EXHIBIT 4.1
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CALIFORNIA STEEL INDUSTRIES, INC.,
as Company
and
STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A.,
as Trustee
_____________________
INDENTURE
Dated as of April 6, 1999
_____________________
$150,000,000
8 1/2% Senior Notes due 2009
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
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310(a)(1)......................................................................... 7.10
(a)(2)......................................................................... 7.10
(a)(3)......................................................................... N.A.
(a)(4)......................................................................... N.A.
(a)(5)......................................................................... 7.10
(b)............................................................................ 7.08; 7.10;
10.02
(c)............................................................................ N.A.
311(a)............................................................................ 7.11
(b)............................................................................ 7.11
(c)............................................................................ N.A.
312(a)............................................................................ 2.05
(b)............................................................................ 10.03
(c)............................................................................ 10.03
313(a)............................................................................ 7.06
(b)(1)......................................................................... N.A.
(b)(2)......................................................................... 7.06
(c)............................................................................ 7.06; 10.02
(d)............................................................................ 7.06
314(a)............................................................................ 4.06; 4.08;
10.02
(b)............................................................................ N.A.
(c)(1)......................................................................... 10.04
(c)(2)......................................................................... 10.04
(c)(3)......................................................................... N.A.
(d)............................................................................ N.A.
(e)............................................................................ 10.05
(f)............................................................................ N.A.
315(a)............................................................................ 7.01(b)
(b)............................................................................ 7.05; 10.02
(c)............................................................................ 7.01(a)
(d)............................................................................ 7.01(c)
(e)............................................................................ 6.11
316(a)(last sentence)............................................................. 2.09
(a)(1)(A)...................................................................... 6.05
(a)(1)(B)...................................................................... 6.04
(a)(2)......................................................................... N.A.
(b)............................................................................ 6.07
(c)............................................................................ 9.04
317(a)(1)......................................................................... 6.08
(a)(2)......................................................................... 6.09
(b)............................................................................ 2.04
318(a)............................................................................ 10.01
(c)............................................................................ 10.01
N.A. means Not Applicable.
________________
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.............................................. 1
SECTION 1.02. Incorporation by Reference of TIA........................ 27
SECTION 1.03. Rules of Construction.................................... 28
ARTICLE TWO
THE NOTES
SECTION 2.01. Form and Dating......................................... 28
SECTION 2.02. Execution and Authentication;
Aggregate Principal Amount.......................... 29
SECTION 2.03. Registrar and Paying Agent.............................. 30
SECTION 2.04. Paying Agent To Hold Assets in Trust.................... 31
SECTION 2.05. Holder Lists............................................ 31
SECTION 2.06. Transfer and Exchange................................... 31
SECTION 2.07. Replacement Notes....................................... 32
SECTION 2.08. Outstanding Notes....................................... 33
SECTION 2.09. Treasury Notes.......................................... 33
SECTION 2.10. Temporary Notes......................................... 34
SECTION 2.11. Cancellation............................................ 34
SECTION 2.12. Defaulted Interest...................................... 34
SECTION 2.13. CUSIP Number............................................ 35
SECTION 2.14. Deposit of Monies....................................... 35
SECTION 2.15. Restrictive Legends..................................... 36
SECTION 2.16. Book-Entry Provisions
for Global Security................................. 38
SECTION 2.17. Special Transfer Provisions............................. 39
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee..................................... 42
SECTION 3.02. Selection of Notes To Be Redeemed...................... 42
SECTION 3.03. Optional Redemption.................................... 43
SECTION 3.04. Notice of Redemption................................... 44
SECTION 3.05. Effect of Notice of Redemption......................... 45
SECTION 3.06. Deposit of Redemption Price............................ 45
SECTION 3.07. Notes Redeemed in Part................................. 46
SECTION 3.08 Sinking Fund........................................... 00
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XXXXXXX XXXX
XXXXXXXXX
SECTION 4.01. Payment of Notes.......................................... 46
SECTION 4.02. Maintenance of Office or Agency........................... 46
SECTION 4.03. Corporate Existence....................................... 47
SECTION 4.04. Payment of Taxes and Other Claims......................... 47
SECTION 4.05. Maintenance of Properties
and Insurance......................................... 47
SECTION 4.06. Compliance Certificate;
Notice of Default..................................... 48
SECTION 4.07. Compliance with Laws...................................... 49
SECTION 4.08. Provision of Financial Statements......................... 49
SECTION 4.09. Waiver of Stay, Extension
or Usury Laws......................................... 50
SECTION 4.10. Limitation on Restricted Payments......................... 50
SECTION 4.11. Limitations on Transactions
with Affiliates....................................... 55
SECTION 4.12. Limitation on Indebtedness................................ 56
SECTION 4.13. Limitation on Dividend and
Other Payment Restrictions
Affecting Restricted Subsidiaries..................... 59
SECTION 4.14. Change of Control......................................... 60
SECTION 4.15. Disposition of Proceeds of Asset Sales.................... 62
SECTION 4.16. Limitation on Liens....................................... 66
SECTION 4.17. Limitation of Issuances and Sale of
Capital Stock of Restricted Subsidiaries.............. 66
SECTION 4.18. Limitation on Unrestricted Subsidiaries................... 67
SECTION 4.19. Limitation on Sale and Lease-Back Transactions............ 68
SECTION 4.20. Application of Fall Away Covenants........................ 69
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Consolidation, Merger,
Sale of Assets, Etc................................... 69
ARTICLE SIX
REMEDIES
SECTION 6.01. Events of Default......................................... 71
SECTION 6.02. Acceleration.............................................. 73
SECTION 6.03. Other Remedies............................................ 74
SECTION 6.04. Waiver of Past Defaults................................... 74
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SECTION 6.05. Control by Majority....................................... 74
SECTION 6.06. Limitation on Suits....................................... 75
SECTION 6.07. Right of Holders To Receive Payment....................... 75
SECTION 6.08. Collection Suit by Trustee................................ 76
SECTION 6.09. Trustee May File Proofs of Claim.......................... 76
SECTION 6.10. Priorities................................................ 76
SECTION 6.11. Undertaking for Costs..................................... 77
SECTION 6.12. Restoration of Rights and Remedies........................ 77
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee......................................... 78
SECTION 7.02. Rights of Trustee......................................... 79
SECTION 7.03. Individual Rights of Trustee.............................. 80
SECTION 7.04. Trustee's Disclaimer...................................... 81
SECTION 7.05. Notice of Default......................................... 81
SECTION 7.06. Reports by Trustee to Holders............................. 81
SECTION 7.07. Compensation and Indemnification
of Trustee and Its Prior Claim........................ 82
SECTION 7.08. Replacement of Trustee.................................... 83
SECTION 7.09. Successor Trustee by Merger, Etc.......................... 84
SECTION 7.10. Eligibility; Disqualification............................. 84
SECTION 7.11. Preferential Collection of
Claims Against Company................................ 85
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Termination of Company's Obligations...................... 85
SECTION 8.02. Application of Trust Money................................ 88
SECTION 8.03. Repayment to the Company.................................. 88
SECTION 8.04. Reinstatement............................................. 89
SECTION 8.05. Acknowledgment of Discharge
by Trustee............................................ 89
ARTICLE NINE
MODIFICATION OF THE INDENTURE
SECTION 9.01. Without Consent of Holders................................ 90
SECTION 9.02. With Consent of Holders................................... 90
SECTION 9.03. Compliance with TIA....................................... 92
SECTION 9.04. Revocation and Effect of Consents......................... 92
SECTION 9.05. Notation on or Exchange of Notes.......................... 93
SECTION 9.06. Trustee To Sign Amendments, Etc........................... 93
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ARTICLE TEN
MISCELLANEOUS
SECTION 10.01. TIA Controls.............................................. 93
SECTION 10.02. Notices................................................... 94
SECTION 10.03. Communications by Holders
with Other Holders.................................... 95
SECTION 10.04. Certificate and Opinion as
to Conditions Precedent............................... 95
SECTION 10.05. Statements Required in
Certificate or Opinion................................ 95
SECTION 10.06. Rules by Trustee, Paying
Agent, Registrar...................................... 96
SECTION 10.07. Legal Holidays............................................ 96
SECTION 10.08. Governing Law............................................. 96
SECTION 10.09. No Adverse Interpretation
of Other Agreements................................... 96
SECTION 10.10. No Personal Liability..................................... 97
SECTION 10.11. Successors................................................ 97
SECTION 10.12. Duplicate Originals....................................... 97
SECTION 10.13. Severability.............................................. 97
SECTION 10.14. Independence of Covenants................................. 97
Exhibit A - Form of Initial Note........................................ A-1
Exhibit B - Form of Exchange Note....................................... B-1
Exhibit C - Form of Certificate To Be Delivered in Connection with
Transfers to Non-QIB Accredited Investors............. C-1
Exhibit D - Form of Certificate To Be Delivered in Connection
with Transfers Pursuant to Regulation S............... D-1
Note: This Table of Contents shall not, for any purpose, be deemed to be part
of this Indenture
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INDENTURE, dated as of April 6, 1999, between CALIFORNIA STEEL
INDUSTRIES, INC., a Delaware corporation (the "Company"), and STATE STREET BANK
AND TRUST COMPANY OF CALIFORNIA, N.A., a national banking association duly
organized under the laws of the United States, as Trustee (the "Trustee").
Each party hereto agrees as follows for the benefit of the other party
and for the equal and ratable benefit of the Holders of the Company's 8 1/2%
Senior Notes due 2009, Series A (the "Initial Notes"), and, when and if issued
as provided in the Registration Rights Agreement of even date herewith, the
Company's 8 1/2% Senior Notes due 2009 Series B, (the "Exchange Notes" and,
together with the Initial Notes, the "Notes").
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
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SECTION 1.01. Definitions.
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"Acquired Indebtedness" means Indebtedness of a Person (i) assumed in
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connection with an Asset Acquisition from such Person or (ii) existing at the
time such Person becomes a Restricted Subsidiary of any other Person (other than
any Indebtedness incurred in connection with, or in contemplation of, such Asset
Acquisition or such Person becoming such a Restricted Subsidiary). Acquired
Indebtedness shall be deemed to be incurred on the date of the related
acquisition of assets from any Person or the date the acquired Person becomes a
Restricted Subsidiary, as the case may be.
"Additional Interest" shall have the meaning set forth in the
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Registration Rights Agreement.
"Affiliate" means with respect to any specified Person:
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(i) any other Person directly or indirectly controlling or controlled
by or under direct or indirect common control with such specified Person;
(ii) any other Person that owns, directly or indirectly, 5% or more of
such specified Person's Capital Stock or any officer or director of any
such specified Person or other Person or, with respect to any natural
Person, any person having a relationship with such Person by blood,
marriage or adoption no more remote than first
cousin; or (iii) any other Person 5% or more of the Voting Stock of which
is beneficially owned or held directly or indirectly by such specified
Person.
For the purposes of this definition, "control" when used with respect
to any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent or co-Registrar.
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"Agent Members" has the meaning provided in Section 2.16.
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"Asset Acquisition" means (i) an Investment by the Company or any
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Restricted Subsidiary in any other Person pursuant to which such Person will
become a Restricted Subsidiary or will be merged or consolidated with or into
the Company or any Restricted Subsidiary or (ii) the acquisition by the Company
or any Restricted Subsidiary of the assets of any Person which constitute
substantially all of the assets of such Person, or any division or line of
business of such Person, or which is otherwise outside of the ordinary course of
business.
"Asset Sale" means any sale, issuance, conveyance, transfer, lease or
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other disposition (including, without limitation, by way of merger,
consolidation or sale and leaseback transaction) (collectively, a "transfer"),
directly or indirectly, in one or a series of related transactions, of: (i) any
Capital Stock of any Restricted Subsidiary; (ii) all or substantially all of the
properties and assets of any division or line of business of the Company or its
Restricted Subsidiaries; or (iii) any other properties or assets of the Company
or any Restricted Subsidiary other than in the ordinary course of business. For
the purposes of this definition, the term "Asset Sale" shall not include any
transfer of properties and assets
(a) that is governed by the provisions described under Section 5.01;
provided, however, that any transaction consummated in compliance with
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Section 5.01 involving a transfer of less than all of the properties or
assets of the Company shall be deemed to be an Asset Sale with respect to
the properties or assets of the Company that are not so transferred in such
transaction,
(b) that is of obsolete assets in the ordinary course of business,
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(c) that is made the subject of an Investment consummated in
compliance with Section 4.10,
(d) that is a transaction or series of related transactions for which
the Company or any of the Restricted Subsidiaries receive aggregate
consideration of less than $250,000,
(e) that is the sale by the Company of all or any portion of its
interest in CST,
(f) that is the sale by the Company or any Subsidiary of the Company
or such Subsidiary's interest in any Unrestricted Subsidiary or is the sale
of any assets by an Unrestricted Subsidiary, or
(g) that is the sale by the Company or any Subsidiary of assets that
either (i) are not used in the business of making steel or (ii) are not
critical to the Company's ability to manufacture steel products and were
not owned by the Company or such Subsidiary on the Issue Date; provided,
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that any sale pursuant to this subclause (g) complies with clause (ii) of
the first paragraph of Section 4.15.
"Asset Sale Offer" has the meaning set forth under Section 4.15.
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"Attributable Indebtedness" in respect of a Sale and Lease-Back
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Transaction means, as at the time of determination, the greater of (i) the fair
value of the property subject to such arrangement and (ii) the present value of
the Notes (discounted at the rate borne by the Notes, compounded semi-annually)
of the total obligations of the lessee for rental payments during the remaining
term of the lease included in such Sale and Lease-Back Transaction (including
any period for which such lease has been extended).
"Authenticating Agent" has the meaning provided in Section 2.02.
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"Average Life to Stated Maturity" means, with respect to any
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Indebtedness, as at any date of determination, the quotient obtained by dividing
(i) the sum of the products of (a) the number of years from such date to the
date or dates of each successive scheduled principal payment (including, without
limitation, any sinking fund requirements) of such Indebtedness multiplied by
(b) the amount of each such principal payment by (ii) the sum of all such
principal payments.
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"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal,
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state or foreign law for the relief of debtors.
"Board of Directors" means (i) in the case of a Person that is a
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corporation, the board of directors of such Person and (ii) in the case of any
other Person, the board of directors, board of managers, management committee or
similar governing body of such Person (or in the case of a limited partnership,
of such Person's general partner, or in the case of a limited liability company,
of such Person's manager), or any authorized committee thereof responsible for
the management of the business and affairs of such Person.
"Board Resolution" means, with respect to any Person, a copy of a
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resolution certified by the secretary or an assistant secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification and delivered to the
Trustee.
"Business Day" means any day other than a Saturday, Sunday or any
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other day on which commercial banking institutions in the City of New York or
the city in which the Corporate Trust Office of the Trustee is located are
required or authorized by law or other governmental action to be closed.
"Capital Stock" means, with respect to any Person, any and all shares,
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interests, participations, rights in or other equivalents (however designated)
of such Person's capital stock, and any rights (other than debt securities
convertible into capital stock), warrants or options exchangeable for or
convertible into such capital stock, whether now outstanding or issued after the
date of this Indenture.
"Capital Expenditure Indebtedness" means Indebtedness incurred by any
--------------------------------
Person to finance a capital expenditure so long as (i) such capital expenditure
is or should be included as an addition to "Property, Plant and Equipment" in
accordance with GAAP and (ii) such Indebtedness is incurred within 180 days of
the date such capital expenditure is made.
"Capitalized Lease Obligation" means any obligation under a lease of
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(or other agreement conveying the right to use) any property (whether real,
personal or mixed) that is required to be classified and accounted for as a
capital lease obligation under GAAP, and, for the purpose of this Indenture, the
amount of such obligation at any date shall be the capitalized amount thereof at
such date, determined in accordance with GAAP consistently applied.
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"Cash Equivalents" means, at any time,
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(i) any evidence of Indebtedness with a maturity of not more than
one year issued or directly and fully guaranteed or insured by the United
States of America or any agency or instrumentality thereof (provided that
the full faith and credit of the United States of America is pledged in
support thereof);
(ii) certificates of deposit or acceptances with a maturity of not
more than one year of any financial institution that is a member of the
Federal Reserve System having combined capital and surplus and undivided
profits of not less than $500,000,000;
(iii) commercial paper with a maturity of not more than one year
issued by a corporation that is not an Affiliate of the Company organized
under the laws of any state of the United States or the District of
Columbia and rated at least A-1 by Standard & Poor's Corporation or at
least P-1 by Xxxxx'x Investors Service, Inc.; and
(iv) repurchase obligations with a term of not more than seven days
for underlying securities of the types described in clauses (i) and (ii)
above entered into with any financial institution meeting the
qualifications specified in clause (ii) above.
"Certificated Securities" means Notes in definitive registered form.
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"Change of Control" means the occurrence of any of the following
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events (whether or not approved by the Board of Directors of the Company):
(i) (A) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act), other than any one or more Permitted
Holders, is or becomes the "beneficial owner" (as defined in Rules 13d-3
and 13d-5 under the Exchange Act, except that a Person shall be deemed to
have "beneficial ownership" of all securities that such Person has the
right to acquire, whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, of a majority of the
total voting power of the then outstanding Voting Stock of the Company; or
(B) (x) any such "person" or "group," other than any one or more Permitted
Holders, is or becomes the "beneficial owner" (as defined above), directly
or indirectly, of 50% or more of the total voting power of the then
outstanding Voting Stock of the Company, and (y) at such time, neither (I)
Companhia Vale do Rio
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Doce and its Subsidiaries nor (II) Kawasaki Steel Corporation and its
Subsidiaries directly or indirectly own 50% or more of the total voting
power of the then outstanding Voting Stock of the Company;
(ii) after the consummation of a Public Equity Offering, during any
period of two consecutive years, individuals who at the beginning of such
period constituted the Board of Directors of the Company (together with any
new directors whose election to such board or whose nomination for election
by the stockholders of the Company was approved by a vote of a majority of
the directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election was
previously so approved), cease for any reason to constitute a majority of
such Board of Directors then in office; or
(iii) the Company consolidates with or merges with or into any Person
or sells, assigns, conveys, transfers, leases or otherwise disposes of all
or substantially all of its assets to any Person, or any corporation
consolidates with or merges into or with the Company, in all such foregoing
events pursuant to a transaction in which the outstanding Voting Stock of
the Company is changed into or exchanged for cash, securities or other
property, other than any such transaction where the outstanding Voting
Stock of the Company is not changed or exchanged at all (except to the
extent necessary solely to reflect a change in the jurisdiction of
incorporation of the Company) or where (A) the outstanding Voting Stock of
the Company is changed into or exchanged for (x) Voting Stock of the
surviving corporation which is not Redeemable Capital Stock or (y) cash,
securities and other property (other than Capital Stock of the surviving
corporation) in an amount which could be paid by the Company as a
Restricted Payment as described under Section 4.10 (and such amount shall
be treated as a Restricted Payment subject to the provisions in this
Indenture described under Section 4.10, (B) no "person" or "group," other
than Permitted Holders, owns immediately after such transaction, directly
or indirectly, 50% or more of the total outstanding Voting Stock of the
surviving corporation and (C) the holders of the Voting Stock of the
Company immediately prior to such transaction own, directly or indir ectly,
not less than a majority of the total voting power of the then outstanding
Voting Stock of the surviving or transferee corporation immediately after
such transaction; provided, in the case of clauses (A), (B) and (C) of this
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clause (iii), that one of the Permitted Holders at all times owns 50% or
more of
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the total voting power of the then outstanding Voting Stock of the Company.
