
Debt (whether with the original Administrative Agent and lenders or another administrative
agent or agents or
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one or more other lenders and whether provided under the original Senior Secured Credit
Facilities or one or more other credit or other agreements).
Significant Restricted Subsidiary means any Restricted Subsidiary that would be a
significant subsidiary of the Parent within the meaning of Rule 1-02 under Regulation S-X
promulgated by the Commission.
Special Interest has the meaning set forth in a registration rights agreement relating to
amounts to be paid in the event the Company fails to satisfy certain conditions set forth therein.
For all purposes herein, interest shall include Special Interest, if any, with respect to the
notes.
Standard Securitization Undertakings means representations, warranties, covenants and
indemnities entered into by the Parent or any of its Restricted Subsidiaries which are reasonably
and customary in the securitization of receivables transactions.
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 of the Security upon the happening of any
contingency beyond the control of the issuer unless such contingency has occurred).
Subordinated Debt means any Debt of the Company or any Guarantor (whether outstanding on the
Issue Date or thereafter Incurred) that is subordinate or junior in right of payment to the notes
or the applicable Guarantee pursuant to a written agreement to that effect.
Subsidiary means, in respect of any Person, any corporation, company (including any limited
liability company), association, partnership, joint venture or other business entity of which at
least 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.
Surviving Person means the surviving Person formed by a merger, consolidation or
amalgamation and, for purposes of the covenant described under Merger, Consolidation and Sale
of Property, 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.
Transactions means (i) the entering into of our senior secured credit facilities as
described under Description of Other Indebtedness and (ii) our tender offered conducted with
respect to our 91/4 Senior Subordinated Notes due 2012 (which have been retired).
Treasury Rate means, with respect to any redemption date, the rate per annum equal to the
yield to maturity of the Comparable Treasury Issue, compounded semi-annually, assuming a price for
such Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such redemption date.
Unrestricted Subsidiary means (a) any Subsidiary of the Parent that is designated after the
Issue Date as an Unrestricted Subsidiary as permitted or required pursuant to the covenant
described under Certain Covenants Designation of Restricted and Unrestricted Subsidiaries
and is not thereafter redesignated as a Restricted Subsidiary as permitted pursuant thereto; and
(b) any Subsidiary of an Unrestricted Subsidiary.
U.S. Government Obligations means obligations issued or directly and fully guaranteed or
insured (or certificates representing an ownership interest in such obligations) of the United
States of America (including any
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agency or instrumentality of the United States of America) for the payment of which the full
faith and credit of the United States of America is pledged.
Voting Stock of any Person 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 other voting
members of the governing body of such Person.
Wholly Owned Restricted Subsidiary means, at any time, a Restricted Subsidiary all the
Voting Stock of which (except directors qualifying shares) is at such time owned, directly or
indirectly, by the Parent and its other Wholly Owned Subsidiaries.
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DESCRIPTION OF THE OLD NOTES
The terms of the old notes are substantially identical to those of the new notes, except that
(1) the old notes have not been registered under the Securities Act, are subject to certain
restrictions on transfer and are entitled to certain rights under the registration rights agreement
(which rights will terminate upon consummation of the exchange offer, except under limited
circumstances); and (2) the new notes will not provide for any additional interest as a result of
our failure to fulfill certain registration obligations.
The old notes provide that, in the event that we and the guarantors have not exchanged the new
notes for all old notes validly tendered in accordance with the terms of an exchange offer on or
before the 366th day after the original issue date of the old notes or, if applicable, a shelf
registration statement covering resales of the old notes has not been declared effective or such
shelf registration statement ceases to be effective at any time during the shelf registration
period (subject to certain exceptions), then additional interest shall accrue on the principal
amount of the old notes at a rate of 0.25% per annum for the first 90-day period immediately
following such date and by an additional 0.25% per annum with respect to each subsequent 90-day
period, up to a maximum additional rate of 1.00% per annum thereafter, until an exchange offer is
completed, the shelf registration statement is declared effective or, if such shelf registration
statement ceased to be effective, again becomes effective, or until the second anniversary of the
original issue date of the old notes, unless such period is extended, as described in the
registration rights agreement which we entered into with the initial purchasers of the old notes.
The new notes are not, and upon consummation of the exchange offer with respect to the old
notes will not be, entitled to any such additional interest. Holders of old notes should review
the information set forth under Risk Factors and Description of the New Notes.
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BOOK ENTRY, SETTLEMENT AND CLEARANCE
The Global Notes
The new notes will be issued in the form of several registered notes in global form, without
interest coupons (we refer to such new notes in global form as the global notes).
Upon issuance, each of the global notes will be deposited with the trustee as custodian for
DTC and registered in the name of Cede & Co., as nominee of DTC.
Ownership of beneficial interests in each global note will be limited to persons who have
accounts with DTC (DTC participants) or persons who hold interests through DTC participants. We
expect that under procedures established by DTC:
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upon deposit of each global note with DTCs custodian, DTC will credit portions of the
principal amount of the global note to the accounts of persons who have accounts with DTC;
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ownership of beneficial interests in each global note will be shown on, and transfer of
ownership of those interests will be effected only through, records maintained by DTC (with
respect to interests of DTC participants) and the records of DTC participants (with respect
to other owners of beneficial interests in the global note). |
Beneficial interests in the global notes may not be exchanged for notes in physical,
certificated form except in the limited circumstances described below.
Exchanges Among the Global Notes
Beneficial interests in one global note may generally be exchanged for interests in another
global note. Depending on whether the transfer is being made during or after the Distribution
Compliance Period, and to which global note the transfer is being made, the trustee may require the
seller to provide certain written certifications in the form provided in the indenture. In
addition, in the case of a transfer of interests to the Institutional Accredited Investor global
note, the trustee may require the buyer to deliver a representation letter in the form provided in
the indenture that states, among other things, that the buyer is not acquiring notes with a view to
distributing them in violation of the Securities Act.
A beneficial interest in a global note that is transferred to a person who takes delivery
through another global note will, upon transfer, become subject to any transfer restrictions and
other procedures applicable to beneficial interests in the other global note.
Book-Entry Procedures for the Global Notes
All interests in the global notes will be subject to the operations and procedures of DTC. We
provide the following summaries of those operations and procedures solely for the convenience of
investors. The operations and procedures of each settlement system are controlled by that
settlement system and may be changed at any time. We are not responsible for those operations or
procedures.
DTC has advised us that it is:
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a limited purpose trust company organized under the laws of the State of New York; |
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a banking organization within the meaning of the New York Banking Law; |
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a member of the Federal Reserve System; |
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a clearing corporation within the meaning of the New York Uniform Commercial Code; and |
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a clearing agency registered under Section 17A of the Exchange Act.
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DTC was created to hold securities for its participants and to facilitate the clearance and
settlement of securities transactions between its participants through electronic book-entry
changes to the accounts of its participants. DTCs participants include securities brokers and
dealers; banks and trust companies; clearing corporations and other organizations. Indirect access
to DTCs system is also available to others such as banks, brokers, dealers and trust companies;
these indirect participants clear through or maintain a custodial relationship with a DTC
participant, either directly or indirectly. Investors who are not DTC participants may
beneficially own securities held by or on behalf of DTC only through DTC participants or indirect
participants in DTC.
So long as DTCs nominee is the registered owner of a global note, that nominee will be
considered the sole owner or holder of the notes represented by that global note for all purposes
under the indenture. Except as provided below, owners of beneficial interests in a global note:
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will not be entitled to have notes represented by the global note registered in their
names; |
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will not receive or be entitled to receive physical, certificated notes; and |
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will not be considered the owners or holders of the notes under the indenture for any
purpose, including with respect to the giving of any direction, instruction or approval to
the trustee under the indenture. |
As a result, each investor who owns a beneficial interest in a global note must rely on the
procedures of DTC to exercise any rights of a holder of notes under the indenture (and, if the
investor is not a participant or an indirect participant in DTC, on the procedures of the DTC
participant through which the investor owns its interest).
Payments of principal, premium (if any) and interest with respect to the notes represented by
a global note will be made by the trustee to DTCs nominee as the registered holder of the global
note. Neither we nor the trustee will have any responsibility or liability for the payment of
amounts to owners of beneficial interests in a global note, for any aspect of the records relating
to or payments made on account of those interests by DTC, or for maintaining, supervising or
reviewing any records of DTC relating to those interests.
Payments by participants and indirect participants in DTC to the owners of beneficial
interests in a global note will be governed by standing instructions and customary industry
practice and will be the responsibility of those participants or indirect participants and DTC.
Transfers between participants in DTC will be effected under DTCs procedures and will be
settled in same-day funds.
Certificated Notes
Notes in physical, certificated form will be issued and delivered to each person that DTC
identifies as a beneficial owner of the related notes only if:
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DTC notifies us at any time that it is unwilling or unable to continue as depositary for
the global notes and a successor depositary is not appointed within 90 days; |
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DTC ceases to be registered as a clearing agency under the Exchange Act and a successor
depositary is not appointed within 90 days; |
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we, at our option, notify the trustee that we elect to cause the issuance of
certificated notes; or |
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certain other events provided in the indenture should occur. |
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CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following discussion is a summary of certain U.S. federal income tax consequences relevant
to the exchange of old notes for new notes in the exchange offer, but does not purport to be a
complete analysis of all potential tax effects. This discussion is based upon the U.S. Internal
Revenue Code of 1986, as amended, which we refer to as the Code, U.S. Treasury Regulations issued
thereunder, Internal Revenue Service (IRS) rulings and pronouncements, and judicial decisions now
in effect, all of which are subject to change at any time. Any such change may be applied
retroactively in a manner that could adversely affect a holder of the notes. We have not sought
and will not seek any rulings from the IRS, with respect to the matters discussed below. There can
be no assurance that the IRS will not take a different position concerning the tax consequences of
the exchange of old notes for new notes in the exchange offer or that any position would not be
sustained.
This discussion is limited to holders who exchange old notes for new notes in the exchange
offer. This discussion does not address all of the U.S. federal income tax consequences that may
be relevant to a holder in light of such holders particular circumstances or to holders subject to
special rules, such as banks and certain other financial institutions, partnerships and other
pass-through entities (or investors in such entities), regulated investment companies, real estate
investment trusts, U.S. expatriates, insurance companies, dealers in securities or currencies,
traders in securities, U.S. holders whose functional currency is not the U.S. dollar, holders
subject to alternative minimum tax, tax-exempt organizations, tax deferred or other retirement
accounts and persons holding the notes as part of a straddle, hedge, conversion transaction
or other integrated transaction. In addition, this discussion is limited to persons that hold the
notes as capital assets (generally, property held for investment) within the meaning of Section
1221 of the Code. This discussion does not address the effect of any applicable state, local,
foreign or other tax laws, including gift and estate tax laws.
If a partnership or other entity or arrangement treated as a partnership for U.S. federal
income tax purposes holds notes, the tax treatment of a partner in the partnership will generally
depend upon the status of the partner and the activities of the partnership. If you are a partner
of a partnership holding the notes, you should consult your tax advisor regarding the tax
consequences of the exchange of old notes for new notes in the exchange offer.
THIS SUMMARY OF CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES IS FOR GENERAL INFORMATION ONLY
AND IS NOT TAX ADVICE. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS REGARDING THE APPLICATION OF THE
TAX CONSEQUENCES DISCUSSED BELOW TO THEIR PARTICULAR SITUATIONS AS WELL AS POTENTIAL CHANGES IN
APPLICABLE TAX LAWS AND THE APPLICATION OF ANY STATE, LOCAL, FOREIGN OR OTHER TAX LAWS, INCLUDING
GIFT AND ESTATE TAX LAWS, AND ANY TAX TREATIES.
The exchange of old notes for new notes in the exchange offer will not constitute a taxable
exchange for U.S. federal income tax purposes. As a result, (1) a holder will not recognize
taxable gain or loss as a result of exchanging such holders old notes for new notes in the
exchange offer; (2) the holding period of the new notes will include the holding period of the old
notes exchanged therefor; and (3) the adjusted basis of the new notes received will be the same as
the adjusted basis of the old notes exchanged therefor immediately before such exchange.
TREASURY DEPARTMENT CIRCULAR 230 DISCLOSURE: Any discussion of tax issues set forth in this
prospectus was written in connection with the promotion and marketing of the transactions described
herein. Such discussion was not intended or written to be used, and it cannot be used, by any
person for the purpose of avoiding any tax penalties that may be imposed on such person. Each
holder should seek advice based on its particular circumstances from an independent tax adviser.
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PLAN OF DISTRIBUTION
We are not using any underwriters for this exchange offer and we are bearing the expense of
the exchange offer. Each broker-dealer that receives new notes for its own account in connection
with the exchange offer must acknowledge that it will deliver a prospectus in connection with any
resale of such new notes. This prospectus, as it may be amended or supplemented from time to time,
may be used by a broker-dealer in connection with resales of new notes received in exchange for old
notes where such notes were acquired as a result of market-making activities or other trading
activities. We have agreed that we will use our commercially reasonable efforts to keep this
prospectus continuously effective, supplemented and amended to ensure that it is available for
resales of new notes acquired by broker-dealers for their own accounts as a result of market-making
activities or other trading activities for a period ending on the earlier of (i) 180 days from the
date on which this prospectus is declared effective and (ii) the date on which a broker-dealer is
no longer required to deliver a prospectus in connection with market-making or other trading
activities.
We will not receive any proceeds from the issuance of new notes in the exchange offer or from
any sale of new notes by broker-dealers. New notes received by broker-dealers for their own
accounts pursuant to the exchange offer may be sold from time to time in one or more transactions
in the over-the-counter market, in negotiated transactions, through the writing of options on the
new notes or a combination of such methods of resale, at market prices prevailing at the time of
resale, at prices related to such prevailing market prices or at negotiated prices. Any such
resale may be made directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such broker-dealer and/or the
purchasers of any such new notes. Any broker-dealer that resells new notes that were received by
it for its own account pursuant to the exchange offer and any broker or dealer that participates in
a distribution of such new notes may be deemed to be an underwriter within the meaning of the
Securities Act, and any profit on any such resale of new notes and any commissions or concessions
received by any such persons may be deemed to be underwriting compensation under the Securities
Act. The letter of transmittal states that by acknowledging that it will deliver and by delivering
a prospectus, a broker-dealer will not be deemed to admit that it is an underwriter within the
meaning of the Securities Act.
For a period ending on the earlier of (i) 180 days from the date on which this prospectus is
declared effective and (ii) the date on which a broker-dealer is no longer required to deliver a
prospectus in connection with market-making or other trading activities, we will promptly send a
reasonable number of additional copies of the prospectus and any amendment or supplement to this
prospectus to any broker-dealer that requests such documents in the letter of transmittal. We have
agreed to pay all expenses incident to the exchange offer (including the expenses of one counsel
for the holder of the notes) other than commissions or concessions of any brokers or dealers and
will indemnify the holders of the new notes, including any broker-dealers, against certain
liabilities, including liabilities under the Securities Act.
