Exhibit 4.3
EXECUTION COPY
================================================================================
$120,000,000
WOLVERINE TUBE, INC.
ISSUER
and
THE SUBSIDIARIES DESCRIBED HEREIN
as Subsidiary Guarantors
10 1/2% Senior Notes Due 2009
------------------------
INDENTURE
Dated as of March 27, 2002
------------------------
FIRST UNION NATIONAL BANK
Trustee
================================================================================
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
310(a)(1) ............................... 7.10
(a)(2) ............................... 7.10
(a)(3) ............................... N.A.
(a)(4) ............................... N.A.
(b) ............................... 7.08; 7.10
(c) ............................... N.A.
311(a) ............................... 7.11
(b) ............................... 7.11
(c) ............................... N.A.
312(a) ............................... 2.05
(b) ............................... 11.03
(c) ............................... 11.03
313(a) ............................... 7.06
(b)(1) ............................... N.A.
(b)(2) ............................... 7.06
(c) ............................... 11.02
(d) ............................... 7.06
314(a) ............................... 4.02; 4.10;
11.02
(b) ............................... N.A.
(c)(1) ............................... 11.04
(c)(2) ............................... 11.04
(c)(3 ............................... N.A.
(d) ............................... N.A.
(e) ............................... 11.05
(f) ............................... 4.10
315(a) ............................... 7.01
(b) ............................... 7.05; 11.02
(c) ............................... 7.01
(d) ............................... 7.01
(e) ............................... 6.11
316(a)(last sentence) ....................... 11.06
(a)(1)(A) ............................... 6.05
(a)(1)(B) ............................... 6.04
(a)(2) ............................... N.A.
(b) ............................... 6.07
317(a)(1) ............................... 6.08
(a)(2) ............................... 6.09
(b) ............................... 2.04
318(a) ............................... 11.01
N.A. means Not Applicable.
----------------------------
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of this Indenture.
TABLE OF CONTENTS
Page
----
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions ............................... 1
SECTION 1.02. Other Definitions ......................... 30
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act ........................... 30
SECTION 1.04. Rules of Construction ..................... 31
ARTICLE 2
The Securities
SECTION 2.01. Form and Dating ........................... 32
SECTION 2.02. Execution and Authentication .............. 32
SECTION 2.03. Registrar and Paying Agent ................ 33
SECTION 2.04. Paying Agent To Hold Money in Trust ....... 33
SECTION 2.05. Holder Lists .............................. 34
SECTION 2.06. Transfer and Exchange ..................... 34
SECTION 2.07. Replacement Securities .................... 34
SECTION 2.08. Outstanding Securities .................... 35
SECTION 2.09. Temporary Securities ...................... 35
SECTION 2.10. Cancellation .............................. 35
SECTION 2.11. Defaulted Interest ........................ 36
SECTION 2.12. CUSIP Numbers ............................. 36
ARTICLE 3
Redemption
SECTION 3.01. Notices to Trustee ........................ 36
SECTION 3.02. Selection of Securities To Be Redeemed..... 37
SECTION 3.03. Notice of Redemption ...................... 37
SECTION 3.04. Effect of Notice of Redemption ............ 38
SECTION 3.05. Deposit of Redemption Price ............... 38
SECTION 3.06. Securities Redeemed in Part ............... 38
ARTICLE 4
Covenants
SECTION 4.01. Payment of Securities ..................... 38
SECTION 4.02. SEC Reports ............................... 38
SECTION 4.03. Limitation on Indebtedness ................ 39
SECTION 4.04 Limitation on Restricted Payments ....... 42
SECTION 4.05 Limitation on Restrictions on
Distributions from Restricted
Subsidiaries 46
SECTION 4.06 Limitation on Sales of Assets and
Subsidiary Stock 47
SECTION 4.07 Limitation on Affiliate Transactions .... 51
SECTION 4.08 Limitation on Line of Business .......... 53
SECTION 4.09 Limitation on the Sale or Issuance
of Capital Stock of Restricted
Subsidiaries 53
SECTION 4.10 Change of Control ....................... 54
SECTION 4.11 Limitation on Liens ..................... 55
SECTION 4.12 Limitation on Sale/Leaseback Transactions 57
SECTION 4.13 Future Guarantors ....................... 59
SECTION 4.14 Compliance Certificate .................. 59
SECTION 4.15 Further Instruments and Acts ............ 59
ARTICLE 5
Successors
SECTION 5.01 When Company May Merge or
Transfer Assets ......................... 59
SECTION 5.02 When Subsidiary Guarantor May Merge
or Transfer Assets ...................... 61
ARTICLE 6
Defaults and Remedies
SECTION 6.01 Events of Default ....................... 61
SECTION 6.02 Acceleration ............................ 64
SECTION 6.03 Other Remedies .......................... 64
SECTION 6.04 Waiver of Past Defaults ................. 65
SECTION 6.05 Control by Majority ..................... 65
SECTION 6.06 Limitation on Suits ..................... 65
SECTION 6.07 Rights of Holders to Receive Payment .... 66
SECTION 6.08 Collection Suit by Trustee .............. 66
SECTION 6.09 Trustee May File Proofs of Claim ........ 66
SECTION 6.10 Priorities .............................. 67
SECTION 6.11 Undertaking for Costs ................... 67
SECTION 6.12 Waiver of Stay or Extension Laws ........ 67
2
ARTICLE 7
Trustee
SECTION 7.01. Duties of Trustee ................... 68
SECTION 7.02. Rights of Trustee ................... 69
SECTION 7.03. Individual Rights of Trustee ........ 70
SECTION 7.04. Trustee's Disclaimer ................ 70
SECTION 7.05. Notice of Defaults .................. 70
SECTION 7.06. Reports by Trustee to Holders ....... 70
SECTION 7.07. Compensation and Indemnity .......... 70
SECTION 7.08. Replacement of Trustee .............. 71
SECTION 7.09. Successor Trustee by Merger ......... 72
SECTION 7.10. Eligibility; Disqualification ....... 73
SECTION 7.11. Preferential Collection of Claims
Against Company ................... 73
ARTICLE 8
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities;
Defeasance ........................ 73
SECTION 8.02. Conditions to Defeasance ............ 74
SECTION 8.03. Application of Trust Money .......... 76
SECTION 8.04. Repayment to Company ................ 76
SECTION 8.05. Indemnity for Government Obligations 76
SECTION 8.06. Reinstatement ....................... 76
ARTICLE 9
Amendments
SECTION 9.01. Without Consent of Holders .......... 77
SECTION 9.02. With Consent of Holders ............. 78
SECTION 9.03. Compliance with Trust Indenture Act . 78
SECTION 9.04. Revocation and Effect of Consents
and Waivers ....................... 79
SECTION 9.05. Notation on or Exchange of Securities 79
SECTION 9.06. Trustee To Sign Amendments .......... 79
SECTION 9.07. Payment for Consent ................. 80
ARTICLE 10
Subsidiary Guaranties
SECTION 10.01.Guaranties ........................... 80
SECTION 10.02.Limitation on Liability .............. 82
SECTION 10.03.Successors and Assigns ............... 82
SECTION 00.00.Xx Waiver ............................ 83
SECTION 10.05.Modification ......................... 83
SECTION 10.06.Release of Subsidiary Guarantor ...... 83
3
ARTICLE 11
Miscellaneous
SECTION 11.01. Trust Indenture Act Controls ................ 84
SECTION 11.02. Notices ..................................... 84
SECTION 11.03. Communication by Holders with
Other Holders .............................. 85
SECTION 11.04. Certificate and Opinion as to Conditions
Precedent .................................. 85
SECTION 11.05. Statements Required in Certificate
or Opinion ................................. 85
SECTION 11.06. When Securities Disregarded ................. 85
SECTION 11.07. Rules by Trustee, Paying Agent
and Registrar .............................. 86
SECTION 11.08. Legal Holiday ............................... 86
SECTION 11.09. Governing La ................................ 86
SECTION 11.10. No Recourse Against Others .................. 86
SECTION 11.11. Successors .................................. 86
SECTION 11.12. Multiple Originals .......................... 86
SECTION 11.13. Table of Contents; Headings ................. 87
Rule 144A/Regulation S Appendix
Exhibit 1 - Form of Initial Security
Exhibit A - Form of Exchange Security or Private Exchange
Security
4
INDENTURE dated as of March 27, 2002, among Wolverine Tube,
Inc., a Delaware corporation (the "Company"), TF Investor,
Inc., Tube Forming, L.P., Wolverine Finance Company, Wolverine
China Investments, LLC, STPC Holding, Inc., Small Tube
Manufacturing Corporation, Wolverine Joining Technologies,
Inc. and Tube Forming Holdings, Inc. and First Union National
Bank, a national banking association, as Trustee (the
"Trustee").
Each party agrees as follows for the benefit of the other parties and
for the equal and ratable benefit of the Holders of the Company's 10 1/2% Senior
Notes Due 2009 (the "Initial Securities") and, if and when issued pursuant to a
registered exchange for Initial Securities, the Company's 10 1/2% Senior Notes
Due 2009 (the "Exchange Securities") and if and when issued pursuant to a
private exchange for Initial Securities, the Company's 10 1/2% Senior Notes Due
2009 (the "Private Exchange Securities" and, together with the Exchange
Securities and the Initial Securities, the "Securities"):
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions.
"Additional Assets" means:
(1) any property, plant or equipment used in a Related
Business;
(2) the Capital Stock of a Person that becomes a
Restricted Subsidiary as a result of the acquisition of such Capital
Stock by the Company or another Restricted Subsidiary; or
(3) Capital Stock constituting a minority interest in any
Person that at such time is a Restricted Subsidiary;
provided, however, that any such Restricted Subsidiary described in clauses (2)
or (3) above is primarily engaged in a Related Business.
"Affiliate" of any specified Person means any other Person,
directly or indirectly, controlling or
2
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 foregoing. For purposes of the Sections 4.04, 4.06
and 4.07 only, "Affiliate" shall also mean any beneficial owner (other than a
Person that would then be eligible pursuant to Rule 13d-1(g) under the Exchange
Act to file a Schedule 13G under the Exchange Act with respect to its ownership
interest in the Company) of Capital Stock representing 5% or more of the total
voting power of the Voting Stock (on a fully diluted basis) of the Company or of
rights or warrants to purchase such Capital Stock (whether or not currently
exercisable) and any Person who would be an Affiliate of any such beneficial
owner pursuant to the first sentence hereof.
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Company or any Restricted Subsidiary, including any disposition by means of
a merger, consolidation or similar transaction (each referred to for the
purposes of this definition as a "disposition"), of:
(1) any shares of Capital Stock of a Restricted
Subsidiary (other than directors' qualifying shares or shares required
by applicable law to be held by a Person other than the Company or a
Restricted Subsidiary);
(2) all or substantially all the assets of any division
or line of business of the Company or any Restricted Subsidiary; or
(3) any other assets of the Company or any Restricted
Subsidiary outside of the ordinary course of business of the Company or
such Restricted Subsidiary;
other than, in the case of clauses (1), (2) and (3) above,
(A) a disposition between or among the Company
and its Restricted Subsidiaries;
(B) for purposes of Section 4.06 only, (x) a
disposition that constitutes a Restricted Payment permitted by
Section 4.04 or a Permitted Investment, (y) a transaction that
is permitted by
3
Section 5.01 and (z) a transaction that constitutes a
Sale/Leaseback Transaction permitted by the Section 4.12;
(C) a disposition of assets with a fair market
value of less than $500,000;
(D) the disposition by the Company or any
Restricted Subsidiary of (i) inventory and other assets
acquired or produced and held for sale or resale in the
ordinary course of business (including inventory that is no
longer useful in the conduct of the Company's or its
Subsidiaries' businesses), (ii) obsolete, damaged or worn out
personal property that is no longer useful in the ordinary
course of business or (iii) rights granted to others pursuant
to leases, subleases or licenses in the ordinary course of
business;
(E) any disposition of Capital Stock or assets
of an Unrestricted Subsidiary; and
(F) any disposition of the Capital Stock or
assets of Wolverine Ratcliffs, Inc. in existence on the Issue
Date.
"Attributable Debt" in respect of a Sale/Leaseback Transaction means,
as at the time of determination, the present value (discounted at the interest
rate set forth or implicit in the terms of the lease included in such
transaction) of the total obligations of the lessee for rental payments during
the remaining term of the lease included in such Sale/Leaseback Transaction
(including any period for which such lease has been extended); provided,
however, that if such Sale/Leaseback Transaction results in a Capital Lease
Obligation, the amount of Indebtedness represented thereby will be determined in
accordance with the definition of "Capital Lease Obligation".
"Average Life" means, as of the date of determination, with respect to
any Indebtedness, the quotient obtained by dividing:
(1) the sum of the products of the numbers of years from
the date of determination to the dates of each successive scheduled
principal payment of or redemption or similar payment with respect to
such Indebtedness multiplied by the amount of such payment by
4
(2) the sum of all such payments.
"Board of Directors" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board.
"Business Day" means each day which is not a Legal Holiday.
"Capital Lease Obligation" means an obligation that is required to be
classified and accounted for as a capital lease for financial reporting purposes
in accordance with GAAP, and the amount of Indebtedness represented by such
obligation shall be the capitalized amount of such obligation determined in
accordance with GAAP; and the Stated Maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
penalty. For purposes of Section 4.11, a Capital Lease Obligation will be deemed
to be secured by a Lien on the property being leased.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Change of Control" means the occurrence of any of the following
events:
(1) any "person" (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act), is or becomes the "beneficial owner"
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except
that for purposes of this clause (1) such person shall be deemed to
have "beneficial ownership" of all shares that any such person has the
right to acquire, whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, of more than 50% of
the total voting power of the Voting Stock of the Company;
(2) individuals who on the Issue Date constituted the
Board of Directors (together with any new directors whose election by
such Board of Directors or whose nomination for election by the
shareholders of the Company was approved by a vote of the majority of
the directors of the Company then still in office who were either
directors on the Issue Date or whose election or
5
nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors then in
office;
(3) the adoption of a plan relating to the liquidation or
dissolution of the Company; or
(4) the merger or consolidation of the Company with or
into another Person or the merger of another Person with or into the
Company, or the sale of all or substantially all the assets of the
Company (determined on a consolidated basis) to another Person, other
than a transaction following which (A) in the case of a merger or
consolidation transaction, holders of securities that represented 100%
of the Voting Stock of the Company immediately prior to such
transaction (or other securities into which such securities are
converted as part of such merger or consolidation transaction) own
directly or indirectly at least a majority of the voting power of the
Voting Stock of the surviving Person in such merger or consolidation
transaction immediately after such transaction and in substantially the
same proportion as before the transaction and (B) in the case of a sale
of assets transaction, each transferee becomes an obligor in respect of
the Notes and a Subsidiary of the transferor of such assets.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commodity Agreement" means any commodity or raw material futures
contract, commodity or raw materials option, or any other agreement designed to
protect against or manage exposure to fluctuations in commodity or raw material
prices, including silver leasing arrangements entered into for such purposes.
"Company" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision contained herein and required by the TIA, each other obligor on
the indenture securities.
"Consolidated Coverage Ratio" as of any date of determination means the
ratio of (x) the aggregate amount of EBITDA for the period of (i) the most
recent four consecutive fiscal quarters ending at least 45 days prior to the
date of such determination or (ii) if quarterly financial information is
available for the immediately preceding fiscal quarter and such financial
information is
6
included in the reports filed or delivered pursuant to Section 4.02, the most
recent four consecutive fiscal quarters, to (y) Consolidated Interest Expense
for such four fiscal quarters; provided, however, that:
(1) if the Company or any Restricted Subsidiary has
Incurred any Indebtedness since the beginning of such period that
remains outstanding or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio is an Incurrence of
Indebtedness, or both, EBITDA and Consolidated Interest Expense for
such period shall be calculated after giving effect on a pro forma
basis to such Indebtedness as if such Indebtedness had been Incurred on
the first day of such period;
(2) if the Company or any Restricted Subsidiary has
repaid, repurchased, defeased or otherwise discharged any Indebtedness
since the beginning of such period or if any Indebtedness is to be
repaid, repurchased, defeased or otherwise discharged (in each case
other than Indebtedness Incurred under any revolving credit facility
unless such Indebtedness has been permanently repaid and has not been
replaced) on the date of the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio, EBITDA and Consolidated
Interest Expense for such period shall be calculated on a pro forma
basis as if such discharge had occurred on the first day of such period
and as if the Company or such Restricted Subsidiary has not earned the
interest income actually earned during such period in respect of cash
or Temporary Cash Investments used to repay, repurchase, defease or
otherwise discharge such Indebtedness;
(3) if since the beginning of such period the Company or
any Restricted Subsidiary shall have made any Asset Disposition, EBITDA
for such period shall be reduced by an amount equal to EBITDA (if
positive) directly attributable to the assets which are the subject of
such Asset Disposition for such period, or increased by an amount equal
to EBITDA (if negative), directly attributable thereto for such period
and Consolidated Interest Expense for such period shall be reduced by
an amount equal to the Consolidated Interest Expense directly
attributable to any Indebtedness of the Company or any Restricted
Subsidiary repaid, repurchased, defeased or otherwise discharged with
respect to the Company and its continuing Restricted Subsidiaries in
connection with such Asset Disposition for such period (or, if the
Capital Stock of any
7
Restricted Subsidiary is sold, the Consolidated Interest Expense for
such period directly attributable to the Indebtedness of such
Restricted Subsidiary to the extent the Company and its continuing
Restricted Subsidiaries are no longer liable for such Indebtedness
after such sale);
(4) if since the beginning of such period the Company or
any Restricted Subsidiary (by merger or otherwise) shall have made an
Investment in any Restricted Subsidiary (or any person which becomes a
Restricted Subsidiary) or an acquisition of assets, including any
acquisition of assets occurring in connection with a transaction
requiring a calculation to be made hereunder, which constitutes all or
substantially all of an operating unit of a business, EBITDA and
Consolidated Interest Expense for such period shall be calculated after
giving pro forma effect thereto (including the Incurrence of any
Indebtedness) as if such Investment or acquisition occurred on the
first day of such period; and
(5) if since the beginning of such period any Person
(that subsequently became a Restricted Subsidiary or was merged with or
into the Company or any Restricted Subsidiary since the beginning of
such period) shall have made any Asset Disposition, any Investment or
acquisition of assets that would have required an adjustment pursuant
to clause (3) or (4) above if made by the Company or a Restricted
Subsidiary during such period, EBITDA and Consolidated Interest Expense
for such period shall be calculated after giving pro forma effect
thereto as if such Asset Disposition, Investment or acquisition
occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be
given to an acquisition of assets, the amount of income or earnings relating
thereto and the amount of Consolidated Interest Expense associated with any
Indebtedness Incurred in connection therewith, the pro forma calculations shall
be determined in good faith by a responsible financial or accounting Officer of
the Company. If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest on such Indebtedness shall be calculated as
if the rate in effect on the date of determination had been the applicable rate
for the entire period (taking into account any Interest Rate Agreement
applicable to such Indebtedness if such Interest Rate Agreement has a remaining
term in excess of 12 months
8
or, if less, a remaining term equal to the remaining term of the Indebtedness).
"Consolidated Current Liabilities" as of the date of determination
means the aggregate amount of liabilities of the Company and its consolidated
Restricted Subsidiaries which may properly be classified as current liabilities
(including taxes accrued as estimated), on a consolidated basis, after
eliminating:
(1) all intercompany items between the Company and any
Restricted Subsidiary; and
(2) all current maturities of long-term Indebtedness, all
as determined in accordance with GAAP consistently applied.
"Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its consolidated Restricted Subsidiaries,
plus, to the extent not included in such total interest expense, and to the
extent incurred by the Company or its Restricted Subsidiaries, without
duplication:
(1) interest expense attributable to capital leases
(which interest shall be deemed to accrue at an interest rate
reasonably determined in good faith by the Company to be the rate of
interest implicit in such Capital Lease Obligation in accordance with
GAAP) and the interest expense attributable to leases constituting part
of a Sale/Leaseback Transaction;
(2) amortization of debt discount and debt issuance cost;
(3) capitalized interest;
(4) non-cash interest expense;
(5) commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers' acceptance
financing;
(6) net payments pursuant to obligations under Interest
Rate Agreements and, to the extent Currency Agreements relate to
Indebtedness or Interest Rate Agreements, Currency Agreements;
(7) Preferred Stock dividends in respect of all Preferred
Stock held by Persons other than the Company or a Wholly Owned
Subsidiary (other than dividends
9
payable solely in Capital Stock (other than Disqualified Stock) of the
Company); provided, however, that such dividends will be multiplied by
a fraction the numerator of which is one and the denominator of which
is one minus the effective combined tax rate of the issuer of such
Preferred Stock (expressed as a decimal) for such period (as estimated
by the Chief Financial Officer of the Company in good faith);
(8) interest incurred in connection with Investments in
discontinued operations;
(9) interest accruing on any Indebtedness of any other
Person to the extent such Indebtedness is Guaranteed by (or secured by
the assets of) the Company or any Restricted Subsidiary; and
(10) 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 Company) in connection with Indebtedness Incurred by such plan
or trust.
"Consolidated Net Income" means, for any period, the net income of the
Company and its consolidated Subsidiaries; provided, however, that there shall
not be included in such Consolidated Net Income:
(1) any net income of any Person (other than the Company)
if such Person is not a Restricted Subsidiary, except that:
(A) subject to the exclusion contained in clause
(4) below, the Company's equity in the net income of any such
Person for such period shall be included in such Consolidated
Net Income up to the aggregate amount of cash that could have
been distributed by such Person during such period to the
Company or a Restricted Subsidiary as a dividend or other
distribution (subject, in the case of a dividend or other
distribution paid to a Restricted Subsidiary, to the
limitations contained in clause (3) below); and
(B) the Company's equity in a net loss of any
such Person for such period shall be included in determining
such Consolidated Net Income;
(2) any net income (or loss) of any Person acquired by
the Company or a Subsidiary in a pooling of
10
interests transaction for any period prior to the date of such
acquisition;
(3) any net income of any Restricted Subsidiary if
payment of dividends or the making of distributions by such Restricted
Subsidiary, directly or indirectly, to the Company is not permitted by
the terms of its charter or by-laws or any other agreement, instrument,
judgment, decree, order, statute, rule or government regulation
applicable to such Restricted Subsidiary, except that:
(A) subject to the exclusion contained in clause
(4) below, the Company's equity in the net income of any such
Restricted Subsidiary for such period shall be included in
such Consolidated Net Income up to the aggregate amount of
cash actually distributed by such Restricted Subsidiary during
such period to the Company or another Restricted Subsidiary as
a dividend or other distribution (subject, in the case of a
dividend or other distribution paid to another Restricted
Subsidiary, to the limitation contained in this clause); and
(B) the Company's equity in a net loss of any
such Restricted Subsidiary for such period shall be included
in determining such Consolidated Net Income;
(4) any gain (or loss) realized upon the sale or other
disposition of any assets of the Company, its consolidated Subsidiaries
or any other Person (including pursuant to any sale-and-leaseback
arrangement) which is not sold or otherwise disposed of in the ordinary
course of business and any gain (or loss) realized upon the sale or
other disposition of any Capital Stock of any Person;
(5) extraordinary gains or losses; and
(6) the cumulative effect of a change in accounting
principles.