"Change of Control Offer" has the meaning set forth under Section
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4.14.
"Change of Control Payment Date" has the meaning set forth under
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Section 4.14.
"Commission" means the U.S. Securities and Exchange Commission.
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"Commodity Price Protection Agreement" means any forward contract,
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commodity swap, commodity option or other similar financial agreement or
arrangement relating to, or the value of which is dependent upon, fluctuations
in commodity prices.
"Company" means California Steel Industries, Inc., a Delaware
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corporation.
"Consolidated Cash Flow Available for Fixed Charges" means, for any
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period, (i) the sum of, without duplication, the amounts for such period, taken
as a single accounting period, of (a) Consolidated Net Income, (b) to the extent
reducing Consolidated Net Income, Consolidated Non-cash Charges, (c) to the
extent reducing Consolidated Net Income, Consolidated Interest Expense, and (d)
to the extent reducing Consolidated Net Income, Consolidated Income Tax Expense
less (ii) other non-cash items increasing Consolidated Net Income for such
period.
"Consolidated Fixed Charge Coverage Ratio" means the ratio of the
-----------------------------------
aggregate amount of Consolidated Cash Flow Available for Fixed Charges of the
Company for the four full fiscal quarters immediately preceding the date of the
transaction (the "Transaction Date") giving rise to the need to calculate the
Consolidated Fixed Charge Coverage Ratio for which consolidated financial
information of the Company is available (such four full fiscal quarter period
being referred to herein as the "Four Quarter Period") to the aggregate amount
of Consolidated Fixed Charges of the Company for such Four Quarter Period.
For purposes of this definition, "Consolidated Cash Flow Available for
Fixed Charges" and "Consolidated Fixed Charges" will be calculated, without
duplication, after giving effect on a pro forma basis for the period of such
calculation to
(i) the incurrence of any Indebtedness and Preferred Stock of the
Company or any of the Restricted Subsidiaries during the period commencing
on the first day of the Four
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Quarter Period to and including the Transaction Date (the "Reference
Period"), including, without limitation, the incurrence of the Indebtedness
giving rise to the need to make such calculation, as if such incurrence
occurred on the first day of the Reference Period,
(ii) any Asset Sale or Asset Acquisition (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of the Company or one of the Restricted
Subsidiaries (including any Person who becomes a Restricted Subsidiary as a
result of the Asset Acquisition) incurring Acquired Indebtedness)
incurring, assuming or otherwise being liable for Acquired Indebtedness and
also including any Consolidated EBITDA (including any pro forma expense and
cost reductions as determined in accordance with Regulation S-X under the
Exchange Act) attributable to the assets which are the subject of the Asset
Acquisition or Asset Sale during the Four Quarter period) occurring during
the Reference Period, as if such Asset Sale or Asset Acquisition occurred
on the first day of the Reference Period and
(iii) the retirement of Indebtedness during the Reference Period that
cannot thereafter be reborrowed occurring as if retired on the first day of
the Reference Period.
In calculating "Consolidated Fixed Charges" for purposes of
determining the denominator (but not the numerator) of this "Consolidated Fixed
Charge Coverage Ratio,"
(1) interest on Indebtedness determined on a fluctuating basis as of
the Transaction Date and that will continue to be so determined thereafter
will be deemed to accrue at a fixed rate per annum equal to the rate of
interest on such Indebtedness in effect on the Transaction Date;
(2) if interest on any Indebtedness actually incurred on the
Transaction Date may optionally be determined at an interest rate based
upon a factor of a prime or similar rate, a eurocurrency interbank offered
rate, or other rates, then the interest rate in effect on the Transaction
Date shall be deemed to have been in effect during the Reference Period;
and
(3) notwithstanding clause (1) above, interest on Indebtedness
determined on a fluctuating basis, to the extent such interest is covered
by Interest Rate Agreements, will be deemed to accrue at the rate per annum
resulting after giving effect to the operation of such agreements.
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If the Company or any Restricted Subsidiaries directly or indirectly
guarantees Indebtedness of a third Person, the above definition will give effect
to the incurrence of such guaranteed Indebtedness as if the Company or any
Restricted Subsidiary had directly incurred or otherwise assumed such guaranteed
Indebtedness.
"Consolidated Fixed Charges" means, for any period, the sum of,
--------------------------
without duplication, the amounts for such period of (i) Consolidated Interest
Expense; and (ii) the aggregate amount of cash dividends and other distributions
paid or accrued during such period in respect of Redeemable Capital Stock and
Preferred Stock of the Company.
"Consolidated Income Tax Expense" means, for any period, the provision
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for federal, state, local and foreign income taxes payable by the Company and
the Restricted Subsidiaries for such period as determined on a consolidated
basis in accordance with GAAP.
"Consolidated Interest Expense" means, for any period, without
-----------------------------
duplication, the sum of (a) the interest expense of the Company and the
Restricted Subsidiaries for such period as determined on a consolidated basis in
accordance with GAAP, including, without limitation,
(i) any amortization of debt discount attributable to such period,
(ii) the net cost under or otherwise associated with Interest Rate
Agreements, Currency Agreements and Commodity Price Protection Agreements
(in each case, including any amortization of discounts),
(iii) the interest portion of any deferred payment obligation,
(iv) all commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing and
(v) all capitalized interest and all accrued interest, and
(b) all but the principal component of Capitalized Lease Obligations
paid, accrued and/or scheduled to be paid or accrued by the Company and the
Restricted Subsidiaries during such period and as determined on a
consolidated basis in accordance with GAAP.
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"Consolidated Net Income" means, for any period, the consolidated net
-----------------------
income (or loss) of the Company and the Restricted Subsidiaries for such period
on a consolidated basis as determined in accordance with GAAP, adjusted, to the
extent included in calculating such net income (or loss), by excluding, without
duplication,
(i) all extraordinary gains or losses (net of all fees and expenses
relating thereto),
(ii) the portion of net income (or loss) of the Company and the
Restricted Subsidiaries on a consolidated basis allocable to minority
interests in unconsolidated Persons, except (a) to the extent that cash
dividends or distributions are actually received by the Company or a
Restricted Subsidiary or, (b) for purposes of Section 4.10, that portion of
equity in income of affiliate relating to the Company's interest in CST,
(iii) income of the Company and the Restricted Subsidiaries derived
from or in respect of Investments in Unrestricted Subsidiaries, except to
the extent that cash dividends or distributions are actually received by
the Company or a Restricted Subsidiary,
(iv) net income (or loss) of any Person combined with the Company or
any of the Restricted Subsidiaries on a "pooling of interests" basis
attributable to any period prior to the date of combination,
(v) any gain or loss realized upon the termination of any employee
pension benefit plan,
(vi) gains (or losses), net of all fees and expenses relating
thereto, in respect of any Asset Sales by the Company or a Restricted
Subsidiary,
(vii) the net income of any Restricted Subsidiary to the extent that
the declaration of dividends or similar distributions by that Restricted
Subsidiary of that income is not at the time permitted, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Restricted Subsidiary or its stockholders,
(viii) any restoration to income of any contingency reserve except to
the extent provision for such reserve was made out of income accrued at
any time following the Issue Date and
-10-
(ix) any gain, arising from the acquisition of any securities, or
the extinguishment, under GAAP, of any Indebtedness of the Company.
"Consolidated Net Worth" with respect to any Person means the equity
----------------------
of the holders of Capital Stock of such Person and its Restricted Subsidiaries
(excluding any Redeemable Capital Stock), as reflected in a balance sheet of
such Person determined on a consolidated basis and in accordance with GAAP.
"Consolidated Non-cash Charges" means, for any period, the aggregate
-----------------------------
depreciation, amortization and other non-cash expenses of the Company and the
Restricted Subsidiaries reducing Consolidated Net Income for such period (other
than any non-cash item requiring an accrual or reserve for cash disbursements in
any future period), determined on a consolidated basis in accordance with GAAP.
"Corporate Trust Office" means the office of the Trustee at which at
----------------------
any particular time the trust created by this Indenture shall be principally
administered, which office at the date of execution of this Indenture is located
at 000 Xxxx 0xx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000.
"Covenant Defeasance" has the meaning set forth under Section 8.01.
-------------------
"Credit Facility" means the credit agreement dated as of March 10,
---------------
1999, among the Company, the lenders party thereto in their capacities as
lenders thereunder and BankBoston, N.A., as Loan and Collateral Agent, and Bank
of America National Trust and Savings Association, as Letter of Credit and
Documentation Agent, together with the related documents thereto (including,
without limitation, any guarantee agreements and security documents), in each
case as such agreements may be amended (including any amendment and restatement
thereof), supplemented or otherwise modified from time to time, including any
agreement extending the maturity of, refinancing, replacing or otherwise
restructuring (including increasing the amount of available borrowings
thereunder or adding Restricted Subsidiaries of the Company as additional
borrowers or guarantors thereunder) all or any portion of the Indebtedness under
such agreement or any successor or replacement agreement and whether by the same
or any other agent, lender or group of lenders.
"CST" means Companhia Siderurgica de Tubarao.
---
"Currency Agreement" means any foreign exchange contract, currency
------------------
swap agreement or other similar agreement or arrangement designed to protect the
Company or the Restricted Subsidiaries against fluctuations in currency values.
-11-
"Custodian" means any receiver, trustee, assignee, liquidator,
---------
sequestrator or similar official under any Bankruptcy Law.
"Default" means any event that is, or after notice or passage of time
-------
or both would be, an Event of Default.
"defeasance" has the meaning set forth under Section 8.01.
----------
"Depository" means The Depository Trust Company, its nominees and
----------
successors.
"Designation" has the meaning set forth under Section 4.18.
-----------
"Designation Amount" has the meaning set forth under Section 4.18.
------------------
"Disinterested Director" means, with respect to any transaction or
----------------------
series of related transactions, a member of the Board of Directors of the
Company who does not have any material direct or indirect financial interest in
or with respect to such transaction or series of related transactions.
"Event of Default" has the meaning set forth under Section 6.01.
----------------
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
------------
and the rules and regulations promulgated by the Commission thereunder.
"Exchange Notes" means the 8 1/2% Senior Notes due 2009, Series B, to
--------------
be issued pursuant to this Indenture in connection with the offer to exchange
Notes for the Initial Notes pursuant to the Registration Rights Agreement.
"Exchange Offer Registration Statement" means the registration
-------------------------------------
statement filed by the Company pursuant to the Registration Rights Agreement.
"Fair Market Value" means, with respect to any asset or property, the
-----------------
price (or, in the case of a lease, the rent) which could be negotiated in an
arm's-length transaction, for cash, between an informed and willing seller (or
lessor) under no compulsion to sell and an informed and willing buyer (or
lessee) under no compulsion to buy. Fair Market Value with respect to any asset
or property of more than $1,000,000 shall be determined by the Board of
Directors of the Company acting in good faith evidenced by a Board Resolution
thereof delivered to the Trustee.
-12-
"Four Quarter Period" has the meaning set forth in the definition of
-------------------
"Consolidated Fixed Charge Coverage Ratio."
"GAAP" means, at any date of determination, generally accepted
----
accounting principles in effect in the United States which are applicable at the
date of determination and which are consistently applied for all applicable
periods.
"Global Note" has the meaning provided in Section 2.01.
-----------
"guarantee" means, as applied to any obligation, (i) a guarantee
---------
(other than by endorsement of negotiable instruments for collection in the
ordinary course of business), direct or indirect, in any manner, of any part or
all of such obligation and (ii) an agreement, direct or indirect, contingent or
otherwise, the practical effect of which is to assure in any way the payment or
performance (or payment of damages in the event of non-performance) of all or
any part of such obligation, including, without limiting the foregoing, the
payment of amounts drawn down by letters of credit. A guarantee shall include,
without limitation, any agreement to maintain or preserve any other Person's
financial condition or to cause any other Person to achieve certain levels of
operating results.
"Holder" means a registered holder of Notes.
------
"incur" has the meaning set forth in Section 4.12. "Incurrence,"
-----
"incurred" and "incurring" shall have the meanings correlative to the foregoing.
"Indebtedness" means, with respect to any Person, without duplication,
------------
(i) all indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services, excluding any trade
payables and other accrued current liabilities incurred or arising in the
ordinary course of business, but including, without limitation, all
obligations, contingent or otherwise, of such Person in connection with any
letters of credit, bankers acceptance or other similar credit transaction
or in connection with any agreement to purchase, redeem, exchange, convert
or otherwise acquire for value any Capital Stock of such Person, or any
warrants, rights or options to acquire such Capital Stock, now or hereafter
outstanding,
(ii) all obligations of such Person evidenced by bonds, notes,
debentures or other similar instruments,
-13-
(iii) all indebtedness created or arising under any conditional sale
or other title retention agreement with respect to property acquired by
such Person (even if the rights and remedies of the seller or lender under
such agreement in the event of default are limited to repossession or sale
of such property), but excluding trade payables arising in the ordinary
course of business,
(iv) all Capitalized Lease Obligations of such Person,
(v) all Indebtedness referred to in clauses (i) through (iv) above
of other Persons and all dividends of other Persons, the payment of which
is secured by any Lien upon or with respect to property (including, without
limitation, accounts and contract rights) owned by such Person, even though
such Person has not assumed or become liable for the payment of such
Indebtedness,
(vi) all guarantees of Indebtedness by such Person,
(vii) all Redeemable Capital Stock issued by such Person valued at
the greater of its voluntary or involuntary maximum fixed repurchase price
plus accrued and unpaid dividends,
(viii) all obligations under Interest Rate Agreements, Currency
Agreements or Commodity Price Protection Agreements of such Person and
(ix) any amendment, supplement, modification, deferral, renewal,
extension, refunding or refinancing of any liability of the types referred
to in clauses (i) through (viii) above.
For purposes hereof, the "maximum fixed repurchase price" of any
Redeemable Capital Stock that does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Redeemable Capital Stock as if
such Redeemable Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to the Indenture, and if such price
is based upon, or measured by, the Fair Market Value of such Redeemable Capital
Stock, such Fair Market Value shall be determined in good faith by the Board of
Directors of the issuer of such Redeemable Capital Stock.
"Indenture" means this Indenture, as amended or supplemented from time
---------
to time in accordance with the terms hereof.
-14-
"Independent Financial Advisor" means a nationally recognized
-----------------------------
accounting, appraisal or investment banking firm (i) which does not, and whose
directors, officers and employees or Affiliates do not have, a direct or
indirect financial interest in the Company and (ii) which, in the judgment of
the Board of Directors of the Company, is otherwise independent and qualified to
perform the task for which it is to be engaged.
"Initial Notes" means the 8 1/2% Senior Notes due 2009, Series A,
-------------
issued under this Indenture on or about the date hereof.
"Initial Purchasers" means Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce,
------------------
Xxxxxx & Xxxxx Incorporated, BancBoston Xxxxxxxxx Xxxxxxxx Inc. and NationsBanc
Xxxxxxxxxx Securities LLC.
"Institutional Accredited Investor" means an institution that is an
---------------------------------
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3), or
(7) under the Securities Act.
"interest" when used with respect to any Note means the amount of all
--------
interest accruing on such Note, including any applicable defaulted interest
pursuant to Section 2.12 and any Additional Interest pursuant to the
Registration Rights Agreement.
"Interest Payment Date" means the Stated Maturity of an installment of
---------------------
interest on the Notes.
"Interest Rate Agreements" means one or more of the following
------------------------
agreements which shall be entered into by one or more financial institutions:
obligations of any Person pursuant to any arrangement with any other Person
whereby, directly or indirectly, such Person is entitled to receive from time to
time periodic payments calculated by applying either a floating or a fixed rate
of interest on a stated notional amount in exchange for periodic payments made
by such Person calculated by applying a fixed or a floating rate of interest on
the same notional amount or any other arrangement involving payments by or to
such Person based upon fluctuations in interest rates (including, without
limitation, interest rate swaps, caps, floors, collars and similar agreements)
and/or other types of interest rate hedging agreements from time to time.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
---------------------
amended to the date hereof and from time to time hereafter.
"Investment" means, with respect to any Person, any direct or indirect
----------
advance, loan or other extension of credit
-15-
(including by means of a guarantee) 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 otherwise), or any purchase or
acquisition by such Person of any Capital Stock, bonds, notes, debentures or
other securities or evidences of Indebtedness issued by any other Person and all
other items that would be classified as investments on a balance sheet prepared
in accordance with GAAP. Investments shall exclude extensions of trade credit on
commercially reasonable terms in accordance with normal trade practices. In
addition to the foregoing, any Currency Agreement, Interest Rate Agreement,
Commodity Price Protection Agreement or similar agreement shall constitute an
Investment.
"Investment Grade" means (i) with respect to S&P, BBB- and any
----------------
category above BBB- (or equivalent successor categories); (ii) with respect to
Moody's, Baa3 and any category above Baa3 (or equivalent successor categories);
and (iii) the equivalent of any such category of S&P or Moody's used by another
Rating Agency.
"Issue Date" means April 6, 1999.
----------
"Legal Defeasance" has the meaning set forth in Section 8.01.
----------------
"Legal Holiday" has the meaning provided in Section 10.07.
-------------
"Lien" means any mortgage or deed of trust, charge, pledge, lien
----
(statutory or other), security interest, assignment for security or other
encumbrance upon any property of any kind (including any conditional sale,
capital lease or other title retention agreement), whether real, personal or
mixed, movable or immovable, now owned or hereafter acquired. A Person shall be
deemed to own subject to a Lien any property which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement.
"Liquid Assets" shall mean any marketable securities or steel slab
-------------
immediately received by, and used in the business of, the Company or any of its
Subsidiaries in an amount not to exceed 25% of the Company's total consolidated
assets.
"Maturity Date" means April 1, 2009.
-------------
"Material Subsidiary" means each Restricted Subsidiary of the Company
-------------------
that is a "significant subsidiary" as defined in Rule 1-02 of Regulation S-X
under the Securities Act
-16-
and the Exchange Act (as such regulation is in effect on the Issue Date).
"Moody's" means Xxxxx'x Investors Service, Inc. and its successors.
-------
"Net Cash Proceeds" means with respect to any Asset Sale by any
-----------------
Person, the proceeds thereof (without duplication in respect of all Asset Sales)
in the form of cash or Cash Equivalents including payments in respect of
deferred payment obligations when received in form of, or stock or other assets
when disposed of for, cash or Cash Equivalents (except to the extent that such
obligations are financed or sold with recourse to the Company or any Restricted
Subsidiary) net of
(i) brokerage commissions and other reasonable fees and expenses
(including fees and expenses of legal counsel and investment bankers)
related to such Asset Sale ,
(ii) provisions for all taxes payable as a result of such Asset
Sale,
(iii) payments made to retire Indebtedness where payment of such
Indebtedness is secured by the assets or properties the subject of such
Asset Sale,
(iv) amounts required to be paid to any Person (other than the
Company or any Restricted Subsidiary) owning a beneficial interest in or
having a Lien on the assets subject to the Asset Sale and
(v) appropriate amounts to be provided by the Company or any
Restricted Subsidiary, as the case may be, as a reserve, in accordance with
GAAP, against any liabilities associated with such Asset Sale and retained
by the Company or any Restricted Subsidiary, as the case may be, after such
Asset Sale, including, without limitation, pension and other post-
employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated
with such Asset Sale (provided that the amount of any such reserves shall
be deemed to constitute Net Cash Proceeds at the time such reserves shall
have been released or are not otherwise required to be retained as a
reserve), all as reflected in an Officers' Certificate delivered to the
Trustee.