CERTAIN ERISA CONSIDERATIONS
The new notes may be acquired and held by an employee benefit plan subject to Title I of the
U.S. Employee Retirement Income Security Act of 1974, as amended (which we refer to as ERISA), or
by an individual retirement account or other plan subject to Section 4975 of the Code. A fiduciary
of an employee benefit plan subject to ERISA must determine that the purchase and holding of the
new notes is consistent with its fiduciary duties under ERISA. The fiduciary of an ERISA plan, as
well as any other prospective investor subject to Section 4975 of the Code or any other federal,
state, local, non-U.S. or other laws or requirements that are similar to such provisions of ERISA
or the Code (we refer to these laws collectively as similar laws), must also determine that its
purchase and holding of the new notes does not result in a non-exempt prohibited transaction as
defined in Section 406 of ERISA or Section 4975 of the Code or any applicable similar law. Each
holder of our new notes who is subject to Section 406 of ERISA, Section 4975 of the Code or any
similar law (we refer to each such holder as a plan investor) will be deemed to have represented by
its acquisition and holding of the new notes that its acquisition and holding of the new notes does
not constitute or give rise to a non-exempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code or a violation of any applicable similar law. The sale of any new notes
to any plan investor is in no respect a representation by us, our parent guarantor, our subsidiary
and affiliate guarantors, or any of our or their affiliates or representatives that such an
investment meets all relevant legal
requirements with respect to investments by plan investors generally or any particular plan
investor, or that such an investment is appropriate for plan investors generally or any particular
plan investor.
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LEGAL MATTERS
The validity of the new notes and guarantees offered hereby has been passed upon for us by
Alston & Bird LLP, New York, New York.
EXPERTS
The financial statements and the financial statement schedule incorporated in this prospectus by
reference to Prestige Brands Holdings, Inc.s Current Report on Form 8-K filed August 5, 2010 and
managements assessment of the effectiveness of internal control over financial reporting (which is
included in Managements Report on Internal Control over Financial Reporting) incorporated in this
prospectus by reference to the Annual Report on Form 10-K of Prestige Brands Holdings, Inc. for the
year ended March 31, 2010 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the
authority of said firm as experts in auditing and accounting.
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Prestige Brands, Inc.
Exchange Offer for
$150,000,000
8.25% Senior Notes due 2018
We are offering to exchange:
up to $150,000,000 of our new 8.25% Senior Notes due 2018
for
a like amount of our outstanding 8.25% Senior Notes due 2018.
PROSPECTUS
We have not authorized anyone to give any information or represent anything to you other
than the information contained in this prospectus. You must not rely on any unauthorized
information or representations.
Until 90 days from the date of this prospectus, all dealers that effect transactions in these
securities, whether or not participating in this offering, may be required to deliver a prospectus.
This is in addition to the dealers obligation to deliver a prospectus when acting as underwriters
and with respect to their unsold allotments or subscriptions.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers.
Prestige Delaware Entities
The officers and directors of Prestige Brands Holdings, Inc. (a Delaware corporation),
Prestige Personal Care Holdings, Inc., Prestige Personal Care, Inc., Prestige Services Corp.,
Medtech Holdings, Inc., Medtech Products Inc., The Cutex Company, The Denorex Company, and The Spic
and Span Company (collectively, the Prestige Delaware Entities) are covered by certain provisions
of the Delaware General Corporation Law (or the DGCL) and the respective certificates of
incorporation and insurance policies of such entities, that serve to limit and, in certain
instances, to indemnify them against certain liabilities that they may incur in such capacities.
These various provisions are described below.
In June 1986, Delaware enacted legislation that authorizes corporations to limit or eliminate
the personal liability of directors to corporations and their stockholders for monetary damages for
breach of directors fiduciary duty of care. This duty of care requires that, when acting on
behalf of the corporation, directors must exercise an informed business judgment based on all
significant information reasonably available to them. Absent the limitations now authorized by
such legislation, directors are accountable to corporations and their stockholders for monetary
damages for conduct constituting negligence or gross negligence in the exercise of their duty of
care. Although the statute does not change directors duty of care, it enables corporations to
limit available relief to equitable remedies such as injunction or rescission. The certificates of
incorporation of the Prestige Delaware Entities limit the liability of the directors of such
entities to the fullest extent permitted by such legislation. Specifically, the directors of the
Prestige Delaware Entities will not be personally liable for monetary damages for breach of a
directors fiduciary duty as director, except for liability: (1) for any breach of the directors
duty of loyalty, (2) for acts or omissions not in good faith or that involve intentional misconduct
or a knowing violation of law, (3) for unlawful payments of dividends or unlawful share repurchases
or redemptions as provided in Section 174 of the DGCL, or (4) for any transaction from which the
director derived an improper personal benefit.
Under Delaware law, the Prestige Delaware Entities have the power, under specified
circumstances generally requiring the director or officer to act in good faith and in a manner he
reasonably believes to be in or not opposed to the best interests of the relevant Prestige Delaware
Entity, to indemnify its directors and officers in connection with actions, suits or proceedings
brought against them by a third party or in the name of the particular entity by reason of the fact
that (i) they were or are such directors or officers or (ii) while a director or officer, they are
or were serving at the request of the relevant Prestige Delaware Entity as a director, officer,
partner, venturer, proprietor, trustee, employee, agent, or similar functionary of another foreign
or domestic entity, to the fullest extent permitted under the DGCL. The Prestige Delaware Entities
also have the authority to indemnify any of its employees or agents to the fullest extent permitted
by law. In addition, certain of the Prestige Delaware Entities have entered into indemnification
agreements with its directors and officers that generally provide for indemnification under
circumstances for which indemnification would otherwise be discretionary under Delaware law.
Certain of the Prestige Delaware Entities maintain insurance coverage on behalf of any person
who is or was a director or officer of the relevant entity or is or was a director or officer of
such entitiy serving at the request of such entity as a director, officer, partner, venturer,
proprietor, trustee, employee, agent, or similar functionary of another foreign or domestic entity,
on terms at least comparable and in the same amount as the amounts set forth in the indemnitees
respective indemnification agreement.
Prestige Virginia Entities
The officers and directors of Prestige Brands Holdings, Inc. (a Virginia corporation) and
Prestige Brands International, Inc. (collectively, the Prestige Virginia Entities) are covered by
certain provisions of the Virginia Stock Corporation Act (or the VSCA) and the respective Articles
of Incorporation and insurance policies of such entities, that serve to limit and, in certain
instances, to indemnify them against certain liabilities that they may incur in such capacities.
These various provisions are described below.
II-1
The VSCA allows, in general, for indemnification, in certain circumstances, by a corporation
of any person threatened with or made a defendant or respondent in any action, suit, or proceeding
by reason of the fact that he or she is, or was, a director or officer of such corporation if the
director or officer meets certain conditions of conduct. Indemnification is also authorized with
respect to a criminal action or proceeding where the person had no reasonable cause to believe that
his conduct was unlawful. The VSCA provides limitations on damages payable by officers and
directors, except in cases of willful misconduct or knowing violation of criminal law or any
federal or state securities law.
The Prestige Virginia Entities respective Articles of Incorporation provide for mandatory
indemnification of their directors and officers who are or were a party to any proceeding, by
reason of the fact that (i) they were or are a director, officer, employee or agent or (ii) while a
director or officer, they are or were serving at the request of the relevant Prestige Virginia
Entity as a director, trustee, partner, or officer similar functionary of another corporation,
partnership, limited liability company, joint venture, trust, employee benefit plan or other
enterprise, against any liability incurred in the proceeding. However, the director or officer
will not be indemnified for such liabilities as are incurred because of such directors or
officers willful misconduct or knowing violation of the criminal law.
The Prestige Virginia Entities maintain standard policies of officers and directors
liability insurance on terms at least comparable and in the same amount as the amounts set forth in
the indemnitees respective indemnification agreement.
Item 21. Exhibits and Financial Statement Schedules.
(a) Exhibits.
A list of exhibits filed with this registration statement is set forth on the Exhibit Index
that immediately follows the signature pages and is incorporated herein by reference.
Item 22. Undertakings
(a) The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made, a post-effective
amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, as
amended (the Securities Act);
(ii) To reflect in the prospectus any facts or events arising after the effective date of the
registration statement (or the most recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed that which was registered) and
any deviation from the low or high end of the estimated maximum offering range may be reflected in
the form of prospectus filed with the Securities and Exchange Commission (the SEC) pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in
the maximum aggregate offering price set forth in the Calculation of Registration Fee table in
the effective registration statement;
(iii) To include any material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material change to such information in
the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act, each such
post-effective amendment shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-2
(3) To remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering.
(b) The undersigned registrants hereby undertake that, for purposes of determining any
liability under the Securities Act, each filing of the registrants annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of 1934, as amended (Exchange Act)
(and, where applicable, each filing of an employee benefit plans annual report pursuant to section
15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the registrants pursuant to the
foregoing provisions, or otherwise, the registrants have been advised that in the opinion of the
SEC such indemnification is against public policy as expressed in the Securities Act and is,
therefore, unenforceable. In the event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with the securities being
registered, the registrants will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
(d) The undersigned registrants hereby undertake to respond to requests for information that
is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form
S-4, within one business day of receipt of such request, and to send the incorporated documents by
first class mail or other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration statement through the date of responding
to the request.
(e) The undersigned registrants hereby undertake to supply by means of a post-effective
amendment all information concerning a transaction, and the company being acquired involved
therein, that was not the subject of and included in the registration statement when it became
effective.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
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PRESTIGE BRANDS, INC.
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
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Signature |
|
Title |
|
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|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
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PRESTIGE BRANDS HOLDINGS, INC.,
a Delaware corporation
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
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|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director, President and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ John E. Byom
|
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Director |
|
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John E. Byom |
|
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/s/ Gary E. Costley
|
|
Director |
|
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|
Gary E. Costley |
|
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/s/ Patrick M. Lonergan
|
|
Director |
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Patrick M. Lonergan |
|
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|
/s/ Charles J. Hinkaty
|
|
Director |
|
|
|
Charles J. Hinkaty |
|
|
II-5
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
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PRESTIGE PERSONAL CARE HOLDINGS, INC.
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
PRESTIGE PERSONAL CARE, INC.
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-7
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
PRESTIGE SERVICES CORP.
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-8
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
PRESTIGE BRANDS HOLDINGS, INC.,
a Virginia corporation
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-9
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
PRESTIGE BRANDS INTERNATIONAL, INC.
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-10
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
MEDTECH HOLDINGS, INC.
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-11
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
MEDTECH PRODUCTS INC.
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-12
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
THE CUTEX COMPANY
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-13
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
THE DENOREX COMPANY
|
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-14
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Irvington, State of New York, on August 9, 2010.
|
|
|
|
|
|
THE SPIC AND SPAN COMPANY |
|
|
By: |
/s/ Peter J. Anderson
|
|
|
|
Peter J. Anderson |
|
|
|
Chief Financial Officer and Treasurer |
|
|
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities indicated on August 9, 2010. Each person
whose signature appears below authorizes Peter J. Anderson and Eric S. Klee, and either of them,
with full power of substitution and resubstitution, his true and lawful attorneys-in-fact, for him
in any and all capacities, to sign any amendments (including post-effective amendments or
supplements) to this registration statement and to file the same, with exhibits thereto, and other
documents in connection therewith, with the SEC.
|
|
|
Signature |
|
Title |
|
|
|
/s/ Matthew M. Mannelly
Matthew M. Mannelly
|
|
Director and Chief Executive Officer
(Principal Executive Officer) |
|
|
|
/s/ Peter J. Anderson
Peter J. Anderson
|
|
Director, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer) |
|
|
|
/s/ Eric S. Klee
|
|
Director |
|
|
|
Eric S. Klee |
|
|
II-15
EXHIBIT INDEX
|
|
|
Exhibit Number |
|
Description of Document |
|
|
|
3.1
|
|
Amended and Restated Certificate of Incorporation of Prestige Brands Holdings, Inc. (filed as
Exhibit 3.1 to Prestige Brands Holdings, Inc.s Form S-1/A filed on February 8, 2005).+ |
|
|
|
3.2
|
|
Amended and Restated Bylaws of Prestige Brands Holdings, Inc., as amended (filed as Exhibit
3.2 to Prestige Brands Holdings, Inc.s Form 10-Q filed on November 6, 2009).+ |
|
|
|
3.3
|
|
Certificate of Incorporation of Prestige Brands, Inc. |
|
|
|
3.4
|
|
Bylaws of Prestige Brands, Inc. |
|
|
|
4.1
|
|
Indenture, dated as of March 24, 2010, by and among Prestige Brands, Inc., each Guarantor
listed on the signature pages thereto, and U.S. Bank National Association, as trustee.* |
|
|
|
4.2
|
|
Form of 8.25% Senior Note due 2018 (contained in Exhibit 4.2 to Prestige Brands Holding,
Inc.s Annual Report on Form 10-K for the fiscal year ended March 31, 2010).* |
|
|
|
5.1
|
|
Opinion of Alston & Bird LLP. |
|
|
|
12.1
|
|
Computation of Ratio of Earnings to Fixed Charges. |
|
|
|
21.1
|
|
Subsidiaries.* |
|
|
|
23.1
|
|
Consent of Alston & Bird LLP (reference is made to Exhibit 5.1). |
|
|
|
23.2
|
|
Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm. |
|
|
|
24.1
|
|
Powers of Attorney (contained on the signature pages of this registration statement). |
|
|
|
25.1
|
|
Statement of Eligibility on Form T-1 of U.S. Bank National Association, as the Trustee under
the Indenture. |
|
|
|
99.1
|
|
Form of Letter of Transmittal. |
|
|
|
* |
|
Incorporated herein by reference from Prestige Brands Holdings, Inc.s Annual Report on Form 10-K
for the fiscal year ended March 31, 2010. |
|
+ |
|
Incorporated herein by reference. |
II-16
exv3w3
Exhibit 3.3
CERTIFICATE OF INCORPORATION
OF
PRESTIGE BRANDS, INC.
FIRST: The name of the corporation is Prestige Brands, Inc. (the Corporation).
SECOND: The address of its registered office in the State of Delaware is National
Registered Agents, Inc., 160 Greentree Drive, Suite 101, City of Dover 19904, County of
Kent. The name of its registered agent at such address is National Registered Agents, Inc.
THIRD: The nature of the business or purposes to be conducted or promoted by the
Corporation is to engage in any lawful act or activity for which corporations may be
organized under the Delaware General Corporation Law.
FOURTH: The total number of shares of all classes of capital stock which the
corporation shall have authority to issue is One Thousand (1,000) shares of common stock at
a par value of One Cent ($0.01) per share.
FIFTH: The name of the incorporator is Kathryn Truett c/o Vinson & Elkins L.L.P., 2001
Ross Avenue, Suite 3700, Dallas, Texas 75201.
SIXTH: The name and mailing address of the sole director, who shall serve until the
first annual meeting of stockholders or until his successor is elected and qualified, is as
follows:
|
|
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Name |
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Address |
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Vincent I. Hemmer
|
|
6100 Sears Tower
Chicago, IL 60606 |
The number of directors of the Corporation shall be as specified in, or determined in the
manner provided in, the bylaws of the Corporation. Election of directors need not be by
written ballot.