Notwithstanding the foregoing, for the purposes of Section 4.04 only,
there shall be excluded from Consolidated Net Income any repurchases, repayments
or redemptions of Investments, proceeds realized on the sale of Investments or
return of capital to the Company or a Restricted Subsidiary to the extent such
repurchases, repayments, redemptions, proceeds or returns increase the amount of
Restricted
11
Payments permitted under Section 4.04 pursuant to clause (a)(3)(D) thereof.
"Consolidated Net Tangible Assets" means as of any particular time the
aggregate amount of assets (less depreciation and valuation reserves and other
reserves and items deductible from gross book value of specific asset accounts
under GAAP) after deducting therefrom:
(a) all current liabilities except for (i) notes and
loans payable, (ii) current maturities of long-term debt, and (iii)
current maturities of obligations under capital leases; and
(b) all deferred debt issuance costs, goodwill, patents,
and other like intangibles
all as set forth on the most recent consolidated balance sheet of the Company
and its consolidated Subsidiaries and computed in accordance with GAAP.
"Consolidated Net Worth" means, at any time of determination, the total
of the amounts shown on the balance sheet of the Company and its consolidated
Subsidiaries, determined on a consolidated basis in accordance with GAAP, as of
the end of (i) the most recent fiscal quarter of the Company ending at least 45
days prior to the taking of any action for the purpose of which the
determination is being made or (ii) if quarterly financial information is
available for the immediately preceding fiscal quarter and such financial
information is included in the reports filed or delivered pursuant to Section
4.02, the most recent fiscal quarter of the Company ending prior to the taking
of any action for the purpose of which the determination is being made, as the
sum of:
(1) the par or stated value of all outstanding Capital
Stock of the Company plus
(2) paid-in capital or capital surplus relating to such
Capital Stock plus
(3) any retained earnings or earned surplus less (A) any
accumulated deficit and (B) any amounts attributable to Disqualified
Stock.
"Credit Agreement" means the Credit Agreement to be entered into by and
among, the Company, certain of its Subsidiaries, the lenders referred to
therein, First Union National Bank, as Administrative Agent, Congress Financial
Corporation (Canada), as Canadian Agent, and First Union
12
Securities, Inc. d/b/a Wachovia Securities, as Sole Lead Arranger and Book
Manager, together with the related documents thereto (including the term loans
and revolving loans thereunder, any guarantees and security documents), as
amended, extended, renewed, restated, supplemented, replaced (by one or more
credit facilities, debt instruments or related document) or otherwise modified
(in whole or in part, and without limitation as to amount, terms, conditions,
covenants and other provisions) from time to time, and any agreement (and
related document) increasing the amount of, extending the maturity of or
Refinancing such Credit Agreement or a successor Credit Agreement, whether by
the same or any other lender or group of lenders.
"Currency Agreement" means any foreign exchange contract, currency swap
agreement or other similar agreement designed to protect against or manage
exposure to fluctuations in currency values.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Designated Assets" means the property, plant and equipment
constituting the assets held for sale, as represented on the consolidated
balance sheet of the Company dated as of December 31, 2001.
"Disqualified Stock" means, with respect to any Person, any Capital
Stock which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable at the option of the holder) or upon
the happening of any event:
(1) matures or is mandatorily redeemable (other than
redeemable only for Capital Stock of such Person which is not itself
Disqualified Stock) pursuant to a sinking fund obligation or otherwise;
(2) is convertible or exchangeable at the option of the
holder for Indebtedness or Disqualified Stock; or
(3) is mandatorily redeemable or must be purchased upon
the occurrence of certain events or otherwise, in whole or in part;
in each case on or prior to the first anniversary of the Stated Maturity of the
Notes; provided, however, that any Capital Stock that would not constitute
Disqualified Stock but for provisions thereof giving holders thereof the right
13
to require such Person to purchase or redeem such Capital Stock upon the
occurrence of an "asset sale" or "change of control" occurring prior to the
first anniversary of the Stated Maturity of the Notes shall not constitute
Disqualified Stock if:
(1) the "asset sale" or "change of control" provisions
applicable to such Capital Stock are not more favorable to the holders
of such Capital Stock than the terms applicable to the Notes pursuant
to Sections 4.06 and 4.10; and
(2) any such requirement only becomes operative after
compliance with such terms applicable to the Notes, including the
purchase of any Notes tendered pursuant thereto.
The amount of any Disqualified Stock that does not have a fixed redemption,
repayment or repurchase price will be calculated in accordance with the terms of
such Disqualified Stock as if such Disqualified Stock were redeemed, repaid or
repurchased on any date on which the amount of such Disqualified Stock is to be
determined pursuant to this Indenture; provided, however, that if such
Disqualified Stock could not be required to be redeemed, repaid or repurchased
at the time of such determination, the redemption, repayment or repurchase price
will be the book value of such Disqualified Stock as reflected in the most
recent financial statements of such Person.
"EBITDA" for any period means the sum of Consolidated Net Income, plus
the following to the extent deducted in calculating such Consolidated Net
Income:
(1) all income tax expense of the Company and its
consolidated Restricted Subsidiaries;
(2) Consolidated Interest Expense;
(3) depreciation and amortization expense of the Company
and its consolidated Restricted Subsidiaries (excluding amortization
expense attributable to a prepaid operating activity item that was paid
in cash in a prior period); and
(4) all other non-cash charges of the Company and its
consolidated Restricted Subsidiaries (excluding any such non-cash
charge to the extent that it represents an accrual of or reserve for
cash expenditures in any future period);
14
in each case for such period. Notwithstanding the foregoing, the provision for
taxes based on the income or profits of, and the depreciation and amortization
and non-cash charges of, a Restricted Subsidiary shall be added to Consolidated
Net Income to compute EBITDA only to the extent (and in the same proportion,
including by reason of minority interest) that the net income of such Restricted
Subsidiary was included in calculating Consolidated Net Income and only if a
corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Restricted Subsidiary without prior approval
(that has not been obtained), pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to such Restricted Subsidiary or its
stockholders.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means the debt securities of the Company issued
pursuant to this Indenture in exchange for, and in an aggregate principal amount
equal to, the Notes, in compliance with the terms of the Registration Rights
Agreement.
"Existing Notes" means the Company's 7d% Senior Notes due 2008 issued
under an indenture dated as of August 4, 1998 among the Company, the guarantors
named therein and First Union National Bank, as trustee.
"Foreign Restricted Subsidiary" means any Restricted Subsidiary not
incorporated or organized under the laws of the United States of America, any
State thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Issue Date, including those set forth
in:
(1) the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants;
(2) statements and pronouncements of the Financial
Accounting Standards Board; and
(3) the rules and regulations of the SEC 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
15
staff accounting bulletins and similar written statements from the
accounting staff of the SEC.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any Person and
any obligation, direct or indirect, contingent or otherwise, of such Person:
(1) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness of
such Person (whether arising by virtue of partnership
arrangements, or by agreements to keep-well, to purchase
assets, goods, securities or services, to take-or-pay or to
maintain financial statement conditions or otherwise); or
(2) entered into for the purpose of assuring in
any other manner the obligee of such Indebtedness of the
payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part);
provided, however, that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Guaranty Agreement" means a supplemental indenture, in a form
satisfactory to the Trustee, pursuant to which a Subsidiary Guarantor guarantees
the Company's obligations with respect to the Notes on the terms provided for in
this Indenture.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement, Commodity Agreement, Natural Gas
Agreement or Currency Agreement.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Restricted Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Person at the time it becomes a Restricted Subsidiary. The term
"Incurrence" when used as
16
a noun shall have a correlative meaning. Solely for purposes of determining
compliance with Section 4.03:
(1) amortization of debt discount or the accretion of
principal with respect to a non-interest bearing or other discount
security;
(2) the accrual or capitalization of interest;
(3) the payment of regularly scheduled interest in the
form of additional Indebtedness of the same instrument, or the payment
of regularly scheduled dividends on Capital Stock in the form of
additional Capital Stock of the same class and with the same terms; and
(4) the obligation to pay a premium in respect of
indebtedness arising in connection with the issuance of a notice of
redemption or the making of a mandatory offer to purchase such
Indebtedness;
will not be deemed to be the Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication):
(1) the principal in respect of (A) indebtedness of such
Person for money borrowed and (B) indebtedness evidenced by notes,
debentures, bonds or other similar instruments for the payment of which
such Person is responsible or liable, including, in each case, any
premium on such indebtedness to the extent such premium has become due
and payable;
(2) all Capital Lease Obligations of such Person and all
Attributable Debt in respect of Sale/Leaseback Transactions entered
into by such Person;
(3) all obligations of such Person issued or assumed as
the deferred purchase price of property, all conditional sale
obligations of such Person and all obligations of such Person under any
title retention agreement (but excluding trade accounts payable arising
in the ordinary course of business);
(4) all obligations of such Person for the reimbursement
of any obligor on any letter of credit, banker's acceptance or similar
credit transaction (other than obligations with respect to letters of
credit securing obligations (other than obligations described in
clauses (1) through (3) above) entered
17
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 tenth Business
Day following payment on the letter of credit);
(5) the amount of all obligations of such Person with
respect to the redemption, repayment or other repurchase of any Capital
Stock of such Person or any Subsidiary of such Person or that are
determined by the value of such Capital Stock, the principal amount of
such Capital Stock to be determined in accordance with this Indenture;
(6) all obligations of the type referred to in clauses
(1) through (5) 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;
(7) all obligations of the type referred to in clauses
(1) through (6) of other Persons secured by any Lien on any property or
asset of such Person (whether or not such obligation is assumed by such
Person), the amount of such obligation being deemed to be the lesser of
the value of such property or assets and the amount of the obligation
so secured; and
(8) to the extent not otherwise included in this
definition, Hedging Obligations of such Person.
Notwithstanding the foregoing, in connection with the purchase by the Company or
any Restricted Subsidiary of any business, the term "Indebtedness" will exclude
post-closing payment adjustments to which the seller may become entitled to the
extent such payment is determined by a final closing balance sheet or such
payment depends on the performance of such business after the closing; provided,
however, that, at the time of closing, the amount of any such payment is not
determinable and, to the extent such payment thereafter becomes fixed and
determined, the amount is paid within 60 days thereafter.
The amount of Indebtedness of any Person at any date shall be (A) the
outstanding balance at such date of all unconditional obligations as described
above, (B) the maximum liability, upon the occurrence of the contingency giving
rise to the obligation, of any contingent obligations at such date, and (C) in
the case of any Indebtedness consisting of Hedging Obligations, the net amount
payable if
18
the related Interest Rate Agreement, Commodity Agreement, Natural Gas Agreement
or Currency Agreement were terminated at that time; provided, however, that in
the case of Indebtedness sold at a discount, the amount of such Indebtedness at
any time will be the accreted value thereof at such time.
"Indenture" means this Indenture as amended or supplemented from time
to time.
"Independent Qualified Party" means an investment banking firm,
accounting firm or appraisal firm of national standing; provided, however, that
such firm is not an Affiliate of the Company.
"Interest Rate Agreement" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other financial
agreement or arrangement designed to protect against or manage exposure to
fluctuations in interest rates.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers or suppliers in the ordinary course of
business that are recorded as accounts receivable, endorsements for collection
or deposits arising in the ordinary course of business) or other extensions of
credit (including by way of Guarantee or similar arrangement) or capital
contribution to (by means of any transfer of cash or other property to others or
any payment for property or services for the account or use of others), or any
purchase or acquisition of Capital Stock, Indebtedness or other similar
instruments issued by such Person. Except as otherwise provided for herein, the
amount of an Investment shall be its fair value at the time the Investment is
made and without giving effect to subsequent changes in value.
For purposes of the definition of "Unrestricted Subsidiary", the
definition of "Restricted Payment" and Section 4.04:
(1) "Investment" shall include the portion (proportionate
to the Company's equity interest in such Subsidiary) of the fair market
value of the net assets of any Subsidiary of the Company at the time
that such Subsidiary is designated an Unrestricted Subsidiary;
provided, however, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Company shall be deemed to continue to have
a permanent "Investment" in an Unrestricted Subsidiary equal to an
amount (if positive) equal to (A) the Company's
19
"Investment" in such Subsidiary at the time of such redesignation less
(B) the portion (proportionate to the Company's equity interest in such
Subsidiary) of the fair market value of the net assets of such
Subsidiary at the time of such redesignation; and
(2) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of
Directors.
"Issue Date" means the date on which the Notes are originally issued.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the State of New York.
"Lenders" has the meaning specified in the Credit Agreement.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind (including any conditional sale or other title retention
agreement or lease in the nature thereof).
"Natural Gas Agreement" means any natural gas purchase or hedging
agreement, future contract or option, or any other agreement designed to protect
against or manage exposure to fluctuations in natural gas prices.
"Net Available Cash" from an Asset Disposition means cash payments
received therefrom (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise
and proceeds from the sale or other disposition of any securities received as
consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring Person of
Indebtedness or other obligations relating to such properties or assets or
received in any other noncash form), in each case net of:
(1) all legal, title and recording tax expenses,
commissions and other fees and expenses incurred in connection with
such Asset Disposition, (including fees and expenses of counsel,
investment bankers, consultants and accountants), and all Federal,
state, provincial, foreign and local taxes required to be accrued as a
liability under GAAP, as a consequence of such Asset Disposition;
20
(2) all payments made on any Indebtedness which is
secured by any assets subject to such Asset Disposition, in accordance
with the terms of any Lien upon or other security agreement of any kind
with respect to such assets, or which must by its terms, or in order to
obtain a necessary consent to such Asset Disposition, or by applicable
law, be repaid out of the proceeds from such Asset Disposition;
(3) all distributions and other payments required to be
made to minority interest holders in Restricted Subsidiaries as a
result of such Asset Disposition; and
(4) the deduction of appropriate amounts provided by the
seller as a reserve, in accordance with GAAP, against any liabilities
associated with the property or other assets disposed in such Asset
Disposition and retained by the Company or any Restricted Subsidiary
after such Asset Disposition, including pension and other
post-employment benefit liabilities, liabilities related to
environmental matters and liabilities under any indemnification
obligations associated with such Asset Disposition.
"Net Cash Proceeds", with respect to any issuance or sale of Capital
Stock or Indebtedness, means the cash proceeds of such issuance or sale net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other fees actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof.
"Officer" means the Chairman of the Board, the President, any Vice
President, the Treasurer or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers.
"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 or the Trustee.
"Pari Passu Indebtedness" means any Indebtedness of the Company,
whether outstanding on the date on which the Notes are originally issued or
thereafter created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly
21
provides that such Indebtedness shall be subordinated in right of payment to the
Notes.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in:
(1) the Company, a Restricted Subsidiary or a Person that
will, upon the making of such Investment, become a Restricted
Subsidiary; provided, however, that the primary business of such
Restricted Subsidiary is a Related Business;
(2) another Person if as a result of such Investment such
other Person is merged or consolidated with or into, or transfers or
conveys all or substantially all its assets to, the Company or a
Restricted Subsidiary; provided, however, that such Person's primary
business is a Related Business;
(3) cash and Temporary Cash Investments;
(4) receivables owing to the Company or any Restricted
Subsidiary if 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 Company or any such Restricted Subsidiary deems
reasonable under the circumstances;
(5) 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;
(6) loans or advances to employees made in the ordinary
course of business of the Company or such Restricted Subsidiary;
(7) stock, obligations or securities received in
compromise or settlement of debts created in the ordinary course of
business and owing to the Company or any Restricted Subsidiary or in
satisfaction of judgments;
(8) any Person to the extent such Investment represents
the non-cash portion of the consideration received for an Asset
Disposition as permitted under Section 4.06;
22
(9) any Person where such Investment was acquired by the
Company or any of its Restricted Subsidiaries (a) in exchange for any
other Investment or accounts receivable held by the Company or any such
Restricted Subsidiary in connection with or as a result of a
bankruptcy, workout, reorganization or recapitalization of the issuer
of such other Investment or accounts receivable or (b) as a result of a
foreclosure by the Company or any of its Restricted Subsidiaries with
respect to any secured Investment or other transfer of title with
respect to any secured Investment in default;
(10) any Person to the extent such Investments consist of
prepaid expenses, negotiable instruments held for collection and lease,
utility and workers' compensation, performance and other similar
deposits made in the ordinary course of business by the Company or any
Restricted Subsidiary;
(11) any Person to the extent such Investments consist of
Hedging Obligations otherwise permitted under Section 4.03;
(12) any Person to the extent such Investments consist of
the Company or a Restricted Subsidiary funding a qualified or
non-qualified benefit plan for employees of the Company and the
Restricted Subsidiaries;
(13) Persons to the extent such Investments are in
existence on the Issue Date; and
(14) Unrestricted Subsidiaries and Permitted Joint
Ventures (in addition to Investments permitted by clauses (1) through
(13) of this definition) in an aggregate amount not to exceed $10.0
million at any time.
"Permitted Joint Venture" means any joint venture between the Company
or any Restricted Subsidiary and any other Person, regardless of legal form and
whether or not such joint venture is a Subsidiary of the Company or any
Restricted Subsidiary, entered into for the purpose of constructing, acquiring,
owning or operating facilities engaged in a Related Business outside of the
United States of America.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated
23
organization, government or any agency or political subdivision thereof or any
other entity.
"Preferred Stock", as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) which is preferred as
to the payment of dividends or distributions, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
Person, over shares of Capital Stock of any other class of such Person.
"principal" of a Note means the principal of the Note plus the premium,
if any, payable on the Note which is due or overdue or is to become due at the
relevant time.
"Public Equity Offering" means an underwritten primary public offering
of common stock of the Company pursuant to an effective registration statement
under the Securities Act.
"Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
other Indebtedness in exchange or replacement for, such Indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that Refinances any
Indebtedness of the Company or any Restricted Subsidiary existing on the Issue
Date or Incurred in compliance with this Indenture, including Indebtedness that
Refinances Refinancing Indebtedness; provided, however, that:
(1) such Refinancing Indebtedness has a Stated Maturity
no earlier than the date that is the earlier of the Stated Maturity of
the Indebtedness being Refinanced and the first anniversary of the
Stated Maturity of the Notes;
(2) such Refinancing Indebtedness has an Average Life at
the time such Refinancing Indebtedness is Incurred that is equal to or
greater than the Average Life of the Indebtedness being Refinanced; and
(3) such Refinancing Indebtedness has an aggregate
principal amount (or if Incurred with original issue discount, an
aggregate issue price) that is equal to or less than the aggregate
principal amount (or if Incurred with original issue discount, the
aggregate accreted value) then outstanding or committed (plus
24
fees and expenses, including any premium and defeasance costs) under
the Indebtedness being Refinanced;
provided further, however, that Refinancing Indebtedness shall not include (A)
Indebtedness of a Subsidiary that Refinances Indebtedness of the Company or (B)
Indebtedness of the Company or a Restricted Subsidiary that Refinances
Indebtedness of an Unrestricted Subsidiary.
"Registration Rights Agreement" means the Registration Rights Agreement
dated March 22, 2002, among the Company, the Subsidiary Guarantors identified
therein, Credit Suisse First Boston Corporation and First Union Securities, Inc.
"Related Business" means any business in which the Company was engaged
on the Issue Date and any business related, ancillary or complementary to any
business of the Company.
"Restricted Payment" with respect to any Person means:
(1) the declaration or payment of any dividends
or any other distributions of any sort in respect of its
Capital Stock (including any payment in connection with any
merger or consolidation involving such Person) or similar
payment to the direct or indirect holders of its Capital Stock
(other than dividends or distributions payable solely in its
Capital Stock (other than Disqualified Stock) and dividends or
distributions payable solely to the Company or a Restricted
Subsidiary, and other than pro rata dividends or other
distributions made by a Subsidiary that is not a Wholly Owned
Subsidiary to minority stockholders (or owners of an
equivalent interest in the case of a Subsidiary that is an
entity other than a corporation));
(2) the purchase, redemption or other
acquisition or retirement for value of any Capital Stock of
the Company held by any Person or of any Capital Stock of a
Restricted Subsidiary held by any Affiliate of the Company
(other than a Restricted Subsidiary), including in connection
with any merger or consolidation and including the exercise of
any option to exchange any Capital Stock (other than into
Capital Stock of the Company that is not Disqualified Stock);
(3) the purchase, repurchase, redemption,
defeasance or other acquisition or retirement for
25
value, prior to scheduled maturity, scheduled repayment or
scheduled sinking fund payment of any Subordinated Obligations
of such Person (other than the purchase, repurchase or other
acquisition of Subordinated Obligations purchased in
anticipation of satisfying a sinking fund obligation,
principal installment or final maturity, in each case due
within one year of the date of such purchase, repurchase or
other acquisition); or
(4) the making of any Investment (other than a
Permitted Investment) in any Person.
"Restricted Subsidiary" means any Subsidiary of the Company that is not
an Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means any arrangement with any Person
providing for the leasing by the Company or any Restricted Subsidiary of the
Company, for a period of more than three years, of any real or tangible personal
property, which property has been or is to be sold or transferred by the Company
or such Subsidiary to such Person in contemplation of such leasing.
"SEC" means the U.S. Securities and Exchange Commission.
"Securities" or "Notes" means the Securities issued under this
Indenture.
"Securities Act" means the U.S. Securities Act of 1933, as amended.