"Net Proceeds Payment Date" has the meaning set forth in Section 4.15.
-------------------------
-17-
"Notes" means, collectively, the Initial Notes and, when and if issued
-----
as provided in the Registration Rights Agreement, the Exchange Notes.
"Offer Excess Proceeds" has the meaning set forth in Section 4.15.
---------------------
"Offering Memorandum" means the confidential Offering Memorandum dated
-------------------
March 30, 1999 of the Company relating to the offering of the Notes.
"Officer" means, with respect to any Person, the Chairman of the Board
-------
of Directors, the Chief Executive Officer, the President, any Executive Vice
President, any Vice President, the Chief Financial Officer, the Treasurer, the
Controller, or the Secretary of such Person, or any other officer designated by
the Board of Directors serving in a similar capacity.
"Officers' Certificate" means a certificate signed by two Officers of
---------------------
the Company.
"Opinion of Counsel" means a written opinion from legal counsel who is
------------------
reasonably acceptable to the Trustee complying with the requirements of Sections
10.04 and 10.05, as they relate to the giving of an Opinion of Counsel.
"Other Senior Debt Pro Rata Share" means the amount of the applicable
--------------------------------
Offer Excess Proceeds obtained by multiplying the amount of such Offer Excess
Proceeds by a fraction, (i) the numerator of which is the aggregate accreted
value and/or principal amount, as the case may be, of all Indebtedness (other
than (x) the Notes, (y) Subordinated Indebtedness and (z) Indebtedness under the
Credit Facility) of the Company outstanding at the time of the applicable Asset
Sale with respect to which the Company is required to use Offer Excess Proceeds
to repay or make an offer to purchase or repay and (ii) the denominator of which
is the sum of (a) the aggregate principal amount of all Notes outstanding at the
time of the applicable Asset Sale and (b) the aggregate principal amount or the
aggregate accreted value, as the case may be, of all other Indebtedness (other
than Subordinated Indebtedness and Indebtedness under the Credit Facility) of
the Company outstanding at the time of the applicable Asset Sale Offer with
respect to which the Company is required to use the applicable Offer Excess
Proceeds to offer to repay or make an offer to purchase or repay.
"Pari Passu Indebtedness" means any Indebtedness of the Company which
-----------------------
ranks pari passu in right of payment to the Notes.
-18-
"Paying Agent" has the meaning provided in Section 2.03.
------------
"Permitted Holders" means (a) Companhia Vale do Rio Doce, Rio Doce
-----------------
Limited, Kawasaki Steel Corporation and Kawasaki Steel Holdings (USA), Inc. and
(b) each Affiliate of each of the entities set forth in clause (a) of this
definition for so long as they are Affiliates.
"Permitted Indebtedness" has the meaning set forth under Section 4.12.
----------------------
"Permitted Investments" means
---------------------
(i) Cash Equivalents;
(ii) Investments in prepaid expenses, negotiable instruments held
for collection and lease, utility and workers' compensation, performance
and other similar deposits;
(iii) loans and advances to employees made in the ordinary course of
business not to exceed $250,000 in the aggregate at any one time
outstanding;
(iv) Investments in partnerships, joint ventures or other entities,
including Unrestricted Subsidiaries, in an aggregate amount not to exceed
$60.0 million at any one time outstanding; provided that (x) such entity is
--------
in a steel related business or (y) such Investment is made to acquire or
develop raw materials used in steelmaking.
(v) Interest Rate Agreements, Currency Agreements and Commodity
Price Protection Agreements permitted under clauses (v), (vi) and (vii) of
the second paragraph under Section 4.12;
(vi) Investments represented by accounts receivable created or
acquired in the ordinary course of business;
(vii) loans or advances to vendors in the ordinary course of
business;
(viii) Investments existing on the Issue Date and any renewal or
replacement thereof on terms and conditions no less favorable in any
respect than that existing on the Issue Date;
(ix) Investments made by the Company or any Restricted Subsidiary as
a result of consideration received in connection with an Asset Sale made in
compliance with Section 4.15; and
-19-
(x) stock, obligations or securities received in satisfaction of
judgments or good faith settlement of litigation, disputes or other debts.
"Permitted Liens" means
---------------
(a) Liens on property of (or on shares of Capital Stock or debt
securities of) a Person existing at the time such Person
(i) is merged into or consolidated with the Company or any
Restricted Subsidiary or
(ii) becomes a Restricted Subsidiary; provided, however, that such
-------- -------
Liens were in existence prior to the contemplation of such merger, consolidation
or acquisition and do not secure any property or assets of the Company or any
Restricted Subsidiary other than the property or assets subject to the Liens
prior to such merger, consolidation or acquisition;
(b) Liens imposed by law such as landlords', carriers',
warehousemen's and mechanics' Liens and other similar Liens arising in the
ordinary course of business which secure payment of obligations not more than 60
days past due or which are being contested in good faith and by appropriate
proceedings;
(c) Liens existing on the Issue Date;
(d) Liens securing only the Notes;
(e) Liens in favor of the Company or Liens on any property or
assets of a Subsidiary (or on shares of Capital Stock or debt securities of a
Subsidiary) in favor of the Company or any Restricted Subsidiary;
(f) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent for more than 90 days or that are being contested in
good faith by appropriate proceedings promptly instituted and diligently
concluded; provided, however, that any reserve or other appropriate provision as
-------- -------
shall be required in conformity with GAAP shall have been made therefor;
(g) easements, reservation of rights of way, restrictions and other
similar easements, licenses, restrictions on the use of properties or
imperfections of title that in the aggregate are not material in amount and do
not in any case interfere with the ordinary conduct of the business of the
Company and the Restricted Subsidiaries;
-20-
(h) Liens resulting from the deposit of cash or notes in connection
with contracts, tenders or expropriation proceedings, or to secure workers'
compensation, surety or appeal bonds, costs of litigation when required by law,
public and statutory obligations, obligations under franchise arrangements
entered into in the ordinary course of business and other obligations of a
similar nature arising in the ordinary course of business;
(i) Liens in existence on the Issue Date under the Credit Facility;
(j) Liens securing Indebtedness consisting of Capitalized Lease
Obligations, Purchase Money Obligations (other than Indebtedness incurred to
finance an Asset Acquisition), Capital Expenditure Indebtedness, mortgage
financings, industrial revenue bonds or other monetary obligations, in each case
incurred solely for the purpose of financing all or any part of the purchase
price or cost of construction or installation of assets used in the business of
the Company or the Restricted Subsidiaries, or repairs, additions or
improvements to such assets; provided, however, that (I) such Liens secure
-------- -------
Indebtedness in an amount not in excess of the original purchase price or the
original cost of any such assets or repair, addition or improvement thereto
(plus an amount equal to the reasonable fees and expenses in connection with the
incurrence of such Indebtedness), (II) such Liens do not extend to any other
assets of the Company or the Restricted Subsidiaries (and, in the case of
repair, addition or improvements to any such assets, such Lien extends only to
the assets (and improvements thereto or thereon) repaired, added to or
improved), (III) the incurrence of such Indebtedness is permitted by Section
4.12 and (IV) such Liens attach prior to 90 days after such purchase,
construction, installation, repair, addition or improvement;
(k) Liens to secure any refinancings (or successive refinancings),
in whole or in part, of any Indebtedness secured by Liens referred to in the
clauses above so long as such Lien does not extend to any other property (other
than improvements thereto);
(l) Liens securing letters of credit entered into in the ordinary
course of business and consistent with past business practice;
(m) Liens securing Indebtedness of the Company or any Restricted
Subsidiary under any Interest Rate Agreements, Currency Agreements or Commodity
Price Protection Agreements;
-21-
(n) Liens on and pledges of the capital stock of any Unrestricted
Subsidiary securing any Indebtedness of such Unrestricted Subsidiary;
(o) Liens arising from the rendering of a final judgment or order
against the Company or any Restricted Subsidiary that does not give rise to an
Event of Default; and
(p) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into by the
Company or any Restricted Subsidiary in the ordinary course of business.
"Person" means any individual, corporation, limited liability company,
------
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Physical Notes" has the meaning provided in Section 2.01.
--------------
"plan of liquidation" means, with respect to any Person, a plan
-------------------
(including by operation of law) that provides for, contemplates or the
effectuation of which is preceded or accompanied by (whether or not
substantially contemporaneously) (a) the sale, lease, conveyance or other
disposition of all or substantially all of the assets of such Person otherwise
than as an entirety or substantially as an entirety and (b) the distribution of
all or substantially all of the proceeds of such sale, lease, conveyance or
other disposition and all or substantially all of the remaining assets of such
Person to holders of Capital Stock of such Person.
"Preferred Stock" means, with respect to any Person, Capital Stock of
---------------
any class or, classes (however designated) of such Person 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 Capital Stock of any other class of such Person.
"principal" of any Indebtedness (including the Notes) means the
---------
principal amount of such Indebtedness plus the premium, if any, on such
Indebtedness.
"Private Exchange Notes" has the meaning set forth in the Registration
----------------------
Rights Agreement.
"Private Placement Legend" means the legend initially set forth on the
------------------------
Notes in the form set forth in Section 2.15.
-22-
"pro forma" means, with respect to any calculation made or required to
---------
be made pursuant to the terms of this Indenture, a calculation in accordance
with Article 11 of Regulation S-X under the Securities Act, as determined by the
Board of Directors of the Company in consultation with its independent public
accountants.
"Public Equity Offering" means any underwritten public offering of
----------------------
Capital Stock (other then Redeemable Capital Stock) of the Company made on a
primary basis by the Company pursuant to a registration statement filed with and
declared effective by the Commission in accordance with the Securities Act.
"Purchase Money Obligation" means any Indebtedness secured by a Lien
-------------------------
on assets related to the business of the Company and its Restricted Subsidiaries
and any additions and accessions thereto, which are purchased by the Company or
any Restricted Subsidiary at any time after the Issue Date; provided that (i)
the security agreement or conditional sales or other title retention contract
pursuant to which the Lien on such assets is created (collectively a "Purchase
Money Security Agreement") shall be entered into within 180 days after the
purchase or substantial completion of the construction of such assets and shall
at all times be confined solely to the assets so purchased or acquired, any
additions and accessions thereto and any proceeds therefrom, (ii) at no time
shall the aggregate principal amount of the outstanding Indebtedness secured
thereby be increased, except in connection with the purchase of additions and
accessions thereto and except in respect of fees and other obligations in
respect of such Indebtedness and (iii) (A) the aggregate outstanding principal
amount of Indebtedness secured thereby (determined on a per asset basis in the
case of any additions and accessions) shall not at the time such Purchase Money
Security Agreement is entered into exceed 85% of the purchase price to the
Company and its Restricted Subsidiaries of the assets subject thereto or (B) the
Indebtedness secured thereby shall be with recourse solely to the assets so
purchased or acquired, any additions and accessions thereto and any proceeds
therefrom.
"Qualified Capital Stock" of any Person means any and all Capital
-----------------------
Stock of such Person other than Redeemable Capital Stock.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
----------------------------- ---
specified in Rule 144A under the Securities Act.
"Rating Agencies" means (i) S&P and (ii) Xxxxx'x and (iii) if S&P or
---------------
Xxxxx'x or both shall not make a rating of the Notes publicly available, a
nationally recognized United States
-23-
securities rating agency or agencies, as the case may be, selected by the
Company, which shall be substituted for S&P or Xxxxx'x or both, as the case may
be.
"Rating Category" means (i) with respect to S&P, any of the following
---------------
categories: BB, B, CCC, CC, C and D (or equivalent successor categories); (ii)
with respect to Xxxxx'x, any of the following categories: Ba, B, Caa, Ca, C and
D (or equivalent successor categories); and (iii) the equivalent of any such
category of S&P or Xxxxx'x used by another Rating Agency. In determining whether
the rating of the Notes has decreased by one or more gradations, gradations
within Rating Categories (+ and -- for S&P; 1, 2 and 3 for Xxxxx'x; or the
equivalent gradations for another Rating Agency) shall be taken into account
(e.g., with respect to S&P, a decline in rating from BB+ to BB, as well as from
BB- to B+, will constitute a decrease of one gradation).
"Record Date" means the Record Date specified in the Notes.
-----------
"Redeemable Capital Stock" means any class or series of Capital Stock
------------------------
to the extent that, either by its terms, by the terms of any security into which
it is convertible or exchangeable, or by contract or otherwise, is or upon the
happening of an event (other than a Change of Control) or passage of time would
be, required to be redeemed prior to any Stated Maturity of the principal of the
Notes or is redeemable at the option of the holder thereof at any time prior to
such Stated Maturity, or is convertible into or exchangeable for debt securities
at any time prior to such Stated Maturity.
"Redemption Date," when used with respect to any Note to be redeemed,
---------------
means the date fixed for such redemption pursuant to this Indenture and the
Notes.
"redemption price," when used with respect to any Note to be redeemed,
----------------
means the price fixed for such redemption, including principal and premium, if
any, pursuant to this Indenture and the Notes.
"Reference Period" has the meaning set forth under the definition of
----------------
"Consolidated Fixed Charge Coverage Ratio."
"refinancing" has the meaning set forth under Section 4.12.
-----------
"Registrar" has the meaning provided in Section 2.03.
---------
-24-
"Registration Rights Agreement" means the Registration Rights
-----------------------------
Agreement dated as of the Issue Date by and among the Company and the Initial
Purchasers.
"Regulation S" means Regulation S under the Securities Act.
------------
"Restricted Payment" shall have the meaning set forth in Section 4.10.
------------------
"Restricted Security" has the meaning assigned to such term in Rule
-------------------
144(a)(3) under the Securities Act; provided, however, that the Trustee shall be
-------- -------
entitled to request and conclusively rely on an Opinion of Counsel with respect
to whether any Note constitutes a Restricted Security.
"Restricted Subsidiary" means any Subsidiary of the Company that has
---------------------
not been designated by the Board of Directors of the Company, by a board
resolution delivered to the Trustee, as an Unrestricted Subsidiary pursuant to
and in compliance with Section 4.18. Any such designation may be revoked by a
board resolution of the Board of Directors of the Company delivered to the
Trustee, subject to the provisions of such covenant.
"Restricted Subsidiary Indebtedness" means Indebtedness of any
----------------------------------
Restricted Subsidiary (i) that is not subordinated to any other Indebtedness of
such Restricted Subsidiary and (ii) in respect of which the Company is not also
obligated (by means of a guarantee or otherwise) other than, in the case of this
clause (ii), Indebtedness under the Credit Facility.
"Revocation" has the meaning set forth under Section 4.18.
----------
"Rule 144A" means Rule 144A under the Securities Act.
---------
"Sale and Lease-Back Transaction" means any arrangement with any
-------------------------------
Person providing for the leasing by the Company or a Restricted Subsidiary of
any real or tangible personal property, which property has been or is to be sold
or transferred by the Company or such Restricted Subsidiary to such Person in
contemplation of such leasing.
"S&P" means Standard & Poor's Rating Services, a division of The
---
McGraw Hill Companies, Inc., and its successors.
"Securities Act" means the Securities Act of 1933, as amended, and the
--------------
rules and regulations promulgated by the Commission thereunder.
-25-
"Stated Maturity" means, with respect to any Note or any installment
---------------
of interest thereon, the dates specified in such Note as the fixed date on which
the principal of such Note or such installment of interest is due and payable,
and when used with respect to any other Indebtedness, means the date specified
in the instrument governing such Indebtedness as the fixed date on which the
principal of such Indebtedness or any installment of interest is due and
payable.
"Subordinated Indebtedness" means, with respect to the Company,
-------------------------
Indebtedness of the Company which is expressly subordinated in right of payment
to the Notes.
"Subsidiary" means, with respect to any Person, (a) any corporation of
----------
which the outstanding shares of Voting Capital Stock having at least a majority
of the votes entitled to be cast in the election of directors shall at the time
be owned, directly or indirectly, by such Person, or (b) any other Person of
which at least a majority of the shares of Voting Capital Stock are at the time,
directly or indirectly, owned by such first named Person.
"Surviving Person" means, with respect to any Person involved in any
----------------
consolidation or merger, or any sale, assignment, conveyance, transfer, lease or
other disposition of all or substantially all of its properties and assets as an
entirety, the Person formed by or surviving such merger or consolidation or the
Person to which such sale, assignment, conveyance, transfer or lease is made.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-
---
77bbbb), as amended, as in effect on the date of this Indenture, except as
otherwise provided in Section 9.03.
"Transaction Date" has the meaning set forth under the definition of
----------------
"Consolidated Fixed Charge Coverage Ratio."
"Trust Officer" means any officer of the Trustee assigned by the
-------------
Trustee to administer this Indenture, or in the case of a successor trustee, an
officer assigned to the department, division or group performing the corporate
trust work of such successor and assigned to administer this Indenture.
"Trustee" means the party named as such in this Indenture until a
-------
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"U.S. Government Obligations" mean direct obligations of, and
---------------------------
obligations guaranteed by, the United States of America
-26-
for the payment of which the full faith and credit of the United States of
America is pledged.
"U.S. Legal Tender" means such coin or currency of the United States
-----------------
of America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Unrestricted Subsidiary" means each Subsidiary of the Company
-----------------------
designated as such pursuant to and in compliance with the covenant described
under Section 4.18. Any such designation may be revoked by a Board Resolution
of the Company delivered to the Trustee, subject to the provisions of such
covenant.
"Voting Stock" means any class or classes of Capital Stock pursuant to
------------
which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the Board of Directors, managers
or trustees of any Person (irrespective of whether or not, at the time, stock of
any other class or classes shall have, or might have, voting power by reason of
the happening of any contingency).
"Wholly-Owned Restricted Subsidiary" means any Restricted Subsidiary
----------------------------------
of which 100% of the outstanding Capital Stock is owned by the Company and/or
another Wholly-Owned Restricted Subsidiary. For purposes of this definition,
any directors' qualifying shares shall be disregarded in determining the
ownership of a Restricted Subsidiary.
SECTION 1.02. Incorporation by Reference of TIA.
---------------------------------
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the Indenture securities means the Company or any other
obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute
-27-
or defined by Commission rule and not otherwise defined herein have the meanings
assigned to them therein.
SECTION 1.03. 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 of any date of determination;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other subdivision; and
(6) any reference to a statute, law or regulation means that
statute, law or regulation as amended and in effect from time to time and
includes any successor statute, law or regulation; provided, however, that
-------- -------
any reference to the Bankruptcy Law shall mean the Bankruptcy Law as
applicable to the relevant case.
ARTICLE TWO
THE NOTES
---------
SECTION 2.01. Form and Dating.