SEVENTH: In furtherance of, and not in limitation of the powers conferred by statute,
the Board is expressly authorized to adopt, amend or repeal the bylaws of the corporation.
EIGHTH: Whenever a compromise or arrangement is proposed between the Corporation and
its creditors or any class of them and/or between the Corporation and its stockholders or any
class of them, any court of equitable jurisdiction within the State of Delaware may, on the
application in a summary way of the Corporation or of any creditor or stockholder thereof or
on the application of any receiver or receivers appointed for the Corporation under the
provisions of Section 291 of Title 8 of the Delaware Code or on the application of trustees
in dissolution or of any receiver or receivers appointed for the
1
Corporation under the provisions of Section 279 of Title 8 of the Delaware Code order a
meeting of the creditors or class of creditors, and/or of the stockholders or class of
stockholders of the Corporation, as the case may be, to be summoned in such manner as the
said court directs. If a majority in number representing at least three-fourths in value of
the creditors or class of creditors, and/or of the stockholders or class of stockholders of
the corporation, as the case may be, agree to any compromise or arrangement and to any
reorganization of the Corporation as a consequence of such compromise or arrangement, the
said compromise or arrangement and the said reorganization shall, if sanctioned by the court
to which the said application has been made, be binding on all the creditors or class of
creditors, and/or on all the stockholders or class of stockholders, of the Corporation, as
the case may be, and also on the corporation.
NINTH: No director of the Corporation shall be liable to the Corporation or its stockholders
for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any
breach of the directors duty of loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from
which the director derived an improper personal benefit. In addition to the circumstances in which
a director of the Corporation is not personally liable as set forth in the preceding sentence, a
director of the Corporation shall not be liable to the fullest extent permitted by any amendment to
the Delaware General Corporation Law hereafter enacted that further limits the liability of a
director.
TENTH: The Corporation shall indemnify any person who was, is, or is threatened to be made a
party to a proceeding (as hereinafter defined) by reason of the fact that he or she (i) is or was a
director or officer of the Corporation or (ii) while a director or officer of the Corporation, is
or was serving at the request of the Corporation as a director, officer, partner, venturer,
proprietor, trustee, employee, agent, or similar functionary of another foreign or domestic
corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan, or
other enterprise, to the fullest extent permitted under the Delaware General Corporation Law, as
the same exists or may hereafter be amended. Such right shall be a contract right and as such
shall inure to the benefit of any director or officer who is elected and accepts the position of
director or officer of the Corporation or elects to continue to serve as a director or officer of
the Corporation while this Article Tenth is in effect. Any repeal or amendment of this Article
Tenth shall be prospective only and shall not limit the rights of any such director or officer or
the obligations of the Corporation with respect to any claim arising from or related to the
services of such director or officer in any of the foregoing capacities prior to any such repeal or
amendment to this Article Tenth. Such right shall include the right to be paid by the Corporation
expenses (including without limitation attorneys fees) actually and reasonably incurred by him in
defending any such proceeding in advance of its final disposition to the maximum extent permitted
under the Delaware General Corporation Law, as the same exists or may hereafter be amended. If a
claim for indemnification or advancement of expenses hereunder is not paid in full by the
Corporation within sixty (60) days after a written claim has been received by the Corporation, the
claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount
of the claim, and if successful in whole or in part, the claimant shall also be entitled to be paid
the expenses of prosecuting such claim. It shall be a defense to any such
2
action that such indemnification or advancement of costs of defense is not permitted under the
Delaware General Corporation Law, but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including its Board of Directors or any
committee thereof, independent legal counsel, or stockholders) to have made its determination prior
to the commencement of such action that indemnification of, or advancement of costs of defense to,
the claimant is permissible in the circumstances nor any actual determination by the Corporation
(including its Board or any committee thereof, independent legal counsel, or stockholders) that
such indemnification or advancement is not permissible shall be a defense to the action or create a
presumption that such indemnification or advance is not permissible. In the event of the death of
any person having a right of indemnification under the foregoing provisions, such right shall inure
to the benefit of his or her heirs, executors, administrators, and personal representatives, The
rights conferred above shall not be exclusive of any other right which any person may have or
hereafter acquire under any statute, bylaw, resolution of stockholders or directors, agreement, or
otherwise.
The Corporation may also indemnify any employee or agent of the corporation to the fullest
extent permitted by law.
As used herein, the term proceeding means any threatened, pending, or completed action,
suit, or proceeding, whether civil, criminal, administrative, arbitrative, or investigative, any
appeal in such an action, suit, or proceeding, any inquiry or investigation that could lead to such
an action, suit, or proceeding.
ELEVENTH: No contract or transaction between the Corporation and one or more of its
directors, officers, or stockholders or between the Corporation and any person (as used herein,
person means other corporation, partnership, association, firm, trust, joint venture, political
subdivision, or instrumentality) or other organization in which one or more of its directors,
officers, or stockholders are directors, officers, or stockholders, or have a financial interest,
shall be void or voidable solely for this reason, or solely because the director or officer is
present at or participates in the meeting of the board or committee which authorizes the contract
or transaction, or solely because his, her, or their votes are counted for such purpose, if (i) the
material facts as to his or her relationship or interest and as to the contract or transaction are
disclosed or are known to the board of directors or the committee, and the board of directors or
committee in good faith authorizes the contract or transaction by the affirmative votes of a
majority of the disinterested directors, even though the disinterested directors be less than a
quorum; or (ii) the material facts as to his or her relationship or interest and as to the contract
or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the
contract or transaction is specifically approved in good faith by vote of the stockholders; or
(iii) the contract or transaction is fair as to the Corporation as of the time it is authorized,
approved, or ratified by the board of directors, a committee thereof, or the stockholders. Common
or interested directors may be counted in determining the presence of a quorum at a meeting of the
board of directors or of a committee which authorizes the contract or transaction.
TWELFTH: The Corporation shall have the right, subject to any express provisions or
restrictions contained in this certificate of incorporation or bylaws of the Corporation, from time
to time, to amend this certificate of incorporation or any provision hereof in any manner now or
3
hereafter provided by law, and all rights and powers of any kind conferred upon a director or
stockholder of the Corporation by this certificate of incorporation or any amendment hereof are
subject to such right of the Corporation.
4
I, the undersigned, being the incorporator hereinbefore named, for the purpose of forming a
corporation pursuant to the Delaware General Corporation Law, do make this certificate, hereby
declaring that this is my act and deed and that the facts herein stated are true, and accordingly
have hereunto set my hand this 12th day of December, 2003.
|
|
|
|
|
|
|
|
|
/s/ Kathryn Truett
|
|
|
Kathryn Truett, Incorporator |
|
|
|
|
|
5
exv3w4
Exhibit 3.4
BYLAWS
OF
PRESTIGE BRANDS, INC.
A Delaware corporation
(Amended as of March 30, 2004)
Article I
Offices
Section 1. Registered Office. The registered office of the Corporation
required by the General Corporation Law of the State of Delaware to be maintained in the State of
Delaware, shall be the registered office named in the original Certificate of Incorporation of the
Corporation (as the same may be amended and restated from time to time, the Certificate of
Incorporation), or such other office as may be designated from time to time by the Board of
Directors in the manner provided by law. Should the Corporation maintain a principal office within
the State of Delaware such registered office need not be identical to such principal office of the
Corporation.
Section 2. Other Offices. The Corporation may also have offices at
such other places both within and without the State of Delaware as the Board of Directors may from
time to time determine or the business of the Corporation may require.
Article II
Stockholders
Section 1. Place of Meetings. All meetings of the stockholders shall be
held at the principal office of the Corporation, or at such other place within or without the State
of Delaware as shall be specified or fixed in the notices or waivers of notice thereof.
Section 2. Quorum; Adjournment of Meetings. Unless otherwise
required by law or provided in the Certificate of Incorporation or these bylaws, the holders of a
majority of the stock issued and outstanding and entitled to vote thereat, present in person or
represented by proxy, shall constitute a quorum at any meeting of stockholders for the transaction
of business and the act of a majority of such stock so represented at any meeting of stockholders
at which a quorum is present shall constitute the act of the meeting of stockholders. The
stockholders present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal of enough stockholders to
leave less than a quorum.
1
Notwithstanding the other provisions of the Certificate of Incorporation or these bylaws, the
chairman of the meeting or the holders of a majority of the issued and outstanding stock present in
person or represented by proxy at any meeting of stockholders, whether or not a quorum is present,
shall have the power to adjourn such meeting from time to time, without any notice other than
announcement at the meeting of the time and place of the holding of the adjourned meeting;
provided, however, if the adjournment is for more than thirty (30) days, or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting
shall be given to each stockholder of record entitled to vote at such meeting. At any such
adjourned meeting at which a quorum shall be present or represented any business may be transacted
which might have been transacted at the meeting as originally called.
Section 3. Annual Meetings. An annual meeting of the stockholders, for the
election of directors to succeed those whose terms expire and for the transaction of such other
business as may properly come before the meeting, shall be held at such place, within or without
the State of Delaware, on such date, and at such time as the Board of Directors shall fix and set
forth in the notice of the meeting, which date shall be within thirteen (13) months subsequent to
the later of the date of incorporation or the last annual meeting of stockholders.
Section 4. Special Meetings. Unless otherwise provided in the Certificate of
Incorporation, special meetings of the stockholders for any purpose or purposes may be called at
any time by the Chairman of the Board (if any), by the President or by a majority of the Board of
Directors, or by a majority of the executive committee (if any), and shall be called by the
Chairman of the Board (if any), by the President or the Secretary upon the written request
therefor, stating the purpose or purposes of the meeting, delivered to such officer, signed by the
holder(s) of at least ten percent (10%) of the issued and outstanding stock entitled to vote at
such meeting.
Section 5. Record Date. For the purpose of determining stockholders entitled
to notice of or to vote at any meeting of stockholders, or any adjournment thereof, or entitled to
express consent to corporate action in writing without a meeting, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to exercise any rights
in respect of any change, conversion or exchange of stock or for the purpose of any other lawful
action, the Board of Directors of the Corporation may fix, in advance, a date as the record date
for any such determination of stockholders, which date shall not be more than sixty (60) days nor
less than ten (10) days before the date of such meeting, nor more than sixty (60) days prior to any
other action.
If the Board of Directors does not fix a record date for any meeting of the stockholders, the
record date for determining stockholders entitled to notice of or to vote at such meeting shall be
at the close of business on the day next preceding the day on which notice is given, or, if in
accordance with Article VII, Section 3 of these bylaws notice is
waived, at the close of business on the day next preceding the day on which the meeting is
held. If, in accordance with Section 12 of this Article II, corporate action without a meeting of
stockholders is to be taken, the record date for determining stockholders
2
entitled to express
consent to such corporate action in writing, when no prior action by the Board of Directors is
necessary, shall be the day on which the first written consent is expressed. The record date for
determining stockholders for any other purpose shall be at the close of business on the day on
which the Board of Directors adopts the resolution relating thereto.
A determination of stockholders of record entitled to notice of or to vote at a meeting of
stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of
Directors may fix a new record date for the adjourned meeting.
Section 6. Notice of Meetings. Written notice of the place, date and hour of
all
meetings, and, in case of a special meeting, the purpose or purposes for which the meeting is
called, shall be given by or at the direction of the Chairman of the Board (if any) or the
President, the Secretary or the other person(s) calling the meeting to each stockholder entitled to
vote thereat not less than ten (10) nor more than sixty (60) days before the date of the meeting.
Such notice may be delivered either personally or by mail. If mailed, notice is given when
deposited in the United States mail, postage prepaid, directed to the stockholder at his address as
it appears on the records of the Corporation.
Section 7. Stock List. A complete list of stockholders entitled to vote at any
meeting of stockholders, arranged in alphabetical order for each class of stock and showing the
address of each such stockholder and the number of shares registered in the name of such
stockholder, shall be open to the examination of any stockholder, for any purpose germane to the
meeting, during ordinary business hours, for a period of at least ten (10) days prior to the
meeting, either on a reasonably accessible electronic network, provided that the information
required to gain access to the list is provided with the notice of the meeting, or during ordinary
business hours, at the principal place of business of the Corporation. The stock list shall also
be produced and kept at the time and place of the meeting during the whole time thereof, and may be
inspected by any stockholder who is present.
Section 8. Proxies. Each stockholder entitled to vote at a meeting of
stockholders or to express consent or dissent to a corporate action in writing without a meeting
may authorize another person or persons to act for him by proxy. Proxies for use at any meeting of
stockholders shall be filed with the Secretary, or such other officer as the Board of Directors may
from time to time determine by resolution, before or at the time of the meeting. All proxies shall
be received and taken charge of and all ballots shall be received and canvassed by the secretary of
the meeting who shall decide all questions touching upon the qualification of voters, the validity
of the proxies, and the acceptance or rejection of votes, unless an inspector or inspectors shall
have been appointed by the chairman of the meeting, in which event such inspector or inspectors
shall decide all such questions.
No proxy shall be valid after three (3) years from its date, unless the proxy provides for a
longer period. Each proxy shall be revocable unless expressly provided therein to be irrevocable
and coupled with an interest sufficient in law to support an irrevocable power.
3
Should a proxy designate two or more persons to act as proxies, unless such instrument shall
provide the contrary, a majority of such persons present at any meeting at which their powers
thereunder are to be exercised shall have and may exercise all the powers of voting or giving
consents thereby conferred, or if only one be present, then such powers may be exercised by that
one; or, if an even number attend and a majority do not agree on any particular issue, each proxy
so attending shall be entitled to exercise such powers in respect of the same portion of the shares
as he is of the proxies representing such shares.
Section 9. Voting., Elections; Inspectors. Unless otherwise
required by law or provided in the Certificate of Incorporation, each stockholder shall have one
vote for each share of stock entitled to vote which is registered in his name on the record date
for the meeting. Shares registered in the name of another corporation, domestic or foreign, may be
voted by such officer, agent or proxy as the bylaw (or comparable instrument) of such corporation
may prescribe, or in the absence of such provision, as the Board of Directors (or comparable body)
of such corporation may determine. Shares registered in the name of a deceased person may be voted
by his executor or administrator, either in person or by proxy.
All voting, except as required by the Certificate of Incorporation or where otherwise required
by law, may be by a voice vote; provided, however, that upon demand therefor by stockholders
holding a majority of the issued and outstanding stock present in person or by proxy at any meeting
a stock vote shall be taken. Every stock vote shall be taken by written ballots, each of which
shall state the name of the stockholder or proxy voting and such other information as may be
required under the procedure established for the meeting. All elections of directors shall be by
ballot, unless otherwise provided in the Certificate of Incorporation.
At any meeting at which a vote is taken by ballots, the chairman of the meeting may appoint
one or more inspectors, each of whom shall subscribe an oath or affirmation to execute faithfully
the duties of inspector at such meeting with strict impartiality and according to the best of his
ability. Such inspector shall receive the ballots, count the votes and make and sign a certificate
of the result thereof. The chairman of the meeting may appoint any person to serve as inspector,
except no candidate for the office of director shall be appointed as an inspector.