"Senior Indebtedness" means with respect to any Person:
(1) Indebtedness of such Person, whether
outstanding on the Issue Date or thereafter Incurred; and
(2) all other Obligations of such Person
(including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to such
Person whether or not post-filing interest is allowed in such
proceeding) in respect of Indebtedness described in clause (1)
above;
unless, in the case of clauses (1) and (2), in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is provided
that such Indebtedness or other Obligations are subordinate in right
26
of payment to the Notes or the Subsidiary Guaranty of such Person, as the case
may be; provided, however, that Senior Indebtedness shall not include:
(1) any obligation of such Person to any Subsidiary;
(2) any liability for Federal, state, local or other
taxes owed or owing by such Person;
(3) any accounts payable or other liability to trade
creditors arising in the ordinary course of business (including
guarantees thereof or instruments evidencing such liabilities);
(4) any Indebtedness or other Obligation of such Person
which is subordinate or junior in any respect to any other Indebtedness
or other Obligation of such Person; or
(5) that portion of any Indebtedness which at the time of
Incurrence is Incurred in violation of this Indenture.
"Significant Subsidiary" means any Restricted Subsidiary that would be
a "Significant Subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the SEC.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the final payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency unless such contingency has occurred).
"Subordinated Obligation" means, with respect to a Person, any
Indebtedness of such Person (whether outstanding on the Issue Date or thereafter
Incurred) which is subordinate or junior in right of payment to the Notes or a
Subsidiary Guaranty of such Person, as the case may be, pursuant to a written
agreement to that effect.
"Subsidiary" means, with respect to any Person, any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of
27
shares of Voting Stock is at the time owned or controlled, directly or
indirectly, by:
(1) such Person;
(2) such Person and one or more Subsidiaries of such
Person; or
(3) one or more Subsidiaries of such Person.
"Subsidiary Guarantor" means TF Investor, Inc., Tube Forming, L.P.,
Wolverine Finance Company, Wolverine China Investments, LLC, STPC Holding, Inc.,
Small Tube Manufacturing Corporation, Wolverine Joining Technologies, Inc. and
Tube Forming Holdings, Inc. and each other Subsidiary of the Company that
guarantees the Notes pursuant to the terms of this Indenture.
"Subsidiary Guaranty" means a Guarantee by a Subsidiary Guarantor of
the Company's obligations with respect to the Notes.
"Temporary Cash Investments" means any of the following:
(1) any investment in direct obligations of the United
States of America or any agency thereof or obligations guaranteed by
the United States of America or any agency thereof;
(2) investments in demand and time deposit accounts,
certificates of deposit and money market deposits maturing within 1
year of the date of acquisition thereof and overnight bank deposits, in
each case with or issued by a bank or trust company which is organized
under the laws of the United States of America, any State thereof or
any foreign country recognized by the United States of America, and
which bank or trust company has capital, surplus and undivided profits
aggregating in excess of $50.0 million (or the foreign currency
equivalent thereof) and has outstanding debt which is rated "A-2" (or
such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436
under the Securities Act) or any money-market fund sponsored by a
registered broker dealer or mutual fund distributor;
(3) repurchase obligations with a term of not more than
30 days for underlying securities of the types described in clause (1)
above entered into with a bank
28
meeting the qualifications described in clause (2) above;
(4) investments in commercial paper, maturing not more
than one year after the date of acquisition, issued by a corporation
(other than an Affiliate of the Company) organized and in existence
under the laws of the United States of America or any foreign country
recognized by the United States of America with a rating at the time as
of which any investment therein is made of "P-1" (or higher) according
to Xxxxx'x Investors Service, Inc. or "A-1" (or higher) according to
Standard and Poor's Ratings Group; and
(5) investments in securities with maturities of six
months or less from the date of acquisition issued or fully guaranteed
by any state, commonwealth or territory of the United States of
America, or by any political subdivision or taxing authority thereof,
and rated at least "A-2" by Standard & Poor's Ratings Group or "P-2" by
Xxxxx'x Investors Service, Inc.
"Trustee" means First Union National Bank until a successor replaces it
and, thereafter, means the successor.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939
(15 U.S.C.ss.ss.77aaa-77bbbb) as in effect on the Issue Date.
"Trust Officer" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"U.S. Government Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable at the issuer's option.
"Unrestricted Subsidiary" means:
(1) any Subsidiary of the Company that at the time of
determination shall be designated an Unrestricted Subsidiary by the
Board of Directors in the manner provided below; and
(2) any Subsidiary of an Unrestricted Subsidiary.
29
The Board of Directors may designate any Subsidiary of the Company (including
any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary
unless such Subsidiary or any of its Subsidiaries owns any Capital Stock or
Indebtedness of, or holds any Lien on any property of, the Company or any other
Restricted Subsidiary; provided, however, that either (A) the Subsidiary to be
so designated has total assets of $1,000 or less or (B) if such Subsidiary has
assets greater than $1,000, such designation would be permitted under the
covenant described under Section 4.04.
The Board of Directors may designate any Unrestricted Subsidiary to be
a Restricted Subsidiary; provided, however, that immediately after giving effect
to such designation (A) the Company could Incur $1.00 of additional Indebtedness
under Section 4.03(A) and (B) no Default shall have occurred and be continuing.
Any such designation by the Board of Directors shall be evidenced to the Trustee
by promptly filing with the Trustee a copy of the resolution of the Board of
Directors giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
"Voting Stock" of a 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 trustees thereof.
"Wholly Owned Subsidiary" means a Restricted Subsidiary all the Capital
Stock of which (other than directors' qualifying shares) is owned by the Company
or one or more Wholly Owned Subsidiaries.
30
SECTION 1.02. Other Definitions.
Defined in
Term Section
---- -----------
"Affiliate Transaction" ....................... 4.08
"Bankruptcy Law" .............................. 6.01
"Change of Control" .......................... 4.09(b)
"covenant defeasance option" ................. 8.01(b)
"Custodian" ................................... 6.01
"Event of Default" ........................... 6.01
"legal defeasance option" .................... 8.01(b)
"Legal Holiday" .............................. 11.08
"Offer" ....................................... 4.07(b)
"Offer Amount"................................. 4.07(c)(2)
"Offer Period"................................. 4.07(c)(2)
"Paying Agent"................................. 2.03
"Purchase Date"................................ 4.07(c)(1)
"Registrar".................................... 2.03
"Securities Obligations"....................... 10.01
"Successor Company"............................ 5.01
SECTION 1.03. Incorporation by Reference of Trust Indenture Act. This
Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC;
"indenture securities" means the Securities and each
Subsidiary Guaranty;
"indenture security holder" means a Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the indenture securities means the Company, each
Subsidiary Guarantor and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
31
SECTION 1.04. Rules of Construction. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in
the plural include the singular;
(6) unsecured Indebtedness shall not be deemed to be
subordinate or junior to secured Indebtedness merely by virtue of its
nature as unsecured Indebtedness;
(7) the principal amount of any noninterest bearing or
other discount security at any date shall be the principal amount
thereof that would be shown on a balance sheet of the issuer dated such
date prepared in accordance with GAAP;
(8) the principal amount of any Preferred Stock shall be
(i) the maximum liquidation value of such Preferred Stock or (ii) the
maximum mandatory redemption or mandatory repurchase price with respect
to such Preferred Stock, whichever is greater; and
(9) all references to the date the Securities were
originally issued shall refer to the date the Initial Securities were
originally issued.
32
ARTICLE 2
The Securities
SECTION 2.01. Form and Dating. Provisions relating to the Initial
Securities, the Private Exchange Securities and the Exchange Securities are set
forth in the Rule 144A/Regulation S Appendix attached hereto (the "Appendix")
which is hereby incorporated in and expressly made part of this Indenture. The
Initial Securities and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit 1 to the Appendix which is hereby
incorporated in and expressly made a part of this Indenture. The Exchange
Securities, the Private Exchange Securities and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A, which is hereby
incorporated in and expressly made a part of this Indenture. The Securities may
have notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Company is subject, if any, or usage (provided that any
such notation, legend or endorsement is in a form acceptable to the Company).
Each Security shall be dated the date of its authentication. The terms of the
Securities set forth in the Appendix and Exhibit A are part of the terms of this
Indenture.
SECTION 2.02. Execution and Authentication. Two Officers shall sign
the Securities for the Company by manual or facsimile signature. The Company's
seal shall be impressed, affixed, imprinted or reproduced on the Securities and
may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate and deliver Securities for original
issue in an aggregate principal amount of $120,000,000 upon a written order of
the Company signed by two Officers or by an Officer and either an Assistant
Treasurer or an Assistant Secretary of the Company. Such order shall specify the
amount of the Securities to be authenticated and the date on which the original
issue of Securities is to be authenticated. The
33
aggregate principal amount of Securities outstanding at any time may not exceed
$120,000,000 except as provided in Section 2.07.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate the Securities. Unless limited by the terms of
such appointment, an authenticating agent may authenticate Securities whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as any Registrar, Paying Agent or agent for service of notices and
demands.
SECTION 2.03. Registrar and Paying Agent. The Company shall maintain
an office or agency where Securities may be presented for registration of
transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Registrar
shall keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent.
The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent or co-registrar not a party to this Indenture, which
shall incorporate the terms of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall notify
the Trustee of the name and address of any such agent. If the Company fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 7.07. The
Company or any Wholly Owned Subsidiary incorporated or organized within the
United States of America may act as Paying Agent, Registrar, co- registrar or
transfer agent.
The Company initially appoints the Trustee as Registrar and Paying
Agent in connection with the Securities.
SECTION 2.04. Paying Agent To Hold Money in Trust. Prior to each due
date of the principal and interest on any Security, the Company shall deposit
with the Paying Agent a sum sufficient to pay such principal and interest when
so becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
34
payment of principal of or interest on the Securities and shall notify the
Trustee of any default by the Company in making any such payment. If the Company
or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as
Paying Agent and hold it as a separate trust fund. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee and to account
for any funds disbursed by the Paying Agent. Upon complying with this Section,
the Paying Agent shall have no further liability for the money delivered to the
Trustee.
SECTION 2.05. Holder Lists. The Trustee shall preserve in as current a
form as is reasonably practicable the most recent list available to it of the
names and addresses of Holders. If the Trustee is not the Registrar, the Company
shall furnish to the Trustee, in writing at least five Business Days before each
interest payment date and at such other times as the Trustee may request in
writing, a list in such form and as of such date as the Trustee may reasonably
require of the names and addresses of Holders.
SECTION 2.06. Transfer and Exchange. The Securities shall be issued in
registered form and shall be transferable only upon the surrender of a Security
for registration of transfer. When a Security is presented to the Registrar or a
co-registrar with a request to register a transfer, the Registrar shall register
the transfer as requested if the requirements of this Indenture and Section
8-401(1) of the Uniform Commercial Code are met. When Securities are presented
to the Registrar or a co- registrar with a request to exchange them for an equal
principal amount of Securities of other denominations, the Registrar shall make
the exchange as requested if the same requirements are met. No service charge
shall be made for any registration of transfer or exchange or redemption of the
Notes, but the Company may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or other similar governmental charge payable
upon exchanges pursuant to Section 2.09, 3.06, 4.06, 4.10 or 9.05.
SECTION 2.07. Replacement Securities. If a mutilated Security is
surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost, destroyed or wrongfully taken, the Company shall issue
and the Trustee shall authenticate a replacement Security if the requirements of
Section 8-405 of the Uniform Commercial Code are met and the Holder satisfies
any other reasonable requirements of the Trustee. If required by the Trustee or
35
the Company, such Holder shall furnish an indemnity bond sufficient in the
judgment of the Company and the Trustee to protect the Company, the Trustee, the
Paying Agent, the Registrar and any co-registrar from any loss which any of them
may suffer if a Security is replaced. The Company and the Trustee may charge the
Holder for their expenses in replacing a Security.
Every replacement Security is an additional obligation of the Company.
SECTION 2.08. Outstanding Securities. Securities outstanding at any
time are all Securities authenticated by the Trustee except for those canceled
by it, those delivered to it for cancellation and those described in this
Section as not outstanding. A Security does not cease to be outstanding because
the Company or an Affiliate of the Company holds the Security.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance with
this Indenture, on a redemption date or maturity date money sufficient to pay
all principal and interest payable on that date with respect to the Securities
(or portions thereof) to be redeemed or maturing, as the case may be, then on
and after that date such Securities (or portions thereof) cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.09. Temporary Securities. Until definitive Securities are
ready for delivery, the Company may prepare and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate definitive Securities and
deliver them in exchange for temporary Securities.
SECTION 2.10. Cancellation. The Company at any time may deliver
Securities to the Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel and
destroy (subject to the record retention requirements of the Exchange Act) all
Securities
36
surrendered for registration of transfer, exchange, payment or cancellation and
deliver a certificate of such destruction to the Company unless the Company
directs the Trustee to deliver canceled Securities to the Company. The Company
may not issue new Securities to replace Securities it has redeemed, paid or
delivered to the Trustee for cancellation.
SECTION 2.11. Defaulted Interest. If the Company defaults in a payment
of interest on the Securities, the Company shall pay defaulted interest (plus
interest on such defaulted interest to the extent lawful) in any lawful manner.
The Company may pay the defaulted interest to the persons who are Holders on a
subsequent special record date. The Company shall fix or cause to be fixed any
such special record date and payment date to the reasonable satisfaction of the
Trustee and shall promptly mail to each Holder a notice that states the special
record date, the payment date and the amount of defaulted interest to be paid.
SECTION 2.12. CUSIP Numbers. The Company in issuing the Securities may
use "CUSIP" numbers (if then generally in use) and, if so, the Trustee shall use
"CUSIP" numbers in notices of redemption as a convenience to Holders; provided,
however, that any such notice may state that no representation is made as to the
correctness of such "CUSIP" numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
ARTICLE 3
Redemption
SECTION 3.01. Notices to Trustee. If the Company elects to redeem
Securities pursuant to paragraph 5 of the Securities, it shall notify the
Trustee in writing of the redemption date, the principal amount of Securities to
be redeemed and the paragraph of the Securities pursuant to which the redemption
will occur.
The Company shall give each notice to the Trustee provided for in this
Section at least [45] days before the redemption date period. Such notice shall
be accompanied by an Officers' Certificate and an Opinion of Counsel from the
Company to the effect that such redemption will comply with the conditions
herein.
37
SECTION 3.02. Selection of Securities To Be Redeemed. If fewer than
all the Securities are to be redeemed, the Trustee shall select the Securities
to be redeemed pro rata or by lot. The Trustee shall make the selection from
outstanding Securities not previously called for redemption. The Trustee may
select for redemption portions of the principal of Securities that have
denominations larger than $1,000. Securities and portions of them the Trustee
selects shall be in principal amounts of $1,000 or a whole multiple of $1,000.
Provisions of this Indenture that apply to Securities called for redemption also
apply to portions of Securities called for redemption. The Trustee shall notify
the Company promptly of the Securities or portions of Securities to be redeemed.
SECTION 3.03. Notice of Redemption. At least 30 days but not more than
60 days before a date for redemption of Securities, the Company shall mail a
notice of redemption by first-class mail to each Holder of Securities to be
redeemed at such Holder's registered address.
The notice shall identify the Securities to be redeemed and shall
state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(5) if fewer than all the outstanding Securities are to be redeemed,
the identification and principal amounts of the particular Securities to be
redeemed;
(6) that, unless the Company defaults in making such redemption
payment, interest on Securities (or portion thereof) called for redemption
ceases to accrue on and after the redemption date; and
(7) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the
Securities.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by this
Section.
38
SECTION 3.04. Effect of Notice of Redemption. Once notice of
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the related interest payment date). Failure to give
notice or any defect in the notice to any Holder shall not affect the validity
of the notice to any other Holder.
SECTION 3.05. Deposit of Redemption Price. Prior to the redemption
date, the Company shall deposit with the Paying Agent (or, if the Company or a
Subsidiary is the Paying Agent, shall segregate and hold in trust) money
sufficient to pay the redemption price of and accrued interest on all Securities
to be redeemed on that date other than Securities or portions of Securities
called for redemption which have been delivered by the Company to the Trustee
for cancellation.
SECTION 3.06. Securities Redeemed in Part. Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate for the Holder (at the Company's expense) a new Security
equal in principal amount to the unredeemed portion of the Security surrendered.
ARTICLE 4
Covenants
SECTION 4.01. Payment of Securities. The Company shall pay in lawful
currency of the United States of America the principal of and interest on the
Securities on the dates and in the manner provided in the Securities and in this
Indenture. Principal and interest shall be considered paid on the date due if on
such date the Trustee or the Paying Agent holds in accordance with this
Indenture money sufficient to pay all principal and interest then due.
The Company shall pay interest on overdue principal at the rate
specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
SECTION 4.02. SEC Reports. Notwithstanding that the Company may not be
subject to the reporting requirements
39
of Section 13 or 15(d) of the Exchange Act, the Company will file with the SEC
(to the extent that the SEC will accept such filing) and provide the Trustee and
Noteholders with such annual reports and such information, documents and other
reports as are specified in Sections 13 and 15(d) of the Exchange Act and
applicable to a U.S. corporation subject to such Sections, such information,
documents and other reports to be so filed and provided at the times specified
for the filings of such information, documents and reports under such Sections.
At any time that any of the Company's Subsidiaries are Unrestricted
Subsidiaries, then the quarterly and annual financial information required by
the preceding paragraph will include a reasonably detailed presentation, either
on the face of the financial statements or in the footnotes thereto, and in "-
Management's Discussion and Analysis of Financial Condition and Results of
Operations," of the financial condition and results of operations of the Company
and its Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries of the Company.
In addition, the Company will furnish to the Holders of the Notes and
to prospective investors, upon the requests of such Holders, any information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so
long as the Notes are not freely transferable under the Securities Act. The
Company also will comply with the other provisions of TIA ss.314(a).
SECTION 4.03. Limitation on Indebtedness. (a) The Company will not,
and will not permit any Restricted Subsidiary to, Incur, directly or indirectly,
any Indebtedness; provided, however, that the Company and the Subsidiary
Guarantors will be entitled to Incur Indebtedness if, on the date of such
Incurrence and after giving effect thereto on a pro forma basis, no Default has
occurred and is continuing and the Consolidated Coverage Ratio would be greater
than 2.25 to 1.
(b) Notwithstanding the foregoing paragraph (a), the Company and any
Restricted Subsidiary will be entitled to Incur any or all of the following
Indebtedness:
(1) Indebtedness Incurred by the Company or any Restricted Subsidiary
pursuant to the Credit Agreement; provided, however, that, after giving
effect to any such Incurrence, the aggregate principal amount of all
Indebtedness Incurred under this clause (1) and then outstanding does not
exceed $50.0 million;
40
(2) Indebtedness owed to and held by the Company or a Restricted
Subsidiary; provided, however, that (A) any subsequent issuance or transfer
of any Capital Stock which results in any such Restricted Subsidiary
ceasing to be a Restricted Subsidiary or any subsequent transfer of such
Indebtedness (other than to the Company or a Restricted Subsidiary) shall
be deemed, in each case, to constitute the Incurrence of such Indebtedness
by the obligor thereon and (B) if the Company is the obligor on such
Indebtedness, such Indebtedness is expressly subordinated to the prior
payment in full in cash of all obligations with respect to the Notes;
(3) the Notes and the Exchange Notes;
(4) the Existing Notes and any other Indebtedness outstanding on the
Issue Date (other than Indebtedness described in clause (1), (2) or (3) of
this covenant);
(5) Indebtedness of a Restricted Subsidiary Incurred and outstanding
on or prior to the date on which such Subsidiary (or the assets and
liabilities comprising such Subsidiary on such date) was acquired by the
Company or any Restricted Subsidiary (other than Indebtedness Incurred in
connection with, or to provide all or any portion of the funds or credit
support utilized to consummate, the transaction or series of related
transactions pursuant to which such Subsidiary became a Subsidiary or was
acquired (or such assets and liabilities were acquired) by the Company or
any Restricted Subsidiary); provided, however, that on the date of such
acquisition and after giving pro forma effect thereto, the Company would
have been able to Incur at least $1.00 of additional Indebtedness pursuant
to Section 4.03(a);
(6) Refinancing Indebtedness in respect of Indebtedness Incurred
pursuant to Section 4.03(a) or pursuant to clause (3), (4) or (5) above or
this clause (6);
(7) Hedging Obligations entered into in the ordinary course of
business to hedge risks with respect to the Company's or a Restricted
Subsidiary's interest rate, currency, natural gas or commodity exposure and
not for speculative purposes;
(8) obligations in respect of performance, bid, appeal or surety bonds
and completion guarantees
41
provided by the Company or any Restricted Subsidiary in
the ordinary course of business;
(9) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course of business; provided, however,
that such Indebtedness is extinguished within two Business Days of its
Incurrence;
(10) Guarantees by the Company or any Restricted Subsidiary of any
Indebtedness of the Company or any Restricted Subsidiary permitted to be
Incurred pursuant to Section 4.03(a) or pursuant to this paragraph (b);
(11) Indebtedness of Foreign Restricted Subsidiaries in an aggregate
principal amount which, when taken together with all other Indebtedness of
Foreign Restricted Subsidiaries Incurred pursuant to this clause (11) and
then outstanding, does not exceed $10.0 million; and
(12) Indebtedness of the Company or of any of its Restricted
Subsidiaries in an aggregate principal amount which, when taken together
with all other Indebtedness of the Company and its Restricted Subsidiaries
outstanding on the date of such Incurrence (other than Indebtedness
permitted by clauses (1) through (11) above or Section 4.03(a)) does not
exceed $15.0 million.
(c) Notwithstanding the foregoing, neither the Company nor any
Subsidiary Guarantor will Incur any Indebtedness pursuant to Section 4.03(a) if
the proceeds thereof are used, directly or indirectly, to Refinance any
Subordinated Obligations of the Company or any Subsidiary Guarantor unless such
Indebtedness shall be subordinated to the Notes or the applicable Subsidiary
Guaranty to at least the same extent as such Subordinated Obligations.
(d) For purposes of determining compliance with
this Section 4.03:
(1) any indebtedness outstanding under the Credit Agreement after the
application of the net proceeds from the sale of the Notes will be treated
as Incurred on the Issue Date under Section 4.03(b)(1);
(2) in the event that an item of Indebtedness (or any portion thereof)
meets the criteria of more than one of the types of Indebtedness described
above, the
42
Company, in its sole discretion, will classify such item of Indebtedness
(or any portion thereof) at the time of Incurrence and will only be
required to include the amount and type of such Indebtedness in one of the
above clauses; and
(3) the Company will be entitled to (i) divide and classify an item of
Indebtedness in more than one of the types of Indebtedness described above
and (ii) in the case of Indebtedness Incurred pursuant to clause (1), (11)
or (12) of Section 4.03(b), from time to time reclassify items of such
Indebtedness; provided, however, that the amount and type of such
reclassified Indebtedness (or any portion thereof) will be required to be
included in one of clauses (1), (11) or (12) of Section 4.03(b).