---------------
The Initial Notes and the Trustee's certificate of authentication
relating thereto shall be substantially in the form of Exhibit A. The Exchange
---------
Notes and the Trustee's certificate of authentication relating thereto shall be
substantially in the form of Exhibit B. The Notes may have notations, legends
---------
or endorsements required by law, stock exchange rule or depository rule or
usage. The Company and the Trustee shall approve the form of the Notes and any
notation, legend or endorsement on them. If required, the Notes may bear the
appropriate legend regarding any original issue discount for federal income tax
purposes. Each Note shall be dated the date of its issuance and shall show the
date of its authentication.
-28-
The terms and provisions contained in the Notes, annexed hereto as
Exhibits A and B, shall constitute, and are hereby expressly made, a part of
----------------
this Indenture and, to the extent applicable, the Company and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby.
Notes offered and sold in reliance on Rule 144A shall be issued
initially in the form of one or more permanent global Notes in registered form,
substantially in the form set forth in Exhibit A (the "Global Note"), deposited
---------
with the Trustee, as custodian for the Depository, duly executed by the Company
and authenticated by the Trustee as hereinafter provided and shall bear the
legend set forth in Section 2.15. The aggregate principal amount of the Global
Note may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depository, as hereinafter
provided.
Notes issued in exchange for interests in a Global Note pursuant to
Section 2.16 may be issued in the form of permanent certificated Notes in
registered form in substantially the form set forth in Exhibit A (the "Physical
---------
Notes").
SECTION 2.02. Execution and Authentication;
Aggregate Principal Amount.
-----------------------------
Two Officers of the Company (each of whom shall have been duly
authorized by all requisite corporate actions) shall sign the Notes for the
Company by manual or facsimile signature.
If an Officer whose signature is on a Note was an Officer at the time
of such execution but no longer holds that office or position at the time the
Trustee authenticates the Note, the Note shall nevertheless be valid.
A Note shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
The Trustee shall authenticate (i) Initial Notes for original issue in
the aggregate principal amount not to exceed $150,000,000 and (ii) Exchange
Notes for issue only in a registered Exchange Offer, pursuant to the
Registration Rights Agreement, for a like principal amount of Initial Notes, in
each case upon a written order of the Company in the form of an Officers'
Certificate of the Company. Each such written order shall specify the amount of
Notes to be authenticated and the date on which the Notes are to be
authenticated, whether the
-29-
Notes are to be Initial Notes or Exchange Notes and whether the Notes are to be
issued as Physical Notes or Global Notes or such other information as the
Trustee may reasonably request. In addition, with respect to authentication
pursuant to clause (ii) of the first sentence of this paragraph, the first such
written order from the Company shall be accompanied by an Opinion of Counsel of
the Company in a form reasonably satisfactory to the Trustee stating that the
issuance of the Exchange Notes complies with this Indenture and has been duly
authorized by the Company. The aggregate principal amount of Notes outstanding
at any time may not exceed $150,000,000, except as provided in Sections 2.07 and
2.08.
The Trustee may appoint an authenticating agent (the "Authenticating
Agent") reasonably acceptable to the Company to authenticate Notes. Unless
otherwise provided in the appointment, an Authenticating Agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such Authenticating
Agent. An Authenticating Agent has the same rights as an Agent to deal with the
Company or with any Affiliate of the Company.
The Notes shall be issuable in fully registered form only, without
coupons, in denominations of $1,000 and any integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent.
--------------------------
The Company shall maintain an office or agency (which shall be located
in the Borough of Manhattan in the City of New York, State of New York) where
(a) Notes may be presented or surrendered for registration of transfer or for
exchange ("Registrar"), (b) Notes may be presented or surrendered for payment
("Paying Agent") and (c) notices and demands to or upon the Company in respect
of the Notes and this Indenture may be served. The Registrar shall keep a
register of the Notes and of their transfer and exchange. The Company, upon
prior written notice to the Trustee, may have one or more co-Registrars and one
or more additional paying agents reasonably acceptable to the Trustee. The term
"Paying Agent" includes any additional Paying Agent. The Company may act as its
own Paying Agent, except that for the purposes of payments on the Notes pursuant
to Sections 4.14 and 4.15, neither the Company nor any Affiliate of the Company
may act as Paying Agent.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which agreement shall incorporate the
provisions of the TIA and implement the provisions of this Indenture that relate
to such Agent. The Company shall notify the Trustee, in advance, of
-30-
the name and address of any such Agent. If the Company fails to maintain a
Registrar or Paying Agent, or fails to give the foregoing notice, the Trustee
shall act as such and shall be entitled to appropriate compensation in
accordance with Section 7.07.
The Company initially appoints the Trustee as Registrar, Paying Agent
and agent for service of demands and notices in connection with the Notes, until
such time as the Trustee has resigned or a successor has been appointed. Any of
the Registrar, the Paying Agent or any other agent may resign upon 30 days'
notice to the Company.
SECTION 2.04. Paying Agent To Hold Assets in Trust.
------------------------------------
The Company shall require each Paying Agent other than the Trustee to
agree in writing that such Paying Agent shall hold in trust for the benefit of
the Holders or the Trustee all assets held by the Paying Agent for the payment
of principal of, premium, if any, or interest on, the Notes (whether such assets
have been distributed to it by the Company or any other obligor on the Notes),
and the Company and the Paying Agent shall notify the Trustee of any Default by
the Company (or any other obligor on the Notes) in making any such payment. The
Company at any time may require a Paying Agent to distribute all assets held by
it to the Trustee and account for any assets disbursed and the Trustee may at
any time during the continuance of any payment Default, upon written request to
a Paying Agent, require such Paying Agent to distribute all assets held by it to
the Trustee and to account for any assets distributed. Upon distribution to the
Trustee of all assets that shall have been delivered by the Company to the
Paying Agent, the Paying Agent shall have no further liability for such assets.
SECTION 2.05. Holder Lists.
------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
the Holders. If the Trustee is not the Registrar, the Company shall furnish or
cause the Registrar to furnish to the Trustee before each Record Date and at
such other times as the Trustee may request in writing a list as of such date
and in such form as the Trustee may reasonably require of the names and
addresses of the Holders, which list may be conclusively relied upon by the
Trustee.
SECTION 2.06. Transfer and Exchange.
---------------------
When Notes are presented to the Registrar or a co-Registrar with a
request to register the transfer of such Notes
-31-
or to exchange such Notes for an equal principal amount of Notes or other
authorized denominations, the Registrar or co-Registrar shall register the
transfer or make the exchange as requested if its requirements for such
transaction are met; provided, however, that the Notes presented or surrendered
-------- -------
for registration of transfer or exchange shall be duly endorsed or accompanied
by a written instrument of transfer in form satisfactory to the Company, the
Trustee and the Registrar or co-Registrar, duly executed by the Holder thereof
or his attorney duly authorized in writing. To permit registration of transfers
and exchanges, the Company shall execute and the Trustee shall authenticate
Notes. No service charge shall be made by a Holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax, fee or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charges
payable upon exchanges or transfers pursuant to Section 2.10, 3.04, 4.14, 4.15
or 9.05, in which event the Company shall be responsible for the payment of such
taxes).
The Registrar or co-Registrar shall not be required to register the
transfer of or exchange of any Note (i) during a period beginning at the opening
of business 15 days before the mailing of a notice of redemption of Notes and
ending at the close of business on the day of such mailing,(ii) selected for
redemption in whole or in part pursuant to Article Three, except the unredeemed
portion of any Note being redeemed in part or (iii) between a Record Date and
the next succeeding Interest Payment Date.
Any Holder of a beneficial interest in a Global Note shall, by
acceptance of such Global Note, agree that transfers of beneficial interests in
such Global Notes may be effected only through a book entry system maintained by
the Holder of such Global Note (or its agent), and that ownership of a
beneficial interest in the Note shall be required to be reflected in a book
entry system.
Neither the Company nor the Trustee shall be liable for any delay by
the Holder of a Global Note or the Depository in identifying the beneficial
owners of any Note and the Company and the Trustee may conclusively rely on
instructions from the Holder of a Global Note or the Depository for all
purposes.
SECTION 2.07. Replacement Notes.
-----------------
If a mutilated Note is surrendered to the Trustee or if the Holder of
a Note claims that the Note has been lost, destroyed or wrongfully taken, the
Company shall issue and the Trustee shall authenticate a replacement Note. If
required by
-32-
the Trustee or the Company, such Holder must provide satisfactory evidence of
such loss, destruction or taking, and an indemnity bond or other indemnity of
reasonable tenor, sufficient in the reasonable judgment of the Company and the
Trustee, to protect the Company, the Trustee or any Agent from any loss which
any of them may suffer if a Note is replaced. Every replacement Note shall
constitute an obligation of the Company. The Company and the Trustee each may
charge such Holder for its expenses in replacing such Note.
SECTION 2.08. Outstanding Notes.
-----------------
Notes outstanding at any time are all the Notes that have been
authenticated by the Trustee except those canceled by it, those delivered to it
for cancellation and those described in this Section as not outstanding.
Subject to the provisions of Section 2.09, a Note does not cease to be
outstanding because the Company or any of its Affiliates holds the Note.
If a Note is replaced pursuant to Section 2.07 (other than a mutilated
Note surrendered for replacement), it ceases to be outstanding unless the
Trustee receives proof satisfactory to it that the replaced Note is held by a
bona fide purchaser. A mutilated Note ceases to be outstanding upon surrender
---- ----
of such Note and replacement thereof pursuant to Section 2.07.
If on a Redemption Date, the Maturity Date, the Change of Control
Payment Date or the Net Proceeds Payment Date the Paying Agent holds U.S. Legal
Tender or U.S. Government Obligations sufficient to pay all of the principal,
premium, if any, and interest due on the Notes payable on that date and is not
prohibited from paying such money to the Holders thereof pursuant to the terms
of this Indenture, then on and after that date such Notes shall be deemed not to
be outstanding and interest on them shall cease to accrue.
SECTION 2.09. Treasury Notes.
--------------
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver, consent or notice, Notes owned by
the Company or an Affiliate of the Company shall be considered as though they
are not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes which a Trust Officer of the Trustee actually knows are so owned
shall be so considered. The Company shall notify the Trustee, in writing, when
it or, to its knowledge, any of its Affiliates repurchases or otherwise acquires
Notes, of the aggregate principal amount of such Notes so repurchased or
otherwise acquired and such other
-33-
information as the Trustee may reasonably request and the Trustee shall be
entitled to rely thereon.
SECTION 2.10. Temporary Notes.
---------------
Until definitive Notes are ready for delivery, the Company may prepare
and the Trustee shall authenticate temporary Notes upon receipt of a written
order of the Company in the form of an Officers' Certificate. The Officers'
Certificate shall specify the amount of temporary Notes to be authenticated and
the date on which the temporary Notes are to be authenticated. Temporary Notes
shall be substantially in the form of definitive Notes but may have variations
that the Company considers appropriate for temporary Notes and so indicate in
the Officers' Certificate. Without unreasonable delay, the Company shall
prepare and the Trustee shall authenticate, upon receipt of a written order of
the Company pursuant to Section 2.02, definitive Notes in exchange for temporary
Notes.
SECTION 2.11. Cancellation.
------------
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for transfer, exchange or payment. The Trustee,
or at the direction of the Trustee, the Registrar or the Paying Agent, and no
one else, shall cancel and, at the written direction of the Company, shall
dispose, in its customary manner, of all Notes surrendered for transfer,
exchange, payment or cancellation. Subject to Section 2.07, the Company may not
issue new Notes to replace Notes that it has paid or delivered to the Trustee
for cancellation. If the Company shall acquire any of the Notes, such
acquisition shall not operate as a redemption or satisfaction of the
Indebtedness represented by such Notes unless and until the same are surrendered
to the Trustee for cancellation pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest.
------------------
The Company will pay interest on overdue principal from time to time
on demand at the rate of interest then borne by the Notes. The Company shall,
to the extent lawful, pay interest on overdue installments of interest (without
regard to any applicable grace periods) from time to time on demand at the rate
of interest then borne by the Notes. Interest will be computed on the basis of
a 360-day year comprised of twelve 30-day months, and, in the case of a partial
month, the actual number of days elapsed.
If the Company defaults in a payment of interest on the Notes, it
shall pay the defaulted interest, plus (to the
-34-
extent lawful) any interest payable on the defaulted interest, to the Persons
who are Holders on a subsequent special record date, which special record date
shall be the fifteenth day next preceding the date fixed by the Company for the
payment of defaulted interest or the next succeeding Business Day if such date
is not a Business Day. The Company shall notify the Trustee in writing of the
amount of defaulted interest proposed to be paid on each Note and the date of
the proposed payment (a "Default Interest Payment Date"), and at the same time
the Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such defaulted interest or
shall make arrangements satisfactory to the Trustee for such deposit on or prior
to the date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such defaulted interest as
provided in this Section; provided, however, that in no event shall the Company
-------- -------
deposit monies proposed to be paid in respect of defaulted interest later than
11:00 a.m. New York City time of the proposed Default Interest Payment Date. At
least 15 days before the subsequent special record date, the Company shall mail
(or cause to be mailed) to each Holder, as of a recent date selected by the
Company, with a copy to the Trustee, a notice that states the subsequent special
record date, the payment date and the amount of defaulted interest, and interest
payable on such defaulted interest, if any, to be paid. Notwithstanding the
foregoing, any interest that is paid prior to the expiration of the 30-day
period set forth in Section 6.01(a) shall be paid to Holders as of the regular
record date for the Interest Payment Date for which interest has not been paid.
Notwithstanding the foregoing, the Company may make payment of any defaulted
interest in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Notes may be listed, and upon such notice
as may be required by such exchange.
SECTION 2.13. CUSIP Number.
------------
The Company in issuing the Notes may use "CUSIP" numbers, and, if so,
the Trustee shall use the CUSIP numbers in notices of redemption or exchange as
a convenience to Holders; provided, however, that no representation is hereby
-------- -------
deemed to be made by the Trustee as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Notes, and that reliance may be placed
only on the other identification numbers printed on the Notes. The Company
shall promptly notify the Trustee of any change in the CUSIP number.
SECTION 2.14. Deposit of Monies.
-----------------
Prior to 11:00 a.m. New York City time on each Interest Payment Date,
Maturity Date, Redemption Date, Change of
-35-
Control Payment Date and Net Proceeds Payment Date, the Company shall have
deposited with the Paying Agent in immediately available funds money sufficient
to make cash payments, if any, due on such Interest Payment Date, Maturity Date,
Redemption Date, Change of Control Purchase Date and Net Proceeds Payment Date,
as the case may be, in a timely manner which permits the Paying Agent to remit
payment to the Holders on such Interest Payment Date, Maturity Date, Redemption
Date, Change of Control Purchase Date and Net Proceeds Payment Date, as the case
may be.
SECTION 2.15. Restrictive Legends.
-------------------
Each Global Note and Physical Note that constitutes a Restricted
Security shall bear the following legend (the "Private Placement Legend") on the
face thereof until after the second anniversary of the later of the Issue Date
and the last date on which the Company or any Affiliate of the Company was the
owner of such Note (or any predecessor security) (or such shorter period of time
as permitted by Rule 144(k) under the Securities Act or any successor provision
thereunder) (or such longer period of time as may be required under the
Securities Act or applicable state securities laws in the opinion of counsel for
the Company, unless otherwise agreed by the Company and the Holder thereof):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED
IN RULE 144A UNDER THE ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S
UNDER THE ACT, (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE
ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) INSIDE
THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS
FURNISHED ON ITS BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER CAN BE
OBTAINED FROM THE TRUSTEE OR TRANSFER AGENT FOR THIS SECURITY), (D) OUT-
-36-
SIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE
904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE ACT (IF AVAILABLE), OR (F)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND (3)
AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
CONNECTION WITH ANY TRANSFER OF THIS SECURITY WITHIN TWO YEARS AFTER THE
ORIGINAL ISSUANCE OF THIS SECURITY, IF THE PROPOSED TRANSFER IS PURSUANT TO
CLAUSE (C), (D) OR (E), THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO
THE TRUSTEE OR TRANSFER AGENT AND THE COMPANY SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE 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 ACT.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S.
PERSON" HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE ACT.
Each Global Note shall also bear the following legend on the face
thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR BY ANY SUCH NOMINEE OF
THE DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF SUCH SUCCESSOR
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF
SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY 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 HEREON 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 CEDE & CO. OR TO A SUCCESSOR THEREOF
OR
-37-
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 SECTION 2.17 OF THE INDENTURE GOVERNING THIS
NOTE.
SECTION 2.16. Book-Entry Provisions for Global Security.
-----------------------------------------
(a) The Global Notes initially shall (i) be registered in the name of
the Depository or the nominee of such Depository, (ii) be delivered to the
Trustee as custodian for such Depository and (iii) bear legends as set forth in
Section 2.15.
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depository, or the Trustee as its custodian, or under the
Global Notes, and the Depository may be treated by the Company, the Trustee and
any Agent of the Company or the Trustee as the absolute owner of such Global
Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall prevent the Company, the Trustee or any Agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depository or impair, as between the Depository
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Note.
(b) Transfers of a Global Note shall be limited to transfers in
whole, but not in part, to the Depository, its successors or their respective
nominees. Interests of beneficial owners in a Global Note may be transferred or
exchanged for Physical Notes in accordance with the rules and procedures of the
Depository and the provisions of Section 2.17. In addition, Physical Notes
shall be transferred to all beneficial owners in exchange for their beneficial
interests in a Global Note if (i) the Depository notifies the Company that it is
unwilling or unable to continue as Depository for the Global Notes and 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 and the
Registrar has received a written request from the Depository to issue Physical
Notes.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in a Global Note to beneficial owners pursuant to paragraph
(b), the Registrar shall (if one or more Physical Notes are to be issued)
reflect on its books and records the date and a decrease in the principal amount
of such Global Note in an amount equal to the principal
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amount of the beneficial interest in the Global Note to be transferred, and the
Company shall execute and the Trustee shall authenticate and deliver, one or
more Physical Notes of like tenor and amount.
(d) In connection with the transfer of an entire Global Note to
beneficial owners pursuant to paragraph (b), such Global Note shall be deemed to
be surrendered to the Trustee for cancellation, and the Company shall execute
and the Trustee shall authenticate and deliver, to each beneficial owner
identified by the Depository in exchange for its beneficial interest in the
Global Note, an equal aggregate principal amount of Physical Notes of authorized
denominations registered in the name of such beneficial owners.
(e) Any Physical Note constituting a Restricted Security delivered in
exchange for an interest in a Global Note pursuant to paragraph (b) or (c)
shall, except as otherwise provided by paragraphs (a)(i)(x) and (c) of Section
2.17, bear the legend regarding transfer restrictions applicable to the Physical
Notes set forth in Section 2.15.
(f) The Holder of a Global Note may 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 Notes.
SECTION 2.17. Special Transfer Provisions.