Unless otherwise provided in the Certificate of Incorporation, cumulative voting for the
election of directors shall be prohibited.
Section 10. Conduct of Meetings. The meetings of the stockholders shall be
presided over by the Chairman of the Board (if any), or if he is not present, by the President, or
if neither the Chairman of the Board (if any), nor President is present, by a
chairman elected at the meeting. The Secretary of the Corporation, if present, shall act as
secretary of such meetings, or if he is not present, an Assistant Secretary shall so act; if
neither the Secretary nor an Assistant Secretary is present, then a secretary shall be
4
appointed by
the chairman of the meeting. The chairman of any meeting of stockholders shall determine the order
of business and the procedure at the meeting, including such regulation of the manner of voting and
the conduct of discussion as seem to him in order. Unless the chairman of the meeting of
stockholders shall otherwise determine, the order of business shall be as follows:
|
(a) |
|
Calling of meeting to order. |
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(b) |
|
Election of a chairman and the appointment of a secretary if necessary. |
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(c) |
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Presentation of proof of the due calling of the meeting. |
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(d) |
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Presentation and examination of proxies and determination of a quorum. |
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(e) |
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Reading and settlement of the minutes of the previous meeting. |
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(f) |
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Reports of officers and committees. |
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(g) |
|
The election of directors if an annual meeting, or a meeting called for that
purpose. |
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(h) |
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Unfinished business. |
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(i) |
|
New business. |
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|
(j) |
|
Adjournment. |
Section 11. Treasury Stock. The Corporation shall not vote, directly or
indirectly, shares of its own stock owned by it and such shares shall not be counted for quorum
purposes.
Section 12. Action Without Meeting. Unless otherwise provided in the
Certificate of Incorporation, any action permitted or required by law, the Certificate of
Incorporation or these bylaws to be taken at a meeting of stockholders, may be taken without a
meeting, without prior notice and without a vote, if a consent in writing, setting forth the action
so taken, shall be signed by the holders of outstanding stock having not less than the minimum
number of votes that would be necessary to authorize or take such action at a meeting at which all
shares entitled to vote thereon were present and voted. Prompt notice of the taking of the
corporate action without a meeting by less than a unanimous written consent shall be given by the
Secretary to those stockholders who have not consented in writing.
Article III
Board of Directors
Section 1. Power; Number; Term of Office. The business and affairs
of the Corporation shall be managed by or under the direction of the Board of Directors, and
subject to the restrictions imposed by law or the Certificate of Incorporation, they may exercise
all the powers of the Corporation.
The number of directors of the Corporation shall be determined from time to time by resolution
of the Board of Directors, unless the Certificate of Incorporation fixes the number of directors,
in which case a change in the number of directors shall be made only by amendment of the
Certificate of Incorporation. Each director shall hold office for the
5
term for which he is
elected, and until his successor shall have been elected and qualified or until his earlier death,
resignation or removal.
Unless otherwise provided in the Certificate of Incorporation, directors need not be
stockholders nor residents of the State of Delaware.
Section 2. Quorum. Unless otherwise provided in the Certificate of
Incorporation, a majority of the total number of directors shall constitute a quorum for the
transaction of business of the Board of Directors and the vote of a majority of the directors
present at a meeting at which a quorum is present shall be the act of the Board of Directors.
Section 3. Place of Meetings; Order of Business. The directors may hold their
meetings and may have an office and keep the books of the Corporation, except as otherwise provided
by law, in such place or places, within or without the State of Delaware, as the Board of Directors
may from time to time determine by resolution. At all meetings of the Board of Directors business
shall be transacted in such order as shall from time to time be determined by the Chairman of the
Board (if any), or in his absence by the President, or by resolution of the Board of Directors.
Section 4. First Meeting. Each newly elected Board of Directors may hold its
first meeting for the purpose of organization and the transaction of business, if a quorum is
present, immediately after and at the same place as the annual meeting of the stockholders. Notice
of such meeting shall not be required. At the first meeting of the Board of Directors in each year
at which a quorum shall be present, held next after the annual meeting of stockholders, the Board
of Directors shall proceed to the election of the officers of the Corporation.
Section 5. Regular Meetings. Regular meetings of the Board of Directors shall
be held at such times and places as shall be designated from time to time by resolution of the
Board of Directors. Notice of such regular meetings shall not be required.
Section 6. Special Meetings. Special meetings of the Board of Directors may be
called by the Chairman of the Board (if any), the President or, on the written request of any two
directors, by the Secretary, in each case on at least twenty-four (24) hours personal, written,
telegraphic, cable or wireless notice to each director. Such notice, or any waiver thereof
pursuant to Article VII, Section 3 hereof, need not state the purpose or purposes of such meeting,
except as may otherwise be required by law or provided for in the Certificate of Incorporation or
these bylaws.
Section 7. Removal. Any director or the entire Board of Directors may be
removed, with or without cause, by the holders of a majority of the shares then entitled to vote at
an election of directors; provided that, unless the Certificate of Incorporation
otherwise provides, if the Board of Directors is classified, then the stockholders may effect
such removal only for cause; and provided further that, if the Certificate of Incorporation
expressly grants to stockholders the right to cumulate votes for the election of directors and if
less than the entire board is to be removed, no director may be removed without cause if
6
the votes
cast against his removal would be sufficient to elect him if then cumulatively voted at an election
of the entire Board of Directors, or, if there be classes of directors, at an election of the class
of directors of which such director is a part.
Section 8. Vacancies; Increases in the Number of Directors. Unless otherwise
provided in the Certificate of Incorporation, vacancies and newly created directorships resulting
from any increase in the authorized number of directors may be filled by a majority of the
directors then in office, although less than a quorum, or a sole remaining director; and any
director so chosen shall hold office until the next annual election and until his successor shall
be duly elected and shall qualify, unless sooner displaced.
If the directors of the Corporation are divided into classes, any directors elected to fill
vacancies or newly created directorships shall hold office until the next election of the class for
which such directors shall have been chosen, and until their successors shall be duly elected and
shall qualify.
Section 9. Compensation. Unless otherwise restricted by the Certificate of
Incorporation, the Board of Directors shall have the authority to fix the compensation of
directors.
Section 10. Action Without a Meeting; Telephone Conference Meeting. Unless
otherwise restricted by the Certificate of Incorporation, any action required or permitted to be
taken at any meeting of the Board of Directors, or any committee designated by the Board of
Directors, may be taken without a meeting if all members of the Board of Directors or committee, as
the case may be consent thereto in writing, and the writing or writings are filed with the minutes
of proceedings of the Board of Directors or committee. Such consent shall have the same force and
effect as a unanimous vote at a meeting, and may be stated as such in any document or instrument
filed with the Secretary of State of Delaware.
Unless otherwise restricted by the Certificate of Incorporation, subject to the requirement
for notice of meetings, members of the Board of Directors, or members of any committee designated
by the Board of Directors, may participate in a meeting of such Board of Directors or committee, as
the case may be, by means of a conference telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each other, and participation in such a
meeting shall constitute presence in person at such meeting, except where a person participates in
the meeting for the express purpose of objecting to the transaction of any business on the ground
that the meeting is not lawfully called or convened.
Section 11. Approval or Ratification of Acts or Contracts by Stockholders. The
Board of Directors in its discretion may submit any act or contract for approval or
ratification at any annual meeting of the stockholders, or at any special meeting of the
stockholders called for the purpose of considering any such act or contract, and any act or
contract that shall be approved or be ratified by the vote of the stockholders holding a majority
of the issued and outstanding shares of stock of the Corporation entitled to vote
7
and present in
person or by proxy at such meeting (provided that a quorum is present), shall be as valid and as
binding upon the Corporation and upon all the stockholders as if it has been approved or ratified
by every stockholder of the Corporation. In addition, any such act or contract may be approved or
ratified by the written consent of stockholders holding a majority of the issued and outstanding
shares of capital stock of the Corporation entitled to vote and such consent shall be as valid and
as binding upon the Corporation and upon all the stockholders as if it had been approved or
ratified by every stockholder of the Corporation.
Article IV
Committees
Section 1. Designation; Powers. The Board of Directors may, by resolution
passed by a majority of the whole board, designate one or more committees, including, if they shall
so determine, an executive committee, each such committee to consist of one or more of the
directors of the Corporation. Any such designated committee shall have and may exercise such of
the powers and authority of the Board of Directors in the management of the business and affairs of
the Corporation as may be provided in such resolution, except that no such committee shall have the
power or authority of the Board of Directors in reference to amending the Certificate of
Incorporation, adopting an agreement of merger or consolidation, recommending to the stockholders
the sale, lease or exchange of all or substantially all of the Corporations property and assets,
recommending to the stockholders a dissolution of the Corporation or a revocation of a dissolution
of the Corporation, or amending, altering or repealing the bylaws or adopting new bylaws for the
Corporation and, unless such resolution or the Certificate of Incorporation expressly so provides,
no such committee shall have the power or authority to declare a dividend or to authorize the
issuance of stock. Any such designated committee may authorize the seal of the Corporation to be
affixed to all papers which may require it. In addition to the above such committee or committees
shall have such other powers and limitations of authority as may be determined from time to time by
resolution adopted by the Board of Directors.
Section 2. Procedure; Meetings; Quorum. Any committee designated
pursuant to Section 1 of this Article shall choose its own chairman, shall keep regular minutes of
its proceedings and report the same to the Board of Directors when requested, shall fix its own
rules or procedures, and shall meet at such times and at such place or places as may be provided by
such rules, or by resolution of such committee or resolution of the Board of Directors. At every
meeting of any such committee, the presence of a majority of all the members thereof shall
constitute a quorum and the affirmative vote of a majority of the members present shall be
necessary for the adoption by it of any resolution.
Section 3. Substitution of Members. The Board of Directors may
designate one or more directors as alternate members of any committee, who may replace any absent
or disqualified member at any meeting of such committee. In the absence or disqualification of a
member of a committee, the member or members present at any meeting and not disqualified from
voting, whether or not constituting a quorum, may unanimously appoint
8
another member of the Board
of Directors to act at the meeting in the place of the absent or disqualified member.
Article V
Officers
Section 1. Number, Titles and Term of Office. The officers of the
Corporation shall be a President and a Secretary and, if the Board of Directors so elects, a
Chairman of the Board, one or more Vice Presidents (any one or more of whom may be designated
Executive Vice President or Senior Vice President), a Treasurer and such other officers as the
Board of Directors may from time to time elect or appoint. Each officer shall hold office until
his successor shall be duly elected and shall qualify or until his death or until he shall resign
or shall have been removed in the manner hereinafter provided. Any number of offices may be held
by the same person, unless the Certificate of Incorporation provides otherwise. Except for the
Chairman of the Board, if any, no officer need be a director.
Section 2. Salaries. The salaries or other compensation of the
officers and agents of the Corporation shall be fixed from time to time by the Board of Directors.
Section 3. Removal. Any officer or agent elected or appointed by
the Board of Directors may be removed, either with or without cause, by the vote of a majority of
the whole Board of Directors at a special meeting called for the purpose, or at any regular meeting
of the Board of Directors, provided the notice for such meeting shall specify that the matter of
any such proposed removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election or appointment of an
officer or agent shall not of itself create contract rights.
Section 4. Vacancies. Any vacancy occurring in any office of the Corporation
may be filled by the Board of Directors.
Section 5. Powers and Duties of the Chief Executive Officer. The President
shall be the chief executive officer of the Corporation unless the Board of Directors designates
the Chairman of the Board as chief executive officer. Subject to the control of the Board of
Directors and the executive committee (if any), the chief executive officer shall have general
executive charge, management and control of the properties, business and operations of the
Corporation with all such powers as may be reasonably incident to such responsibilities; he may
agree upon and execute all leases, contracts, evidences of indebtedness and other obligations in
the name of the Corporation and may sign all certificates for shares of capital stock of the
Corporation; and shall have such other powers
and duties as designated in accordance with these bylaws and as from time to time may be
assigned to him by the Board of Directors.
Section 6. Powers and Duties of the Chairman of the Board. If elected, the
Chairman of the Board shall preside at all meetings of the stockholders and of the Board of
9
Directors; and he shall have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors.
Section 7. Powers and Duties of the President. Unless the Board of Directors
otherwise determines, the President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the Corporation; and,
unless the Board of Directors otherwise determines, he shall, in the absence of the Chairman of the
Board or if there be no Chairman of the Board, preside at all meetings of the stockholders and
(should he be a director) of the Board of Directors; and he shall have such other powers and duties
as designated in accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
Section 8. Vice Presidents. In the absence of the President, or in the event
of his inability or refusal to act, a Vice President designated by the Board of Directors shall
perform the duties of the President, and when so acting shall have all the powers of and be subject
to all the restrictions upon the President. In the absence of a designation by the Board of
Directors of a Vice President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and who is senior in
terms of time as a Vice President of the Corporation shall so act. The Vice Presidents shall
perform such other duties and have such other powers as the Board of Directors may from time to
time prescribe.
Section 9. Treasurer. The Treasurer, if any, shall have responsibility for the
custody and control of all the funds and securities of the Corporation, and he shall have such
other powers and duties as designated in these bylaws and as from time to time may be assigned to
him by the Board of Directors. He shall perform all acts incident to the position of Treasurer,
subject to the control of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge of his duties in such
form as the Board of Directors may require.
Section 10. Assistant Treasurers. Each Assistant Treasurer, if any, shall have
the usual powers and duties pertaining to his office, together with such other powers and duties as
designated in these bylaws and as from time to time may be assigned to him by the chief executive
officer or the Board of Directors. The Assistant Treasurers shall exercise the powers of the
Treasurer during that officers absence or inability or refusal to act.
Section 11. Secretary. The Secretary shall keep the minutes of all meetings of
the Board of Directors, committees of directors and the stockholders, in books provided for that
purpose; he shall attend to the giving and serving of all notices; he may in the name of the
Corporation affix the seal of the Corporation to all contracts of the Corporation and attest the
affixation of the seal of the Corporation thereto; he may sign with the other
appointed officers all certificates for shares of capital stock of the Corporation; he shall
have charge of the certificate books, transfer books and stock ledgers, and such other books and
papers as the Board of Directors may direct, all of which shall at all reasonable times be open to
inspection of any director upon application at the office of the Corporation during business hours;
he shall have such other powers and duties as designated in these
10
bylaws and as from time to time
may be assigned to him by the Board of Directors; and he shall in general perform all acts incident
to the office of Secretary, subject to the control of the chief executive officer and the Board of
Directors.
Section 12. Assistant Secretaries. Each Assistant Secretary, if any, shall
have the usual powers and duties pertaining to his office, together with such other powers and duties as
designated in these bylaws and as from time to time may be assigned to him by the chief executive
officer or the Board of Directors. The Assistant Secretaries shall exercise the powers of the
Secretary during that officers absence or inability or refusal to act.
Section 13. Action with Respect to Securities of Other Corporations. Unless
otherwise directed by the Board of Directors, the chief executive officer shall have power to vote
and otherwise act on behalf of the Corporation, in person or by proxy, at any meeting of security
holders of or with respect to any action of security holders of any other corporation in which this
Corporation may hold securities and otherwise to exercise any and all rights and powers which this
Corporation may possess by reason of its ownership of securities in such other corporation.