(e) Notwithstanding any other provision of this Section 4.03, the
maximum amount of Indebtedness that may be Incurred pursuant to any clause of
Section 4.03 will not be deemed to be exceeded, with respect to any outstanding
Indebtedness, due solely to fluctuations in the exchange rates of currencies.
SECTION 4.04. Limitation on Restricted Payments. (a) The Company will
not, and will not permit any Restricted Subsidiary, directly or indirectly, to
make a Restricted Payment if at the time the Company or such Restricted
Subsidiary makes such Restricted Payment:
(1) a Default shall have occurred and be continuing (or would result
therefrom);
(2) the Company is not entitled to Incur an additional $1.00 of
Indebtedness pursuant to Section 4.03(a); or
(3) the aggregate amount of such Restricted Payment and all other
Restricted Payments since the Issue Date would exceed the sum of (without
duplication):
(A) 50% of the Consolidated Net Income accrued during the period
(treated as one accounting period) from January 1, 2002 to the date of
such Restricted Payment (or, in case such Consolidated Net Income
shall be a deficit, minus 100% of such deficit); plus
(B) 100% of the aggregate Net Cash Proceeds received by the
Company from the issuance or sale
43
of its Capital Stock (other than Disqualified Stock) subsequent to the
Issue Date (other than an issuance or sale to a Subsidiary of the
Company and other than an issuance or sale to an employee stock
ownership plan or to a trust established by the Company or any of its
Subsidiaries for the benefit of their employees) and 100% of any cash
capital contribution received by the Company from its shareholders
subsequent to the Issue Date; plus
(C) the amount by which Indebtedness of the Company is reduced on
the Company's balance sheet upon the conversion or exchange subsequent
to the Issue Date of any Indebtedness of the Company convertible or
exchangeable for Capital Stock (other than Disqualified Stock) of the
Company (less the amount of any cash, or the fair value of any other
property, distributed by the Company upon such conversion or
exchange); provided, however, that the foregoing amount shall not
exceed the Net Cash Proceeds received by the Company or any Restricted
Subsidiary from the sale of such Indebtedness (excluding Net Cash
Proceeds from sales to a Subsidiary of the Company or to an employee
stock ownership plan or a trust established by the Company or any of
its Subsidiaries for the benefit of their employees); plus
(D) an amount equal to the sum of (x) the net reduction in the
Investments (other than Permitted Investments) made by the Company or
any Restricted Subsidiary in any Person resulting from repurchases,
repayments or redemptions of such Investments by such Person, proceeds
realized on the sale of such Investment and proceeds representing the
return of capital (excluding dividends and distributions), in each
case received by the Company or any Restricted Subsidiary, and (y) to
the extent such Person is an Unrestricted Subsidiary, the portion
(proportionate to the Company's equity interest in such Subsidiary) of
the fair market value of the net assets of such Unrestricted
Subsidiary at the time such Unrestricted Subsidiary is designated a
Restricted Subsidiary; provided, however, that the foregoing sum shall
not exceed, in the case of any such Person or Unrestricted Subsidiary,
the amount of Investments (excluding Permitted Investments) previously
made (and treated as a Restricted
44
Payment) by the Company or any Restricted Subsidiary in such Person or
Unrestricted Subsidiary.
(b) The preceding provisions will not prohibit:
(1) any Restricted Payment made out of the Net Cash Proceeds of the
substantially concurrent sale of, or made by exchange for, Capital Stock of
the Company (other than Disqualified Stock and other than Capital Stock
issued or sold to a Subsidiary of the Company or an employee stock
ownership plan or to a trust established by the Company or any of its
Subsidiaries for the benefit of their employees) or a substantially
concurrent cash capital contribution received by the Company from its
shareholders; provided, however, that (A) such Restricted Payment shall be
excluded in the calculation of the amount of Restricted Payments and (B)
the Net Cash Proceeds from such sale or such cash capital contribution (to
the extent so used for such Restricted Payment) shall be excluded from the
calculation of amounts under clause (3)(B) of paragraph (a) above;
(2) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations of the
Company or any Subsidiary Guarantor made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Indebtedness which is
permitted to be Incurred pursuant to Section 4.03; provided, however, that
such purchase, repurchase, redemption, defeasance or other acquisition or
retirement for value shall be excluded in the calculation of the amount of
Restricted Payments;
(3) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied
with this covenant; provided, however, that such dividend shall be included
in the calculation of the amount of Restricted Payments;
(4) so long as no Default has occurred and is continuing, the
purchase, redemption or other acquisition or retirement for value of
Capital Stock of the Company held by officers, directors or employees or
former officers, directors or employees (or their estates or
beneficiaries), upon death, disability, retirement, severance or
termination of employment, or in order to satisfy tax withholding
obligations of such persons upon the exercise of options or the vesting of
45
performance shares, or pursuant to any agreement under which such Capital
Stock was issued; provided, however, that the aggregate cash consideration
paid therefor does not exceed an aggregate amount of $1.0 million in any
year, with any unused amounts in any year up to a cumulative maximum amount
of $2.0 million being available in any year; provided further, however,
that such purchases will be excluded from the calculation of the amount of
Restricted Payments;
(5) the acquisition in open-market purchases of Capital Stock of the
Company for matching contributions to employee stock purchase and deferred
compensation plans in the ordinary course of business; provided, however,
that such purchases, to the extent the related Capital Stock is actually
contributed to such plans, will be excluded in the calculation of the
amount of Restricted Payments;
(6) repurchases by the Company of Capital Stock of the Company deemed
to occur upon the exercise of options or warrants if such Capital Stock
represents all or a portion of the exercise price thereof; provided,
however, that such repurchases will be excluded from the calculation of the
amount of Restricted Payments;
(7) the purchase by the Company of fractional shares arising out of
stock dividends, splits or combinations, or fractional shares arising out
of business combinations; provided, however, that such purchases will be
included in the calculation of the amount of Restricted Payments;
(8) the purchase, redemption or other acquisition or retirement for
value of any Capital Stock of Wolverine Ratcliffs, Inc. not owned by the
Company or any Restricted Subsidiary as of the Issue Date; provided,
however, that the amount of such purchase, redemption or other acquisition
or retirement individually or in the aggregate, that exceeds CDN$2.0
million shall be deemed to be prohibited by paragraph (a) above; provided
further, however, that such repurchase, redemption, acquisition or
retirement will be excluded from the calculation of the amount of
Restricted Payments;
(9) payments made by the Company as a result of dissenters' rights
related to a merger involving the Company; provided, however, that as a
result of such merger the Company has made a Change of Control Offer
46
under Section 4.10 to the extent required by, and in accordance with, the
provisions of such covenant and any Notes tendered in connection therewith
have been purchased; provided further, however, that any such payments will
be excluded from the calculation of the amount of such Restricted Payments;
and
(10) other Restricted Payments subsequent to the Issue Date in an
aggregate amount not to exceed $5.0 million; provided, however, that such
Restricted Payments will be excluded from the calculation of the amount of
Restricted Payments.
SECTION 4.05. Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to (a) pay dividends or make any other distributions on
its Capital Stock to the Company or a Restricted Subsidiary or pay any
Indebtedness owed to the Company, (b) make any loans or advances to the Company
or (c) transfer any of its property or assets to the Company, except:
(1) any encumbrance or restriction existing on the Issue Date,
including pursuant to the Credit Agreement;
(2) any encumbrance or restriction with respect to any Person existing
on or prior to the date on which such Person was acquired by the Company or
any Restricted Subsidiary (other than Indebtedness 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 related
transactions pursuant to which such Person became a Restricted Subsidiary
or was acquired by the Company or any Restricted Subsidiary) and
outstanding on such date;
(3) any encumbrance or restriction that extends, renews, refinances or
replaces any encumbrances or restrictions referred to in clause (1) or (2)
of this covenant or this clause (3); provided, however, that the
encumbrances and restrictions in such extensions, renewals, refinancings or
replacements are no less favorable, taken as a whole, to the Noteholders
than the encumbrances and restrictions being extended, renewed, refinanced
or replaced;
(4) any encumbrance or restriction imposed pursuant to an agreement
entered into for the sale or
47
disposition of assets permitted by Section 4.06; provided, however, that
such encumbrance or restriction applies only to the assets that are the
subject of such agreement;
(5) provisions in agreements for Permitted Joint Ventures with respect
to the disposition or distribution of assets or property of such Permitted
Joint Venture;
(6) any encumbrance or restriction consisting of customary
nonassignment provisions in leases governing leasehold interests to the
extent such provisions restrict the transfer of the lease or the property
leased thereunder;
(7) any encumbrance or restriction existing under or by reason of
applicable law;
(8) any encumbrance or restriction contained in security agreements or
mortgages securing Indebtedness of a Restricted Subsidiary to the extent
such encumbrance or restriction restricts the transfer of the property
subject to such security agreements or mortgages; and
(9) any Liens securing Indebtedness otherwise permitted to be Incurred
under Section 4.11 that limit the right of the debtor to dispose of the
assets subject to such Liens.
SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock. (a)
The Company will not, and will not permit any Restricted Subsidiary to, directly
or indirectly, consummate any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary receives consideration
at least equal to the fair market value, of the shares and assets subject
to such Asset Disposition;
(2) other than with respect to Designated Assets, at least 80% of the
consideration thereof received by the Company or such Restricted Subsidiary
is in the form of cash or Temporary Cash Investments; and
(3) an amount equal to 100% of the Net Available Cash from such Asset
Disposition is applied by the Company (or such Restricted Subsidiary, as
the case may be)
48
(A) first, to the extent the Company elects (or is required by
the terms of any Indebtedness), to prepay, repay, redeem or purchase
Senior Indebtedness of the Company or Indebtedness (other than any
Disqualified Stock) of a Restricted Subsidiary (in each case other
than Indebtedness owed to the Company or an Affiliate of the Company)
within one year from the later of the date of such Asset Disposition
or the receipt of such Net Available Cash;
(B) second, to the extent of the balance of such Net Available
Cash after application in accordance with clause (A), to the extent
the Company elects, to acquire, construct or invest in, or improve or
repair (but only to the extent that such improvement or repair has a
fair market value equal to or greater than $500,000 and is accounted
for in the Company's balance sheet under the caption "property, plant
and equipment") Additional Assets that will constitute part of or be
used in the business of the Company or a Restricted Subsidiary within
one year from the later of the date of such Asset Disposition or the
receipt of such Net Available Cash; and
(C) third, to the extent of the balance of such Net Available
Cash after application in accordance with clauses (A) and (B), to make
an offer to the holders of the Notes (and to holders of other Senior
Indebtedness of the Company designated by the Company) to purchase
Notes (and such other Senior Indebtedness of the Company) pursuant to
and subject to the conditions contained in this Indenture;
provided, however, that in connection with any prepayment, repayment or purchase
of Indebtedness pursuant to clause (A) or (C) above, the Company or such
Restricted Subsidiary shall permanently retire such Indebtedness and, in respect
of Indebtedness other than Indebtedness Incurred pursuant to Section 4.03(b)(1),
shall cause the related loan commitment (if any) to be permanently reduced in an
amount equal to the principal amount so prepaid, repaid or purchased.
Notwithstanding the foregoing provisions of this covenant, the Company
and the Restricted Subsidiaries will not be required to apply any Net Available
Cash in accordance with this covenant except to the extent that the aggregate
Net Available Cash from all Asset Dispositions which is not applied in
accordance with this covenant
49
exceeds $7.5 million. Pending application of Net Available Cash pursuant to this
covenant, such Net Available Cash shall be invested in Temporary Cash
Investments or applied to temporarily reduce revolving credit indebtedness. For
the purposes of Section 4.06(a)(2), the following are deemed to be cash or
Temporary Cash Investments:
(1) the assumption of Indebtedness of the Company or any Restricted
Subsidiary and the release of the Company or such Restricted Subsidiary
from all liability on such Indebtedness in connection with such Asset
Disposition; and
(2) securities, notes or other obligations received by the Company or
any Restricted Subsidiary from the transferee to the extent converted
within 90 days by the Company or such Restricted Subsidiary into cash or
Temporary Cash Investments.
(b) In the event of an Asset Disposition that requires the purchase of
Notes (and other Senior Indebtedness of the Company) pursuant to clause
(a)(3)(C) above, the Company will purchase Notes tendered pursuant to an offer
by the Company for the Notes (and such other Senior Indebtedness) at a purchase
price of 100% of their principal amount (or, in the event such other Senior
Indebtedness of the Company was issued with significant original issue discount,
100% of the accreted value thereof) without premium, plus accrued but unpaid
interest (or, in respect of such other Senior Indebtedness of the Company, such
lesser price, if any, as may be provided for by the terms of such Senior
Indebtedness) in accordance with the procedures (including prorating in the
event of oversubscription) set forth in this Indenture. If the aggregate
purchase price of the securities tendered exceeds the Net Available Cash
allotted to their purchase, the Company will select the securities to be
purchased on a pro rata basis but in round denominations, which in the case of
the Notes will be denominations of $1,000 principal amount or multiples thereof.
The Company shall not be required to make such an offer to purchase Notes (and
other Senior Indebtedness of the Company) pursuant to this covenant until the
45th day after the first day of a calendar month in which the Net Available Cash
available therefor totals at least $5.0 million (with lesser amounts being
carried forward for purposes of determining whether such an offer is required
with respect to the Net Available Cash from any subsequent Asset Disposition.
Upon completion of such an offer to purchase, Net Available Cash will be deemed
to be reduced by the Offer Amount (as defined below).
50
(c) (1) Promptly, and in any event within 10 days after the Company
becomes obligated to make an Offer, the Company shall deliver to the Trustee and
send, by first-class mail to each Holder, a written notice stating that the
Holder may elect to have his Securities purchased by the Company either in whole
or in part (subject to prorating as described in Section 4.06(b) in the event
the Offer is oversubscribed) in integral multiples of $1,000 of principal
amount, at the applicable purchase price. The notice shall specify a purchase
date not less than 30 days nor more than 60 days after the date of such notice
(the "Purchase Date") and shall contain such information concerning the business
of the Company which the Company in good faith believes will enable such Holders
to make an informed decision and all instructions and materials necessary to
tender Securities pursuant to the Offer, together with the information contained
in clause (3).
(2) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided below, the Company shall deliver to the
Trustee an Officers' Certificate as to (A) the amount of the Offer (the "Offer
Amount"), including information as to any other Senior Indebtedness included in
the Offer, (B) the allocation of the Net Available Cash from the Asset
Dispositions pursuant to which such Offer is being made and (C) the compliance
of such allocation with the provisions of Section 4.06(a) and (b). On such date,
the Company shall also irrevocably deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, segregate and hold
in trust) in Temporary Cash Investments, maturing on the last day prior to the
Purchase Date or on the Purchase Date if funds are immediately available by open
of business, an amount equal to the Offer Amount to be held for payment in
accordance with the provisions of this Section. If the Offer includes other
Senior Indebtedness, the deposit described in the preceding sentence may be made
with any other paying agent pursuant to arrangements satisfactory to the
Trustee. Upon the expiration of the period for which the Offer remains open (the
"Offer Period"), the Company shall deliver to the Trustee for cancellation the
Securities or portions thereof which have been properly tendered to and are to
be accepted by the Company. The Trustee shall, on the Purchase Date, mail or
deliver payment (or cause the delivery of payment) to each tendering Holder in
the amount of the purchase price. In the event that the aggregate purchase
price of the Securities delivered by the Company to the Trustee is less than the
Offer Amount applicable to the Securities, the Trustee shall deliver the excess
to the Company immediately after the expiration of the Offer Period.
51
(3) Holders electing to have a Security purchased shall be required to
surrender the Security, with an appropriate form duly completed, to the
Company at the address specified in the notice at least three Business Days
prior to the Purchase Date. Holders shall be entitled to withdraw their election
if the Trustee or the Company receives not later than one Business Day prior to
the Purchase Date, a telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Security which was delivered for
purchase by the Holder and a statement that such Holder is withdrawing his
election to have such Security purchased. Holders whose Securities are purchased
only in part shall be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered.
(4) At the time the Company delivers Securities to the Trustee which
are to be accepted for purchase, the Company shall also deliver an Officers'
Certificate stating that such Securities are to be accepted by the Company
pursuant to and in accordance with the terms of this Section. A Security shall
be deemed to have been accepted for purchase at the time the Trustee, directly
or through an agent, mails or delivers payment therefor to the surrendering
Holder.
(d) The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Notes pursuant to this
Section 4.06. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.06, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this Section 4.06 by virtue of its
compliance with such securities laws or regulations.
SECTION 4.07. Limitation on Affiliate Transactions. (a) The Company
will not, and will not permit any Restricted Subsidiary to, enter into or permit
to exist any transaction (including the purchase, sale, lease or exchange of any
property, employee compensation arrangements or the rendering of any service)
with, or for the benefit of, any Affiliate of the Company (an "Affiliate
Transaction") unless:
(1) the terms of the Affiliate Transaction are no less favorable to
the Company or such Restricted Subsidiary than those that could be obtained
at the
52
time of the Affiliate Transaction in arm's-length dealings with a
Person who is not an Affiliate;
(2) if such Affiliate Transaction involves an amount in excess of $2.0
million, the terms of the Affiliate Transaction are set forth in writing
and a majority of the directors of the Company disinterested with respect
to such Affiliate Transaction have determined in good faith that the
criteria set forth in clause (1) are satisfied and have approved the
relevant Affiliate Transaction as evidenced by a resolution of the Board of
Directors; and
(3) if such Affiliate Transaction involves an amount in excess of $7.5
million, the Board of Directors shall also have received a written opinion
from an Independent Qualified Party to the effect that such Affiliate
Transaction (i) is fair, from a financial standpoint, to the Company and
its Restricted Subsidiaries or (ii) is not less favorable to the Company
and its Restricted Subsidiaries than could reasonably be expected to be
obtained at the time in an arm's-length transaction with a Person who was
not an Affiliate.
(b) The provisions of the preceding paragraph (a)
will not prohibit:
(1) any Investment (other than a Permitted Investment) or other
Restricted Payment, in each case permitted to be made pursuant to Section
4.04;
(2) any issuance of securities, or other payments, awards or grants in
cash, securities or otherwise pursuant to, or the funding of, employment
arrangements, stock options and stock ownership plans approved by the Board
of Directors;
(3) loans or advances to employees but in any event not to exceed $2.0
million in the aggregate outstanding at any one time;
(4) the payment of reasonable and customary directors' fees,
indemnification and similar arrangements, employee salaries, bonuses or
employment agreements, compensation or employee benefit arrangements and
incentive arrangements with any officer, director or employee of the
Company or any Restricted Subsidiary entered into in the ordinary course of
business;
53
(5) any transaction with a Restricted Subsidiary or joint venture or
similar entity which would constitute an Affiliate Transaction solely
because the Company or a Restricted Subsidiary owns an equity interest in
or otherwise controls such Restricted Subsidiary, joint venture or similar
entity;
(6) the issuance or sale of any Capital Stock (other than Disqualified
Stock) of the Company; and
(7) financial advisory, investment banking, commercial banking,
corporate trust and similar financial services provided by Wachovia
Corporation, or any of its affiliates, for which customary fees and
commissions are paid.
SECTION 4.08. Limitation on Line of Business. The Company will not,
and will not permit any Restricted Subsidiary, to engage in any business other
than a Related Business.
SECTION 4.09. Limitation on the Sale or Issuance of Capital Stock of
Restricted Subsidiaries. The Company:
(1) will not, and will not permit any Restricted Subsidiary to, sell,
lease, transfer or otherwise dispose of any Capital Stock of any Restricted
Subsidiary to any Person (other than the Company or a Wholly Owned
Subsidiary), and
(2) will not permit any Restricted Subsidiary to issue any of its
Capital Stock (other than, if necessary, shares of its Capital Stock
constituting directors' or other legally required qualifying shares) to any
Person (other than to the Company or a Wholly Owned Subsidiary), unless
(A) immediately after giving effect to such issuance, sale or
other disposition, neither the Company nor any of its Subsidiaries own
any Capital Stock of such Restricted Subsidiary;
(B) immediately after giving effect to such issuance, sale or
other disposition, such Restricted Subsidiary would no longer
constitute a Restricted Subsidiary and any Investment in such Person
remaining after giving effect thereto is treated as a new Investment
by the Company and such Investment would be permitted to be made under
Section 4.04 if made on the date of such issuance, sale or other
disposition; or
54
(C) in the case of a Restricted Subsidiary created or acquired by
the Company or any Restricted Subsidiary after the Issue Date,
immediately after giving effect to such issuance, sale or other
disposition of Capital Stock, such Restricted Subsidiary would
continue to be a Restricted Subsidiary; provided, however, that for
purposes of this clause (C), a Restricted Subsidiary will not be
deemed to have been created or acquired after the Issue Date if, as of
the date of such issuance, sale or other disposition, such Restricted
Subsidiary owns all, or any substantial portion, of the assets (other
than cash and Temporary Cash Investments) owned on the Issue Date by
one or more Restricted Subsidiaries.
SECTION 4.10. Change of Control. (a) Upon the occurrence of a Change
of Control, each Holder shall have the right to require that the Company
repurchase such Holder's Notes at a purchase price in cash equal to 101% of the
principal amount thereof on the date of purchase plus accrued and unpaid
interest, if any, to the date of purchase (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 terms contemplated in Section
4.10(b)
(b) Within 30 days following any Change of Control, the Company will
mail a notice to each Holder with a copy to the Trustee (the "Change of Control
Offer") stating:
(1) that a Change of Control has occurred and that such Holder has the
right to require the Company to purchase such Holder's Notes at a purchase
price in cash equal to 101% of the principal amount thereof on the date of
purchase, plus accrued and unpaid interest, if any, to the date of purchase
(subject to the right of Holders of record on the relevant record date to
receive interest on the relevant interest payment date);
(2) the circumstances and relevant facts regarding such Change of
Control;
(3) the purchase date (which shall be no earlier than 30 days nor
later than 60 days from the date such notice is mailed); and
(4) the instructions, as determined by the Company, consistent with
the covenant described
55
hereunder, that a Holder must follow in order to have its Notes purchased.