---------------------------
(a) Transfers to Non-QIB Institutional Accredited Investors and Non-
---------------------------------------------------------------
U.S. Persons. The following provisions shall apply with respect to the
------------
registration of any proposed transfer of a Note constituting a Restricted
Security to any Institutional Accredited Investor that is not a QIB or to any
Non-U.S. Person:
(i) the Registrar shall register the transfer of any Note
constituting a Restricted Security, whether or not such Note bears the
Private Placement Legend, if (x) the requested transfer is after the second
anniversary of the Issue Date (provided, however, that, to the knowledge of
-------- -------
the Registrar, neither the Company nor any Affiliate of the Company has
held any beneficial interest in such Note, or portion thereof, at any time
on or prior to the second anniversary of the Issue Date) or (y) (1) in the
case of a transfer to an Institutional Accredited Investor which is not a
QIB (excluding Non-U.S. Persons), the proposed transferee has delivered to
the Registrar a certificate substantially in the form of Exhibit C and any
---------
legal opinions and certifications required thereby or (2) in the
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case of a transfer to a Non-U.S. Person, the proposed transferor has
delivered to the Registrar a certificate substantially in the form of
Exhibit D; and
---------
(ii) if the proposed transferor is an Agent Member holding a
beneficial interest in the Global Note, upon receipt by the Registrar of
(x) the certificate, if any, required by paragraph (i) above and (y)
written instructions given in accordance with the Depository's and the
Registrar's procedures,
whereupon (a) the Registrar shall reflect on its books and records the date and
(if the transfer does not involve a transfer of outstanding Physical Notes) a
decrease in the principal amount of such Global Note in an amount equal to the
principal amount of the beneficial interest in the Global Note to be
transferred, and (b) the Company shall execute and the Trustee shall
authenticate and deliver one or more Physical Notes of like tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply with
-----------------
respect to the registration of any proposed transfer of a Note constituting a
Restricted Security to a QIB (excluding transfers to Non-U.S. Persons):
(i) the Registrar shall register the transfer if such transfer is
being made by a proposed transferor who has checked the box provided for on
the form of Note stating, or has otherwise advised the Company and the
Registrar in writing, that the sale has been made in compliance with the
provisions of Rule 144A to a transferee who has signed the certification
provided for on the form of Note stating, or has otherwise advised the
Company and the Registrar in writing, that it is purchasing the Note for
its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a QIB within the
meaning of Rule 144A, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as it has requested pursuant to Rule 144A
or has determined not to request such information and that it is aware that
the transferor is relying upon its foregoing representations in order to
claim the exemption from registration provided by Rule 144A; and
(ii) if the proposed transferee is an Agent Member, and the Notes to
be transferred consist of Physical Notes which after transfer are to be
evidenced by an interest in a Global Note, upon receipt by the Registrar of
written instructions given in accordance with the Depository's and the
Registrar's procedures, the Registrar shall reflect on
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its books and records the date and an increase in the principal amount of
such Global Note in an amount equal to the principal amount of the Physical
Notes to be transferred, and the Trustee shall cancel the Physical Notes so
transferred.
(c) Private Placement Legend. Upon the transfer, exchange or
------------------------
replacement of Notes not bearing the Private Placement Legend, the Registrar
shall deliver Notes that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Notes bearing the Private Placement Legend,
the Registrar shall deliver only Notes that bear the Private Placement Legend
unless (i) the requested transfer is after the second anniversary of the Issue
Date (provided, however, that, to the knowledge of the Registrar, neither the
-------- -------
Company nor any Affiliate of the Company has held any beneficial interest in
such Note, or portion thereof, at any time prior to or on the second anniversary
of the Issue Date), or (ii) there is delivered to the Registrar an Opinion of
Counsel reasonably satisfactory to the Company and the Trustee to the effect
that neither such legend nor the related restrictions on transfer are required
in order to maintain compliance with the provisions of the Securities Act.
(d) General. By its acceptance of any Note bearing the Private
-------
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.16 or this Section 2.17.
The Company shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time during the
Registrar's normal business hours upon the giving of reasonable written notice
to the Registrar.
(e) Transfers of Notes Held by Affiliates. Any certificate (i)
-------------------------------------
evidencing a Note that has been transferred to an Affiliate of the Company
within three years after the Issue Date, as evidenced by a notation on the
Assignment Form for such transfer or in the representation letter delivered in
respect thereof or (ii) evidencing a Note that has been acquired from an
Affiliate (other than by an Affiliate) in a transaction or a chain of
transactions not involving any public offering, shall, until two years after the
last date on which either the Company or any Affiliate of the Company was an
owner of such Note, in each case, bear a legend in substantially the form set
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forth in Section 2.15, unless otherwise agreed by the Company (with written
notice thereof to the Trustee).
ARTICLE THREE
REDEMPTION
----------
SECTION 3.01. Notices to Trustee.
------------------
If the Company elects to redeem Notes pursuant to Paragraph 5 of the
Notes and Section 3.03, it shall notify the Trustee and the Paying Agent in
writing of the Redemption Date and the principal amount of the Notes to be
redeemed.
The Company shall give each notice provided for in this Section 3.01
at least 45 but not more than 60 days before the Redemption Date (unless a
shorter notice period shall be satisfactory to the Trustee, as evidenced in a
writing signed on behalf of the Trustee), together with an Officers' Certificate
stating the CUSIP number of the Notes being redeemed, that such redemption shall
comply with the conditions contained herein and in the Notes, the Redemption
Date, the redemption price and the principal amount of the Notes to be redeemed.
If the Company is required to make an offer to redeem Notes pursuant
to the provisions of Section 4.14 or 4.15 hereof, it shall furnish to the
Trustee at least 30 days but not more than 60 days before a Change of Control
Payment Date or Net Proceeds Payment Date (or such shorter period as may be
agreed to by the Trustee in writing), an Officers' Certificate setting forth (i)
the Section of this Indenture pursuant to which the redemption shall occur, (ii)
the Redemption Date, (iii) the principal amount of Notes to be redeemed, (iv)
the redemption price, (v) a statement to the effect that (a) the Company or one
of its Subsidiaries has effected an Asset Sale and the conditions set forth in
Section 4.15 have been satisfied or (b) a Change of Control has occurred and the
conditions set forth in Section 4.14 have been satisfied, as applicable and (vi)
the CUSIP number of the Notes being redeemed.
SECTION 3.02. Selection of Notes To Be Redeemed.
---------------------------------
In the event that less than all of the Notes are to be redeemed at any
time, selection of Notes for redemption shall be made by the Trustee in
compliance with the requirements of the principal national securities exchange,
if any, on which the Notes are listed or, if the Notes are not listed on a
national securities exchange, on a pro rata basis, by lot or by such method as
--- ----
the Trustee shall deem fair and appropriate;
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provided, however, that no Notes of a principal amount of $1,000 or less shall
-------- -------
be redeemed in part; provided, further, however, that any such redemption made
-------- ------- -------
made with the net proceeds of a Public Equity Offering shall be made on a pro
---
rata basis or on as nearly a pro rata basis as practicable (subject to the
---- --- ----
procedures of The Depository Trust Company or any other depositary).
Notice of redemption will be mailed by first class mail at least 30
but not more than 60 days before the redemption date to each holder of Notes to
be redeemed at its registered address. If any Note is to be redeemed in part
only, the notice of redemption that relates to such Note will state the portion
of the principal amount thereof to be redeemed. A new Note in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Note. On and after the redemption
date, interest will cease to accrue on Notes or portions thereof called for
redemption so long as the Company has deposited with the Paying Agent funds in
satisfaction of the applicable redemption price pursuant to this Indenture.
SECTION 3.03. Optional Redemption.
-------------------
(a) The Notes will be redeemable at the option of the Company, in
whole or in part, at any time on or after April 1, 2004, at the redemption
prices (expressed as percentages of the principal amount) set forth below, plus
accrued and unpaid interest, if any, to the date of redemption, if redeemed
during the 12-month period beginning on April 1 of the years indicated below:
Year Redemption
Price
2004.................................... 104.250%
2005.................................... 102.833%
2006.................................... 101.417%
2007 and thereafter..................... 100.000%
(b) On or before April 1, 2002, the Company may, at its option, use
the net proceeds of a Public Equity Offering to redeem up to 35% of the
originally issued aggregate principal amount of the Notes, at a redemption price
in cash equal to 108.500% of the principal amount, plus accrued and unpaid
interest, if any, to the redemption date; provided that at least 65% of the
--------
aggregate principal amount of Notes is outstanding following such redemption.
Notice of any such redemption must be given not later than 60 days after the
consummation of the Public Equity Offering.
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SECTION 3.04. Notice of Redemption.
--------------------
At least 30 days but not more than 60 days before the Redemption Date,
the Company shall mail or cause to be mailed a notice of redemption by first
class mail to each Holder of Notes to be redeemed at its registered address,
with a copy to the Trustee and any Paying Agent. At the Company's request, the
Trustee shall give the notice of redemption in the Company's name and at the
Company's expense. The Company shall provide such notices of redemption to the
Trustee at least five days or such shorter period as shall be agreed to by the
Trustee before the intended mailing date. In any case, failure to give such
notice or any defect in the notice to the holder of any Note shall not affect
the validity of the proceeding for the redemption of any other Note.
Each notice of redemption shall identify (including the CUSIP number)
the Notes to be redeemed and shall state:
(1) the Redemption Date;
(2) the redemption price and the amount of accrued interest, if any,
to be paid;
(3) the name and address of the Paying Agent;
(4) the subparagraph of the Notes pursuant to which such redemption
is being made;
(5) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price plus accrued interest, if any
unless such date of redemption is an interest payment date in which case
interest will be paid to the registered owner;
(6) that, unless the Company defaults in making the redemption
payment, interest on Notes or applicable portions thereof called for
redemption ceases to accrue on and after the Redemption Date, and the only
remaining right of the Holders of such Notes is to receive payment of the
redemption price plus accrued interest as of the Redemption Date, if any,
upon surrender to the Paying Agent of the Notes redeemed;
(7) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the Redemption
Date, and upon surrender of such Note, a new Note or Notes in the aggregate
principal amount equal to the unredeemed portion thereof will be issued;
and
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(8) if fewer than all the Notes are to be redeemed, the
identification of the particular Notes (or portion thereof) to be redeemed,
as well as the aggregate principal amount of Notes to be redeemed and the
aggregate principal amount of Notes to be outstanding after such partial
redemption.
No representation is made as to the accuracy of the CUSIP numbers
listed in such notice or printed on the Notes.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the purchase
of Notes.
SECTION 3.05. Effect of Notice of Redemption.
------------------------------
Once notice of redemption is mailed in accordance with Section 3.04,
such notice of redemption shall be irrevocable and Notes called for redemption
become due and payable on the Redemption Date and at the redemption price plus
accrued interest as of such date, if any. Upon surrender to the Trustee or
Paying Agent, such Notes called for redemption shall be paid on the Redemption
Date at the redemption price plus accrued interest thereon to the Redemption
Date from deposits made in accordance with Section 3.06 hereof, but installments
of interest, the maturity of which is on or prior to the Redemption Date, shall
be payable to Holders of record at the close of business on the relevant record
dates referred to in the Notes. Interest shall accrue on or after the
Redemption Date and shall be payable only if the Company defaults in payment of
the redemption price. If mailed in the manner set forth herein, the notice
shall be conclusively presumed to have been given whether or not the Holder
receives such notice.
SECTION 3.06. Deposit of Redemption Price.
---------------------------
On or before 11:00 a.m. New York City time on the Redemption Date and
in accordance with Section 2.14, the Company shall deposit with the Paying Agent
U.S. Legal Tender sufficient to pay the redemption price plus accrued interest,
if any, of all Notes to be redeemed on that date. The Paying Agent shall
promptly return to the Company any U.S. Legal Tender so deposited which is not
required for that purpose, except with respect to monies owed as obligations to
the Trustee pursuant to Article Seven.
Unless the Company fails to comply with the preceding paragraph and
defaults in the payment of such redemption price plus accrued interest, if any,
interest on the Notes to be re-
-45-
deemed will cease to accrue on and after the applicable Redemption Date, whether
or not such Notes are presented for payment.
SECTION 3.07. Notes Redeemed in Part.
----------------------
Upon surrender of a Note that is to be redeemed in part, the Trustee
shall authenticate for the Holder a new Note or Notes equal in principal amount
to the unredeemed portion of the Note surrendered.
SECTION 3.08. Sinking Fund
------------
There shall be no sinking fund for the payment of principal on the
Notes to the Holders.
ARTICLE FOUR
COVENANTS
---------
SECTION 4.01. Payment of Notes.
----------------
(a) The Company shall pay the principal of, premium, if any, and
interest on the Notes on the dates and in the manner provided in the Notes and
in this Indenture.
(b) An installment of principal of or interest on the Notes shall be
considered paid on the date it is due if the Trustee or Paying Agent (other than
the Company or any of its Affiliates) holds, prior to 11:00 a.m. New York City
time on that date, U.S. Legal Tender designated for and sufficient to pay the
installment in full and is not prohibited from paying such money to the Holders
pursuant to the terms of this Indenture or the Notes.
(c) Notwithstanding anything to the contrary contained in this
Indenture, the Company or its Agent may, to the extent it is required to do so
by law, deduct or withhold income or other similar taxes imposed by the United
States of America from principal or interest payments hereunder.
SECTION 4.02. Maintenance of Office or Agency.
-------------------------------
The Company shall maintain the office or agency required under Section
2.03. The Company shall give prior written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands
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may be made or served at the address of the Trustee set forth in Section 10.02.
SECTION 4.03. Corporate Existence.
-------------------
Except as provided in Article Five, the Company shall do or shall
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence and the corporate, partnership or other existence
of each of its Restricted Subsidiaries in accordance with the respective
organizational documents of the Company and its Restricted Subsidiaries and the
rights (charter and statutory) and material franchises of the Company and its
Restricted Subsidiaries; provided, however, that the Company shall not be
-------- -------
required to preserve, with respect to itself, any material right or franchise
and, with respect to any of its Restricted Subsidiaries, any such existence,
material right or franchise, if the Board of Directors of the Company shall
determine in good faith that the preservation thereof is no longer desirable in
the conduct of the business of the Company and its Subsidiaries taken as a
whole.
SECTION 4.04. Payment of Taxes and Other Claims.
---------------------------------
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (i) all material taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon the Company or any of the
Restricted Subsidiaries or properties of the Company or any of the Restricted
Subsidiaries and (ii) all material lawful claims for labor, materials and
supplies that, if unpaid, might by law become a Lien upon the property of the
Company or any of its Restricted Subsidiaries; provided, however, that the
-------- -------
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount, applicability
or validity is being contested in good faith by appropriate negotiations or
proceedings properly instituted and diligently conducted for which adequate
reserves, to the extent required under GAAP, have been taken.
SECTION 4.05. Maintenance of Properties and Insurance.
---------------------------------------
(a) The Company and each of its Restricted Subsidiaries shall cause
all material properties owned by or leased to it and used or useful in the
conduct of its business to be maintained and kept in normal condition, repair
and working order and supplied with all necessary equipment and shall cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of
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the Company or such Restricted Subsidiary may be necessary so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times; provided, however, that nothing in this Section 4.05 shall
-------- -------
of prevent the Company or any its Restricted Subsidiaries from discontinuing the
use, operation or maintenance of any of such properties, or disposing of any of
them, if such discontinuance or disposal is, in the judgment of the Board of
Directors of the Company or of the Board of Directors of the Restricted
Subsidiary concerned, or of an officer (or other agent employed by the Company
or any of its Restricted Subsidiaries) of the Company or such Restricted
Subsidiary having managerial responsibility for any such property, desirable in
the conduct of the business of the Company or any of its Restricted
Subsidiaries.
(b) The Company and its Restricted Subsidiaries shall cause to be
provided insurance (including appropriate self-insurance) against loss or damage
of the kinds that, in the good faith judgment of the respective Boards of
Directors or other governing body or officer of the Company or such Restricted
Subsidiaries, as the case may be, are adequate and appropriate for the conduct
of the business of the Company or such Restricted Subsidiaries, as the case may
be, with reputable insurers or with the government of the United States of
America or an agency or instrumentality thereof, in such amounts, with such
deductibles, and by such methods as shall be customary, in the good faith
judgment of the respective Boards of Directors or other governing body or
officer of the Company or such Restricted Subsidiary, as the case may be, for
companies similarly situated in the industry.
SECTION 4.06. Compliance Certificate; Notice of Default.
-----------------------------------------
(a) The Company shall deliver to the Trustee, within 90 days after
the end of its fiscal years, an Officers' Certificate (provided, however, that
-------- -------
one of the signatories to such Officers' Certificate shall be the Company's
principal executive officer, principal financial officer or principal accounting
officer), as to such Officers' knowledge of the Company's compliance with all
conditions and covenants under this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and in the event any Default
of the Company exists, such Officers shall specify the nature of such Default.
Each such Officers' Certificate shall also notify the Trustee should the Company
elect to change the manner in which it fixes its fiscal year end.
(b) (i) If any Default or Event of Default has occurred and is
continuing or (ii) if any Holder seeks to exercise any remedy hereunder with
respect to a claimed Default un-
-48-
der this Indenture or the Notes, the Company shall deliver to the Trustee, at
its address set forth in Section 10.02, by registered or certified mail or by
facsimile transmission followed by hard copy by registered or certified mail an
Officers' Certificate specifying such event, notice or other action within 10
days of its becoming aware of such occurrence.
SECTION 4.07. Compliance with Laws.
--------------------
The Company shall comply, and shall cause each of its Subsidiaries to
comply, with all applicable statutes, rules, regulations, orders and
restrictions of the United States of America, all states and municipalities
thereof and of any governmental department, commission, board, regulatory
authority, bureau, agency and instrumentality of the foregoing, in respect of
the conduct of their respective businesses and the ownership of their respective
properties, except for such noncompliances as could not singly or in the
aggregate reasonably be expected to have a material adverse effect on the
financial condition, business, prospects or results of operations of the Company
and its Subsidiaries taken as a whole.
SECTION 4.08. Provision of Financial Statements.
---------------------------------
So long as the Notes are outstanding, whether or not the Company is
subject to Section 13(a) or 15(d) of the Exchange Act, or any successor
provision thereto, the Company shall, to the extent permitted by Commission
practice and applicable law and regulations, file with the Commission the annual
reports, quarterly reports and other documents that the Company would have been
required to file with the Commission pursuant to such Section 13(a) or 15(d), or
any successor provision thereto, if the Company were so subject, such documents
to be filed with the Commission on or prior to the date (the "Required Filing
Date") by which the Company would have been required so to file such documents
if the Company were so subject.
The Company shall in any event (x) within 15 days of each Required
Filing Date, whether or not permitted or required to be filed with the
Commission, (i) transmit or cause to be transmitted by mail to all holders of
Notes, as their names and addresses appear in the security register and to any
other Person described in the TIA (S) 313(c), to the extent required by the TIA,
without cost to such holders and (ii) file with the Trustee, copies of the
annual reports, quarterly reports and other documents that the Company would
have been required to file with the Commission pursuant to Section 13(a) or
15(d) of the Exchange Act, or any successor provision thereto, if the Company
were subject to either of such Sections and (y) if fil-
-49-
ing such documents by the Company with the Commission is not permitted under the
Exchange Act, promptly upon written request and payment of the reasonable cost
of duplication and delivery, supply copies of such documents to any prospective
holder at the Company's cost.
In addition, for so long as any Notes remain outstanding, the Company
shall furnish to the holders of Notes and to securities analysts and prospective
investors, upon their request, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act, and, to any beneficial holder of
Notes, if not obtainable from the Commission, information of the type that would
be filed with the Commission pursuant to the foregoing provisions, upon the
request of any such holder. If any Subsidiary's financial statements would be
required to be included in the financial statements filed or delivered pursuant
hereto if the Company were subject to Section 13(a) or 15(d) of the Exchange
Act, the Company shall include such Subsidiary's financial statements in any
filing or delivery pursuant hereto.