Article VI
Capital Stock
Section 1. Certificates of Stock. The certificates for shares of the capital
stock of the Corporation shall be in such form, not inconsistent with that required by law
and the Certificate of Incorporation, as shall be approved by the Board of Directors. The Chairman
of the Board (if any), President or a Vice President shall cause to be issued to each stockholder
one or more certificates, under the seal of the Corporation or a facsimile thereof if the Board of
Directors shall have provided for such seal, and signed by the Chairman of the Board (if any),
President or a Vice President and the Secretary or an Assistant Secretary or the Treasurer or an
Assistant Treasurer certifying the number of shares (and, if the stock of the Corporation shall be
divided into classes or series, the class and series of such shares) owned by such stockholder in
the Corporation; provided, however, that any of or all the signatures on the certificate may be
facsimile. The stock record books and the blank stock certificate books shall be kept by the
Secretary, or at the office of such transfer agent or transfer agents as the Board of Directors may
from time to time by resolution determine. In case any officer, transfer agent or registrar who
shall have signed or whose facsimile signature or signatures shall have been placed upon any such
certificate or certificates shall have ceased to be such officer, transfer agent or registrar
before such certificate is issued by the Corporation, such certificate may nevertheless be issued
by the Corporation with the same effect as if such person were such officer, transfer agent or
registrar at the date of issue. The stock certificates shall be consecutively
numbered and shall be entered in the books of the Corporation as they are issued and shall
exhibit the holders name and number of shares.
Section 2. Transfer of Shares. The shares of stock of
the Corporation shall be transferable only on the books of the Corporation by the holders thereof
in person or by
11
their duly authorized attorneys or legal representatives upon surrender and
cancellation of certificates for a like number of shares. Upon surrender to the Corporation or a
transfer agent of the Corporation of a certificate for shares duly endorsed or
accompanied by proper evidence of succession, assignment or authority to transfer, it
shall be the duty of the Corporation to issue a new certificate to the person entitled thereto,
cancel the old certificate and record the transaction upon its books.
Section 3. Ownership of Shares. The Corporation shall be entitled
to treat the holder of record of any share or shares of capital stock of the Corporation as the
holder in fact thereof and, accordingly, shall not be bound to recognize any equitable or other
claim to or interest in such share or shares on the part of any other person, whether or not it
shall have express or other notice thereof, except as otherwise provided by the laws of the State
of Delaware.
Section 4. Regulations Regarding Certificates. The Board of Directors shall
have the power and authority to make all such rules and regulations as they may deem expedient
concerning the issue, transfer and registration or the replacement of certificates for shares of
capital stock of the Corporation.
Section 5. Lost or Destroyed Certificates. The Board of Directors may
determine the conditions upon which a new certificate of stock may be issued in place of a
certificate which is alleged to have been lost, stolen or destroyed; and may, in their discretion,
require the owner of such certificate or his legal representative to give bond, with sufficient
surety, to indemnify the Corporation and each transfer agent and registrar against any and all
losses or claims which may arise by reason of the issue of a new certificate in the place of the
one so lost, stolen or destroyed.
Article VII
Miscellaneous Provisions
Section 1. Fiscal Year. The fiscal year of the Corporation shall be such as
established from time to time by the Board of Directors.
Section 2. Corporate Seal. The Board of Directors may provide a suitable seal,
containing the name of the Corporation. The Secretary shall have charge of the seal (if any). If
and when so directed by the Board of Directors or a committee thereof, duplicates of the seal may
be kept and used by the Treasurer or by the Assistant Secretary or Assistant Treasurer.
Section 3. Notice and Waiver of Notice. Whenever any notice is required to be
given by law, the Certificate of Incorporation or under the provisions of these bylaws, said notice
shall be deemed to be sufficient if given (i) by telegraphic, cable or wireless transmission or
(ii) by deposit of the same in a post office box in a sealed prepaid wrapper addressed to the
person entitled thereto at his post office address, as it appears on the
12
records of the
Corporation, and such notice shall be deemed to have been given on the day of such transmission or
mailing, as the case may be.
Whenever notice is required to be given by law, the Certificate of Incorporation or under any
of the provisions of these bylaws, a written waiver thereof, signed by the person entitled to
notice, whether before or after the time stated therein, shall be deemed equivalent to notice.
Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except
when the person attends a meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting is not lawfully called or convened.
Neither the business to be transacted at, nor the purpose of, any regular or special meeting of
the stockholders, directors, or members of a committee of directors need be specified in any
written waiver of notice unless so required by the Certificate of Incorporation or the bylaws.
Section 4. Resignations. Any director, member of a committee or officer may
resign at any time. Such resignation shall be made in writing and shall take effect at the time
specified therein, or if no time be specified, at the time of its receipt by the chief executive
officer or Secretary. The acceptance of a resignation shall not be necessary to make it effective,
unless expressly so provided in the resignation.
Section 5. Facsimile Signatures. In addition to the provisions for the use
of facsimile signatures elsewhere specifically authorized in these bylaws, facsimile
signatures of any officer or officers of the Corporation may be used whenever and as authorized by
the Board of Directors.
Section 6. Reliance upon Books, Reports and Records. Each director and each
member of any committee designated by the Board of Directors shall, in the performance of his
duties, be fully protected in relying in good faith upon the books of account or reports made to
the Corporation by any of its officers, or by an independent certified public accountant, or by an
appraiser selected with reasonable care by the Board of Directors or by any such committee, or in
relying in good faith upon other records of the Corporation.
Article VIII
Amendments
If provided in the Certificate of Incorporation of the Corporation, the Board of Directors
shall have the power to adopt, amend and repeal from time to time bylaws of the Corporation,
subject to the right of the stockholders entitled to vote with respect thereto to amend or repeal
such bylaws as adopted or amended by the Board of Directors.
13
exv5w1
Exhibit 5.1
Alston&Bird llp
90 Park Avenue
New York, NY 10016
212-210-9400
Fax:212-210-9444
www.alston.com
August 9, 2010
Prestige Brands, Inc.
90 North Broadway
Irvington, New York 10533
|
|
Re: Registration Statement on Form S-4 |
Ladies and Gentlemen:
We are acting as counsel to Prestige Brands, Inc., a Delaware corporation (the Company),
Prestige Brands Holdings, Inc., a Delaware corporation, Prestige Personal Care Holdings, Inc., a
Delaware corporation, Prestige Personal Care, Inc., a Delaware corporation, Prestige Services
Corp., a Delaware corporation, Prestige Brands Holdings, Inc., a Virginia corporation, Prestige
Brands International, Inc., a Virginia corporation, Medtech Holdings, Inc., a Delaware corporation,
Medtech Products Inc., a Delaware corporation, The Cutex Company, a Delaware corporation, The
Denorex Company, a Delaware corporation, and The Spic and Span Company, a Delaware corporation
(collectively, the Guarantors), in connection with the filing of the above-referenced
Registration Statement (the Registration Statement) with the Securities and Exchange Commission
(the Commission) under the Securities Act of 1933, as amended (the Securities Act). The
Registration Statement relates to the proposed issuance, in exchange (the Exchange Offer) for up
to $150 million principal amount of the Companys outstanding unregistered 8.25% Senior Notes due
2018 (the Old Notes), of an equal principal amount of the Companys 8.25% Senior Notes due 2018
(the New Notes), that will be registered under the Securities Act. The Old Notes were, and the
New Notes will be, issued under an Indenture, dated as of March 24, 2010 (the Indenture) between
the Company, the Guarantors and U.S. Bank National Association, as Trustee (the Trustee). This
opinion letter is rendered pursuant to Item 21 of Form S-4 and Item 601(b)(5) of Regulation S-K.
We have examined the Indenture, the Old Notes, including the guarantee of each of the
Guarantors set forth therein, the proposed form of the New Notes, including the guarantee of each
of the Guarantors set forth therein, and the Registration Statement. We also have examined
originals, or copies certified or otherwise identified to our satisfaction, of such other
documents,
records, certificates and instruments (collectively, the Ancillary Documents) as in our judgment
are necessary or appropriate to enable us to render the opinions expressed below. In rendering
such opinions, we have relied as to factual matters upon the representations, warranties and other
statements made in the Indenture and the Ancillary Documents.
Atlanta Charlotte Dallas Los Angeles New York Research Triangle Silicon Valley Ventura County Washington, D.C.
August 9, 2010
Page 2
In rendering our opinions set forth below, we have assumed, without any independent
verification, (i) the genuineness of all signatures, (ii) the legal capacity of all natural
persons, (iii) the authenticity of all documents submitted to us as originals, (iv) the conformity
to the original documents of all documents submitted to us as conformed, telefacsimile, photostatic
or electronic copies, (v) that the form of the New Notes, including the guarantee of each of the
Guarantors set forth therein, will conform to that included in the Indenture, (vi) the due
authorization, execution and delivery of the Indenture and the New Notes, including the guarantee
of each of the Guarantors set forth therein, by each of the parties thereto under the laws of their
respective jurisdictions of incorporation or organization, (vii) that all parties to the documents
examined by us have full power and authority under the laws of their respective jurisdictions of
incorporation or organization to execute, deliver and perform their obligations under such
documents and under the other documents required or permitted to be delivered and performed
thereunder, and (viii) that the Indenture has been duly qualified under the Trust Indenture Act of
1939, as amended.
The opinions rendered in paragraphs 1 and 2 below relating to the enforceability of the
Indenture and the New Notes, including the guarantee of each of the Guarantors set forth therein,
are subject to the effects of: (i) bankruptcy, fraudulent conveyance or fraudulent transfer,
insolvency, reorganization, moratorium, liquidation, conservatorship, and similar laws, and
limitations imposed under judicial decisions related to or affecting creditors right and remedies
generally; (ii) general equitable principles, regardless of whether the issue of enforceability is
considered in a proceeding in equity or at law, and principles limiting the availability of the
remedy of specific performance; (iii) concepts of good faith, fair dealing, materiality and
reasonableness; and (iv) the possible unenforceability under certain circumstances of provisions
providing for indemnification or contribution that is contrary to public policy. In particular, as
contemplated by these qualifications, in rendering the opinions sets forth in paragraphs 1 and 2
below, we express no opinion as to federal or state laws relating to fraudulent conveyances or
fraudulent transfers. Further, no opinion is given herein as to the enforceability of any
particular provision of the Indenture and the New Notes, including the guarantee of each of the
Guarantors set forth therein, relating to (i) waivers of rights to object to jurisdiction or venue,
or consents to jurisdiction or venue, (ii) waivers of rights to (or methods of) service of process,
or rights to trial by jury, or other rights or benefits bestowed by operation of law, (iii) waivers
of any applicable defenses, setoffs, recoupments, or counterclaims, (iv) the grant of powers of
attorney or proxies, (v) exculpation or exoneration clauses, indemnity clauses, and clauses
relating to releases or waivers of unmatured claims or rights, (vi) submission to binding
arbitration, or (vii) the
imposition or collection or payment of any premium, liquidated damages, or other amount which
may be held by any court to be a penalty or a forfeiture.
Based on the foregoing, it is our opinion that:
1. the Indenture is a legal, valid and binding obligation of the Company and the Guarantors
enforceable against the Company and the Guarantors in accordance with its terms; and
August 9, 2010
Page 3
2. upon due execution of the New Notes, including the guarantee of each of the Guarantors set
forth therein, by the Company and the Guarantors, due authentication thereof by the Trustee in
accordance with the Indenture and issuance and delivery thereof in exchange for Old Notes of equal
principal amount as contemplated by the Registration Statement, the New Notes, including the
guarantee of each of the Guarantors set forth therein, will be validly issued and will constitute
legal, valid and binding obligations of the Company and the Guarantors entitled to the benefits of
the Indenture and enforceable against the Company and the Guarantors in accordance with their
terms.
Our opinions set forth herein are limited to the General Corporation Law of the State of
Delaware, the laws of the Commonwealth of Virginia, the laws of the State of New York, and the
federal law of the United States, and we do not express any opinion herein concerning any other
laws.
This opinion letter is provided to the Company for its use solely in connection with the
transactions contemplated by the Registration Statement and may not be used, circulated, quoted or
otherwise relied upon by any other person or for any other purpose without our express written
consent, except that the Company may file a copy of this opinion letter with the Commission as an
exhibit to the Registration Statement. The only opinions rendered by us consist of those matters
set forth in the paragraphs 1 and 2 above, and no opinion may be implied or inferred beyond the
opinions expressly stated. Our opinions expressed herein are as of the date hereof, and we
undertake no obligation to advise you of any changes in applicable law or any other matters that
may come to our attention after the date hereof that may affect our opinions expressed herein.
We consent to the filing of this opinion letter as an exhibit to the Registration Statement
and to the use of our name under the heading Legal Matters in the Prospectus constituting a part
thereof. In giving such consent, we do not thereby admit that we are within the category of
persons whose consent is required under Section 7 of the Securities Act or the rules and
regulations of the Commission thereunder.
|
|
|
|
|
|
Very truly yours,
ALSTON & BIRD LLP
|
|
|
By: |
/s/ Mark F. McElreath
|
|
|
|
Mark F. McElreath |
|
|
|
Partner |
|
|
exv12w1
Exhibit 12.1
Prestige Brands Holdings, Inc.
Computation of Ratio of Earnings to Fixed Charges
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2010 |
|
2009 |
|
2008 |
|
2007 |
|
2006 |
|
|
|
|
Income (loss) from continuing operations
before income taxes |
|
$ |
53,111 |
|
|
$ |
(197,858 |
) |
|
$ |
51,214 |
|
|
$ |
51,545 |
|
|
$ |
51,653 |
|
Fixed charges |
|
|
23,184 |
|
|
|
28,781 |
|
|
|
38,265 |
|
|
|
40,664 |
|
|
|
37,107 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) available for fixed
charges |
|
$ |
76,295 |
|
|
$ |
(169,077 |
) |
|
$ |
89,479 |
|
|
$ |
92,209 |
|
|
$ |
88,760 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense on long term debt |
|
$ |
21,021 |
|
|
$ |
26,431 |
|
|
$ |
35,920 |
|
|
$ |
38,330 |
|
|
$ |
34,754 |
|
Capitalized fees on long term debt |
|
|
1,915 |
|
|
|
2,148 |
|
|
|
2,148 |
|
|
|
2,148 |
|
|
|
2,160 |
|
Estimated interest on rent expense (b) |
|
|
248 |
|
|
|
202 |
|
|
|
197 |
|
|
|
186 |
|
|
|
193 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fixed Charges |
|
$ |
23,184 |
|
|
$ |
28,781 |
|
|
$ |
38,265 |
|
|
$ |
40,664 |
|
|
$ |
37,107 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of Earning to Fixed Charges |
|
|
3.29x |
|
|
|
|
(a) |
|
|
2.34x |
|
|
|
2.27x |
|
|
|
2.39x |
|
|
|
|
(a) |
|
For the year ended March 31, 2009, earnings were insufficient to cover fixed charges primarily due to a
non-cash impairment charge against goodwill and intangible assets of $249 million. |
|
(b) |
|
For the purpose of calculating interest on rent expense the company used a reasonable approximation
of the interest factor. |
exv23w2
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in this Registration Statement on Form S-4 of
Prestige Brands Holdings, Inc. of our report dated June 11, 2010, except with respect to our
opinion on the consolidated financial statements insofar as it relates to the Condensed
Consolidating Financial Information described in Note 20, as to which the date is August 2, 2010,
relating to the financial statements, financial statement schedule and the effectiveness of
internal control over financial reporting of Prestige Brands Holdings, Inc., which appears in the
Current Report on Form 8-K filed August 5, 2010. We also consent to the reference to us under the
heading Experts in such Registration Statement.