(c) Holders electing to have a Security purchased will be required to
surrender the Security, with an appropriate form duly completed, to the Company
at the address specified in the notice at least three Business Days prior to the
purchase date. Holders will be entitled to withdraw their election if the
Trustee or the Company receives not later than one Business Day prior to the
purchase date, a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the principal amount of the Security which was delivered
for purchase by the Holder and a statement that such Holder is withdrawing his
election to have such Security purchased.
(d) On the purchase date, all Securities purchased by the Company
under this Section shall be delivered by the Company to the Trustee for
cancellation, and the Company shall pay the purchase price plus accrued and
unpaid interest, if any, to the Holders entitled thereto.
(e) Notwithstanding the foregoing provisions of this Section, the
Company shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in this
Section 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.
(f) The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Notes pursuant to this
Section. To the extent that the provisions of any securities laws or regulations
conflict with the provisions of this Section, the Company will comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section by virtue of its compliance with
such securities laws or regulations.
SECTION 4.11. Limitation on Liens. The Company will not, and will not
permit any Restricted Subsidiary to, issue, assume or guarantee any Indebtedness
for borrowed money secured by any Lien on any property or asset now owned or
hereafter acquired by the Company or such Subsidiary without making effective
provision whereby any and all Notes then or thereafter outstanding will be
secured by a Lien
56
equally and ratably with any and all other obligations thereby secured for so
long as any such obligations shall be so secured.
The foregoing restriction does not, however, apply to:
(a) Liens existing on the date on which the Notes are originally
issued or provided for under the terms of agreements existing on such date;
(b) Liens on property securing (i) all or any portion of the cost of
acquiring, constructing, altering, improving or repairing any property or
assets, real or personal, or improvements used or to be used in connection
with such property or (ii) Indebtedness incurred by the Company or any
Subsidiary Guarantor prior to or within one year after the later of the
acquisition, the completion of construction, alteration, improvement or
repair or the commencement of commercial operation of such property, which
Indebtedness is incurred for the purpose of financing all or any part of
the purchase price thereof or construction or improvements thereon;
(c) Liens securing Indebtedness owed by a Subsidiary Guarantor to the
Company or to any other Subsidiary Guarantor;
(d) Liens on the property of any Subsidiary Guarantor existing at the
time such Person becomes a Subsidiary and not incurred as result of (or in
connection with or in anticipation of) such Person becoming a Subsidiary;
provided, however, that such Liens do not extend to or cover any property
or assets of the Company or any of the Restricted Subsidiaries other than
the property encumbered at the time such Person becomes a Subsidiary and do
not secure Indebtedness with a principal amount in excess of the principal
amount outstanding at such time;
(e) Liens on any property securing (i) Indebtedness incurred in
connection with the construction, installation of financing of pollution
control or abatement facilities or other forms of industrial revenue bond
financing or (ii) Indebtedness issued or guaranteed by the United States or
any State thereof or any department, agency or instrumentality of either;
57
(f) Liens on any property of the Company or any Subsidiary Guarantor
in favor of governmental bodies;
(g) Liens to secure taxes not yet due or which are being contested in
good faith by the Company or a Subsidiary Guarantor;
(h) Liens extending, renewing, refinancing or replacing (or successive
extensions, renewals, refinancing or replacements of) any Lien, in whole or
in part, of any type permitted under the foregoing clauses (a) through (g)
above, provided that such Lien extends to or covers only the property that
is subject to the Lien being extended, renewed, refinanced or replaced and
that the principal amount of the Indebtedness secured thereby shall not
exceed the principal amount of Indebtedness so secured at the time of such
extension, renewal, refinancing or replacement; or
(i) Liens (exclusive of any Lien of any type otherwise permitted under
clauses (a) through (h) above) securing Indebtedness for borrowed money of
the Company or any Subsidiary Guarantor in an aggregate principal amount
which, together with the aggregate amount of Attributable Indebtedness
deemed to be outstanding in respect of all Sale/Leaseback Transactions
entered into pursuant to Section 4.12(a) (exclusive of any such
Sale/Leaseback Transactions otherwise permitted under clauses (a) through
(h) above), does not at the time such Indebtedness is incurred exceed the
greater of $50.0 million and 10% of Consolidated Net Tangible Assets, as
determined based on the consolidated balance sheet of the Company as of the
end of the most recent fiscal quarter ending at least 45 days prior
thereto.
Any Lien created for the benefit of the Holders of the Notes pursuant
to the preceding sentence shall provide by its terms that such Lien shall be
automatically and unconditionally released and discharged upon the release and
discharge of the initial Lien.
SECTION 4.12. Limitation on Sale/Leaseback Transactions. The Company
will not, and will not permit any Restricted Subsidiary to, enter into any
Sale/Leaseback
58
Transaction with any Person (other than the Company or a Subsidiary Guarantor)
unless:
(a) the Company or such Subsidiary would be entitled to incur
Indebtedness, in a principal amount equal to the Attributable Indebtedness
with respect to such Sale/Leaseback Transaction, secured by a Lien on the
property subject to such Sale/Leaseback Transaction pursuant Section 4.11
above without equally and ratably securing the Notes pursuant to such
covenant;
(b) after the date on which the Notes are originally issued and within
a period commencing six months prior to the consummation of such
Sale/Leaseback Transaction and ending six months after the consummation
thereof, the Company or such Subsidiary shall have expended for property
used or to be used in the ordinary course of business of the Company and
its Subsidiary Guarantors an amount equal to all or a portion of the net
proceeds of such Sale/Leaseback Transaction and the Company shall have
elected to designate such amount as a credit against such Sale/Leaseback
Transaction (with any such amount not being so designated to be applied as
set forth in clause (c) below); or
(c) the Company, during the 12-month period after the effective date
of such Sale/Leaseback Transaction, shall have applied to the voluntary
defeasance or retirement of Notes or any Pari Passu Indebtedness an amount
equal to
(i) the greater of the net proceeds of the sale or transfer of
the property leased in such Sale/Leaseback Transaction and the fair
value, as determined by the Board of Directors of the Company, of such
property at the time of entering into such Sale/Leaseback Transaction
(in either case adjusted to reflect the remaining term of the lease
and any amount expended by the Company as set forth in clause (b)
above), less
(ii) an amount equal to the principal amount of Notes and Pari
Passu Indebtedness voluntarily defeased or retired by the Company
within such 12- month period and not designated as a credit against
any other Sale/Leaseback Transaction entered into by the Company or
any Subsidiary during such period.
59
SECTION 4.13. Future Guarantors. The Company will cause each domestic
Restricted Subsidiary that Incurs any Indebtedness in an aggregate principal
amount equal to or greater than $250,000 or that Incurs any Indebtedness
consisting of a Guarantee of Indebtedness with respect to the Credit Agreement
or the Existing Notes to, at the same time, execute and deliver to the Trustee a
Guaranty Agreement pursuant to which such Restricted Subsidiary will Guarantee
payment of the Notes on the same terms and conditions as those set forth in
Article 10 of this Indenture.
SECTION 4.14. Compliance Certificate. The Company shall deliver to the
Trustee within 120 days after the end of each fiscal year of the Company an
Officers' Certificate stating that in the course of the performance by the
signers of their duties as Officers of the Company they would normally have
knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or proposes to take
with respect thereto. The Company also shall comply with TIA ss.314(a)(4).
SECTION 4.15. Further Instruments and Acts. Upon request of the
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
ARTICLE 5
Successors
SECTION 5.01. When Company May Merge or Transfer Assets. The Company
will not consolidate with or merge with or into, or convey, transfer or lease,
in one transaction or a series of transactions, directly or indirectly, all or
substantially all its assets to, any Person, unless:
(1) the resulting, surviving or transferee Person (the "Successor
Company") shall be a Person organized and existing under the laws of the
United States of America, any State thereof or the District of Columbia and
the Successor Company (if not the Company) shall expressly assume, by an
indenture supplemental thereto, executed and delivered to the Trustee, all
the obligations of the Company under the Notes and this Indenture;
60
(2) immediately after giving pro forma effect to such transaction (and
treating any Indebtedness which becomes an obligation of the Successor
Company or any Subsidiary as a result of such transaction as having been
Incurred by such Successor Company or such Subsidiary at the time of such
transaction), no Default shall have occurred and be continuing;
(3) immediately after giving pro forma effect to such transaction, the
Successor Company would be able to Incur an additional $1.00 of
Indebtedness pursuant to Section 4.03(a);
(4) immediately after giving pro forma effect to such transaction, the
Successor Company shall have Consolidated Net Worth in an amount that is
not less than the Consolidated Net Worth of the Company immediately prior
to such transaction; and
(5) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if any)
comply with this Indenture;
provided, however, that clauses (3) and (4) will not be applicable to (A) a
Restricted Subsidiary consolidating with, merging into or transferring all or
part of its properties and assets to the Company or (B) the Company merging with
an Affiliate of the Company principally for the purpose and with the principal
effect of reincorporating the Company in another jurisdiction and not for
evading the foregoing limitations.
For purposes of this Section 5.01, the sale, lease, conveyance,
assignment, transfer or other disposition of all or substantially all of the
properties and assets of one or more Subsidiaries of the Company, which
properties and assets, if held by the Company instead of such Subsidiaries,
would constitute all or substantially all of the properties and assets of the
Company on a consolidated basis, shall be deemed to be the transfer of all or
substantially all of the properties and assets of the Company.
The Successor Company shall be the successor to the Company and shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture, and the predecessor Company, except in the
case of a lease, shall be released from the obligation to pay the principal of
and interest on the Notes.
61
SECTION 5.02. When Subsidiary Guarantor May Merge or Transfer Assets.
The Company will not permit any Subsidiary Guarantor to consolidate with or
merge with or into, or convey, transfer or lease, in one transaction or a series
of transactions, all or substantially all of its assets to any Person unless:
(1) except in the case of a Subsidiary Guarantor that has been
disposed of in its entirety to another Person (other than to the Company or
an Affiliate of the Company), whether through a merger, consolidation or
sale of Capital Stock or assets, if in connection therewith the Company
provides an Officers' Certificate to the Trustee to the effect that the
Company will comply with its obligations under Section 4.06 in respect of
such disposition, the resulting, surviving or transferee Person (if not
such Subsidiary) shall be a Person organized and existing under the laws of
the jurisdiction under which such Subsidiary was organized or under the
laws of the United States of America, or any State thereof or the District
of Columbia, and such Person shall expressly assume, by a Guaranty
Agreement all the obligations of such Subsidiary, if any, under its
Subsidiary Guaranty;
(2) immediately after giving effect to such transaction or
transactions on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the resulting, surviving or transferee Person as a
result of such transaction as having been issued by such Person at the time
of such transaction), no Default shall have occurred and be continuing; and
(3) the Company delivers to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger or
transfer and such Guaranty Agreement, if any, complies with this Indenture.
ARTICLE 6
Defaults and Remedies
SECTION 6.01. Events of Default. An "Event of Default" occurs if:
(1) the Company defaults in any payment of interest on any Security
when the same becomes due and payable, and such default continues for a
period of 30 days;
62
(2) the Company (i) defaults in the payment of the principal of any
Security when the same becomes due and payable at its Stated Maturity, upon
optional redemption, upon declaration or otherwise, or (ii) fails to
purchase Securities when required pursuant to this Indenture or the
Securities;
(3) the Company fails to comply with Section 5.01 or 5.02;
(4) the Company fails to comply with Section 4.02, 4.03, 4.04, 4.05,
4.06, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12 or 4.13 (other than a failure to
purchase Securities when required under Section 4.06 or 4.10) and such
failure continues for 30 days after the notice specified below;
(5) the Company fails to comply with any of its agreements in the
Securities or this Indenture (other than those referred to in clause (1),
(2), (3) or (4) above) and such failure continues for 60 days after the
notice specified below;
(6) a default occurs which results in the acceleration of the maturity
of any Indebtedness of the Company or any Significant Subsidiary having an
outstanding principal amount of $10 million or more individually or, taken
together with all such other Indebtedness that has been so accelerated, in
the aggregate; or a default occurs in the payment of principal or interest
in respect of any Indebtedness of the Company or any Significant Subsidiary
having an outstanding principal amount of $10 million or more individually
or, taken together with other such Indebtedness with respect to which any
such payment has not been made, in the aggregate and such default continues
for 30 days without cure;
(7) the Company or any Significant Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against it in an
involuntary case;
(C) consents to the appointment of a Custodian of it or for all
or substantially all of its property; or
63
(D) makes a general assignment for the benefit of its creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(8) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for all or substantially all of the property of any of
them; or
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order or
decree remains unstayed and in effect for 60 days;
(9) a judgment or order is rendered against the Company or any
Significant Subsidiary, which requires the payment in money by the Company
or any Significant Subsidiary either individually or in the aggregate, of
an amount (to the extent not covered by insurance) in excess of $10.0
million and such judgment or order remains unsatisfied, undischarged,
unvacated, unbonded and unstayed for 30 days (the "judgment default
provision"); or
(10) a Subsidiary Guaranty ceases to be in full force and effect (other
than in accordance with the terms of such Subsidiary Guaranty) or a
Subsidiary Guarantor denies or disaffirms its obligations under its
Subsidiary Guaranty.
The foregoing will constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means Xxxxx 00, Xxxxxx Xxxxxx Code, or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver,
64
trustee, assignee, liquidator, custodian or similar official under any
Bankruptcy Law.
A Default under clauses (4) or (5) is not an Event of Default until
the Trustee or the holders of at least 25% in principal amount of the
outstanding Securities notify the Company of the Default and the Company does
not cure such Default 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".
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default under clause (6) or (10) and any event which with the
giving of notice or the lapse of time would become an Event of Default under
clause (4) or (5) or (9), its status and what action the Company is taking or
proposes to take with respect thereto.
SECTION 6.02. Acceleration. If an Event of Default (other than an
Event of Default specified in Section 6.01(7) or (8) with respect to the
Company) occurs and is continuing, the Trustee by notice to the Company, or the
Holders of at least 25% in principal amount of the Securities by notice to the
Company and the Trustee, may declare the principal of and accrued but unpaid
interest on all the Securities to be due and payable. Upon such a declaration,
such principal and interest shall be due and payable immediately. If an Event of
Default specified in Section 6.01(7) or (8) with respect to the Company occurs,
the principal of and interest on all the Securities shall ipso facto become and
be immediately due and payable without any declaration or other act on the part
of the Trustee or any Holders. The Holders of a majority in principal amount of
the Securities by notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except
nonpayment of principal or interest that has become due solely because of
acceleration. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
SECTION 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
65
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is exclusive of any
other remedy. All available remedies are cumulative.
SECTION 6.04. Waiver of Past Defaults. The Holders of a majority in
principal amount of the Securities by notice to the Trustee may waive an
existing Default and its consequences except (i) a Default in the payment of the
principal of or interest on a Security (ii) a Default arising from the failure
to redeem or purchase any Security when required pursuant to this Indenture or
(iii) a Default in respect of a provision that under Section 9.02 cannot be
amended without the consent of each Holder affected. When a Default is waived,
it is deemed cured, but no such waiver shall extend to any subsequent or other
Default or impair any consequent right.
SECTION 6.05. Control by Majority. The Holders of a majority in
principal amount of the Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 7.01, that the Trustee determines is unduly prejudicial to
the rights of other Holders or would involve the Trustee in personal liability;
provided, however, that the Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction. Prior to taking any
action hereunder, the Trustee shall be entitled to indemnification satisfactory
to it in its sole discretion against all losses and expenses caused by taking or
not taking such action.
SECTION 6.06. Limitation on Suits. Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Holder
may pursue any remedy with respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(2) the Holders of at least 25% in principal amount of the Securities
make a written request to the Trustee to pursue the remedy;
66
(3) such Holder or Holders offer to the Trustee reasonable security or
indemnity against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity; and
(5) the Holders of a majority in principal amount of the Securities do
not give the Trustee a direction inconsistent with the request during such
60-day period.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over another Holder.
SECTION 6.07. Rights of Holders to Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder to receive
payment of principal of and interest on the Securities held by such Holder, on
or after the respective due dates expressed in the Securities, or to bring suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of Default
specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount then due and owing (together with interest on any
unpaid interest to the extent lawful) and the amounts provided for in Section
7.07.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Holders allowed in
any judicial proceedings relative to the Company, its creditors or its property
and, unless prohibited by law or applicable regulations, may vote on behalf of
the Holders in any election of a trustee in bankruptcy or other Person
performing similar functions, and any Custodian in any such judicial proceeding
is hereby authorized by each Holder to make payments to the Trustee and, in the
event that the Trustee shall consent to the making of such payments directly to
the Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel, and any other amounts due the Trustee under Section 7.07.
67
SECTION 6.10. Priorities. If the Trustee collects any money or
property pursuant to this Article 6, it shall pay out the money or property in
the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to Holders for amounts due and unpaid on the Securities for
principal and interest, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Securities for
principal and interest, respectively; and
THIRD: to the Company.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section. At least 15 days before such record date, the
Company shall mail to each Holder and the Trustee a notice that states the
record date, the payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of
more than 10% in principal amount of the Securities.
SECTION 6.12. Waiver of Stay or Extension Laws. The Company (to the
extent it may lawfully do so) shall not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and shall not hinder, delay or impede the execution
of any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law had been enacted.
68
ARTICLE 7
Trustee
SECTION 7.01. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture. However, the
Trustee shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own wilful misconduct,
except that:
(1) this paragraph does not limit the effect of paragraph (b) of this
Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer unless it is proved that the Trustee was negligent
in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it takes
or omits to take in good faith in accordance with a direction received by it
pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
69
(e) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company.
(f) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(g) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur financial liability in the performance
of any of its duties hereunder or in the exercise of any of its rights or
powers, if it shall have reasonable grounds to believe that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
SECTION 7.02. Rights of Trustee. (a) The Trustee may rely on any
document believed by it to be genuine and to have been signed or presented by
the proper person. The Trustee need not investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers; provided , however, that the Trustee's conduct does not constitute
wilful misconduct or negligence.
(e) The Trustee may consult with counsel, and the advice or opinion of
counsel with respect to legal matters relating to this Indenture and the
Securities shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it hereunder in
good faith and in accordance with the advice or opinion of such counsel.
70
SECTION 7.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement of the Company in this Indenture or in any document issued in
connection with the sale of the Securities or in the Securities other than the
Trustee's certificate of authentication.
SECTION 7.05. Notice of Defaults. If a Default occurs and is continuing
and if it is known to the Trustee, the Trustee shall mail to each Holder notice
of the Default within 90 days after it occurs. Except in the case of a Default
in payment of principal of or interest on any Security (including payments
pursuant to the mandatory redemption provisions of such Security, if any), the
Trustee may withhold the notice if and so long as a committee of its Trust
Officers in good faith determines that withholding the notice is in the
interests of Holders.
SECTION 7.06. Reports by Trustee to Holders. As promptly as practicable
after each April 1 beginning with the April 1 following the date of this
Indenture, and in any event prior to June 1 in each year, the Trustee shall mail
to each Holder a brief report dated as of April 1 that complies with TIA '
313(a). The Trustee also shall comply with TIA ' 313(b).
A copy of each report at the time of its mailing to Holders shall be
filed with the SEC and each stock exchange (if any) on which the Securities are
listed. The Company agrees to notify promptly the Trustee whenever the
Securities become listed on any stock exchange and of any delisting thereof.
SECTION 7.07. Compensation and Indemnity. The Company shall pay to the
Trustee from time to time reasonable compensation for its services. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-
71
of-pocket expenses incurred or made by it, including costs of collection, in
addition to the compensation for its services. Such expenses shall include the
reasonable compensation and expenses, disbursements and advances of the
Trustee's agents, counsel, accountants and experts. The Company shall indemnify
the Trustee against any and all loss, liability or expense (including reasonable
attorneys' fees) incurred by it in connection with the administration of this
trust and the performance of its duties hereunder. The Trustee shall notify the
Company promptly of any claim for which it may seek indemnity. Failure by the
Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim and the Trustee may
have separate counsel and the Company shall pay the reasonable fees and expenses
of such counsel. The Company need not reimburse any expense or indemnify against
any loss, liability or expense incurred by the Trustee through the Trustee's own
wilful misconduct, negligence or bad faith.
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee other than money or property held in trust to pay
principal of and interest on particular Securities.
The Company's payment obligations pursuant to this Section shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.01(7) or (8) with respect to
the Company, the expenses are intended to constitute expenses of administration
under the Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The Trustee may resign at any
time by so notifying the Company. The Holders of a majority in principal amount
of the Securities may remove the Trustee by so notifying the Trustee and may
appoint a successor Trustee. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee otherwise becomes incapable of acting.
72
If the Trustee resigns, is removed by the Company or by the Holders of
a majority in principal amount of the Securities and such Holders do not
reasonably promptly appoint a successor Trustee, or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, subject to the lien provided for
in Section 7.07.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
10% in principal amount of the Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this
Section, the Company's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any
73
successor to the Trustee may authenticate such Securities either in the name of
any predecessor hereunder or in the name of the successor to the Trustee; and in
all such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have.
SECTION 7.10. Eligibility; Disqualification. The Trustee shall at all
times satisfy the requirements of TIA ss.310(a). The Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition. The Trustee shall comply with TIA
ss.310(b); provided, however, that there shall be excluded from the operation of
TIA ss.310(b)(1) any indenture or indentures under which other securities or
certificates of interest or participation in other securities of the Company are
outstanding if the requirements for such exclusion set forth in TIA ss.310(b)(1)
are met.
SECTION 7.11. Preferential Collection of Claims Against Company. The
Trustee shall comply with TIA ss.311(a), excluding any creditor relationship
listed in TIA ss.311(b). A Trustee who has resigned or been removed shall be
subject to TIA ss.311(a) to the extent indicated.
ARTICLE 8
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities; Defeasance. (a)
When (1) the Company delivers to the Trustee all outstanding Securities (other
than Securities replaced pursuant to Section 2.07) for cancellation or (2) all
outstanding Securities have become due and payable, whether at maturity or on a
redemption date as a result of the mailing of a notice of redemption pursuant to
Article 3 hereof and the Company irrevocably deposits with the Trustee funds
sufficient to pay at maturity or upon redemption all outstanding Securities,
including interest thereon to maturity or such redemption date (other than
Securities replaced pursuant to Section 2.07), and if in either case the Company
pays all other sums payable hereunder by the Company, then this Indenture shall,
subject to Section 8.01(c), cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the
Company accompanied by an Officers' Certificate and an Opinion of Counsel and at
the cost and expense of the Company.