SECTION 4.09. Waiver of Stay, Extension or Usury Laws.
---------------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law or any usury law
or other law that would prohibit or forgive the Company from paying all or any
portion of the principal of or interest on the Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) the Company hereby expressly waives all benefit or advantage of
any such law, and covenants that it 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.
SECTION 4.10. Limitation on Restricted Payments.
---------------------------------
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly:
(i) declare or pay any dividend or make any other distribution or
payment on or in respect of Capital Stock of the Company or any payment to
the direct or indirect holders (in their capacities as such) of Capital
Stock of the Company (other than dividends or distributions payable solely
in shares of Qualified Capital Stock of the Company
-50-
or in options, warrants or other rights to acquire shares of such Qualified
Capital Stock); or
(ii) purchase, redeem, defease or otherwise acquire or retire for
value, directly or indirectly, the Company's Capital Stock or any Capital
Stock of any Restricted Subsidiary (other than any such Capital Stock owned
by the Company or any Wholly-Owned Restricted Subsidiary); or
(iii) make any principal payment on, or purchase, repurchase,
redeem, defease, retire or otherwise acquire for value, prior to any
scheduled maturity, scheduled repayment, scheduled sinking fund payment or
other Stated Maturity, any Subordinated Indebtedness (other than any
Subordinated Indebtedness owed to and held by the Company or any Wholly-
Owned Restricted Subsidiary); or
(iv) make any Investment (other than any Permitted Investment) in
any Person (other than in the Company, any Wholly-Owned Restricted
Subsidiary or a Person that as a result of such Investment becomes a
Wholly-Owned Restricted Subsidiary, or is merged with or into or
consolidated with the Company or a Wholly-Owned Restricted Subsidiary
(provided the Company or a Wholly-Owned Restricted Subsidiary is the
survivor), as a result of or in connection with such Investment)
(any of the foregoing actions described in clauses (i) through (iv),
individually, a "Restricted Payment") (the amount of any such Restricted
Payment, if other than cash, shall be the Fair Market Value of the asset(s)
proposed to be transferred by the Company or such Restricted Subsidiary, as the
case may be, in each case, as determined by the Board of Directors of the
Company, whose determination shall be conclusive and evidenced by a board
resolution), unless (1) immediately before and immediately after giving effect
to such Restricted Payment on a pro forma basis, no Default shall have occurred
and be continuing; (2) immediately before and immediately after giving effect to
such Restricted Payment on a pro forma basis, the Company could incur $1.00 of
--- -----
additional Indebtedness (other than Permitted Indebtedness) under Section 4.12;
and (3) immediately after giving effect to the proposed Restricted Payment, the
aggregate amount of all such Restricted Payments (including any Designation
Amounts) declared or made after the Issue Date, does not exceed an amount equal
to the sum of without duplication:
(A) 50% of the cumulative Consolidated Net Income of the Company
during the period (treated as one accounting period) beginning on the first
day of the fiscal quarter beginning prior to the Issue Date and ending on
the last day of the Company's last fiscal quarter ending prior to
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the date of the Restricted Payment (or, if such aggregate cumulative
Consolidated Net Income shall be a deficit, minus 100% of such deficit);
plus
(B) the aggregate net cash proceeds received after the Issue Date by
the Company either (x) as capital contributions to the Company or (y) from
the issuance or sale (other than to any of the Restricted Subsidiaries) of
Qualified Capital Stock of the Company or from the exercise of any options,
warrants or rights to purchase such Qualified Capital Stock of the Company
(except, in each case, to the extent such proceeds are used to purchase,
redeem or otherwise retire Capital Stock or Subordinated Indebtedness as
set forth in clause (ii) or (iii) of paragraph (b) below and excluding the
net cash proceeds from any issuance and sale of Capital Stock or from any
such exercises, in each case, financed, directly or indirectly, using funds
borrowed from the Company or any Restricted Subsidiary until and to the
extent such borrowing is repaid); plus
(C) the aggregate net cash proceeds received after the Issue Date by
the Company from the conversion or exchange, if any, of Indebtedness of the
Company or its Subsidiaries into or for Qualified Capital Stock of the
Company, plus, whether or not such Indebtedness was issued prior to or
after the Issue Date, the aggregate of Net Cash Proceeds from their
original issuance, less any principal and sinking fund payments made
thereon; plus
(D) in the case of the disposition or repayment (in whole or in part)
of any Investment constituting a Restricted Payment made after the Issue
Date, an amount (to the extent not included in Consolidated Net Income)
equal to the lesser of the return of capital with respect to such
Investment and the initial amount of such Investment that was treated as a
Restricted Payment, in either case, less the cost of disposition of such
Investment and net of taxes; plus
(E) an amount in cash equal to the net cash proceeds of a sale by the
Company of all of a part of its interest in CST to an unaffiliated third
party; provided that such amount would not exceed the lesser of (x) the
book value of the portion of the Company's interest in CST being sold on
the balance sheet of the Company as of such sale date and (y) the Fair
Market Value of such portion of the Company's interest in CST; plus
(F) so long as the Designation thereof was treated as a Restricted
Payment made after the Issue Date, with
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respect to any Unrestricted Subsidiary that has been redesignated as a
Restricted Subsidiary after the Issue Date in accordance with Section 4.18,
the Fair Market Value of the Capital Stock of such Subsidiary owned by the
Company and the Restricted Subsidiaries, provided that such amount shall
not in any case exceed the Designation Amount with respect to such
Restricted Subsidiary upon its Designation; plus
(G) $20.0 million; and minus
(H) the greater of (i) $0 and (ii) the Designation Amount (measured
as of the date of Designation) with respect to any Subsidiary of the
Company that has been Designated as an Unrestricted Subsidiary after the
Issue Date in accordance with Section 4.18.
(b) Notwithstanding the foregoing, and in the case of clauses (ii)
through (v) below, so long as no Default or Event of Default shall have occurred
and be continuing or would arise therefrom, the foregoing provisions shall not
prohibit the following actions (each of clauses (i) through (v) being referred
to as a "Permitted Payment"):
(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at such date of declaration such payment was
permitted by the provisions of this Indenture;
(ii) the repurchase, redemption, or other acquisition or retirement
of any shares of any class of Capital Stock of the Company in exchange for
(including any such exchange pursuant to the exercise of a conversion right
or privilege in connection with which cash is paid in lieu of the issuance
of fractional shares or scrip), or out of the net cash proceeds of a
substantially concurrent issue and sale for cash to any Person (other than
to a Restricted Subsidiary) of, shares of Qualified Capital Stock of the
Company; provided that the net cash proceeds from the issuance of such
--------
shares of Qualified Capital Stock are excluded from clause (B) of the first
paragraph (a) of this Section;
(iii) the repurchase, redemption, defeasance, retirement or
acquisition for value or payment of principal of any Subordinated
Indebtedness in exchange for, or out of the net cash proceeds of a
substantially concurrent issuance and sale for cash to any Person (other
than to the Company or any Restricted Subsidiary) of, any Qualified Capital
Stock of the Company, provided that the net cash proceeds from the issuance
--------
of such shares of Qualified
-53-
Capital Stock are excluded from clause (B) of the first paragraph (a) of
this Section;
(iv) the repurchase, redemption, defeasance, retirement, refinancing,
acquisition for value or payment of principal of any Subordinated
Indebtedness (other than Redeemable Capital Stock) of the Company in
exchange for, or out of the net cash proceeds of a substantially concurrent
issuance and sale for cash to any Person (other than to a Restricted
Subsidiary) of, new Subordinated Indebtedness of the Company, provided that
--------
any such new Subordinated Indebtedness
(1) shall be in a principal amount that does not exceed the
principal amount so repurchased, redeemed, defeased, retired, acquired
or paid (or, if such Subordinated Indebtedness provides for an amount
less than the principal amount thereof to be due and payable upon a
declaration of acceleration thereof, then such lesser amount as of the
date of determination), plus the amount of any stated or reasonably
determined prepayment premium paid in connection with such repurchase,
redemption, defeasance, retirement, acquisition or payment, plus the
amount of expenses of the Company and the Restricted Subsidiaries
incurred in connection with such repurchase, redemption, defeasance,
retirement, acquisition or payment;
(2) has an Average Life to Stated Maturity equal to or greater
than the Average Life to Stated Maturity of the Subordinated
Indebtedness being repurchased, redeemed, defeased, retired, acquired
or paid; and
(3) is expressly subordinated in right of payment to the Notes
at least to the same extent as the Subordinated Indebtedness to be
repurchased, redeemed, defeased, retired, acquired or paid; and
(v) the payment of dividends on the Class C Preferred Stock of the
Company as in effect on the Issue Date not to exceed $3.0 million in any
given year.
In computing the amount of Restricted Payments previously made for
purposes of clause (3) of the first paragraph (a) of this Section, Restricted
Payments under the immediately preceding clause (i) shall be included (but only
to the extent the related dividend declaration is not so included). If the
Company makes a Restricted Payment that, at the time of the making of such
Restricted Payment would in the good faith determination of the Company be
permitted under the provisions of
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the Indenture, such Restricted Payment shall be deemed to have been made in
compliance with the Indenture notwithstanding any subsequent adjustments made in
good faith to the Company's financial statements affecting Consolidated Net
Income of the Company for any period.
SECTION 4.11. Limitations on Transactions
with Affiliates.
---------------------------
The Company shall not, and shall not permit, cause or suffer any
Restricted Subsidiary to, conduct any business or enter into any transaction (or
series of related transactions that are similar or part of a common plan) with
or for the benefit of any of their respective Affiliates or any beneficial
holder of 10% or more of the Common Stock of the Company or any officer or
director of the Company (each, an "Affiliate Transaction"), unless the terms of
the Affiliate Transaction are set forth in writing, and are fair and reasonable
to the Company or such Restricted Subsidiary, as the case may be. Each Affiliate
Transaction involving aggregate payments or other Fair Market Value in excess of
$2.5 million shall be approved by a majority of the Board of Directors of the
Company, such approval to be evidenced by a Board Resolution stating that the
Board of Directors of the Company has determined that such transaction or
transactions comply with the foregoing provisions. In addition to the foregoing,
each Affiliate Transaction involving aggregate consideration of $10.0 million or
more shall be approved by a majority of the Disinterested Directors; provided
that, in lieu of such approval by the Disinterested Directors, the Company may
obtain a written opinion from an Independent Financial Advisor stating that the
terms of such Affiliate Transaction to the Company or the Restricted Subsidiary,
as the case may be, are fair from a financial point of view.
Notwithstanding the foregoing, the restrictions set forth in this
covenant shall not apply to
(i) transactions with or among the Company and any Restricted
Subsidiary or between or among Restricted Subsidiaries;
(ii) customary directors' fees, indemnification and similar
arrangements, consulting fees, employee salaries, bonuses or employment
agreements, compensation or employee benefit arrangements and incentive
arrangements with any officer, director or employee of the Company entered
into in the ordinary course of business (including customary benefits
thereunder) and payments under any indemnification arrangements permitted
by applicable law;
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(iii) any transactions undertaken pursuant to any other
contractual obligations in existence on the Issue Date (as in effect on the
Issue Date) and any renewals, replacements or modifications of such
obligations (pursuant to new transactions or otherwise) with suppliers on
terms no less favorable than such supplier could receive from an
unaffiliated third party;
(iv) any Restricted Payments made in compliance with Section
4.10;
(v) loans, advances and reimbursements to officers, directors
and employees of the Company and the Restricted Subsidiaries for travel,
entertainment, moving and other relocation expenses, in each case made in
the ordinary course of business and consistent with past business
practices;
(vi) the pledge of any Capital Stock of Unrestricted Subsidiaries
to support the Indebtedness thereof;
(vii) the sale of products, property or services by any Person to
the Company or a Restricted Subsidiary, or by the Company or any Restricted
Subsidiary to any Person, in the ordinary course of business; and
(viii) the issuance and sale by the Company of Qualified Capital
Stock.
SECTION 4.12. Limitation on Indebtedness.
--------------------------
The Company shall not, and shall not permit any of the Restricted
Subsidiaries to, directly or indirectly, create, incur, assume, issue, guarantee
or in any manner become liable for or with respect to, contingently or otherwise
(in each case, to "incur"), the payment of any Indebtedness (including any
Acquired Indebtedness); provided, however, that (i) the Company may incur
-------- -------
Indebtedness (including Acquired Indebtedness) and (ii) a Restricted Subsidiary
may incur Acquired Indebtedness, if, in either case, immediately after giving
pro forma effect thereto, the Consolidated Fixed Charge Coverage Ratio of the
Company is at least equal to 2.5:1.0.
Notwithstanding the foregoing, the Company and, to the extent set
forth below, the Restricted Subsidiaries may incur each and all of the following
(collectively, "Permitted Indebtedness"):
(i) Indebtedness of the Company under the Credit Facility in an
aggregate principal amount at any one time outstanding not to exceed $130.0
million;
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(ii) Indebtedness of the Company pursuant to the Notes and this
Indenture;
(iii) Indebtedness of the Company and any Restricted Subsidiary
outstanding on the Issue Date;
(iv) (a) Indebtedness of a Wholly-Owned Restricted Subsidiary
owing to and held by the Company or another Wholly-Owned Restricted
Subsidiary that is unsecured; provided that (a) any disposition, pledge or
transfer of any such Indebtedness to a Person (other than the Company or a
Wholly-Owned Restricted Subsidiary) shall be deemed to be an incurrence of
such Indebtedness by the obligor not permitted by this clause (iv), and (b)
any transaction pursuant to which any Wholly-Owned Restricted Subsidiary,
which has Indebtedness owing to the Company or any other Wholly-Owned
Restricted Subsidiary, ceases to be a Wholly-Owned Restricted Subsidiary
shall be deemed to be the incurrence of Indebtedness by such Wholly-Owned
Restricted Subsidiary that is not permitted by this clause (iv);
(v) Indebtedness of the Company or any Restricted Subsidiary
under Interest Rate Agreements not entered into for speculative purposes
covering Indebtedness of the Company or such Restricted Subsidiary;
provided, however, that such Interest Rate Agreements do not increase the
-------- -------
Indebtedness or other obligations of the Company outstanding other than as
a result of fluctuations in interest rates or by reason of fees,
indemnities and compensation payable thereunder;
(vi) Indebtedness of the Company or any Restricted Subsidiary
under Currency Agreements relating to (a) Indebtedness of the Company or
such Restricted Subsidiary and/or (b) obligations to purchase or sell
assets or properties, in each case, incurred in the ordinary course of
business of the Company; provided, however, that such Currency Agreements
-------- -------
do not increase the Indebtedness or other obligations of the Company
outstanding other than as a result of fluctuations in foreign currency
exchange rates or by reason of fees, indemnities and compensation payable
thereunder;
(vii) Indebtedness of the Company or any Restricted Subsidiary
under Commodity Price Protection Agreements relating to (a) Indebtedness of
the Company or such Restricted Subsidiary and/or (b) obligations to
purchase or sell assets or properties, in each case, incurred in the
ordinary course of business of the Company; provided, however, that such
-------- -------
Commodity Price Protection Agreements do not increase the Indebtedness or
other obligations of the
-57-
Company outstanding other than as a result of fluctuations in foreign
currency exchange rates or by reason of fees, indemnities and compensation
payable thereunder;
(viii) Indebtedness of the Company represented by Capitalized Lease
Obligations or Purchase Money Obligations or other Indebtedness incurred or
assumed in connection with the acquisition or development of real or
personal property in each case incurred for the purpose of financing or
refinancing all or any part of the purchase price or cost of construction
or improvement of property used in the business of the Company (whether
through the direct purchase of assets or the purchase of Capital Stock of
any Person owning such assets and whether such Indebtedness is owed to the
seller or Person carrying out such construction or improvement or to any
third party), in an aggregate principal amount pursuant to this clause
(viii) not to exceed $25.0 million outstanding at any one time; provided,
--------
that the principal amount of any Indebtedness permitted under this clause
(viii) did not in each case at the time of incurrence exceed the Fair
Market Value of the acquired or constructed asset or improvement so
financed;
(ix) reimbursement obligations under letters of credit in the
ordinary course of business consistent with past practice (including
without limitation letters of credit in respect of workers compensation
obligations and bankers acceptances and performance bonds, surety bonds and
performance guarantees, of the Company or any Restricted Subsidiary);
(x) Capital Expenditure Indebtedness not to exceed $50.0 million
outstanding at any one time in the aggregate; provided that the principal
--------
amount of any such Indebtedness incurred pursuant to this clause (x) does
not exceed the Fair Market Value (on the date of such incurrence) of the
property acquired, constructed or leased;
(xi) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
drawn against insufficient funds in the ordinary course of business;
provided, however, that such Indebtedness is extinguished within three
business days of incurrence;
(xii) Indebtedness of the Company or any Restricted Subsidiary
consisting of indemnities or obligations in respect of purchase price
adjustments in connection with the disposition of assets;
-58-
(xiii) any renewals, extensions, substitutions, refundings,
refinancings or replacements (collectively, a "refinancing") of any
Indebtedness incurred under the first paragraph of this Section or clause
(ii) and (iii) above, including any successive refinancings so long as the
aggregate principal amount of Indebtedness represented thereby is not
increased by such refinancing, plus the amount of any stated or reasonably
determined prepayment premium paid in connection with such a refinancing,
plus the amount of expenses of the Company or a Restricted Subsidiary
incurred in connection with such refinancing and (A) in the case of any
refinancing of Indebtedness that is Subordinated Indebtedness, such new
Indebtedness is subordinated to the Notes at least to the same extent as
the Indebtedness being refinanced and (B) such new Indebtedness has an
Average Life to Stated Maturity equal to or greater than the Average Life
to Stated Maturity of the Subordinated Indebtedness being repurchased,
redeemed, defeased, retired, acquired or paid; and
(xiv) Indebtedness of the Company in addition to that described in
clauses (i) through (xiii) above (including any Indebtedness incurred under
the Credit Facility) not to exceed $25.0 million outstanding at any one
time in the aggregate.
SECTION 4.13. Limitation on Dividend and
Other Payment Restrictions
Affecting Restricted Subsidiaries.
---------------------------------
The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective or enter into any agreement with any Person that would
cause to become effective, any consensual encumbrance or restriction of any
kind, on the ability of any Restricted Subsidiary to
(i) pay dividends, in cash or otherwise, or make any other
distribution on or in respect of its Capital Stock or any other interest or
participation in, or measured by, its profits, to the Company or any other
Restricted Subsidiary,
(ii) pay any Indebtedness owed to the Company or any other
Restricted Subsidiary,
(iii) make any Investment in the Company or any other Restricted
Subsidiary or
(iv) transfer any of its properties or assets to the Company or
any other Restricted Subsidiary, except for:
-59-
(a) any encumbrance or restriction existing under any agreement
in effect on the Issue Date;
(b) customary non-assignment provisions in any contract or lease
entered into in the ordinary course of business;
(c) any encumbrance or restriction, with respect to a Subsidiary
that is not a Restricted Subsidiary of the Company on the Issue Date, in
existence at the time such Person becomes a Restricted Subsidiary of the
Company and not incurred in connection with, or in contemplation of, such
Person becoming a Restricted Subsidiary; provided, however, that such
-------- -------
encumbrances and restrictions are not applicable to the Company or any
other Restricted Subsidiary, or the properties or assets of the Company or
any other Restricted Subsidiary; and
(d) any encumbrance or restriction existing under any agreement
that extends, renews, refinances or replaces the agreements containing the
encumbrances or restrictions in the foregoing clauses (a), (b) and (c), or
in this clause (d), provided that the terms and conditions of any such
--------
encumbrances or restrictions are no more restrictive in any material
respect than those under or pursuant to the agreement evidencing the
Indebtedness so extended, renewed, refinanced or replaced.