/s/
PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Salt Lake City, Utah
August 9, 2010
exv25w1
Exhibit 25.1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY UNDER
THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine Eligibility of
a Trustee Pursuant to Section 305(b)(2)
U.S. BANK NATIONAL ASSOCIATION
(Exact name of Trustee as specified in its charter)
31-0841368
I.R.S. Employer Identification No.
|
|
|
800 Nicollet Mall |
|
|
Minneapolis, Minnesota
|
|
55402 |
|
|
|
(Address of principal executive offices)
|
|
(Zip Code) |
Raymond S. Haverstock
U.S. Bank National Association
60 Livingston Avenue
St. Paul, MN 55107
(651) 495-3909
(Name, address and telephone number of agent for service)
Prestige Brands, Inc.
Guarantors Listed on Scheduled A Hereto
(Issuer with respect to the Securities)
|
|
|
Delaware
|
|
80-0091750 |
|
|
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.) |
|
|
|
90 North Broadway |
|
|
Irvington, New York
|
|
10533 |
|
|
|
(Address of Principal Executive Offices)
|
|
(Zip Code) |
8.25% Senior Notes Due 2018
(Title of the Indenture Securities)
SCHEDULE A
GUARANTORS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Primary Standard |
|
|
|
|
|
|
|
|
Industrial |
|
|
|
|
|
I.R.S. Employer |
|
|
Classification |
|
Jurisdiction of |
|
Identification |
Exact Name of Additional Registrants* |
|
Number |
|
Formation |
|
Number |
Prestige Brands Holdings, Inc. |
|
|
2834 |
|
|
Delaware |
|
|
20-1297589 |
|
Prestige Personal Care Holdings, Inc. |
|
|
2834 |
|
|
Delaware |
|
|
80-0091757 |
|
Prestige Personal Care, Inc. |
|
|
2834 |
|
|
Delaware |
|
|
80-0091755 |
|
Prestige Services Corp. |
|
|
2834 |
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Delaware |
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|
26-0715445 |
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Prestige Brands Holdings, Inc. |
|
|
2834 |
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Virginia |
|
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65-1026844 |
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Prestige Brands International, Inc. |
|
|
2834 |
|
|
Virginia |
|
|
59-3606733 |
|
Medtech Holdings, Inc. |
|
|
2834 |
|
|
Delaware |
|
|
94-3335024 |
|
Medtech Products Inc. |
|
|
2834 |
|
|
Delaware |
|
|
83-0318374 |
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The Cutex Company |
|
|
2834 |
|
|
Delaware |
|
|
74-2899000 |
|
The Denorex Company |
|
|
2834 |
|
|
Delaware |
|
|
75-2993424 |
|
The Spic and Span Company |
|
|
2834 |
|
|
Delaware |
|
|
06-1605546 |
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|
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* |
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The address for each of the Additional Registrants is c/o Prestige Brands Holdings, Inc., 90
North Broadway, Irvington, New York 10533, telephone: (914) 524-6810. The name, address,
including zip code of the agent for service for each Additional Registrant is Eric S. Klee,
Secretary and General Counsel, Prestige Brands Holdings, Inc., 90 North Broadway, Irvington,
New York 10533, telephone: (914) 524-6810. |
FORM T-1
Item 1. GENERAL INFORMATION. Furnish the following information as to the Trustee.
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a) |
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Name and address of each examining or supervising authority to which it
is subject. |
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Comptroller of the Currency
Washington, D.C. |
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b) |
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Whether it is authorized to exercise corporate trust powers. |
Item 2. AFFILIATIONS WITH OBLIGOR. If the obligor is an affiliate of the Trustee, describe
each such affiliation.
Items 3-15 Items 3-15 are not applicable because to the best of the Trustees knowledge, the
obligor is not in default under any Indenture for which the Trustee acts as Trustee.
Item 16. LIST OF EXHIBITS: List below all exhibits filed as a part of this statement of
eligibility and qualification.
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1. |
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A copy of the Articles of Association of the Trustee.* |
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2. |
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A copy of the certificate of authority of the Trustee to commence
business.* |
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3. |
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A copy of the certificate of authority of the Trustee to exercise
corporate trust powers.* |
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4. |
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A copy of the existing bylaws of the Trustee.** |
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5. |
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A copy of each Indenture referred to in Item 4. Not applicable. |
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6. |
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The consent of the Trustee required by Section 321(b) of the Trust
Indenture Act of 1939, attached as Exhibit 6. |
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7. |
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Report of Condition of the Trustee as of March 31, 2010 published
pursuant to law or the requirements of its supervising or examining authority,
attached as Exhibit 7. |
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* |
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Incorporated by reference to Exhibit 25.1 to Amendment No. 2 to registration statement on
S-4, Registration Number 333-128217 filed on November 15, 2005. |
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** |
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Incorporated by reference to Exhibit 25.1 to registration statement on S-4, Registration
Number 333-159463 filed on August 24, 2009. |
2
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the Trustee, U.S.
BANK NATIONAL ASSOCIATION, a national banking association organized and existing under
the laws of the United States of America, has duly caused this statement of eligibility and
qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in the
City of St. Paul, State of Minnesota on the 4th of August, 2010.
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By: |
/s/ Raymond S. Haverstock
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Raymond S. Haverstock |
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Vice President |
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By: |
/s/ Christine Robinette
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Christine Robinette |
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Vice President |
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3
Exhibit 6
CONSENT
In accordance with Section 321(b) of the Trust Indenture Act of 1939, the undersigned, U.S.
BANK NATIONAL ASSOCIATION hereby consents that reports of examination of the undersigned by
Federal, State, Territorial or District authorities may be furnished by such authorities to the
Securities and Exchange Commission upon its request therefor.
Dated: August 4th, 2010
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By: |
/s/ Raymond S. Haverstock
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Raymond S. Haverstock |
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Vice President |
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By: |
/s/ Christine Robinette
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Christine Robinette |
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Vice President |
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4
Exhibit 7
U.S. Bank National Association
Statement of Financial Condition
Exhibit 7
As of 3/31/2010
($000s)
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3/31/2010 |
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Assets |
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Cash and Balances Due From
Depository Institutions |
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$ |
8,396,049 |
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Securities |
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45,269,095 |
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Federal Funds |
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3,774,651 |
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Loans & Lease Financing Receivables |
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180,918,939 |
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Fixed Assets |
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5,108,242 |
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Intangible Assets |
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13,355,160 |
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Other Assets |
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20,687,148 |
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Total Assets |
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$ |
277,509,284 |
|
|
|
|
|
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Liabilities |
|
|
|
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Deposits |
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$ |
194,167,405 |
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Fed Funds |
|
|
9,849,249 |
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Treasury Demand Notes |
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0 |
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Trading Liabilities |
|
|
362,519 |
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Other Borrowed Money |
|
|
31,906,386 |
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Acceptances |
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0 |
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Subordinated Notes and Debentures |
|
|
7,629,967 |
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Other Liabilities |
|
|
6,648,045 |
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|
|
|
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Total Liabilities |
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$ |
250,563,571 |
|
|
|
|
|
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Equity |
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|
|
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Minority Interest in Subsidiaries |
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$ |
1,611,596 |
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Common and Preferred Stock |
|
|
18,200 |
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Surplus |
|
|
12,642,020 |
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Undivided Profits |
|
|
12,673,897 |
|
|
|
|
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Total Equity Capital |
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$ |
26,945,713 |
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|
|
|
|
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Total Liabilities and Equity Capital |
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$ |
277,509,284 |
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To the best of the undersigneds determination, as of the date hereof, the above financial
information is true and correct.
U.S. Bank National Association
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By: |
/s/ Raymond S. Haverstock
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Vice President |
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Date: August 4th, 2010
5
exv99w1
Exhibit 99.1
Letter of Transmittal
by
Prestige Brands, Inc.
For Tender of All
Outstanding 8.25% Senior Notes due 2018
for Registered 8.25% Senior Notes due 2018
Pursuant to the Prospectus
dated , 2010
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON , 2010, UNLESS EXTENDED OR EARLIER TERMINATED (SUCH TIME AND DATE, AS THE
SAME MAY BE EXTENDED, THE EXPIRATION DATE). TENDERS MAY BE WITHDRAWN PRIOR
TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. HOLDERS OF NOTES WHO
DO NOT TENDER THEIR NOTES BY THE EXPIRATION DATE WILL CONTINUE TO HOLD NOTES
WHICH ARE SUBJECT TO TRANSFER RESTRICTIONS, AND THE LIQUIDITY OF THE TRADING
MARKET FOR ANY UNTENDERED NOTES MAY BE SUBSTANTIALLY LIMITED.
The Exchange Agent for the Exchange Offer is:
U.S. Bank National Association
If you want to accept the Exchange Offer, this Letter of Transmittal must be completed,
signed and timely submitted to U.S. Bank National Association, the exchange agent (the Exchange
Agent), as follows:
|
|
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In Person, By Registered or Certified Mail or Overnight Courier: |
|
By Facsimile Transmission:
(For Eligible Institutions Only) |
|
|
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60 Livingston Avenue
|
|
651-495-8158 |
St. Paul, Minnesota 55107
|
|
Attn: Specialized Finance Department |
Attn: Specialized Finance Department |
|
|
Tel (Toll-Free): 800-934-6802 |
|
|
Delivery of this Letter of Transmittal to an address other than as set forth above, or of
instructions via a facsimile number other than as listed above, will not constitute a valid
delivery to the Exchange Agent.
This Exchange Offer is not being made to, nor will we accept tenders from or on behalf of,
holders of outstanding 8.25% Senior Notes due 2018 in any jurisdiction in which the Exchange Offer
or the acceptance of it would not be in compliance with the laws of such jurisdiction.
IMPORTANT INFORMATION
The prospectus dated , 2010 of Prestige Brands, Inc., a Delaware corporation (the
Company), and this letter of transmittal (as it may be amended, the Letter of Transmittal)
together constitute our offer to exchange our outstanding unregistered 8.25% Senior Notes due 2018
(the Old Notes) for new 8.25% Senior Notes due 2018 (the New Notes) (as it may be amended from time to time, the Exchange Offer). The Company
is a wholly-owned subsidiary of Prestige Brands Holdings, Inc. (the Parent). For each Old Note
that we accept for exchange, the holder of the Old Note will receive a New Note having a principal
amount equal to that of the surrendered Old Note. Holders of Old Notes should carefully read the
prospectus for additional information concerning the Old Notes and the Exchange Offer.
The form and terms of the New Notes will be identical in all material respects to the form and
terms of the Old Notes except that:
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the New Notes will bear a different CUSIP number from the Old Notes; |
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the New Notes will be registered under the Securities Act of 1933, as amended (the
Securities Act), and therefore, the New Notes generally will be issued free from transfer
restrictions; and |
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|
holders of the New Notes will not be entitled to any registration rights under that
certain registration rights agreement that we entered into with the initial purchasers of
the Old Notes (the Registration Rights Agreement). |
This Letter of Transmittal is to be used by registered holders (Holders) of the Old Notes.
This Letter of Transmittal is to be used by Holders if certificates representing Old Notes are to
be physically delivered to the Exchange Agent herewith by Holders and such Holders tender of Old
Notes are not being transmitted through DTCs Automated Tender Offer Program (ATOP).
Holders who are accepting the Exchange Offer by book-entry transfer to the Exchange Agents
account at DTC can execute their tender through ATOP. Participants of DTC that are accepting the
Exchange Offer must transmit their acceptance through ATOP to DTC, which will verify the acceptance
and execute a book-entry delivery to the Exchange Agents account at DTC. DTC will then send an
Agents Message (Agents Message) to the Exchange Agent for its acceptance. Delivery of the
Agents Message by DTC will satisfy the terms of the Exchange Offer in lieu of execution and
delivery of a Letter of Transmittal by the participant identified in the Agents Message.
Accordingly, the Letter of Transmittal need not be completed by a Holder tendering through ATOP.
Note that the Exchange Offer does not include a provision for delivering Old Notes pursuant to
a notice of guaranteed delivery.
The date on which Holders who validly tender and do not withdraw their Old Notes will receive
a like amount of New Notes in respect of any Old Notes validly tendered (and not validly withdrawn)
is expected to be promptly following the Expiration Date. Tenders may not be withdrawn at any time
after 5:00 p.m. on the Expiration Date (the Withdrawal Time) unless the Company is otherwise
required by applicable law to permit the withdrawal and revocation or unless the Exchange Offer is
terminated without any Old Notes being exchanged thereunder, as described in the prospectus.
Delivery of documents to DTC or the Company does not constitute delivery to the Exchange
Agent.
The Exchange Offer is subject to the satisfaction or waiver of certain conditions, as
specified in the Exchange Offer.
The undersigned should complete, execute and deliver this Letter of Transmittal to indicate
the action the undersigned desires to take with respect to the Exchange Offer.
2
THE DELIVERY OF THIS LETTER OF TRANSMITTAL SHALL NOT UNDER ANY CIRCUMSTANCES CREATE ANY
IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF OR THAT THERE HAS BEEN NO CHANGE IN THE INFORMATION SET FORTH HEREIN OR IN ANY ATTACHMENTS
HERETO OR IN THE AFFAIRS OF THE PARENT, THE COMPANY OR ANY OF THE SUBSIDIARIES OF THE PARENT OR THE
COMPANY SINCE THE DATE HEREOF. THE COMPANY DISCLAIMS
ANY OBLIGATION TO UPDATE OR REVISE ANY INFORMATION CONTAINED IN THIS LETTER OF TRANSMITTAL.
We reserve the right, at any time, to extend the Exchange Offer, in which case the term
Expiration Date means the latest date and time to which the Exchange Offer is extended. In order
to extend the Exchange Offer, we will notify the Exchange Agent by oral or written notice and will
issue a press release or other public announcement of the extension, each prior to 9:00 a.m. New
York City time, on the next business day after the previously scheduled Expiration Date. The
Exchange Offer is not conditioned upon the tender or acceptance for exchange of any minimum
aggregate principal amount of Old Notes. However, the Exchange Offer is subject to certain
conditions. See The Exchange OfferConditions to the Exchange Offer in the prospectus.
3
TENDER OF OLD NOTES
List below the Old Notes to which this Letter of Transmittal relates. If the space provided
is inadequate, list the certificate numbers and principal amounts on a separately executed schedule
and affix the schedule to this Letter of Transmittal. Tenders of Old Notes will be accepted only
in principal amounts equal to $2,000 and integral multiples of $1,000 in excess thereof. This form
should be completed by registered Holders of Old Notes in certificated form. DTC participants must
tender Old Notes through ATOP and should not complete this Letter of Transmittal.