74
(b) Subject to Sections 8.01(c) and 8.02, the Company at any time may
terminate (1) all its obligations under the Securities and this Indenture
("legal defeasance option") or (2) its obligations under Sections 4.02, 4.03,
4.04, 4.05, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, and 5.02 and the
operation of Sections 6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in
the case of Sections 6.01(7) and (8), with respect only to Significant
Subsidiaries) and the limitations contained in Sections 5.01(3) and (4)
("covenant defeasance option"). 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
Securities may not be accelerated because of an Event of Default with respect
thereto. If the Company exercises its covenant defeasance option, payment of the
Securities may not be accelerated because of an Event of Default specified in
Sections 6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in the case of
Sections 6.01(7) and (8), with respect only to Significant Subsidiaries) or
because of the failure of the Company to comply with Section 5.01(3) or (4) or
Section 5.02. If the Company exercises its legal defeasance option or its
covenant defeasance option, each Subsidiary Guarantor, if any, shall be released
from all its obligations with respect to its Subsidiary Guaranty.
Upon satisfaction of the conditions set forth herein and upon request
of the Company, the Trustee shall acknowledge in writing the discharge of those
obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 7.07 and 7.08 and in
this Article 8 shall survive until the Securities have been paid in full.
Thereafter, the Company's obligations in Sections 7.07, 8.04 and 8.05 shall
survive.
SECTION 8.02. Conditions to Defeasance. The Company may exercise its
legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the Trustee money or
U.S. Government Obligations for the payment of principal of and interest on the
Securities to maturity or redemption, as the case may be;
75
(2) the Company delivers to the Trustee a certificate from a nationally
recognized firm of independent accountants expressing their opinion that the
payments of principal 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 and interest when due on all the Securities to
maturity or redemption, as the case may be;
(3) 123 days pass after the deposit is made and during the 123-day
period no Default specified in Sections 6.01(7) or (8) with respect to the
Company occurs which is continuing at the end of the period;
(4) the deposit does not constitute a default under any other agreement
binding on the Company;
(5) the Company delivers to the Trustee an Opinion of Counsel to the
effect that the trust resulting from the deposit does not constitute, or is
qualified as, a regulated investment company under the Investment Company Act of
1940;
(6) in the case of the legal defeasance option, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling, or (B) since the date of this Indenture there has been a change in the
applicable Federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders 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 times as would have been the case if such
defeasance had not occurred;
(7) in the case of the covenant defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders 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
76
(8) 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 Securities as contemplated by this Article 8 have been
complied with.
Before or after a deposit, the Company may make arrangements satisfactory to the
Trustee for the redemption of Securities at a future date in accordance with
Article 3.
SECTION 8.03. Application of Trust Money. The Trustee shall hold in
trust money or U.S. Government Obligations deposited with it pursuant to this
Article 8. It shall apply the deposited money and the money from U.S. Government
Obligations through the Paying Agent and in accordance with this Indenture to
the payment of principal of and interest on the Securities.
SECTION 8.04. Repayment to Company. The Trustee and the Paying Agent
shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon request any money held by them for
the payment of principal or interest that remains unclaimed for two years, and,
thereafter, Holders entitled to the money must look to the Company for payment
as general creditors.
SECTION 8.05. Indemnity for Government Obligations. The Company shall
pay and shall indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against deposited U.S. Government Obligations or the principal
and interest received on such U.S. Government Obligations.
SECTION 8.06. Reinstatement. If the Trustee or Paying Agent is unable
to apply any money or U.S. Government Obligations in accordance with this
Article 8 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article 8 until such time as the Trustee
or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article 8; provided , however, that, if the
Company has made any payment of interest on or principal of any Securities
because of the reinstatement of its
77
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.
ARTICLE 9
Amendments
SECTION 9.01. Without Consent of Holders. The Company, the Subsidiary
Guarantors and the Trustee may amend this Indenture or the Securities without
notice to or consent of any Holder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in addition to or in place
of certificated Securities; provided, however, that the uncertificated
Securities are issued in registered form for purposes of Section 163(f) of the
Code or in a manner such that the uncertificated Securities are described in
Section 163(f)(2)(B) of the Code;
(4) to add guarantees with respect to the Securities, including any
Subsidiary Guaranties, or to secure the Securities;
(5) to add to the covenants of the Company or a Subsidiary Guarantor
for the benefit of the Holders or to surrender any right or power herein
conferred upon the Company or a Subsidiary Guarantor;
(6) to comply with any requirements of the SEC in connection with
qualifying, or maintaining the qualification of, this Indenture under the TIA;
or
(7) to make any change that does not adversely affect the rights of any
Holder.
After an amendment under this Section becomes effective, the Company
shall mail to Holders a notice briefly describing such amendment. The failure to
give such notice to all Holders, or any defect therein, shall not impair or
affect the validity of an amendment under this Section.
78
SECTION 9.02. With Consent of Holders. The Company, the Subsidiary
Guarantors and the Trustee may amend this Indenture or the Securities without
notice to any Holder but with the written consent of the Holders of at least a
majority in principal amount of the Securities then outstanding (including
consents obtained in connection with a tender offer or exchange for the
Securities). However, without the consent of each Holder affected thereby, an
amendment may not:
(1) reduce the amount of Securities whose Holders must consent to an
amendment;
(2) reduce the rate of or extend the time for payment of interest on
any Security;
(3) reduce the principal amount of or extend the Stated Maturity of any
Security;
(4) reduce the amount payable upon the redemption of any Security or
change the time at which any Security may be redeemed in accordance with Article
3;
(5) make any Security payable in money other than that stated in the
Security;
(6) make any changes in the ranking or priority of any Security that
would adversely affect the Holders;
(7) make any change in Section 6.04 or 6.07 or the second sentence of
this Section; or
(8) make any change in any Subsidiary Guaranty that would adversely
affect the Securityholders; or
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent approves the substance thereof.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
SECTION 9.03. Compliance with Trust Indenture Act. Every amendment to
this Indenture or the Securities shall comply with the TIA as then in effect.
79
SECTION 9.04. Revocation and Effect of Consents and Waivers. A consent
to an amendment or a waiver by a Holder of a Security shall bind the Holder and
every subsequent Holder of that Security or portion of the Security that
evidences the same debt as the consenting Holder's Security, even if notation of
the consent or waiver is not made on the Security. However, any such Holder or
subsequent Holder may revoke the consent or waiver as to such Holder's Security
or portion of the Security if the Trustee receives the notice of revocation
before the date the amendment or waiver becomes effective. After an amendment or
waiver becomes effective, it shall bind every Holder. An amendment or waiver
becomes effective upon the execution of such amendment or waiver by the Trustee.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to give their consent or take
any other action described above or required or permitted to be taken pursuant
to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
days after such record date.
SECTION 9.05. Notation on or Exchange of Securities. If an amendment
changes the terms of a Security, the Trustee may require the Holder of the
Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder. Alternatively, if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
SECTION 9.06. Trustee To Sign Amendments. The Trustee shall sign any
amendment authorized pursuant to this Article 9 if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, and (subject to Section 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an
80
Opinion of Counsel stating that such amendment is authorized or permitted by
this Indenture.
SECTION 9.07. Payment for Consent. Neither the Company nor any
Affiliate of the Company shall, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture or the Securities unless such consideration is
offered to be paid to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.
ARTICLE 10
Subsidiary Guaranties
SECTION 10.01. Guaranties. Each Subsidiary Guarantor hereby
unconditionally and irrevocably guarantees, jointly and severally, to each
Holder and to the Trustee and its successors and assigns (a) the full and
punctual payment of principal of and interest on the Securities when due,
whether at maturity, by acceleration, by redemption or otherwise, and all other
monetary obligations of the Company under this Indenture and the Securities and
(b) the full and punctual performance within applicable grace periods of all
other obligations of the Company under this Indenture and the Securities (all
the foregoing being hereinafter collectively called the "Securities
Obligations"). Each Subsidiary Guarantor further agrees that the Securities
Obligations may be extended or renewed, in whole or in part, without notice or
further assent from such Subsidiary Guarantor and that such Subsidiary Guarantor
will remain bound under this Article 10 notwithstanding any extension or renewal
of any Securities Obligation.
Each Subsidiary Guarantor waives presentation to, demand of, payment
from and protest to the Company of any of the Securities Obligations and also
waives notice of protest for nonpayment. Each Subsidiary Guarantor waives notice
of any default under the Securities or the Securities Obligations. The
obligations of each Subsidiary Guarantor hereunder shall not be affected by (a)
the failure of any Holder or the Trustee to assert any claim or demand or to
enforce any right or remedy against the Company or any other Person under this
Indenture, the Securities or any other agreement or otherwise; (b) any extension
or renewal of any thereof; (c) any rescission, waiver, amendment or modification
of any of the terms or provisions of this
81
Indenture, the Securities or any other agreement; (d) the release of any
security held by any Holder or the Trustee for the Securities Obligations or any
of them; (e) the failure of any Holder or the Trustee to exercise any right or
remedy against any other guarantor of the Securities Obligations; or (f) except
as set forth in Section 10.06, any change in the ownership of such Subsidiary
Guarantor.
Each Subsidiary Guarantor further agrees that its Subsidiary Guaranty
herein constitutes a guarantee of payment, performance and compliance when due
(and not a guarantee of collection) and waives any right to require that any
resort be had by any Holder or the Trustee to any security held for payment of
the Securities Obligations.
Except as expressly set forth in Sections 8.01(b), 10.02 and 10.06, the
obligations of each Subsidiary Guarantor hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason, including any
claim of waiver, release, surrender, alteration or compromise, and shall not be
subject to any defense of setoff, counterclaim, recoupment or termination
whatsoever or by reason of the invalidity, illegality or unenforceability of the
Securities Obligations or otherwise. Without limiting the generality of the
foregoing, the obligations of each Subsidiary Guarantor herein shall not be
discharged or impaired or otherwise affected by the failure of any Holder or the
Trustee to assert any claim or demand or to enforce any remedy under this
Indenture, the Securities or any other agreement, by any waiver or modification
of any thereof, by any default, failure or delay, willful or otherwise, in the
performance of the obligations, or by any other act or thing or omission or
delay to do any other act or thing which may or might in any manner or to any
extent vary the risk of such Subsidiary Guarantor or would otherwise operate as
a discharge of such Subsidiary Guarantor as a matter of law or equity.
Each Subsidiary Guarantor further agrees that its Guarantee herein
shall continue to be effective or be reinstated, as the case may be, if at any
time payment, or any part thereof, of principal of or interest on any Securities
Obligation is rescinded or must otherwise be restored by any Holder or the
Trustee upon the bankruptcy or reorganization of the Company or otherwise.
In furtherance of the foregoing and not in limitation of any other
right which any Holder or the Trustee has at law or in equity against any
Subsidiary Guarantor by virtue hereof, upon the failure of the Company to pay
the principal of or interest on any Securities
82
Obligation when and as the same shall become due, whether at maturity, by
acceleration, by redemption or otherwise, or to perform or comply with any other
Securities Obligation, each Subsidiary Guarantor hereby promises to and shall,
upon receipt of written demand by the Trustee, forthwith pay, or cause to be
paid, in cash, to the Holders or the Trustee an amount equal to the sum of (1)
the unpaid amount of such Securities Obligations, (2) accrued and unpaid
interest on such Securities Obligations (but only to the extent not prohibited
by law) and (3) all other monetary Securities Obligations of the Company to the
Holders and the Trustee.
Each Subsidiary Guarantor further agrees that, as between it, on the
one hand, and the Holders and the Trustee, on the other hand, (x) the maturity
of the Securities Obligations guaranteed hereby may be accelerated as provided
in Article 6 for the purposes of such Subsidiary Guarantor's Subsidiary Guaranty
herein, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the Securities Obligations guaranteed hereby,
and (y) in the event of any declaration of acceleration of such Securities
Obligations as provided in Article 6, such Securities Obligations (whether or
not due and payable) shall forthwith become due and payable by such Subsidiary
Guarantor for the purposes of this Section.
Each Subsidiary Guarantor also agrees to pay any and all costs and
expenses (including reasonable attorneys' fees) incurred by the Trustee or any
Holder in enforcing any rights under this Section.
SECTION 10.02. Limitation on Liability. Any term or provision of this
Indenture to the contrary notwithstanding, the maximum aggregate amount of the
Securities Obligations guaranteed hereunder by any Subsidiary Guarantor shall
not exceed the maximum amount that can be hereby guaranteed without rendering
this Indenture, as it relates to such Subsidiary Guarantor, voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer or
similar laws affecting the rights of creditors generally.
SECTION 10.03. Successors and Assigns. This Article 10 shall be binding
upon each Subsidiary Guarantor and its successors and assigns and shall enure to
the benefit of the successors and assigns of the Trustee and the Holders and, in
the event of any transfer or assignment of rights by any Holder or the Trustee,
the rights and privileges conferred upon that party in this Indenture and in the
Securities shall automatically extend to and be
83
vested in such transferee or assignee, all subject to the terms and conditions
of this Indenture.
SECTION 10.04. No Waiver. Neither a failure nor a delay on the part of
either the Trustee or the Holders in exercising any right, power or privilege
under this Article 10 shall operate as a waiver thereof, nor shall a single or
partial exercise thereof preclude any other or further exercise of any right,
power or privilege. The rights, remedies and benefits of the Trustee and the
Holders herein expressly specified are cumulative and not exclusive of any other
rights, remedies or benefits which either may have under this Article 10 at law,
in equity, by statute or otherwise.
SECTION 10.05. Modification. No modification, amendment or waiver of
any provision of this Article 10, nor the consent to any departure by any
Subsidiary Guarantor therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Trustee, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. No notice to or demand on any Subsidiary Guarantor in any case shall
entitle such Subsidiary Guarantor to any other or further notice or demand in
the same, similar or other circumstances.
SECTION 10.06. Release of Subsidiary Guarantor. Upon (i) the sale
(including any sale upon a foreclosure or exercise of security interests) or
other disposition (including by way of consolidation or merger) of a Subsidiary
Guarantor, (ii) the sale or disposition of all or substantially all the assets
of such Subsidiary Guarantor or upon the designation of such Subsidiary as an
Unrestricted Subsidiary, in each case in accordance with the provisions of this
Indenture and, in the case of (i) and (ii) above, other than a sale or
disposition to the Company or an Affiliate of the Company, such Subsidiary
Guarantor shall be deemed released from all obligations under this Article 10
without any further action required on the part of the Trustee or any Holder. At
the request of the Company, the Trustee shall execute and deliver an appropriate
instrument evidencing such release.
84
ARTICLE 11
Miscellaneous
SECTION 11.01. Trust Indenture Act Controls. If any provision of this
Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
SECTION 11.02. Notices. Any notice or communication shall be in writing
and delivered in person or mailed by first-class mail addressed as follows:
if to the Company or any Subsidiary Guarantor:
Wolverine Tube, Inc.
000 Xxxxxxx Xxxxxx Xxxx
Xxxxx 0000
Xxxxxxxxxx, XX 00000
Attention of: Chief Financial Officer
if to the Trustee:
First Union National Bank
0000 Xxxxx Xxxxx Xxxxx
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, XX 00000-0000
The Company, any Subsidiary Guarantor or the Trustee by notice to the
other may designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Holder shall be mailed to the
Holder at the Holder's address as it appears on the registration books of the
Registrar and shall be sufficiently given if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not the addressee receives it.
85
SECTION 11.03. Communication by Holders with Other Holders. Holders may
communicate pursuant to TIA ' 312(b) with other Holders with respect to their
rights under this Indenture or the Securities. The Company, any Subsidiary
Guarantor, the Trustee, the Registrar and anyone else shall have the protection
of TIA ' 312(c).
SECTION 11.04. Certificate and Opinion as to Conditions Precedent. Upon
any request or application by the Company to the Trustee to take or refrain from
taking any action under this Indenture, the Company shall furnish to the
Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably satisfactory
to the Trustee stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.
SECTION 11.05. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 11.06. When Securities Disregarded. In determining whether the
Holders of the required principal amount of Securities have concurred in any
direction, waiver
86
or consent, Securities owned by the Company or by any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company shall be disregarded and deemed not to be outstanding,
except that, for the purpose of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent, only Securities
which the Trustee knows are so owned shall be so disregarded. Also, subject to
the foregoing, only Securities outstanding at the time shall be considered in
any such determination.
SECTION 11.07. Rules by Trustee, Paying Agent and Registrar. The
Trustee may make reasonable rules for action by or a meeting of Holders. The
Registrar and the Paying Agent may make reasonable rules for their functions.
SECTION 11.08. Legal Holidays. If a payment date is a Legal Holiday,
payment shall be made on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period. If a regular record
date is a Legal Holiday, the record date shall not be affected.
SECTION 11.09. Governing Law. This Indenture and the Securities shall
be governed by, and construed in accordance with, the laws of the State of New
York but without giving effect to applicable principles of conflicts of law to
the extent that the application of the laws of another jurisdiction would be
required thereby.
SECTION 11.10. No Recourse Against Others. A director, officer,
employee or stockholder, as such, of the Company or any Subsidiary Guarantor
shall not have any liability for any obligations of the Company under the
Securities or this Indenture or of such Subsidiary Guarantor under its
Subsidiary Guaranty or this Indenture or for any claim based on, in respect of
or by reason of such obligations or their creation. By accepting a Security,
each Holder shall waive and release all such liability. The waiver and release
shall be part of the consideration for the issue of the Securities.
SECTION 11.11. Successors. All agreements of the Company in this
Indenture and the Securities shall bind its successors. All agreements of the
Trustee in this Indenture shall bind its successors.
SECTION 11.12. Multiple Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together
87
represent the same agreement. One signed copy is enough to prove this Indenture.
SECTION 11.13. Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
WOLVERINE TUBE, INC.
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Executive Vice President,
Chief Financial Officer
and Secretary
TF INVESTOR, INC.
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Vice President and Treasurer
TUBE FORMING, L.P.
by Wolverine Tube, Inc.
as General Partner
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Executive Vice President,
Chief Financial Officer
and Secretary
SMALL TUBE MANUFACTURING
CORPORATION
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Vice President and Treasurer
WOLVERINE FINANCE COMPANY, INC.
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Vice President and Treasurer
WOLVERINE JOINING TECHNOLOGIES,
INC.
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Vice President and Treasurer
WOLVERINE CHINA INVESTMENTS, LLC
by Wolverine Tube, Inc. as
Managing Member
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Executive Vice President,
Chief Financial Officer
and Secretary
STPC HOLDING, INC.
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Vice President and Treasurer
TUBE FORMING HOLDINGS, INC.
by /s/ Xxxxx X. Xxxxxx
-------------------------------------
Vice President,
Chief Financial Officer
and Secretary
FIRST UNION NATIONAL BANK,
as Trustee
by /s/ Xxxxxxxx Xxxxxxx
-------------------------------------
Xxxxxxxx Xxxxxxx
Vice President
RULE 144A/REGULATION S APPENDIX
PROVISIONS RELATING TO INITIAL SECURITIES,
PRIVATE EXCHANGE SECURITIES
AND EXCHANGE SECURITIES
1. Definitions
1.1 Definitions
For the purposes of this Appendix the following terms shall have the
meanings indicated below:
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Temporary Regulation S Global Security or beneficial
interest therein, the rules and procedures of the Depository, Euroclear and
Clearstream for such a Temporary Regulation S Global Security, in each case to
the extent applicable to such transaction and as in effect from time to time.
"Clearstream" means Clearstream Banking, Societe Anonyme, or any
successor securities clearing agency.
"Definitive Security" means a certificated Initial Security or Exchange
Security or Private Exchange Security bearing, if required, the restricted
securities legend set forth in Section 2 .3(e).
"Depository" means The Depository Trust Company, its nominees and their
respective successors.
"Distribution Compliance Period", with respect to any Securities, means
the period of 40 consecutive days beginning on and including the later of (i)
the day on which such Securities are first offered to Persons other than
distributors (as defined in Regulation S under the Securities Act) in reliance
on Regulation S and (ii) the Issue Date with respect to such Securities.
"Euroclear" means Euroclear Bank S.A., as operator of the Euroclear
System or any successor securities clearing agency.
"Exchange Securities" means the 10 1/2% Senior Notes Due 2009 issued
pursuant to the Indenture in connection with the Registered Exchange Offer
pursuant to the Registration Rights Agreement.
"Initial Purchasers" means with respect to the Initial Securities
issued on the Issue Date, Credit Suisse First Boston Corporation and First Union
Securities, Inc.
2
"Initial Securities" means $120,000,000 aggregate principal amount of
10 1/2% Senior Notes due 2009 issued on the Issue Date.
"Private Exchange" means the offer by the Company, pursuant to the
Registration Rights Agreement, to the Initial Purchasers to issue and deliver to
each Initial Purchaser, in exchange for the Initial Securities held by the
Initial Purchaser as part of its initial distribution, a like aggregate
principal amount of Private Exchange Securities.
"Private Exchange Securities" means any 10 1/2% Senior Notes Due 2009
issued in connection with a Private Exchange.
"Purchase Agreement" means with respect to the Initial Securities
issued on the Issue Date, the Purchase Agreement dated March 22, 2002, among the
Company and the Initial Purchasers.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registered Exchange Offer" means the offer by the Company, pursuant to
the Registration Rights Agreement, to certain Holders of Initial Securities, to
issue and deliver to such Holders, in exchange for the Initial Securities, a
like aggregate principal amount of Exchange Securities registered under the
Securities Act.
"Registration Rights Agreement" means with respect to the Initial
Securities issued on the Issue Date, the Registration Rights Agreement dated
March 22, 2002, among the Company and the Initial Purchasers.
"Securities" means the Initial Securities, the Exchange Securities and
the Private Exchange Securities, treated as a single class.
"Securities Act" means the Securities Act of 1933.
"Securities Custodian" means the custodian with respect to a Global
Security (as appointed by the Depository), or any successor Person thereto and
shall initially be the Trustee.
"Shelf Registration Statement" means the registration statement issued
by the Company in connection with the offer and sale of Initial Securities or
Private
3
Exchange Securities pursuant to the a Registration Rights Agreement.
"Transfer Restricted Securities" means Securities that bear or are
required to bear the legend set forth in Section 2.3(e)hereto.