SECTION 4.14. Change of Control.
-----------------
(a) Following the occurrence of a Change of Control (the date of
such occurrence being the "Change of Control Date"), the Company shall, within
30 days after the Change of Control Date, make an offer to purchase (a "Change
of Control Offer") all of the then outstanding Notes at a purchase price (the
"Change of Control Purchase Price") in cash equal to 101% of the principal
amount thereof, plus accrued and unpaid interest thereon, if any, to the
purchase date. The Company shall be required to purchase all Notes properly
tendered in the Change of Control Offer and not withdrawn.
(b) Within 30 days following the date upon which the Change of
Control occurred, the Company shall mail, or cause the Trustee to mail, by first
class mail, a notice to each Holder at such Holder's last registered address,
with a copy to the Trustee, if applicable, which notice shall govern the terms
of the Change of Control Offer. The notice to the Holders shall contain all
instructions and materials necessary to en-
-60-
able such Holders to tender Notes pursuant to the Change of Control Offer. Such
notice shall state:
(i) that the Change of Control Offer is being made pursuant to
this Section 4.14 and that all Notes tendered and not withdrawn shall be
accepted for payment;
(ii) the purchase price (including the amount of accrued
interest) and the purchase date (which shall be no earlier than 30 days nor
later than 45 days from the date such notice is mailed, other than as may
be required by law) (the "Change of Control Payment Date");
(iii) that any Note not tendered shall continue to accrue interest;
(iv) that, unless the Company defaults in making payment therefor,
any Note accepted for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Payment Date;
(v) that Holders electing to have a Note purchased pursuant to a
Change of Control Offer shall be required to surrender the Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Note completed, to the Paying Agent at the address specified in the notice
prior to the close of business on the third business day prior to the
Change of Control Payment Date;
(vi) that Holders shall be entitled to withdraw their election if
the Paying Agent receives, not later than the second business day prior to
the Change of Control Payment Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Notes the Holder delivered for purchase and a statement that
such Holder is withdrawing his election to have such Notes purchased;
(vii) that Holders whose Notes are purchased only in part shall be
issued new Notes in a principal amount equal to the unpurchased portion of
the Notes surrendered; provided, however, that each Note purchased and each
-------- -------
new Note issued shall be in an original principal amount of $1,000 or
integral multiples thereof; and
(viii) the circumstances and relevant facts regarding such Change of
Control.
On the Change of Control Payment Date, the Company shall, to the
extent permitted by law, (i) accept for payment all Notes or portions thereof
properly tendered pursuant to the
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Change of Control Offer, (ii) deposit with the Paying Agent an amount equal to
the aggregate Change of Control Payment in respect of all Notes or portions
thereof so tendered and (iii) deliver, or cause to be delivered, to the Trustee
for cancellation the Notes so accepted together with an Officers' Certificate
stating that such Notes or portions thereof have been tendered to and purchased
by the Company. The Paying Agent will promptly either (x) pay to the Holder
against presentation and surrender (or, in the case of partial payment,
endorsement) of the Global Notes or (y) in the case of Certificated Securities,
mail to each Holder of Notes the Change of Control Payment for such Notes, and
the Trustee will promptly authenticate and deliver to the Holder of the Global
Notes a new Global Note or Notes or, in the case of Certificated Securities,
mail to each Holder new Certificated Securities, as applicable, equal in
principal amount to any unpurchased portion of the Notes surrendered, if any,
provided that each new Certificated Security will be in a principal amount of
$1,000 or an integral multiple thereof. The Company will notify the Trustee and
the Holders of the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.
Neither the Board of Directors of the Company nor the Trustee may
waive the provisions of this Section 4.14 relating to the Company's obligation
to make a Change of Control Offer or a Holder's right to redemption upon a
Change of Control.
The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes pursuant to a Change of Control Offer. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of this Section 4.14, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached their
obligations under the provisions of this Section 4.14 by virtue thereof.
SECTION 4.15. Disposition of Proceeds of Asset Sales.
--------------------------------------
The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, consummate an Asset Sale unless (i) at
least 75% of the consideration from such Asset Sale is received in cash, Cash
Equivalents or Liquid Assets (or any combination thereof) and (ii) the Company
or such Restricted Subsidiary receives consideration at the time of such Asset
Sale at least equal to the Fair Market Value of the shares or assets subject to
such Asset Sale.
-62-
The Company or the applicable Restricted Subsidiary, as the case may
be, shall, at the Company's option,
(i) apply the Net Cash Proceeds from such Asset Sale within 360
days of the receipt thereof to repay Indebtedness under the Credit Facility
and elect to permanently reduce the commitments thereunder by the amount of
Indebtedness so repaid,
(ii) apply the Net Cash Proceeds from such Asset Sale within 360
days of the receipt thereof to repay an amount of other Indebtedness (other
than Subordinated Indebtedness) of the Company in an amount not exceeding
the Other Senior Debt Pro Rata Share and, if applicable, elect to
permanently reduce the amount of the commitments thereunder by the amount
of the Indebtedness so repaid,
(iii) apply the Net Cash Proceeds from such Asset Sale within 360
days of the receipt thereof to repay any Restricted Subsidiary Indebtedness
and, if applicable, elect to permanently reduce the commitments thereunder
by the amount of the Indebtedness so repaid or
(iv) apply such Net Cash Proceeds within 360 days thereof to an
investment in properties and assets that will be used in the same line of
business of the Company or any Restricted Subsidiary or in businesses
reasonably related thereto (or in Capital Stock and other securities of any
person that will become a Restricted Subsidiary as a result of such
investment to the extent such person owns properties and assets that will
be used in the business of the Company or its Subsidiaries existing on the
Issue Date or in businesses reasonably related thereto) ("Replacement
Assets").
Any Net Cash Proceeds from any Asset Sale that are neither used to
repay, and permanently reduce the commitments under, any Indebtedness of the
Company or any Restricted Subsidiary Indebtedness as set forth in clauses (i),
(ii) or (iii), respectively, of the preceding sentence or invested in
Replacement Assets within the 360-day period as set forth in clause (iv) shall
constitute "Offer Excess Proceeds."
When the aggregate amount of Offer Excess Proceeds equals or exceeds
$10.0 million, the Company shall make an offer to purchase (an "Asset Sale
Offer"), from all holders of the Notes, that aggregate principal amount of Notes
as can be purchased by application of the entire amount of such Offer Excess
Proceeds (and not just the amount in excess of $10.0 million) at a price in cash
equal to 100% of the principal amount thereof on any purchase date (the "Net
Proceeds Payment Date"),
-63-
plus accrued and unpaid interest, if any,to any purchase date. Each Asset Sale
Offer shall remain open for a period of 20 business days or such longer period
as may be required by law. To the extent that the principal amount of Notes
tendered pursuant to an Asset Sale Offer is less than the Offer Excess Proceeds,
the Company or any Restricted Subsidiary may use such deficiency for any purpose
consistent with other terms of this Indenture. If the principal amount of Notes
validly tendered and not withdrawn by holders thereof exceeds the amount of
Notes that can be purchased with the Offer Excess Proceeds, Notes to be
purchased will be selected on a pro rata basis. Upon completion of such Asset
________
Sale Offer, the amount of Offer Excess Proceeds shall be reset to zero.
If the Asset Sale Offer is on or after a Record Date and on or before
the related Interest Payment Date, any accrued interest shall be paid to the
Person in whose name a Note is registered at the close of business on such
Record Date, and no additional interest shall be payable to Holders who tender
Notes pursuant to the Asset Sale Offer.
The notice, which shall govern the terms of the Asset Sale Offer,
shall include such disclosures as are required by law and shall state:
(v) that the Asset Sale Offer is being made pursuant to this Section
4.15;
(vi) the purchase price (including the amount of accrued interest,
if any) to be paid for Notes purchased pursuant to the Asset Sale Offer and
the purchase date;
(vii) that any Note not tendered for payment will continue to accrue
interest in accordance with the terms thereof;
(viii) that, unless the Company defaults on making the payment, any Note
accepted for payment pursuant to the Net Proceeds Offer shall cease to
accrue interest after the Net Proceeds Payment Date;
(ix) that Holders accepting the Offer to have their Notes purchased
pursuant to the Asset Sale Offer will be required to surrender their Notes
to the Paying Agent at the address specified in the notice prior to the
close of business on the purchase date;
(x) that Holders will be entitled to withdraw their acceptance if the
Paying Agent receives, not later than the close of business on the second
Business Day prior to the purchase date, a facsimile transmission or letter
set-
-64-
ting forth the name of the Holder, the principal amount of the Notes the
Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Notes purchased;
(xi) that Holders whose Notes are purchased only in part will be
issued new Notes in a principal amount equal to the unpurchased portion of
the Notes surrendered; provided that each Note purchased and each such new
--------
Note issued shall be in an original principal amount in denominations of
$1,000 and integral multiples thereof;
(xii) any other procedures that a Holder must follow to accept an Asset
Sale Offer or effect withdrawal of such acceptance; and
(xiii) the name and address of the Paying Agent.
On the Net Proceeds Payment Date, the Company shall (i) accept for
payment Notes or portions thereof tendered pursuant to the Asset Sale Offer in
accordance with this Section 4.15, (ii) deposit with the Paying Agent U.S. Legal
Tender sufficient to pay the purchase price, plus accrued interest, if any, of
all Notes to be purchased in accordance with this Section 4.15 and (iii) deliver
to the Trustee Notes so accepted together with an Officers' Certificate stating
the Notes or portions thereof tendered to and accepted for payment by the
Company.
For purposes of this Section 4.15, the Trustee shall act as the Paying
Agent. The Paying Agent shall promptly (but in any case no later than 10
calendar days after the Net Proceeds Payment Date) mail or deliver to the
Holders of Notes so accepted payment in an amount equal to the purchase price
for such Notes, and the Company shall execute and issue, and the Trustee shall
promptly authenticate and mail to such Holders, a new Note equal in principal
amount to any unpurchased portion of the Note surrendered; provided that each
--------
such new Note shall be issued in an original principal amount in denominations
of $1,000 and integral multiples thereof. The Company will send to the Trustee
and the Holders of Notes on or as soon as practicable after the purchase date a
notice setting forth the results of the Asset Sale Offer. Any Notes not so
accepted shall be promptly mailed or delivered by the Company to the Holder
thereof.
The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provi-
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sions of any securities laws or regulations conflict with the "Asset Sale"
provisions of this Indenture, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under this Section 4.15 by virtue thereof.
SECTION 4.16. Limitation on Liens.
-------------------
The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, create, incur, assume or suffer to exist
any Lien of any kind upon any of its property or assets, whether now owned or
acquired after the Issue Date, or any proceeds therefrom, or assign or convey
any right to receive income therefrom to secure either (i) Subordinated
Indebtedness or (ii) any Indebtedness of the Company that is not Subordinated
Indebtedness, unless the Notes are equally and ratably secured with the Liens
securing such other Indebtedness, except in the case of this clause (ii),
Permitted Liens.
SECTION 4.17. Limitation of Issuances and Sale of Capital Stock of
Restricted Subsidiaries
----------------------------------------------------
The Company shall not sell and shall not cause or permit any
Restricted Subsidiary of the Company to issue, sell or transfer any Preferred
Stock of any Restricted Subsidiary (other than to the Company or to a Wholly-
Owned Restricted Subsidiary) or permit any Person (other than the Company or a
Wholly-Owned Restricted Subsidiary) to own any Preferred Stock of any Restricted
Subsidiary. In addition, the Company shall not sell or otherwise dispose of any
Capital Stock of a Restricted Subsidiary, and shall not permit any Restricted
Subsidiary, directly or indirectly, to issue or sell or otherwise dispose of any
of its Capital Stock, except
(i) to the Company or a Wholly Owned Subsidiary,
(ii) if, 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 and
(iii) if, immediately after giving effect to such issuance, sale
or other disposition, such Restricted Subsidiary would no longer constitute
a Wholly Owned Restricted Subsidiary and any Investment in such Person
remaining after giving effect thereto would have been permitted to be made
(and shall be deemed to have been made) under Section 4.10 on the date of
such issuance, sale or other disposition.
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SECTION 4.18. Limitation on Unrestricted
Subsidiaries.
--------------------------
The Company shall not make, and shall not permit its Restricted
Subsidiaries to make, any Investment in Unrestricted Subsidiaries if, at the
time thereof, the aggregate amount of such Investments would exceed the amount
of Restricted Payments then permitted to be made pursuant to Section 4.10. Any
Investments in Unrestricted Subsidiaries permitted to be made pursuant to this
Section 4.18 (i) will be treated as a Restricted Payment in calculating the
amount of Restricted Payments made by the Company and (ii) may be made in cash
or property.
The Company may designate after the Issue Date any Subsidiary as an
"Unrestricted Subsidiary" under this Indenture (a "Designation") only if:
(i) no Default shall have occurred and be continuing at the time of
or after giving effect to such Designation;
(ii) the Company would be permitted to make an Investment at the
time of Designation (assuming the effectiveness of such Designation)
pursuant to Section 4.10 in an amount (the "Designation Amount") equal to
the Fair Market Value of the Company's interest in such Subsidiary on such
date calculated in accordance with GAAP; and
(iii) the Company would be permitted under this Indenture to incur
$1.00 of additional Indebtedness (other than Permitted Indebtedness)
pursuant to Section 4.12 at the time of such Designation (assuming the
effectiveness of such Designation).
In the event of any such Designation, the Company shall be deemed to
have made an Investment constituting a Restricted Payment pursuant to Section
4.10 for all purposes of this Indenture in the Designation Amount.
The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, at any time
(x) provide credit support for or subject any of its property or
assets (other than the Capital Stock of any Unrestricted Subsidiary) to the
satisfaction of, any Indebtedness of any Unrestricted Subsidiary (including
any undertaking, agreement or instrument evidencing such Indebtedness),
(y) be directly or indirectly liable for any Indebtedness of any
Unrestricted Subsidiary or
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(z) be directly or indirectly liable for any Indebtedness (other than
Indebtedness pursuant to the Credit Facility) which provides that the
holder thereof may (upon notice, lapse of time or both) declare a default
thereon or cause the payment thereof to be accelerated or payable prior to
its final scheduled maturity upon the occurrence of a default with respect
to any Indebtedness of any Unrestricted Subsidiary (including any right to
take enforcement action against such Unrestricted Subsidiary),
except (i) any non-recourse guarantee given solely to support the pledge by the
Company or any Restricted Subsidiary of the Capital Stock of an Unrestricted
Subsidiary and (ii) in the case of (x) and (y), to the extent permitted under
Section 4.10. All Subsidiaries of Unrestricted Subsidiaries shall automatically
be deemed to be Unrestricted Subsidiaries.
The Company may revoke any Designation of a Subsidiary as an
Unrestricted Subsidiary (a "Revocation") if:
(i) no Default shall have occurred and be continuing at the time of
and after giving effect to such Revocation;
(ii) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if incurred at
such time, have been permitted to be incurred for all purposes of the
Indenture; and
(iii) any transaction (or series of related transactions) between
such Subsidiary and any of its Affiliates that occurred while such Subsidiary
was an Unrestricted Subsidiary would be permitted by Section 4.11 as if such
transaction (or series of related transactions) had occurred at the time of such
Revocation.
All Designations and Revocations must be evidenced by Board
Resolutions of the Company delivered to the Trustee certifying compliance with
the foregoing provisions.
SECTION 4.19. Limitation on Sale and Lease-Back
Transactions.
---------------------------------
The Company shall not, and shall not permit any Restricted Subsidiary
to, enter into any Sale and Lease-Back Transaction unless (i) the consideration
received in such Sale and Lease-Back Transaction is at least equal to the Fair
Market Value of the property sold, and (ii) the Company could incur the
Attributable Indebtedness in respect of such Sale and Lease-Back Transaction in
compliance with Section 4.12.
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SECTION 4.20. Application of Fall Away Covenants.
----------------------------------
If no Default has occurred and is continuing, after the rating assigned to the
Notes by both of the Rating Agencies are Investment Grade and remain as such,
the Company and the Restricted Subsidiaries will not be subject to Sections
4.10, 4.11, 4.12, 4.13, 4.15, 4.17, 4.18 and clause (iii) of the first paragraph
of Section 5.01. Once the Company and the Restricted Subsidiaries are no longer
subject to the above-mentioned provisions, all of the Company's Subsidiaries
other than CSI Foreign Sales Corporation will be Restricted Subsidiaries.
ARTICLE FIVE
SUCCESSOR CORPORATION
---------------------
SECTION 5.01. Consolidation, Merger, Sale of Asset, Etc.
-----------------------------------------
The Company shall not, in any transaction or series of related
transactions, merge or consolidate with or into, or sell, assign, convey,
transfer, lease or otherwise dispose of all or substantially all of its
properties and assets as an entirety to, any Person or Persons, and the Company
shall not permit any of the Restricted Subsidiaries to enter into any such
transaction or series of related transactions if such transaction or series of
related transactions, in the aggregate, would result in a sale, assignment,
conveyance, transfer, lease or other disposition of all or substantially all of
the properties and assets of the Company and the Restricted Subsidiaries (taken
as a whole), to any Person or Persons, unless at the time and after giving
effect thereto
(i) either (A)(1) if the transaction or transactions is a merger or
consolidation involving the Company, the Company shall be the Surviving
Person of such merger or consolidation or (2) if the transaction or
transactions is a merger or consolidation involving a Restricted
Subsidiary, such Restricted Subsidiary shall be the Surviving Person of
such merger or consolidation, or (B)(1) the Surviving Person shall be a
corporation organized and existing under the laws of the United States of
America, any State thereof or the District of Columbia and (2) in the case
of a transaction involving the Company, the Surviving Person shall
expressly assume by a supplemental indenture executed and delivered to the
Trustee, in form satisfactory to the Trustee, all the obligations of the
Company
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under the Notes and this Indenture and the Registration Rights Agreement,
and in each case, this Indenture, the Notes and the Registration Rights
Agreement shall remain in full force and effect;
(ii) immediately after giving effect to such transaction or series
of related transactions on a pro forma basis, no Default or Event of
--- -----
Default shall have occurred and be continuing;
(iii) the Company, or the Surviving Person, as the case may be,
immediately after giving effect to such transaction or series of related
transactions on a pro forma basis (including, without limitation, any
--- -----
Indebtedness incurred or anticipated to be incurred in connection with or
in respect of such transaction or series of transactions), could incur
$1.00 of additional Indebtedness (other than Permitted Indebtedness) under
Section 4.12;
(iv) immediately after giving effect to such transaction or series
of related transactions on a pro forma basis, the Company, or the Surviving
--- -----
Person, as the case may be, shall have a Consolidated Net Worth not less
than the Consolidated Net Worth of the Company immediately prior to such
transaction or series of related transactions; and
(v) at the time of the transaction if any of the property or assets
of the Company or any of its Restricted Subsidiaries would thereupon become
subject to any Lien, Section 4.16 is complied with.