DESCRIPTION OF 8.25% SENIOR NOTES DUE 2018
|
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Name(s) and Address(es) of Registered |
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Aggregate |
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Holder(s) in which Old Notes are Held |
|
Certificate |
|
Principal Amount |
|
Principal Amount |
(please fill in, if blank) |
|
Number(s) |
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Represented |
|
Tendered* |
|
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|
|
|
|
|
Total Principal Amount of Old Notes |
|
|
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|
|
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|
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|
* |
|
Unless otherwise specified, it will be assumed that the entire aggregate principal amount
represented by the Old Notes described above is being tendered. |
The names and addresses of the registered Holders should be printed, if not already printed
above, exactly as they appear on the Old Notes tendered hereby. The Old Notes and the principal
amount of Old Notes that the undersigned wishes to tender should be indicated in the appropriate
boxes.
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
4
Ladies and Gentlemen:
The undersigned hereby tenders to the Company, on the terms and subject to the conditions set
forth in the Exchange Offer, receipt of which is hereby acknowledged, and in accordance with this
Letter of Transmittal, the principal amount of Old Notes indicated in the table above entitled
Description of 8.25% Senior Notes due 2018 under the column heading Principal Amount Tendered.
By reading and signing this Letter of Transmittal, you acknowledge receipt of the prospectus dated
, 2010 relating to the Exchange Offer.
Subject to, and effective upon, the acceptance for exchange of, and exchange for, the Old
Notes tendered herewith in accordance with the terms and subject to the satisfaction or waiver of
the conditions of the Exchange Offer, the undersigned hereby sells, assigns and transfers to, or
upon the order of the Company, all right, title and interest in and to all of the Old Notes
tendered hereby, waives any and all other rights with respect to the Old Notes (including, without
limitation, any existing or past defaults and their consequences in respect of the Old Notes and
the indenture under which the Old Notes were issued) and releases and discharges the Company and
the Parent from any and all claims the undersigned may have now, or may have in the future, arising
out of, or related to, the Old Notes, including without limitation any claims that the undersigned
is entitled to receive additional principal or interest payments with respect to the Old Notes or
to participate in any redemption or defeasance of the Old Notes. The undersigned hereby
irrevocably constitutes and appoints the Exchange Agent the true and lawful agent of the
undersigned (with full knowledge that the Exchange Agent also acts as the agent of the Company)
with respect to such Old Notes, with full powers of substitution and revocation (such appointment
being deemed to be irrevocable) to:
(1) present such Old Notes and all evidences of transfer and authenticity to, or
transfer ownership of, such Old Notes upon the order of the Company;
(2) present such Old Notes for transfer of ownership on the books of Company;
(3) receive all benefits and otherwise exercise all rights of beneficial ownership of
such Old Notes; and
(4) deliver to the Company and the Exchange Agent this Letter of Transmittal in
accordance with the terms and conditions of the Exchange Offer, as set forth therein.
The undersigned understands that tenders of Old Notes may be validly withdrawn by written or
facsimile notice of withdrawal received by the Exchange Agent at any time prior to the Withdrawal
Time, but not thereafter unless the Company is otherwise required by applicable law to permit the
withdrawal and revocation.
In the event of a termination of the Exchange Offer, Old Notes validly tendered pursuant to
the Exchange Offer will be returned to the tendering Holders promptly. If the Company makes a
material change in the terms of, or the information concerning, the Exchange Offer, or waives any
condition of the Exchange Offer that results in a material change to the circumstances of the
Exchange Offer, the Company will disseminate additional Exchange Offer materials to the Holders and
extend the Exchange Offer to the extent required by law.
The undersigned understands that tenders of Old Notes pursuant to any of the procedures
described in the Exchange Offer and in the instructions hereto and acceptance of such Old Notes by
the Company will constitute a binding agreement between the undersigned and the Company upon the
terms and subject to the satisfaction or waiver of the conditions of the Exchange Offer. The
undersigned understands that validly tendered Old Notes (or defectively tendered Old Notes with
respect to which the Company has, or has caused to be, waived such defect) will be deemed to have
been accepted by the Company if and when the Company gives oral (subsequently confirmed in writing)
or written notice thereof to the Exchange Agent.
The undersigned hereby represents and warrants that the undersigned has full power and
authority to tender, sell, assign and transfer the Old Notes tendered hereby, and that when such
tendered Old Notes are accepted for exchange by the Company, the Company will acquire good title
thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any
adverse claim or right. You further represent that the information
5
provided by you in this Letter of Transmittal is true and correct. The undersigned will, upon
request, execute and deliver any additional documents deemed by the Exchange Agent or by the
Company to be necessary or desirable to complete the sale, assignment, transfer, and exchange of
the Old Notes tendered hereby.
You further represent and warrant on behalf of yourself and any beneficial owner of the
tendered Old Notes that:
|
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the New Notes are being acquired in the ordinary course of business for investment
purposes; |
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|
neither you nor any beneficial owner is our affiliate within the meaning of Rule 405
under the Securities Act; and |
|
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|
|
neither you nor any beneficial owner is engaged in, does not intend to engage in and has
no arrangement or understanding with any person to participate in a distribution (within
the meaning of the Securities Act) of the New Notes. |
You agree that our acceptance from you of any tendered Old Notes and the issuance to you of
New Notes in exchange will constitute performance in full of our obligations under the Registration
Rights Agreement and that we will have no further obligations or liabilities thereunder (except as
expressly provided in the Registration Rights Agreement).
Based on interpretations by the staff of the SEC, as described in no-action letters issued to
third parties, we believe that the New Notes issued in the Exchange Offer in exchange for Old Notes
may be offered for resale, resold or otherwise transferred by Holders of the Old Notes without
compliance with the registration and prospectus delivery provisions of the Securities Act, if:
|
|
|
the New Notes are acquired in the ordinary course of the Holders business for
investment purposes; |
|
|
|
|
neither the Holders nor any beneficial owner is an affiliate of ours within the
meaning of Rule 405 under the Securities Act; and |
|
|
|
|
neither the Holders nor any beneficial owner has an arrangement or understanding with
any person to participate in a distribution (within the meaning of the Securities Act) of
the New Notes. |
However, the SEC has not considered the Exchange Offer as described in the accompanying
prospectus in the context of a no-action letter. We cannot assure you that the staff of the SEC
would make a similar determination with respect to the Exchange Offer as in the other
circumstances.
Any Holder who is an affiliate of ours or who intends to participate in the Exchange Offer for
the purpose of distributing New Notes or any broker-dealer who purchased Old Notes directly from us
to resell pursuant to Rule 144A or any other available exemption under the Securities Act:
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may not rely on the applicable interpretations of the staff of the SEC described above; |
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will not be permitted or entitled to tender the Old Notes in the Exchange Offer; and |
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|
must comply with the registration and prospectus delivery requirements of the Securities
Act in connection with any resale transaction. |
Each broker-dealer that receives New Notes for its own account in exchange for Old Notes,
where such securities were acquired by such broker-dealer as a result of market making activities
or other trading activities, must acknowledge that it will deliver a prospectus that meets the
requirements of the Securities Act in connection with any resale of the New Notes. By so
acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it
is an underwriter within the meaning of the Securities Act. See Plan of Distribution in the
prospectus.
All authority conferred or agreed to be conferred by this Letter of Transmittal shall not be
affected by, and shall survive, the death or incapacity of the undersigned, and any obligation of
the undersigned hereunder shall be
6
binding upon the heirs, executors, administrators, trustees in bankruptcy, personal and legal
representatives, successors and assigns of the undersigned.
The undersigned understands that the delivery and surrender of any Old Notes is not effective,
and the risk of loss of the Old Notes does not pass to the Exchange Agent, until receipt by the
Exchange Agent of this Letter of Transmittal (or a manually signed facsimile hereof), properly
completed and duly executed, together with all accompanying evidences of authority and any other
required documents in form satisfactory to the Company. All questions as to the form of all
documents and the validity (including time of receipt) and acceptance of tenders and withdrawals of
Old Notes will be determined by the Company, in its sole discretion, which determination shall be
final and binding.
Unless otherwise indicated herein under A. Special Issuance/Delivery Instructions, the
undersigned hereby request(s) that any Old Notes representing principal amounts not tendered or not
accepted for exchange be issued in the name(s) of, and delivered to, the undersigned. Unless
otherwise indicated herein under B. Special Issuance/Delivery Instructions, the undersigned
hereby request(s) that New Notes be issued to the order of, and delivered to, the undersigned.
In the event that the box entitled A. Special Issuance/Delivery Instructions is completed,
the undersigned hereby requests that any Old Notes representing principal amounts not tendered or
not accepted for exchange be issued in the name(s) of, and be delivered to, the person(s) at the
address(es) therein indicated. The undersigned recognizes that the Company has no obligation
pursuant to the box entitled A. Special Issuance/Delivery Instructions to transfer any Old Notes
from the names of the registered Holder(s) thereof if the Company does not accept for exchange any
of such Old Notes so tendered.
In the event that the box entitled B. Special Issuance/Delivery Instructions is completed,
the undersigned hereby request(s) that the New Notes be issued in the name(s) of; and be delivered
to, the person(s) at the address(es) therein indicated.
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A. SPECIAL ISSUANCE/DELIVERY
|
|
B. SPECIAL ISSUANCE/DELIVERY |
INSTRUCTIONS
|
|
INSTRUCTIONS |
(See Instructions 1, 4, 5 and 6)
|
|
(See Instructions 1, 4, 5 and 6) |
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|
To be completed ONLY if Old Notes in
a principal amount not tendered or
not accepted for exchange are to be
issued in the name of someone other
than the person(s) whose
signature(s) appear(s) within this
Letter of Transmittal or to be
issued to an address different from
that shown in the box entitled
Description of 8.25% Senior Notes
due 2018 within this Letter of
Transmittal.
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|
To be completed ONLY if the New
Notes are to be issued in the name
of someone other than the person(s)
whose signature(s) appear(s) within
this Letter of Transmittal or are to
be issued to an address different
from that shown in the box entitled
Description of 8.25% Senior Notes
due 2018 within this Letter of
Transmittal. |
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Name:
(Please Print) |
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Address: |
(Please Print)
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(Please Print) |
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(Zip Code) |
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(Taxpayer Identification or Social
Security Number)
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(Taxpayer Identification or Social Security Number) |
7
PLEASE SIGN HERE
(To be completed by all tendering Holders unless an Agents Message
is delivered in connection with book-entry transfer of such Old Notes)
This Letter of Transmittal must be signed by the registered Holder(s) exactly as the name of
such Holder appears on certificate(s) for Old Note(s), or by person(s) authorized to become
registered Holder(s) by endorsements and documents transmitted herewith. If signature is by
trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or
others acting in a fiduciary or representative capacity, please set forth full title and see
Instruction 4.
Signature(s) of Registered Holder(s) or Authorized Signatory
(See guarantee requirement below)
Dated: __________________, 2010
(Please Type or Print)
(Please Type or Print)
Area Code and Telephone Number:
Taxpayer Identification or Social Security No.:
(PLEASE COMPLETE ACCOMPANYING FORM W-9 OR APPLICABLE IRS FORM W-8)
SIGNATURE GUARANTEE (see Instructions 1 and 4)
(Certain signatures must be guaranteed by a Medallion Signature Guarantor (as defined below))
(Please Type or Print)
(Please Type or Print)
Name of Eligible Institution:
Area Code and Telephone Number:
Dated: ____________, 2010
8
INSTRUCTIONS
Forming Part of the Terms and Conditions of the Exchange Offer
1. Signature Guarantees. A recognized participant in the Securities Transfer Agents Medallion
Program, the New York Stock Exchange Medallion Signature Program or the Stock Exchange Medallion
Program (each a Medallion Signature Guarantor) must guarantee the signatures on this Letter of
Transmittal, unless the Old Notes tendered hereby are tendered:
(a) by a registered Holder that has not completed either of the boxes entitled Special
Issuance/Delivery Instructions on this Letter of Transmittal; or
(b) for the account of an eligible institution.
In other words, a Medallion Signature Guarantor must guarantee the signatures on this Letter of
Transmittal if Old Notes are tendered other than for the account of an eligible institution and:
(a) the Old Notes are registered in the name of a person other than the signer of this
Letter of Transmittal;
(b) Old Notes not accepted for payment or not tendered are to be returned to a person
other than the registered Holder; or
(c) Delivery of New Notes is to be made to a person other than the registered Holder.
See Instruction 5.
2. Delivery of Letter of Transmittal and New Notes. A properly completed and duly executed
Letter of Transmittal or manually signed facsimile thereof (or confirmation of a book-entry
transfer into the Exchange Agents account at DTC of all Old Notes delivered electronically) and
any other documents required by this Letter of Transmittal must be received by the Exchange Agent
at its address set forth herein on or prior to the Expiration Date. Delivery of documents to DTC
does not constitute delivery to the Exchange Agent.
The method of delivery of this Letter of Transmittal, the Old Notes and any other required
documents, including delivery through DTC and any acceptance or Agents Message delivered through
ATOP, is at the option and risk of the tendering Holder. If delivery is by mail, registered mail
with return receipt requested, properly insured, is recommended. In all cases, sufficient time
should be allowed for such documents to reach the Exchange Agent. Except as otherwise provided in
this Instruction 2, delivery will be deemed made only when actually received by the Exchange Agent.
No alternative, conditional or contingent tenders will be accepted. All tendering Holders, by
execution of this Letter of Transmittal (or a facsimile thereof), waive any right to receive any
notice of the acceptance of their Old Notes for exchange.
3. Inadequate Space. If the space provided herein is inadequate, the certificate numbers
and/or the principal amount represented by Old Notes should be listed on a separate schedule
attached hereto.
4. Signatures of Letter of Transmittal, Instruments of Transfer and Endorsements. If this
Letter of Transmittal is signed by the registered Holders of the Old Notes tendered hereby, the
signatures must correspond with the name(s) as written on the face of the certificate(s) without
alteration, enlargement or any change whatsoever.
If any of the Old Notes tendered hereby are registered in the name of two or more Holders, all
such Holders must sign this Letter of Transmittal. If any of the Old Notes tendered hereby are
registered in different names on several certificates, it will be necessary to complete, sign and
submit as many separate Letters of Transmittals as there are different registrations of
certificates.
9
If this Letter of Transmittal or any Old Notes or instrument of transfer is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, agent, officer of a corporation or
other person acting in a fiduciary or representative capacity, such person should so indicate when
signing, and proper evidence satisfactory to the Company of such persons authority to so act must
be submitted.
When this Letter of Transmittal is signed by the registered Holders of the Old Notes listed
and transmitted hereby, no endorsements of Old Notes or separate instruments of transfer are
required unless payment is to be made, or Old Notes not tendered or purchased are to be issued, to
a person other than the registered Holders, in which case signatures on such Old Notes or
instruments of transfer must be guaranteed by a recognized member of the Medallion Signature
Guarantee Program.