1.2 Other Definitions
Defined
Term in Section:
---- -----------
"Agent Members" 2.1(b)
"Global Security" 2.1(a)
"Permanent Regulation S Global Security" 2.1(a)
"Regulation S" 2.1(a)
"Rule 144A" 2.1(a)
"Rule 144A Global Security" 2.1(a)
"Temporary Regulation S Global Security" 2.1(a)
2. The Securities.
2.1 (a) Form and Dating. The Initial Securities will be offered and
sold by the Company pursuant to a Purchase Agreement. The Initial Securities
will be resold initially only to (i) QIBs in reliance on Rule 144A under the
Securities Act ("Rule 144A") and (ii) Persons other than U.S. Persons (as
defined in Regulation S) in reliance on Regulation S under the Securities Act
("Regulation S"). Initial Securities may thereafter be transferred to, among
others, QIBs and purchasers in reliance on Regulation S, in each case, subject
to the restrictions on transfer set forth herein. Initial Securities initially
resold pursuant to Rule 144A shall be issued initially in the form of one or
more permanent global Securities in definitive, fully registered form
(collectively, the "Rule 144A Global Security") and Initial Securities initially
resold pursuant to Regulation S shall be issued initially in the form of one or
more temporary global securities in definitive, fully registered form
(collectively, the "Temporary Regulation S Global Security"), in each case
without interest coupons and with the global securities legend and restricted
securities Legend set forth in Exhibit 1 hereto, which shall be deposited on
behalf of the purchasers of the Initial Securities represented thereby with the
Securities Custodian, and registered in the name of the Depository or a nominee
of the Depository, duly executed by the Company and authenticated by the Trustee
as provided in this Indenture. Except as set forth in this Section 2.1(a),
beneficial ownership interests in the Temporary Regulation S Global
4
Security (x) will not be exchangeable for interests in the Rule 144A Global
Security, the permanent global security (the "Permanent Regulation S Global
Security"), or any other Security without a legend containing restrictions on
transfer of such Security prior to the expiration of the Distribution Compliance
Period and (y) then may be exchanged for interests in a Rule 144A Global
Security or the Permanent Regulation S Global Security only upon certification
that beneficial ownership interests in such Temporary Regulation S Global
Security are owned either by non-U.S. persons or U.S. persons who purchased such
interests in a transaction that did not require registration under the
Securities Act.
Beneficial interests in Temporary Regulation S Global Securities may be
exchanged for interests in Rule 144A Global Securities or Permanent Regulation S
Global Securities if(1) such exchange occurs in connection with a transfer of
Securities in compliance with Rule 144A, and (2) the transferor of the
beneficial interest in the Temporary Regulation S Global Security first delivers
to the Trustee a written certificate (in a form satisfactory to the Trustee) to
the effect that the beneficial interest in the Temporary Regulation S Global
Security is being transferred to a Person (a) who the transferor reasonably
believes to be a QIB (b) purchasing for its own account or the account of a QIB
in a transaction meeting the requirements of Rule 144A, and (c) in accordance
with all applicable securities laws of the States of the United States and other
jurisdictions.
The Rule 144A Global Security, the Temporary Regulation S Global
Security and the Permanent Regulation S Global Security are collectively
referred to herein as "Global Securities". The aggregate principal amount of the
Global Securities may from time to time be increased or decreased by adjustments
made on the records of the Trustee and the Depository or its nominee as
hereinafter provided.
(b) Book-Entry Provisions. This Section 2.1(b) shall apply only to a
Global Security deposited with or on behalf of the Depository.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.1(b), authenticate and deliver initially one or more Global
Securities that (a) shall be registered in the name of the Depository for such
Global Security or Global Securities or the nominee of such Depository and (b)
shall be delivered by the Trustee to such Depository or pursuant to such
Depository's instructions or held by the Trustee as custodian for the
Depository.
5
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depository or by the Trustee as the custodian of the
Depository or under such Global Security, and the Company, the Trustee and any
agent of the Company or the Trustee shall be entitled to treat the Depository as
the absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and its Agent Members, the operation of
customary practices of such Depository governing the exercise of the rights of a
holder of a beneficial interest in any Global Security.
(c) Certificated Securities. Except as provided in this Section 2.1 or
Section 2.3 or 2.4, owners of beneficial interests in Global Securities shall
not be entitled to receive physical delivery of Definitive Securities.
2.2 Authentication. The Trustee shall authenticate and deliver: (1) on
the Issue Date, an aggregate principal amount of $120.0 million 10 1/2% Senior
Notes Due 2009, and (2) Exchange Securities or Private Exchange Securities for
issue only in a Registered Exchange Offer or a Private Exchange, respectively,
pursuant to the Registration Rights Agreement, for a like principal amount of
Initial Securities, in each case upon a written order of the Company signed by
two Officers or by an Officer and either an Assistant Treasurer or an Assistant
Secretary of the Company. Such order shall specify the amount of the Securities
to be authenticated and the date on which the original issue of Securities is to
be authenticated.
2.3 Transfer and Exchange. (a) Transfer and Exchange of Definitive
Securities. When Definitive Securities are presented to the Registrar or a
co-registrar with a request:
(x) to register the transfer of such Definitive Securities; or
(y) to exchange such Definitive Securities for an equal principal
amount of Definitive Securities of other authorized denominations,
the Registrar or co-registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
provided ,
6
however , that the Definitive Securities surrendered for transfer or exchange:
(i) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Registrar or co-
registrar, duly executed by the Holder thereof or its attorney duly authorized
in writing; and
(ii) if such Definitive Securities are required to bear a restricted
securities legend, they are being transferred or exchanged pursuant to an
effective registration statement under the Securities Act, pursuant to Section
2.3(b) or pursuant to clause (A), (B) or (C) below, and are accompanied by the
following additional information and documents, as applicable:
(A) if such Definitive Securities are being delivered to the Registrar
by a Holder for registration in the name of such Holder, without transfer, a
certification from such Holder to that effect; or
(B) if such Definitive Securities are being transferred to the Company,
a certification to that effect; or
(C) if such Definitive Securities are being transferred (x) pursuant to
an exemption from registration in accordance with Rule 144A, Regulation S or
Rule 144 under the Securities Act; or (y) in reliance upon another exemption
from the requirements of the Securities Act: (i) a certification to that effect
(in the form set forth on the reverse of the Security) and (ii) if the Company
so requests, an opinion of counsel or other evidence reasonably satisfactory to
it as to the compliance with the restrictions set forth in the legend set forth
in Section 2.3(e)(i).
(b) Restrictions on Transfer of a Definitive Security for a Beneficial
Interest in a Global Security. A Definitive Security may not be exchanged for a
beneficial interest in a Rule 144A Global Security or a Permanent Regulation S
Global Security except upon satisfaction of the requirements set forth below.
Upon receipt by the Trustee of a Definitive Security, duly endorsed or
accompanied by
7
appropriate instruments of transfer, in form satisfactory to the Trustee,
together with:
(i) certification, in the form set forth on the reverse of the
Security, that such Definitive Security is either (A) being transferred to a QIB
in accordance with Rule 144A or (B) is being transferred after expiration of the
Distribution Compliance Period by a Person who initially purchased such Security
in reliance on Regulation S to a buyer who elects to hold its interest in such
Security in the form of a beneficial interest in the Permanent Regulation S
Global Security; and
(ii) written instructions directing the Trustee to make, or to direct
the Securities Custodian to make, an adjustment on its books and records with
respect to such Rule 144A Global Security (in the case of a transfer pursuant to
clause (b)(i)(A)) or Permanent Regulation S Security (in the case of a transfer
pursuant to clause (b)(i)(B)) to reflect an increase in the aggregate principal
amount of the Securities represented by the Rule 144A Global Security or
Permanent Regulation S Global Security, as applicable, such instructions to
contain information regarding the Depository account to be credited with such
increase,
then the Trustee shall cancel such Definitive Security and cause, or direct the
Securities Custodian to cause, in accordance with the standing instructions and
procedures existing between the Depository and the Securities Custodian, the
aggregate principal amount of Securities represented by the Rule 144A Global
Security or Permanent Regulation S Global Security, as applicable, to be
increased by the aggregate principal amount of the Definitive Security to be
exchanged and shall credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in the Rule 144A Global
Security or Permanent Regulation S Global Security, as applicable, equal to the
principal amount of the Definitive Security so canceled. If no Rule 144A Global
Securities or Permanent Regulation S Global Securities, as applicable, are then
outstanding, the Company shall issue and the Trustee shall authenticate, upon
written order of the Company in the form of an Officers' Certificate, a new Rule
144A Global Security or Permanent Regulation S Global Security, as applicable,
in the appropriate principal amount.
(c) Transfer and Exchange of Global Securities. (i) The transfer and
exchange of Global Securities or beneficial interests therein shall be effected
through the
8
Depository, in accordance with this Indenture (including applicable restrictions
on transfer set forth herein, if any) and the procedures of the Depository
therefor. A transferor of a beneficial interest in a Global Security shall
deliver to the Registrar a written order given in accordance with the
Depository's procedures containing information regarding the participant account
of the Depository to be credited with a beneficial interest in the Global
Security. The Registrar shall, in accordance with such instructions, instruct
the Depository to credit to the account of the Person specified in such
instructions a beneficial interest in the Global Security and to debit the
account of the Person making the transfer the beneficial interest in the Global
Security being transferred.
(ii) If the proposed transfer is a transfer of a beneficial interest in
one Global Security to a beneficial interest in another Global Security, the
Registrar shall reflect on its books and records the date and an increase in the
principal amount of the Global Security to which such interest is being
transferred in an amount equal to the principal amount of the interest to be so
transferred, and the Registrar shall reflect on its books and records the date
and a corresponding decrease in the principal amount of the Global Security from
which such interest is being transferred.
(iii) Notwithstanding any other provisions of this Appendix (other than
the provisions set forth in Section 2.4), a Global Security may not be
transferred as a whole except by the Depository to a nominee of the Depository
or by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor Depository or
a nominee of such successor Depository.
(iv) In the event that a Global Security is exchanged for Definitive
Securities pursuant to Section 2.4 of this Appendix prior to the consummation of
a Registered Exchange Offer or the effectiveness of a Shelf Registration
Statement with respect to such Securities, such Securities may be exchanged only
in accordance with such procedures as are substantially consistent with the
provisions of this Section 2.3 (including the certification requirements set
forth on the reverse of the Initial Securities intended to ensure that such
transfers comply with Rule 144A or Regulation S, as the case may be) and such
other procedures as may from time to time be adopted by the Company.
9
(d) Restrictions on Transfer of Temporary Regulation S Global
Securities. During the Distribution Compliance Period, beneficial ownership
interests in Temporary Regulation S Global Securities may only be sold, pledged
or transferred through Euroclear or Clearstream in accordance with the
Applicable Procedures and only (i) to the Company, (ii) so long as such Security
is eligible for resale pursuant to Rule 144A, to a Person whom the selling
holder reasonably believes is a QIB that purchases for its own account or for
the account of a QIB in a transaction meeting the requirement of Rule 144A,
(iii) in an offshore transaction in accordance with Regulation S (other than a
transaction resulting in an exchange for interest in a Permanent Regulation S
Global Security), (iv) pursuant to an exemption from registration under the
Securities Act provided by Rule 144 (if applicable) under the Securities Act or
(v) pursuant to an effective registration statement under the Securities Act, in
each case in accordance with any applicable securities laws of any state of the
United States.
(e) Legend.
(i) Except as permitted by the following para- graphs (ii), (iii) and
(iv), each Security certificate evidencing the Global Securities (and all
Securities issued in exchange therefor or in substitution thereof) shall bear a
legend in substantially the following form:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF
THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY
(I) THE COMPANY, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (III) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH
10
RULE 904 UNDER THE SECURITIES ACT, (IV) PURSUANT TO EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (V)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE.
Each Definitive Security will also bear the following additional legend:
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT
MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.
(ii) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Global Security)
pursuant to Rule 144 under the Securities Act, the Registrar shall permit the
transferee thereof to exchange such Transfer Restricted Security for a
certificated Security that does not bear the legend set forth above and rescind
any restriction on the transfer of such Transfer Restricted Security, if the
transferor thereof certifies in writing to the Registrar that such sale or
transfer was made in reliance on Rule 144 (such certification to be in the form
set forth on the reverse of the Security).
(iii) After a transfer of any Initial Securities or Private Exchange
Securities pursuant to and during the period of the effectiveness of a Shelf
Registration Statement with respect to such Initial Securities or Private
Exchange Securities, as the case may be, all requirements pertaining to legends
on such Initial Security or such Private Exchange Security will cease to apply,
the requirements requiring any such Initial Security or such Private Exchange
Security issued to certain Holders be issued in global form will cease to apply,
and a certificated Initial Security or Private Exchange Security or an Initial
Security or Private Exchange Security in global form, in each case without
restrictive transfer legends, will be available to the transferee of the Holder
of such Initial Securities or
11
Private Exchange Securities upon exchange of such transferring Holder's
certificated Initial Security or Private Exchange Security or appropriate
directions to transfer such Holder's interest in the Global Security, as
applicable.
(iv) Upon the consummation of a Registered Exchange Offer with respect
to the Initial Securities, all requirements pertaining to such Initial
Securities that Initial Securities issued to certain Holders be issued in global
form will still apply with respect to Holders of such Initial Securities that do
not exchange their Initial Securities, and Exchange Securities in certificated
or global form, in each case without the restrictive securities legend set forth
in Exhibit 1 hereto will be available to Holders that exchange such Initial
Securities in such Registered Exchange Offer.
(v) Upon the consummation of a Private Exchange with respect to the
Initial Securities, all requirements pertaining to such Initial Securities that
Initial Securities issued to certain Holders be issued in global form will still
apply with respect to Holders of such Initial Securities that do not exchange
their Initial Securities, and Private Exchange Securities in global form with
the global securities legend and the Restricted Securities Legend set forth in
Exhibit 1 hereto will be available to Holders that exchange such Initial
Securities in such Private Exchange.
(f) Cancellation or Adjustment of Global Security. At such time as all
beneficial interests in a Global Security have either been exchanged for
Definitive Securities, redeemed, purchased or canceled, such Global Security
shall be returned to the Depository for cancellation or retained and canceled by
the Trustee. At any time prior to such cancellation, if any beneficial interest
in a Global Security is exchanged for certificated Securities, redeemed,
purchased or canceled, the principal amount of Securities represented by such
Global Security shall be reduced and an adjustment shall be made on the books
and records of the Trustee (if it is then the Securities Custodian for such
Global Security) with respect to such Global Security, by the Trustee or the
Securities Custodian, to reflect such reduction.
(g) Obligations with Respect to Transfers and Exchanges of Securities.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee
12
shall authenticate Definitive Securities and Global Securities at the
Registrar's or co-registrar's request.
(ii) No service charge shall be made for any registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any transfer tax, assessments, or similar governmental charge payable in
connection therewith (other than any such transfer taxes, assessments or similar
governmental charge payable upon exchange or transfer pursuant to Sections 2.09,
3.06, 4.06, 4.10 or 9.05 of the Indenture).
(iii) The Registrar or co-registrar shall not be required to register
the transfer of or exchange of (a) any Definitive Security selected for
redemption in whole or in part pursuant to Article 3 of this Indenture, except
the unredeemed portion of any Definitive Security being redeemed in part, or (b)
any Security for a period beginning 15 Business Days before the mailing of a
notice of an offer to repurchase or redeem Securities or 15 Business Days before
an interest payment date.
(iv) Prior to the due presentation for registration of transfer of
any Security, the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of receiving
payment of principal of and interest on such Security and for all other purposes
whatsoever, whether or not such Security is overdue, and none of the Company,
the Trustee, the Paying Agent, the Registrar or any co-registrar shall be
affected by notice to the contrary.
(v) All Securities issued upon any transfer or exchange pursuant to the
terms of this Indenture shall evidence the same debt and shall be entitled to
the same benefits under this Indenture as the Securities surrendered upon such
transfer or exchange.
(h) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or obligation to any
beneficial owner of a Global Security, a member of, or a participant in the
Depository or other Person with respect to the accuracy of the records of the
Depository or its nominee or of any participant or member thereof, with respect
to any
13
ownership interest in the Securities or with respect to the delivery to any
participant, member, beneficial owner or other Person (other than the
Depository) of any notice (including any notice of redemption) or the payment of
any amount, under or with respect to such Securities. All notices and
communications to be given to the Holders and all payments to be made to Holders
under the Securities shall be given or made only to or upon the order of the
registered Holders (which shall be the Depository or its nominee in the case of
a Global Security). The rights of beneficial owners in any Global Security shall
be exercised only through the Depository subject to the applicable rules and
procedures of the Depository. The Trustee may rely and shall be fully
protected in relying upon information furnished by the Depository with respect
to its members, participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor, determine
or inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Depository
participants, members or beneficial owners in any Global Security) other than to
require delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by, the terms
of this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
2.4 Certificated Securities.
(a) A Global Security deposited with the Depository or with the Trustee
as Custodian for the Depository pursuant to Section 2.1 shall be transferred to
the beneficial owners thereof in the form of Definitive Securities in an
aggregate principal amount equal to the principal amount of such Global
Security, in exchange for such Global Security, only if such transfer complies
with Section 2.3 hereof and (i) the Depository notifies the Company that it is
unwilling or unable to continue as Depository for such Global Security or if at
any time such Depository ceases to be a "clearing agency" registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by the
Company within 90 days of such notice, or (ii) an Event of Default has occurred
and is continuing or (iii) the Company, in its sole discretion, notifies the
Trustee in writing that it elects to cause the issuance of Definitive Securities
under this Indenture.
14
(b) Any Global Security that is transferable to the beneficial owners
thereof pursuant to this Section shall be surrendered by the Depository to the
Trustee located at its principal corporate trust office in Charlotte, North
Carolina, to be so transferred, in whole or from time to time in part, without
charge, and the Trustee shall authenticate and deliver, upon such transfer of
each portion of such Global Security, an equal aggregate principal amount of
Definitive Securities of authorized denominations. Any portion of a Global
Security transferred pursuant to this Section shall be executed, authenticated
and delivered only in denominations of $1,000 principal amount and any integral
multiple thereof and registered in such names as the Depository shall direct.
Any Definitive Security delivered in exchange for an interest in the Transfer
Restricted Security shall, except as otherwise provided by Section 2.3(e)
hereof, bear the restricted securities legend and definitive security legend set
forth in Exhibit 1 hereto.
(c) Subject to the provisions of Section 2.4(b) hereof, the registered
Holder of a Global Security shall be entitled to grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Securities.
(d) In the event of the occurrence of one of the events specified in
Section 2.4(a) hereof, the Company shall promptly make available to the Trustee
a reasonable supply of Definitive Securities in definitive, fully registered
form without interest coupons.
EXHIBIT 1
to
RULE 144A/REGULATION S APPENDIX
[FORM OF FACE OF INITIAL SECURITY]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[FOR REGULATION S GLOBAL NOTE ONLY] UNTIL 40 DAYS AFTER THE
COMMENCEMENT OF THE OFFERING, AN OFFER OR SALE OF NOTES WITHIN THE UNITED STATES
BY A DEALER (AS DEFINED IN THE U.S. SECURITIES ACT) MAY VIOLATE THE REGISTRATION
REQUIREMENTS OF THE U.S. SECURITIES ACT IF SUCH OFFER OR SALE IS MADE OTHERWISE
THAN IN ACCORDANCE WITH THE RULE 144A THEREUNDER.]
[Restricted Securities Legend]
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF
THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY
(I) THE COMPANY, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN
2
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED
STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (IV) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (V) PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES
(I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE.
[Temporary Regulation S Global Security Legend]
EXCEPT AS SET FORTH BELOW, BENEFICIAL OWNERSHIP INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY WILL NOT BE EXCHANGEABLE FOR INTERESTS IN
THE PERMANENT REGULATION S GLOBAL SECURITY OR ANY OTHER SECURITY REPRESENTING AN
INTEREST IN THE SECURITIES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND
CONTAINING RESTRICTIONS ON TRANSFER, UNTIL THE EXPIRATION OF THE "40-DAY
DISTRIBUTION COMPLIANCE PERIOD" (WITHIN THE MEANING OF RULE 903(c)(3) OF
REGULATION S UNDER THE SECURITIES ACT) AND THEN ONLY UPON CERTIFICATION IN FORM
REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS ARE OWNED
EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A
TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT. DURING
SUCH 40-DAY DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP INTERESTS IN
THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY ONLY BE SOLD, PLEDGED OR
TRANSFERRED THROUGH EUROCLEAR BANK S.A./N.A., AS OPERATOR OF THE EUROCLEAR
SYSTEM OR CLEARSTREAM BANKING, SOCIETE ANONYME AND ONLY (I) TO THE COMPANY, (II)
IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED
STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, OR
(IV) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT,
IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES. HOLDERS OF INTERESTS IN THIS TEMPORARY
REGULATION S GLOBAL SECURITY WILL NOTIFY ANY PURCHASER OF THIS SECURITY OF THE
RESALE RESTRICTIONS REFERRED TO ABOVE, IF THEN APPLICABLE.
BENEFICIAL INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY BE
EXCHANGED FOR INTERESTS IN A RULE 144A GLOBAL SECURITY ONLY IF (1) SUCH EXCHANGE
OCCURS IN
3
CONNECTION WITH A TRANSFER OF THE SECURITIES IN COMPLIANCE WITH RULE 144A, AND
(2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY FIRST DELIVERS TO THE
TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE
EFFECT THAT THE REGULATION S GLOBAL SECURITY BEING TRANSFERRED TO A PERSON (A)
WHO THE TRANSFEROR REASONABLY BELIEVES TO BE A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A (B) PURCHASING FOR ITS OWN ACCOUNT OR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, AND (C) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.
BENEFICIAL INTEREST IN A RULE 144A GLOBAL SECURITY MAY BE TRANSFERRED TO A
PERSON WHO TAKES DELIVERY IN THE FORM OF AN INTEREST IN THE REGULATION S GLOBAL
SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE 40-DAY DISTRIBUTION
COMPLIANCE PERIOD, ONLY IF THE TRANSFEROR FIRST DELIVERS TO THE TRUSTEE A
WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE EFFECT
THAT IF SUCH TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR 904 OF
REGULATION S OR RULE 144 (IF AVAILABLE) AND THAT, IF SUCH TRANSFER OCCURS PRIOR
TO THE EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD, THE INTEREST
TRANSFERRED WILL BE HELD IMMEDIATELY THEREAFTER THROUGH EUROCLEAR BANK S.A./N.A.