If this Letter of Transmittal is signed other than by the registered Holders of the Old Notes
listed, the Old Notes must be endorsed or accompanied by appropriate instruments of transfer, in
either case, signed exactly as the name or names of the registered Holders appear on the Old Notes
and signatures on such Old Notes or instruments of transfer are required and must be guaranteed by
a Medallion Signature Guarantor, unless the signature is that of an eligible institution.
5. Special Issuance and Delivery Instructions. If New Notes are to be issued in the name of a
person other than the signer of this Letter of Transmittal or to an address other than that shown
above, the appropriate Special Issuance/Delivery Instructions boxes above on this Letter of
Transmittal should be completed. All Old Notes tendered by book-entry transfer and not accepted
for exchange will be returned by crediting the account at DTC from which such Old Notes were
delivered.
6. Federal Income Tax Treatment of the Exchange. The exchange of Old Notes for New Notes
pursuant to the Exchange Offer will not constitute a taxable exchange for U.S. federal income tax
purposes. As a result, (1) a Holder will not recognize taxable gain or loss as a result of
exchanging such Holders Old Notes for New Notes in the Exchange Offer; (2) the holding period of
the New Notes will include the holding period of the Old Notes exchanged therefor; and (3) the
adjusted basis of the New Notes received will be the same as the adjusted basis of the Old Notes
exchanged therefor immediately before such exchange.
7. Transfer Taxes. The Company will pay or cause to be paid all transfer taxes, if any,
required to be paid by the Company with respect to the exchange of Old Notes pursuant to the
Exchange Offer. If a New Note is to be made to, or if Old Notes not tendered for exchange pursuant
to the Exchange Offer are to be registered in the name of any persons other than the registered
owners, or if a transfer tax is imposed for any reason other than the exchange of the Old Notes in
connection with the exchange of Old Notes pursuant to the Exchange Offer, the amount of any
transfer tax (whether imposed on the registered Holder or such other person) payable on account of
the transfer to such other person will be payable by the tendering Holder. Unless satisfactory
evidence of the payment of such transfer taxes or exemption therefrom is submitted with this Letter
of Transmittal, the amount of such transfer taxes will be billed directly to the tendering Holder.
8. Waiver of Conditions. To the extent permitted by applicable law, the conditions of the
Exchange Offer may be waived by the Company in whole or in part at any time and from time to time
in its sole discretion, in the case of any Old Notes tendered.
9. Withholding Tax; Internal Revenue Service Forms. To avoid the potential application of U.S.
federal withholding taxes, each exchanging Holder (or other payee) should complete and provide to
the Exchange Agent a substitute Form W-9, in the case of a U.S. Holder, or an Internal Revenue
Service (IRS) Form W-8BEN or other appropriate IRS Form W-8, in the case of a non-U.S. Holder.
Each U.S. Holder, when completing a substitute Form W-9, is required to provide the U.S. Holders
correct taxpayer identification number (TIN) (generally the U.S. Holders Social Security or
Employer Identification Number), along with certain other information, and to certify under
penalties of perjury that the U.S. Holder is a U.S. person, that such TIN is correct (or that such
U.S. Holder is awaiting a TIN) and that the U.S. Holder is not subject to backup withholding.
Alternatively, a U.S. Holder can prevent backup withholding by providing a basis for exemption from
backup withholding. Failure to provide the correct information on substitute Form W-9 or an
adequate basis for an exemption from the obligation to provide such information may subject the
exchanging U.S. Holder to a $50 penalty imposed by the IRS and backup withholding at a rate of 28%
of the reportable payments made with respect to the
10
Old Notes. If withholding results in an overpayment of taxes, a refund or credit may be
obtained, provided that the required information is timely furnished to the IRS. A substitute Form
W-9, along with the accompanying instructions, has been included with this Letter of Transmittal
for completion by each U.S. Holder.
Non-U.S. Holders should not complete a substitute Form W-9. Instead, to avoid U.S. federal
withholding taxes, each Non-U.S. Holder should complete an IRS Form W-8BEN (or other appropriate
type of IRS Form W-8). In the case of Non-U.S. Holders for which IRS Form W-8BEN is the
appropriate form, IRS Form W-8BEN requires a Non-U.S. Holder to provide such Non-U.S. Holders name
and address, along with certain other information, and to certify, under penalties of perjury, that
such Non-U.S. Holder is not a U.S. person. Non-U.S. Holders may obtain an IRS Form W-8BEN and
instructions (or other appropriate IRS Form W-8) from the Exchange Agent or from the IRSs website
(http://www.irs.gov).
Failure to include a properly completed substitute Form W-9 or IRS Form W-8BEN may result in
the application of U.S. withholding taxes.
Payments attributable to accrued but unpaid interest made to a Non-U.S. Holder will be subject
to 30% U.S. federal withholding tax unless the Non-U.S. Holder provides proper certification on an
applicable IRS Form W-8. Please see Certain U.S. Federal Income Tax Considerations of the
accompanying prospectus.
Treasury Department Circular 230 Disclosure: Any discussion of tax issues set forth in this
Letter of Transmittal was written in connection with the promotion and marketing of the
transactions described in this Letter of Transmittal. Such discussion was not intended or written
to be used, and it cannot be used, by any person for the purpose of avoiding any tax penalties that
may be imposed on such person. Each investor should seek advice based on its particular
circumstances from an independent tax adviser.
10. Requests for Assistance or Additional Copies. Any questions or requests for assistance or
additional copies of the prospectus or this Letter of Transmittal may be directed to the Exchange
Agent at the telephone number and location listed on the back cover.
11. Partial Tenders. Tenders of Old Notes will be accepted only in aggregate principal
amounts equal to $2,000 and integral multiples of $1,000 in excess thereof. If Holders wish to
tender with respect to less than the entire aggregate principal amount evidenced by any Old Notes
submitted, such Holders must fill in the aggregate principal amount that is to be tendered in the
column entitled Principal Amount Tendered in the table above entitled Description of 8.25%
Senior Notes due 2018. In the case of a partial tender of Old Notes, as soon as practicable after
the Expiration Date, new certificates for the remainder of the Old Notes that were evidenced by
such Holders old certificates will be sent to such Holder, unless otherwise provided in the
appropriate box of this Letter of Transmittal. The entire aggregate principal amount that is
represented by Old Notes delivered to the Exchange Agent will be deemed to have been tendered in
the Exchange Offer with respect to the entire aggregate principal amount of such Old Notes, unless
otherwise indicated.
12. Brokerage Commissions. No brokerage commissions are payable by Holders of the Old Notes
to the Company or the Exchange Agent.
IMPORTANT: This Letter of Transmittal (or a facsimile hereof), together with the Old Notes and all
other required documents, must be received by the Exchange Agent prior to the Expiration Date with
respect to Holders wishing to receive a like amount of New Notes.
Tendering your Notes may have tax consequences. Please see Certain U.S. Federal Income Tax
Considerations of the accompanying prospectus.
11
SUBSTITUTE FORM W-9
TO BE COMPLETED BY TENDERING HOLDERS THAT ARE U.S. HOLDERS
(INCLUDING U.S. RESIDENT ALIENS)
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PAYERS NAME: PRESTIGE BRANDS, INC.
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SUBSTITUTE
Form W-9
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Part 1 PLEASE PROVIDE
YOUR TIN IN THE BOX TO THE
RIGHT AND CERTIFY BY
SIGNING AND DATING BELOW.
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Taxpayer Identification Number (e.g. SSN or EIN) |
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Department of the Treasury
Internal Revenue Service
Payers Request for
Taxpayer Identification Number
(TIN) and Certifications |
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Part 2 Certification Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a
number to be issued to me), and
(2) I am not subject to backup withholding because: (a) I am exempt from backup withholding, (b) I have
not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a
result of failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer
subject to backup withholding, and
(3) I am a U.S. citizen or other U.S. person (for U.S. federal income tax purposes).
Certification Instructions You must cross out item (2) above if you have been notified by the IRS that
you are currently subject to backup withholding because you have failed to report all interest or
dividends on your tax return, and have not received another notification from the IRS stating that you
are no longer subject to backup withholding.
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Part 3 |
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Business name (if different from above):
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Awaiting TIN |
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List Account number(s) here (optional):
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Entity: o Individual/Sole Proprietor o Corporation o Partnership o Other:
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o |
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Address (Include Zip Code):
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Signature of U.S. person: _______________________________________ Date: ______________
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NOTE: |
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FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN A $50 PENALTY
IMPOSED BY THE IRS AND BACKUP WITHHOLDING OF 28% OF ANY CASH
PAYMENTS MADE TO YOU PURSUANT TO THE EXCHANGE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS. |
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NOTE: |
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YOU MUST COMPLETE THE FOLLOWING CERTIFICATION IF YOU CHECKED THE BOX
IN PART 3 OF THE SUBSTITUTE FORM W-9. |
CERTIFICATION OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a Taxpayer Identification Number has not been
issued to me, and either (1) I have mailed or delivered an application to receive a
Taxpayer Identification Number to the appropriate Internal Revenue Service Center or
Social Security Administration office or (2) I intend to mail or deliver an application
in the near future. I understand that if I do not provide a Taxpayer Identification
Number by the time of payment, 28% of all reportable cash payments payable to me
thereafter will be withheld and remitted to the IRS as backup withholding.
Signature: ________________________________
Date: ___________________
12
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Guidelines for Determining the Proper identification Number to Give the Payer. Social Security
Numbers have nine digits separated by two hyphens: i.e., 000-00-0000. Employer Identification
Numbers have nine digits separated by only one hyphen: i.e., 00-0000000. The table below will help
determine the number to give the payer. All Section references are to the Internal Revenue Code
of 1986, as amended (the Code).
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Give the SOCIAL |
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Give the EMPLOYER |
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SECURITY |
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IDENTIFICATION |
For this type of account: |
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NUMBER OF |
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For this type of account: |
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NUMBER OF |
1.
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An individuals
account
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The individual
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6. |
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A valid trust,
estate, or pension
trust
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The legal entity(4) |
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2.
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Two or more
individuals
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The actual owner of the account
or, if combined funds, the first
individual on the
account(1)
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7. |
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Corporate
account or LLC
electing corporate
status on Form 8832
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The corporation |
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3.
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Custodian account of
a minor (Uniform Gift to
Minors Act)
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The minor(2)
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8. |
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Association,
club, religious,
charitable,
educational, or
other tax-exempt
organization
account
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The organization |
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4.
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a. The usual
revocable savings trust
account (grantor is also
trustee)
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The grantor-trustee(1)
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Partnership
account or
multi-member LLC
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The partnership |
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b. So-called trust
account that is not
a legal or valid
trust under State
law
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The actual owner(1) |
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5.
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Sole proprietorship
account or single-owner
LLC owned by an
individual
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The owner(3)
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10. |
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A broker or
registered nominee
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The broker or nominee |
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11. |
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Account with
the department of
Agriculture in the
name of a public
entity (such as a
State or local
government, school
district, or
prison) that
receives
agricultural
program payments
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The public entity |
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12. |
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Sole
proprietorship or
single owner LLC
not owned by an
individual
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The owner |
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List first and circle the name of the person whose number you furnish. If only one person on a joint account has a
Social Security Number, that persons number must be furnished. |
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Circle the minors name and furnish the minors Social Security Number. |
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3. |
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You must show your individual name. You may also enter your business name. You may use either your Social Security
Number or your Employer Identification Number. |
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List first and circle the name of the legal trust, estate, or pension trust. Do not furnish the taxpayer
identification number of the personal representative or trustee under the legal entity itself is not designated in
the account title. |
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NOTE: |
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If no name is circled when there is more than one name listed, the number will be considered to be that of the first
name listed. |
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OBTAINING A NUMBER.
If you do not have a Taxpayer Identification Number or you do not know your number, obtain Form
SS-5, Application for a Social Security Card (for individuals), or Form SS-4, Application for
Employer Identification Number, at the local office of the Social Security Administration or the
IRS and apply for a number. U.S. resident aliens who cannot obtain a Social Security Number must
apply for an ITIN (Individual Taxpayer Identification Number) on Form W-7.
PAYEES EXEMPT FROM BACKUP WITHHOLDING.
Payees specifically exempted from backup withholding on ALL payments include the following:
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An organization exempt from tax under Section 501(a) of the Internal revenue Code of
1986, as amended (the Code), or an individual retirement plan or a custodial account
under Section 403(b)(7) of the Code, if the account satisfies the requirements of
Section 401(f)(2) of the Code. |
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The United States or any agency or instrumentality thereof. |
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A state, the District of Columbia, a possession of the United States, or any
subdivision or instrumentality thereof. |
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A foreign government, a political subdivision of a foreign government, or any agency
or instrumentality thereof. |
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An international organization or any agency or instrumentality thereof. |
Other payees that MAY BE EXEMPT from backup withholding include the following:
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A corporation. |
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A financial institution. |
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A dealer in securities or commodities required to register in the United States, the
District of Columbia or a possession of the United States. |
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A real estate investment trust. |
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A common trust fund operated by a bank under section 584(a) of the Code. |
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A trust exempt from tax under Section 664 of the Code or a trust described in
Section 4947 of the Code. |
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An entity registered at all times during the tax year under the Investment Company
Act of 1940. |
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A foreign central bank of issue. |
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A futures commission merchant registered with the Commodity Futures Trading
Commission. |
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A middleman known in the investment community as a nominee or custodian. |
Exempt payees described above that are U.S. persons should file substitute Form W-9 to avoid
possible erroneous backup withholding. If you are not a U.S. person and are not subject to backup
withholding, file with the payer a completed IRS Form W-8BEN or other IRS Form W-8, as applicable.
PRIVACY ACT NOTICE. Section 6109 requires most recipients of dividend, interest, or other payments
to give Taxpayer Identification Numbers to payers who must report the payments to the IRS. The IRS
uses the numbers for identification purposes and to help verify the accuracy of your return.
Payers must be given the numbers whether or not recipients are required to file tax returns.
Payers must generally withhold 28% of certain payments to a payee who does not furnish a Taxpayer
Identification Number to a payer. Certain penalties may also apply.
PENALTIES.
(1) Penalty for Failure to Furnish Taxpayer Identification Number. If you fail to furnish your
Taxpayer Identification Number to a payer, you are subject to a penalty of $50 for each such
failure unless your failure is due to reasonable cause and not to willful neglect.
(2) Civil Penalty for False Information with Respect to Withholding. If you make a false statement
with no reasonable basis which results in no imposition of backup withholding, you are subject to a
penalty of $500.
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(3) Criminal Penalty for Falsifying Information. Willfully falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or imprisonment.
(4) Misuse of Taxpayer Identification Numbers. If the requester discloses or uses Taxpayer
Identification Numbers in violation of Federal law, the requester may be subject to civil and
criminal penalties.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE IRS.
15
The Exchange Agent for the Exchange Offer is:
U.S. Bank National Association
In Person, By Registered or Certified Mail or Overnight Courier:
60 Livingston Avenue
St. Paul, Minnesota 55107
Attn: Specialized Finance Department
Tel (Toll-Free): 800-934-6802
By Facsimile Transmission:
(For Eligible Institutions Only)
651-495-8158
Attn: Specialized Finance Department