OR CLEARSTREAM BANKING SOCIETE ANONYME.
[Definitive Securities Legend]
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.
4
No.___________________ $_________________
10 1/2% Senior Notes Due 2009
Wolverine Tube, Inc., a Delaware corporation, promises to pay to , or
registered assigns, the principal sum of ! Dollars on April 1, 2009.
Interest Payment Dates: April 1 and October 1.
Record Dates: March 15 and September 15.
Additional provisions of this Security are set forth on the other side
of this Security.
Dated:
Wolverine Tube, Inc.
by
-----------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
First Union National Bank,
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
by
------------------------------
Authorized Signatory
5
[FORM OF REVERSE SIDE OF INITIAL SECURITY]
10 1/2% Senior Note Due 2009
1. Interest
Wolverine Tube, Inc., a Delaware corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount of this
Security at the rate per annum shown above; provided, however, that if a
Registration Default (as defined in the Registration Rights Agreement) occurs,
additional interest will accrue on this Security at a rate of 0.25% per annum
(increasing by an additional 0.25% per annum after each consecutive 90-day
period that occurs after the date on which such Registration Default occurs up
to a maximum additional interest rate of 1.00%) from and including the date on
which any such Registration Default shall occur to but excluding the date on
which all Registration Defaults have been cured or otherwise cease to exist. The
Company will pay interest semiannually on April 1 and October 1 of each year,
commencing October 1, 2002. Interest on the Securities will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from March 27, 2002. Interest will be computed on the basis of a 360-day year of
twelve 30-day months. The Company will pay interest on overdue principal at the
above rate and will pay interest on overdue installments of interest at such
rate to the extent lawful.
2. Method of Payment
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the March 15 or September 15 next preceding the interest payment
date even if Securities are canceled after the record date and on or before the
interest payment date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company will pay principal and interest in money
of the United States that at the time of payment is legal tender for payment of
public and private debts. Payments in respect of the Securities represented by a
Global Security (including principal, premium, if any, and interest) will be
made by wire transfer of immediately available funds to the accounts specified
by The Depository Trust Company. The Company will make all payments in respect
of a certificated Security (including principal, premium, if any, and
6
interest) by mailing a check to the registered address of each Holder thereof;
provided , however, that payments on a certificated Security will be made by
wire transfer to a U.S. dollar account maintained by the payee with a bank in
the United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating
such account no later than 30 days immediately preceding the relevant due date
for payment (or such other date as the Trustee may accept in its discretion).
3. Paying Agent and Registrar
Initially, First Union National Bank, a national banking association
(the "Trustee"), will act as Paying Agent and Registrar. The Company may appoint
and change any Paying Agent, Registrar or co-registrar without notice. The
Company or any of its domestically incorporated Wholly Owned Subsidiaries may
act as Paying Agent, Registrar or co- registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as of March
27, 2002 ("Indenture"), among the Company, the Subsidiary Guarantors and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S.C. ss.ss.77aaa-77bbbb) as in effect on the date of the Indenture (the
"Act"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all such terms,
and Holders are referred to the Indenture and the Act for a statement of those
terms.
The Securities are general unsecured obligations of the Company limited
to $120.0 million aggregate principal amount (subject to Section 2.07 of the
Indenture). The Initial Securities issued on the Issue Date and all Exchange
Securities or Private Exchange Securities issued in exchange therefor will be
treated as a single class for all purposes under the Indenture. The Indenture
contains covenants that limit the ability of the Company and its subsidiaries to
incur additional indebtedness; pay dividends or distributions on, or redeem or
repurchase capital stock; make investments; issue or sell capital stock of
subsidiaries; engage in transactions with affiliates; create liens on assets;
transfer or sell assets; guarantee indebtedness; restrict dividends or other
payments of subsidiaries; consolidate, merge or transfer all or substantially
all of its assets and the assets of its
7
subsidiaries; and engage in sale/leaseback transactions. These covenants are
subject to important exceptions and qualifications.
5. Optional Redemption
Except as set forth below, the Company shall not be entitled to redeem
the Securities prior to maturity.
On and after April 1, 2006, the Company shall be entitled at its option
to redeem all or a portion of the Securities upon not less than 30 nor more than
60 days' notice, at the redemption prices (expressed in percentages of principal
amount on the redemption date), plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date), if redeemed during
the 12-month period commencing on April 1 of the years set forth below:
Redemption
Period Price
------ ----------
2006 105.250%
2007 102.625%
2008 and thereafter 100.000%
In addition, prior to April 1, 2005, the Company shall be entitled at
its option on one or more occasions to redeem Securities in an aggregate
principal amount not to exceed 35% of the aggregate principal amount of the
Securities originally issued at a redemption price (expressed as a percentage of
principal amount) of 110 .5%, plus accrued and unpaid interest to the redemption
date, with the net cash proceeds from one or more Public Equity Offerings;
provided, however, that (1) at least 65% of such aggregate principal amount of
Securities remains outstanding immediately after the occurrence of each such
redemption (other than Securities held, directly or indirectly, by the Company
or its Affiliates) ; and (2) each such redemption occurs within 60 days after
the date of the related Public Equity Offering.
6. Notice of Redemption
Notice of redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each Holder of Securities to be redeemed
at its registered address. Securities in denominations larger than $1,000
principal amount may be redeemed in part but only in whole
8
multiples of $1,000. If money sufficient to pay the redemption price of and
accrued interest on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date interest
ceases to accrue on such Securities (or such portions thereof) called for
redemption.
7. Put Provisions
Upon a Change of Control, any Holder of Securities will have the right
to cause the Company to repurchase all or any part of the Securities of such
Holder at a repurchase price equal to 101% of the principal amount of the
Securities to be repurchased plus accrued interest, if any, to the date of
repurchase (subject to the right of holders of record on the relevant record
date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the Indenture.
Under certain circumstances as set forth in the Indenture, the Company
will be required to offer to purchase Securities with the Net Available Cash
from Asset Dispositions.
8. Guaranty
The payment by the Company of the principal of, and premium and
interest on, the Securities is guaranteed by the Subsidiary Guarantors on a
joint and several basis, on the terms set forth in the Indenture.
9. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in denominations
of $1,000 principal amount and whole multiples of $1,000. A Holder may transfer
or exchange Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be
redeemed or 15 days before an interest payment date.
9
10. Persons Deemed Owners
The registered Holder of this Security may be treated as the owner of
it for all purposes.
11. Unclaimed Money
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee or Paying Agent shall pay the money back to the Company
at its request unless an abandoned property law designates another Person. After
any such payment, Holders entitled to the money must look only to the Company
and not to the Trustee for payment.
12. Discharge and Defeasance
Subject to certain conditions, the Company at any time shall be
entitled to terminate some or all of its obligations under the Securities and
the Indenture if the Company deposits with the Trustee money or U.S. Government
Obligations for the payment of principal and interest on the Securities to
redemption or maturity, as the case may be.
13. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture and the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding of
the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Holder, the Company, the Subsidiary Guarantors and
the Trustee shall be entitled to amend the Indenture, the Security Agreements or
the Securities to cure any ambiguity, omission, defect or inconsistency, or to
comply with Article 5 of the Indenture, or to provide for uncertificated
Securities in addition to or in place of certificated Securities, or to add
guarantees with respect to the Securities, including Subsidiary Guaranties, or
to secure the Securities, or to add additional covenants or surrender rights and
powers conferred on the Company or the Subsidiary Guarantors, or to comply with
any request of the SEC in connection with qualifying the Indenture under the
Act, or to make any change that does not adversely affect the rights of any
Securityholder.
10
14. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for 30 days
in payment of interest on the Securities; (ii) default in payment of principal
on the Securities at maturity, upon redemption pursuant to paragraph 5 of the
Securities, upon acceleration or otherwise, or failure by the Company to redeem
or purchase Securities when required; (iii) failure by the Company to comply
with other agreements in the Indenture or the Securities, in certain cases
subject to notice and lapse of time; (iv) certain accelerations or payment
default in respect of other Indebtedness of the Company or any Significant
Subsidiary if the amount accelerated (or if the amount of such Indebtedness with
respect to which such a payment is not made after expiration any applicable
grace period) exceeds $10.0 million; (v) certain events of bankruptcy or
insolvency with respect to the Company and the Significant Subsidiaries; and
(vi) certain judgments or decrees for the payment of money in excess of $10.0
million (vii) certain defaults with respect to Subsidiary Guaranties. If an
Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the Securities may declare all the Securities
to be due and payable immediately. Certain events of bankruptcy or insolvency
are Events of Default which will result in the Securities being due and payable
immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders notice of any continuing Default (except a
Default in payment of principal or interest) if it determines that withholding
notice is not opposed to the interest of the Holders.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the Act, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
11
16. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the Company
or the Trustee shall not have any liability for any obligations of the Company
under the Securities or the Indenture or for any claim based on, in respect of
or by reason of such obligations or their creation. By accepting a Security,
each Securityholder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
17. Authentication
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
18. Abbreviations
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
19. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
20. Holders' Compliance with Registration Rights Agreement .
Each Holder of a Security, by acceptance hereof, acknowledges and
agrees to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.
12
21. Governing Law.
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
The Company will furnish to any Securityholder upon written request and
without charge to the Securityholder a copy of the Indenture which has in it the
text of this Security in larger type. Requests may be made to:
Wolverine Tube Inc.
000 Xxxxxxx Xxxxxx Xxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxxxx 00000
Attention: Secretary
13
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on the books of
the Company. The agent may substitute another to act for him.
-----------------------------------------------------------------
Date:________________________ Your Signature:________________
-----------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
In connection with any transfer of any of the Securities evidenced by
this certificate occurring prior to the expiration of the period
referred to in Rule 144(k) under the Securities Act after the later of
the date of original issuance of such Securities and the last date, if
any, on which such Securities were owned by the Company or any
Affiliate of the Company, the undersigned confirms that such Securities
are being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) [ ] to the Company; or
(2) [ ] pursuant to an effective registration
statement under the Securities Act of 1933; or
(3) [ ] inside the United States to a "qualified
institutional buyer" (as defined in Rule 144A under
the Securities Act of 1933) that purchases for its
own account or for the account of a qualified
institutional buyer to whom notice is given that such
transfer is
14
being made in reliance on Rule 144A, in each case
pursuant to and in compliance with Rule 144A under
the Securities Act of 1933; or
(4) [ ] outside the United States in an offshore
transaction within the meaning of Regulation S under
the Securities Act in compliance with Rule 904 under
the Securities Act of 1933; or
(5) [ ] pursuant to the exemption from registration
provided by Rule 144 under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register
any of the Securities evidenced by this certificate in the name of any
person other than the registered holder thereof; provided , however,
that if box (4) or (5) is checked, the Trustee shall be entitled to
require, prior to registering any such transfer of the Securities, such
legal opinions, certifications and other information as the Company has
reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933, such as the
exemption provided by Rule 144 under such Act.
-----------------------------------
Signature
Signature Guarantee:
----------------------------- -----------------------------------
Signature must be guaranteed Signature
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
15
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated:
------------------------------- -----------------------------
NOTICE: To be executed by
an executive officer
16
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have been
made:
Principal amount Signature of
Amount of Amount of of this Global authorized
decrease increase in Security officer of
in Principal Principal following Trustee or
Date of amount of this amount of this such decrease Securities
Exchange Global Security Global Security or increase) Custodian
17
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.06 or 4.10 of the Indenture, check the box:
[ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.06 or 4.10 of the Indenture, state the amount
in principal amount: $ !
Date: Your Signature:
------------------------ ---------------------------
(Sign exactly as your
name appears on the other
side of this Security.)
Signature Guarantee:
-----------------------------------------------------------
(Signature must be guaranteed)
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
EXHIBIT A
[FORM OF FACE OF EXCHANGE SECURITY
OR PRIVATE EXCHANGE SECURITY * /**/]
-----------------------
*/ If the Security is to be issued in global form add the Global Securities
Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1
captioned "TO BE ATTACHED TO GLOBAL SECURITIES - SCHEDULE OF INCREASES OR
DECREASES IN GLOBAL SECURITY".
** / If the Security is a Private Exchange Security issued in a Private Exchange
to an Initial Purchaser holding an unsold portion of its initial allotment, add
the Restricted Securities Legend from Exhibit 1 to Appendix A and replace the
Assignment Form included in this Exhibit A with the Assignment Form included in
such Exhibit 1.
CUSIP No.____________
ISIN_________
No. ___________________ $____________
10 1/2% Senior Notes Due 2009
Wolverine Tube, Inc., a Delaware corporation, promises to pay to
_____________________, or registered assigns, the principal sum of
_______________________________ Dollars on April 1, 2009.
Interest Payment Dates: April 1 and October 1.
Record Dates: March 15 and September 15.
Additional provisions of this Security are set forth on the other side
of this Security.
Dated:
Wolverine Tube, Inc.
by
-----------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
First Union National Bank,
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
by
------------------------
Authorized Signatory
2
[FORM OF REVERSE SIDE OF EXCHANGE SECURITY
OR PRIVATE EXCHANGE SECURITY]
10 1/2% Senior Note Due 2009
1. Interest
Wolverine Tube, Inc., a Delaware corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount of this
Security at the rate per annum shown above[; provided, however , that if a
Registration Default (as defined in the Registration Rights Agreement) occurs,
additional interest will accrue on this Security at a rate of 0.25% per annum
(increasing by an additional 0.25% per annum after each consecutive 90-day
period that occurs after the date on which such Registration Default occurs up
to a maximum additional interest rate of 1.00%) from and including the date on
which any such Registration Default shall occur to but excluding the date on
which all Registration Defaults have been cured or otherwise cease to exist. The
Company will pay interest semiannually on April 1 and October 1 of each year,
commencing October 1, 2002. Interest on the Securities will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from March 27. Interest will be computed on the basis of a 360-day year of
twelve 30-day months. The Company will pay interest on overdue principal at the
above rate and will pay interest on overdue installments of interest at such
rate to the extent lawful.
2. Method of Payment
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the March 15 or September 15 next preceding the interest payment
date even if Securities are canceled after the record date and on or before the
interest payment date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company will pay principal and interest in money
of the United States that at the time of payment is legal tender for payment of
public and private debts. Payments in respect of the Securities represented by a
Global Security (including principal, premium, if any, and interest) will be
made by wire transfer of immediately available funds to the accounts specified
by The Depository Trust Company. The
3
Company will make all payments in respect of a certificated Security (including
principal, premium, if any, and interest) by mailing a check to the registered
address of each Holder thereof; provided , however, that payments on a
certificated Security will be made by wire transfer to a U.S. dollar account
maintained by the payee with a bank in the United States if such Holder elects
payment by wire transfer by giving written notice to the Trustee or the Paying
Agent to such effect designating such account no later than 30 days immediately
preceding the relevant due date for payment (or such other date as the Trustee
may accept in its discretion).
3. Paying Agent and Registrar
Initially, First National Bank, a national banking corporation (the
"Trustee"), will act as Paying Agent and Registrar. The Company may appoint and
change any Paying Agent, Registrar or co-registrar without notice. The Company
or any of its domestically incorporated Wholly Owned Subsidiaries may act as
Paying Agent, Registrar or co- registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as of March
27, 2002 ("Indenture"), among the Company, the Subsidiary Guarantors and the
Trustee. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S.C. ss.ss.77aaa-77bbbb) as in effect on the date of the Indenture (the
"Act"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all such terms,
and Holders are referred to the Indenture and the Act for a statement of those
terms.
The Securities are general unsecured obligations of the Company limited
to $120.0 million aggregate principal amount (subject to Section 2.07 of the
Indenture). The Initial Securities issued on the Issue Date and all Exchange
Securities or Private Exchange Securities issued in exchange therefor will be
treated as a single class for all purposes under the Indenture. The Indenture
contains covenants that limit the ability of the Company and its subsidiaries to
incur additional indebtedness; pay dividends or distributions on, or redeem or
repurchase capital stock; make investments; issue or sell capital stock of
subsidiaries; engage in transactions with affiliates; create liens on assets;
transfer or sell assets; guarantee indebtedness; restrict dividends or other
payments of
4
subsidiaries; consolidate, merge or transfer all or substantially all of its
assets and the assets of its subsidiaries; and engage in sale/leaseback
transactions. These covenants are subject to important exceptions and
qualifications.
5. Optional Redemption
Except as set forth below, the Company shall not be entitled to redeem
the Securities prior t maturity.
On and after April 1, 2006, the Company shall be entitled at its option
to redeem all or a portion of the Securities upon not less than 30 nor more than
60 days' notice, at the redemption prices (expressed in percentages of principal
amount, on the redemption date) plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date), if redeemed during
the 12-month period commencing on April 1 of the years set forth below:
Redemption
Period Price
------ ----------
2006 105.250%
2007 102.625%
2008 and thereafter 100.000%
In addition, prior to April 1, 2005, the Company shall be entitled at
its option on one or more occasions to redeem Securities in an aggregate
principal amount not to exceed 35% of the aggregate principal amount of the
Securities originally issued at a redemption price (expressed as a percentage of
principal amount) of 110 .5%, plus accrued and unpaid interest to the redemption
date, with the net cash proceeds from one or more Public Equity Offerings;
provided, however , that (1) at least 65% of such aggregate principal amount of
Securities remains outstanding immediately after the occurrence of each such
redemption (other than Securities held, directly or indirectly, by the Company
or its Affiliates) ; and (2) each such redemption occurs within 60 days after
the date of the related Public Equity Offering.
6. Notice of Redemption
Notice of redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each Holder of Securities to be redeemed
at its registered
5
address. Securities in denominations larger than $1,000 principal amount may be
redeemed in part but only in whole multiples of $1,000. If money sufficient to
pay the redemption price of and accrued interest on all Securities (or portions
thereof) to be redeemed on the redemption date is deposited with the Paying
Agent on or before the redemption date and certain other conditions are
satisfied, on and after such date interest ceases to accrue on such Securities
(or such portions thereof) called for redemption.
7. Put Provisions
Upon a Change of Control, any Holder of Securities will have the right
to cause the Company to repurchase all or any part of the Securities of such
Holder at a repurchase price equal to 101% of the principal amount of the
Securities to be repurchased plus accrued interest, if any, to the date of
repurchase (subject to the right of holders of record on the relevant record
date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the Indenture.
8. Guarantee
The payment by the Company of the principal of, and premium and
interest on, the Securities is guaranteed by the Subsidiary Guarantors on a
joint and several basis, on the terms set forth in the Indenture.
9. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in denominations
of $1,000 principal amount and whole multiples of $1,000. A Holder may transfer
or exchange Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be
redeemed or 15 days before an interest payment date.
10. Persons Deemed Owners
The registered Holder of this Security may be treated as the owner of
it for all purposes.
6
11. Unclaimed Money
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee or Paying Agent shall pay the money back to the Company
at its request unless an abandoned property law designates another Person. After
any such payment, Holders entitled to the money must look only to the Company
and not to the Trustee for payment.
12. Discharge and Defeasance
Subject to certain conditions, the Company at any time shall be
entitled to terminate some or all of its obligations under the Securities and
the Indenture if the Company deposits with the Trustee money or U.S. Government
Obligations for the payment of principal and interest on the Securities to
redemption or maturity, as the case may be.
13. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture and the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding of
the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company, the Subsidiary
Guarantors and the Trustee shall be entitled to amend the Indenture or the
Securities to cure any ambiguity, omission, defect or inconsistency, or to
comply with Article 5 of the Indenture, or to provide for uncertificated
Securities in addition to or in place of certificated Securities, or to add
guarantees with respect to the Securities, including Subsidiary Guaranties, or
to secure the Securities, or to add additional covenants or surrender rights and
powers conferred on the Company or the Subsidiary Guarantors, or to comply with
any request of the SEC in connection with qualifying the Indenture under the
Act, or to make any change that does not adversely affect the rights of any
Securityholder.
14. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for 30 days
in payment of interest on the Securities; (ii) default in payment of principal
on the Securities at maturity, upon redemption pursuant to
7
paragraph 5 of the Securities, upon acceleration or otherwise, or failure by the
Company to redeem or purchase Securities when required; (iii) failure by the
Company to comply with other agreements in the Indenture or the Securities, in
certain cases subject to notice and lapse of time; (iv) certain accelerations or
payment default in respect other Indebtedness of the Company or any Significant
Subsidiary if the amount accelerated (or if the amount of such Indebtedness with
respect to which such a payment is not made after expiration any applicable
grace period) exceeds $10.0 million; (v) certain events of bankruptcy or
insolvency with respect to the Company and the Significant Subsidiaries; (vi)
certain judgments or decrees for the payment of money in excess of $10.0
million; and (vii) certain defaults with respect to Subsidiary Guaranties. If an
Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the Securities may declare all the Securities
to be due and payable immediately. Certain events of bankruptcy or insolvency
are Events of Default which will result in the Securities being due and payable
immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders notice of any continuing Default (except a
Default in payment of principal or interest) if it determines that withholding
notice is in the interest of the Holders.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the Trust Indenture Act, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its Affiliates with the same rights it would have if it were
not Trustee.
16. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the Company
or the Trustee shall not have any liability for any obligations of the Company
under the Securities or
8
the Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Security, each Securityholder
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities.
17. Authentication
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
18. Abbreviations
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
19. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
20. Holders' Compliance with Registration Rights Agreement.
Each Holder of a Security, by acceptance hereof, acknowledges and
agrees to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.
9
21. Governing Law.
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
The Company will furnish to any Securityholder upon written request and
without charge to the Security holder a copy of the Indenture which has in it
the text of this Security in larger type. Requests may be made to:
Wolverine Tube, Inc
000 Xxxxxxx Xxxxxx Xxx
Xxxxx 0000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Secretary
10
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to
transfer this Security on the books of the Company. The agent may
substitute another to act for him.
-----------------------------------------------------------------
Date:________________________ Your Signature:________________
-----------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
11
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.06 or 4.10 of the Indenture, check the box:
[ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.06 or 4.10 of the Indenture, state the amount
in principal amount: $ __
Date: Your Signature:
------------------------ ---------------------------
(Sign exactly as your
name appears on the other
side of this Security.)
Signature Guarantee:
-----------------------------------------------------------
(Signature must be guaranteed)
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
12