In connection with any consolidation, merger, transfer, lease or other
disposition contemplated hereby, the Company shall deliver, or cause to be
delivered, to the Trustee, in form and substance reasonably satisfactory to the
Trustee, an Officers' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, transfer, lease or other disposition and the
supplemental indenture in respect thereof comply with the requirements under
this Indenture.
Upon any consolidation or merger of the Company or any transfer of all
or substantially all of the assets of the Company in accordance with the
foregoing, in which the Company is not the Surviving Person, the Surviving
Person shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture and the Notes and the
Registration Rights Agreement, with the same effect as if such successor
corporation had been named as the Company therein; and thereafter, except in the
case of (a) a lease of substantially all of the assets of the Company or (b) any
sale, assignment, conveyance, transfer, lease or other disposition to
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a Restricted Subsidiary of the Company, the Company shall be discharged from all
obligations and covenants under this Indenture and the Notes.
For all purposes of this Indenture and the Notes (including the
provision of this Section and Sections 4.10, 4.12 and 4.16), Subsidiaries of any
Surviving Person shall, upon such transaction or series of related transactions,
become Restricted Subsidiaries unless and until designated as Unrestricted
Subsidiaries pursuant to and in accordance with Section 4.18 and all
Indebtedness, and all Liens on property or assets, of the Company and the
Restricted Subsidiaries in existence immediately prior to such transaction or
series of related transactions will be deemed to have been incurred upon such
transaction or series of related transactions.
ARTICLE SIX
REMEDIES
--------
SECTION 6.01. Events of Default.
-----------------
An "Event of Default" means any of the following events:
(a) the Company defaults in the payment of the principal of or
premium, if any, when due and payable, on any of the Notes (at its Stated
Maturity, upon optional redemption, acceleration, required purchase,
sinking fund, scheduled principal payment or otherwise); or
(b) the Company defaults in the payment of an installment of
interest on any of the Notes, when due and payable, continued for 30 days
or more; or
(c) the Company fails to comply with any of its obligations
described under Section 5.01, Section 4.14 or Section 4.15; or
(d) the Company fails to perform or observe any other term,
covenant or agreement contained in the Notes or this Indenture (other than
a default specified in (a), (b) or (c) above) for a period of 45 days after
written notice of such failure requiring the Company to remedy the same
shall have been given (x) to the Company by the Trustee or (y) to the
Company and the Trustee by the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding; or
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(e) the Company or any Restricted Subsidiary defaults under one or
more agreements, indentures or instruments under which the Company or any
Restricted Subsidiary then has outstanding Indebtedness in excess of $10.0
million individually or in the aggregate and either (i) such Indebtedness
is already due and payable in full or (ii) such default or defaults results
in the actual acceleration of the maturity of such Indebtedness; provided,
--------
however, that no such default under any Interest Rate Agreement, Currency
-------
Agreement or Commodity Price Protection Agreement shall by itself
constitute an Event of Default hereunder unless such default consists of
the failure by the Company or any Restricted Subsidiary to pay when due any
net cash amounts actually due to the counterparty to such Interest Rate
Agreement, Currency Agreement or Commodity Price Protection Agreement;
provided, further, that a payment default described in the immediately
-------- -------
preceding proviso shall not constitute an Event of Default unless and until
such payment default continues for 30 days or more, if the acceleration or
termination event giving rise to the applicable payment obligation by the
Company or such Subsidiary was not a result of any default, action or
inaction by the Company or such Subsidiary; or
(f) one or more judgments, orders or decrees of any court or
regulatory or administrative agency for the payment of money in excess of
$10.0 million either individually or in the aggregate shall have been
rendered against the Company or any Restricted Subsidiary or any of their
respective properties and shall not have been discharged and there shall
have been a period of 60 consecutive days during which a stay of
enforcement of such judgment, order or decree, by reason of a pending
appeal or otherwise, shall not be in effect; or
(g) the Company or any of its Material Subsidiaries pursuant to or
under or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it
in an involuntary case or proceeding;
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property;
(iv) makes a general assignment for the benefit of its
creditors; or
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(v) shall generally not pay its debts when such debts become
due or shall admit in writing its inability to pay its debts
generally; or
(h) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(i) is for relief against the Company or any of its Material
Subsidiaries in an involuntary case or proceeding,
(ii) appoints a Custodian of the Company or any of its
Material Subsidiaries for all or substantially all of their properties
taken as a whole, or
(iii) orders the liquidation of the Company or any of its
Material Subsidiaries,
and in each case the order or decree remains unstayed and in effect for 60
days.
SECTION 6.02. Acceleration.
------------
If an Event of Default (other than as specified in clauses (g) or (h)
with respect to the Company or any Material Subsidiary) shall occur and be
continuing, the Trustee, by notice to the Company, or the Holders of at least
25% in aggregate principal amount of the Notes then outstanding, by notice to
the Trustee and the Company, may declare the principal of, premium, if any, and
accrued interest on all of the outstanding Notes due and payable immediately,
upon which declaration all such amounts payable in respect of the Notes will
become and be immediately due and payable. If an Event of Default specified in
clauses (g) or (h) above with respect to the Company or any Material Subsidiary
occurs and is continuing, then the principal of, premium, if any, and accrued
interest on all of the outstanding Notes will become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
holder of Notes.
After a declaration of acceleration, but before a judgment or decree
for payment of the money due has been obtained by the Trustee, the Holders of a
majority in aggregate principal amount of the outstanding Notes, by written
notice to the Company and the Trustee, may rescind such declaration if (a) the
Company has paid or deposited with the Trustee a sum sufficient to pay (i) all
sums paid or advanced by the Trustee under this Indenture and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, (ii) all overdue interest on all Notes, (iii) the principal of and
premium, if any, on any Notes which have become due
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otherwise than by such declaration of acceleration and interest thereon at the
rate borne by the Notes, and (iv) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate borne by the Notes, and (b)
all Events of Default, other than the non-payment of principal of, premium, if
any, and interest on the Notes that has become due solely by such declaration of
acceleration, have been cured or waived as provided in this Indenture.
SECTION 6.03. Other Remedies.
--------------
(a) If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity to collect the
payment of the principal of, premium, if any, or interest on the Notes or to
enforce the performance of any provision of the Notes or this Indenture.
(b) All rights of action and claims under this Indenture or the
Notes may be enforced by the Trustee even if it does not possess any of the
Notes or does not produce any of them in the proceeding. A delay or omission by
the Trustee or any Holder in exercising any right or remedy accruing upon an
Event of Default shall not impair the right or remedy or constitute a waiver of
or acquiescence in the Event of Default. No remedy is exclusive of any other
remedy. All available remedies are cumulative to the extent permitted by law.
SECTION 6.04. Waiver of Past Defaults.
-----------------------
Prior to the acceleration of the Notes, the Holders of a majority in
aggregate principal amount of the Notes then outstanding by notice to the
Trustee may, on behalf of the Holders of all the Notes, waive any existing
Default or Event of Default and its consequences under this Indenture, except a
Default or Event of Default specified in Section 6.01(a) or (b) or in respect of
any provision hereof that cannot be modified or amended without the consent of
the Holder so affected pursuant to Section 9.02. When a Default or Event of
Default is so waived, it shall be deemed cured and shall cease to exist. This
Section 6.04 shall be in lieu of (S) 316(a)(1)(B) of the TIA and such (S)
316(a)(1)(B) of the TIA is hereby expressly excluded from this Indenture and the
Notes, as permitted by the TIA.
SECTION 6.05. Control by Majority.
-------------------
Holders of the Notes may not enforce this Indenture or the Notes
except as provided in this Article Six and under the TIA. The Holders of a
majority in aggregate principal amount of the then outstanding Notes have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or
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power conferred on the Trustee, provided, however, that the Trustee may refuse
-------- -------
to follow any direction (a) that conflicts with any rule of law or this
Indenture, (b) that the Trustee, in its sole discretion, determines may be
unduly prejudicial to the rights of another Holder, or (c) that may expose the
Trustee to personal liability for which adequate indemnity provided to the
Trustee against such liability is not reasonably assured to it; provided,
--------
further, however, that the Trustee may take any other action deemed proper by
------- -------
the Trustee that is not inconsistent with such direction or this Indenture. This
Section 6.05 shall be in lieu of (S) 316(a)(1)(A) of the TIA, and such (S)
316(a)(1)(A) of the TIA is hereby expressly excluded from this Indenture and the
Notes, as permitted by the TIA.
SECTION 6.06. Limitation on Suits.
-------------------
No Holder of any Notes shall have any right to institute any
proceeding with respect to this Indenture or the Notes or any remedy hereunder,
unless the Holders of at least 25% in aggregate principal amount of the
outstanding Notes have made written request, and offered reasonable indemnity,
to the Trustee to institute such proceeding as Trustee under the Notes and this
Indenture, the Trustee has failed to institute such proceeding within 15 days
after receipt of such notice, request and offer of indemnity and the Trustee,
within such 15-day period, has not received directions inconsistent with such
written request by Holders of a majority in aggregate principal amount of the
outstanding Notes.
The foregoing limitations shall not apply to a suit instituted by a
Holder of a Note for the enforcement of the payment of the principal of,
premium, if any, or interest on, such Note on or after the respective due dates
expressed or provided for in such Note.
A Holder may not use this Indenture to prejudice the rights of any
other Holders or to obtain priority or preference over such other Holders.
SECTION 6.07. Right of Holders To Receive Payment.
-----------------------------------
Notwithstanding any other provision in this Indenture, the right of
any Holder of a Note to receive payment of the principal of, premium, if any,
and interest on such Note, on or after the respective due dates expressed or
provided for in such Note, or to bring suit for the enforcement of any such
payment on or after the respective due dates, is absolute and unconditional and
shall not be impaired or affected without the consent of the Holder.
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SECTION 6.08. Collection Suit by Trustee.
--------------------------
If an Event of Default specified in clause (a) or (b) of Section 6.01
occurs and is continuing, the Trustee may recover judgment in its own name and
as trustee of an express trust against the Company, or any other obligor on the
Notes for the whole amount of the principal of, premium, if any, and accrued
interest remaining unpaid, together with interest on overdue principal and, to
the extent that payment of such interest is lawful, interest on overdue
installments of interest, in each case at the rate per annum provided for by the
Notes and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel and any other
amounts due the Trustee pursuant to the provisions of 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 (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents, counsel, accountants and
experts) and the Holders allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Notes), its creditors or its property and
shall be entitled and empowered to collect and receive any monies or other
property payable or deliverable on any such claims and to distribute the same,
and any Custodian in any such judicial proceedings is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay to
the Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agent and counsel, and any other
amounts due the Trustee under Section 7.07. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
SECTION 6.10. Priorities.
----------
If the Trustee collects any money pursuant to this Article Six it
shall pay out such money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07, including payment of all compensation, expense and
liabilities incurred, and all
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advances made, by the Trustee and the cost and expenses of collection;
Second: to Holders for interest accrued on the Notes, ratably,
without preference or priority of any kind, according to the amounts due
and payable on the Notes for interest;
Third: to Holders for the principal amounts (including any premium)
owing under the Notes, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for the principal
(including any premium); and
Fourth: the balance, if any, to the Company.
The Trustee, upon prior written notice to the Company, may fix a
record date and payment date for any payment to Holders pursuant to this Section
6.10.
SECTION 6.11. Undertaking for Costs.
---------------------
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court may in its discretion require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to any suit by the Trustee, any suit by a
Holder pursuant to Section 6.07, or a suit by a Holder or Holders of more than
10% in aggregate principal amount of the outstanding Notes.
SECTION 6.12. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture or any Note and such proceeding has
been discontinued or abandoned for any reason, or has been determined adversely
to the Trustee or to such Holder, then and in every such case the Company, the
Trustee and the Holders shall, subject to any determination in such proceeding,
be restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
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ARTICLE SEVEN
TRUSTEE
-------
SECTION 7.01. Duties of Trustee.
-----------------
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in its exercise thereof as a
prudent person would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties as are specifically
set forth in this Indenture and no covenants or obligations shall be
implied in this Indenture that are adverse to the Trustee.
(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,
in the case of any such certificates or opinions that by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall examine the certificates and opinions to determine whether or
not they conform to the requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein contained, the
Trustee may not be relieved from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section 7.01.
(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.
(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 6.02, 6.04 or 6.05.
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(d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any 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 for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01 and
Section 7.02.
(f) The Trustee shall not be liable for interest on any money or
assets received by it except as the Trustee may agree in writing with the
Company. Assets held in trust by the Trustee need not be segregated from other
assets except to the extent required by law.
SECTION 7.02. Rights of Trustee.
-----------------
Subject to Section 7.01:
(a) The Trustee may rely and shall be fully protected in acting or
refraining from acting upon any document believed by it to be genuine and
to have been signed or presented by the proper Person. The Trustee need
not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel of its selection and may require an Officers' Certificate or
an Opinion of Counsel, which shall conform to Sections 11.04 and 11.05. The
Trustee shall not be liable for any action it takes or omits to take in
good faith in reliance on such Officers' Certificate or Opinion of Counsel.
The Trustee may consult with counsel and the written advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect to any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action that it takes or
omits to take in good faith which it reasonably believes to be authorized
or within its rights or powers.
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(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled, upon reasonable notice to
the Company, to examine the books, records, and premises of the Company,
personally or by agent or attorney and to consult with the officers and
representatives of the Company, including the Company's accountants and
attorneys during reasonable business hours and subject to executing a
confidentiality undertaking in customary form with respect to confidential
or proprietary information of the Company and its Subsidiary.
(f) The Trustee shall be under no obligation to exercise any of its
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this
Indenture, unless such Holders have offered to the Trustee reasonable
indemnity satisfactory to the Trustee against the costs, expenses and
liabilities which may be incurred by it in compliance with such request,
order or direction.
(g) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(h) Delivery of reports, information and documents to the Trustee
under Section 4.08 is for informational purposes only and the Trustee's
receipt of the foregoing shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of their covenants
hereunder (as to which the Trustee is entitled to rely exclusively on
Officers' Certificates).
SECTION 7.03. Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company, the Company,
or any of the Subsidiaries, or their respective Affiliates with the same rights
it would have if it were not Trustee. Any Agent may do the same with like
rights. However, the Trustee must comply with Sections 7.10 and 7.11.
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SECTION 7.04. Trustee's Disclaimer.
--------------------
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Notes, and it shall not be accountable for the Company's
use of the proceeds from the Notes, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement of the Company in this
Indenture or the Notes other than the Trustee's certificate of authentication.
SECTION 7.05. Notice of Default.
-----------------
If a Default or an Event of Default occurs and is continuing and if it
is known to a Trust Officer, the Trustee shall mail to each Holder notice of the
uncured Default or Event of Default within 90 days after the occurrence thereof.
Except in the case of a Default or an Event of Default in payment of principal
of, or interest on, any Note, including an accelerated payment, a Default in
payment on the Change of Control Payment Date pursuant to a Change of Control
Offer or on the Net Proceeds Payment Date pursuant to a Net Proceeds Offer and a
Default in compliance with Article Five hereof, the Trustee may withhold the
notice if and so long as its Board of Directors, the executive committee of its
Board of Directors or a committee of its directors and/or Trust Officers in good
faith determines that withholding the notice is in the interest of the Holders.
The foregoing sentence of this Section 7.05 shall be in lieu of the proviso to
(S) 315(b) of the TIA and such proviso to (S) 315(b) of the TIA is hereby
expressly excluded from this Indenture and the Notes, as permitted by the TIA.
SECTION 7.06. Reports by Trustee to Holders.
-----------------------------
Within 60 days after May 15 of each year beginning with May 15, 2000,
the Trustee shall, to the extent that any of the events described in TIA (S)
313(a) occurred within the previous twelve months, but not otherwise, mail to
each Holder a brief report dated as of such date that complies with TIA (S)
313(a). The Trustee also shall comply with TIA (S)(S) 313(b), (c) and (d).
A copy of each report at the time of its mailing to Holders shall be
mailed to the Company and filed with the Commission and each stock exchange, if
any, on which the Notes are listed.
The Company shall promptly notify the Trustee if the Notes become
listed on any stock exchange and the Trustee shall comply with TIA (S) 313(d).
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SECTION 7.07. Compensation and Indemnification
of Trustee and Its Prior Claim.
--------------------------------
(a) The Company covenants and agrees: (i) to pay to the Trustee from
time to time, and the Trustee shall be entitled to, compensation for all
services rendered by it hereunder (which shall not be limited by any provision
of law in regard to the compensation of a trustee of an express trust) as the
Company and the Trustee shall, from time to time, agree in writing; (ii) to
reimburse the Trustee and each predecessor Trustee upon its written request for
all reasonable and documented expenses, fees, disbursements and advances
incurred or made by or on behalf of it in accordance with any of the provisions
of this Indenture (including the reasonable compensation, fees, and the expenses
and disbursements of its counsel and of all agents and other persons not
regularly in its employ), except any such expense, disbursement or advance as
may arise from its gross negligence, bad faith or willful misconduct; and (iii)
to indemnify the Trustee and each predecessor Trustee for, and to hold it
harmless against, any and all loss, liability, claim, damage, or expense
(including taxes other than taxes based upon the income of the Trustee) incurred
without negligence, bad faith or willful misconduct on its part, arising out of
or in connection with the acceptance or administration of this Indenture or the
trusts hereunder and its duties hereunder, including enforcement of this Section
7.07. The obligations of the Company under this Section to compensate and
indemnify the Trustee and each predecessor Trustee and to pay or reimburse the
Trustee and each predecessor Trustee for such expenses, fees, disbursements and
advances shall constitute an additional obligation hereunder and shall survive
the satisfaction and discharge of this Indenture.
(b) The Trustee shall give notice as promptly as reasonably
practicable to the Company of any action commenced against it in respect of
which indemnity may be sought hereunder, but failure to so notify the Company
shall not relieve the Company from any liability hereunder to the extent it is
not materially prejudiced as a result thereof and in any event shall not relieve
it from any liability which it may have otherwise than on account of this
indemnity agreement. Counsel to the Trustee shall be selected by the Company.
The Company may participate at its own expense in the defense of any such
action; provided, however, that counsel to the Company shall not (except with
-------- -------
the consent of the Trustee) also be counsel to the Trustee. In no event shall
the Company be liable for fees and expenses of more than one counsel (in
addition to any local counsel) separate from its own counsel for the Trustee in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
The Company shall not,
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without the prior written consent of the Trustee, settle or compromise or
consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification could be
sought under this Section 7.07 (whether or not the Trustee is an actual or
potential party thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of the Trustee from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of the Trustee.
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 outstanding Notes may remove
the Trustee and appoint a successor Trustee with the Company's consent, by so
notifying the Company and the Trustee. The Company may 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 becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in aggregate principal
amount of the outstanding Notes may appoint a successor Trustee to replace the
successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided in Section 7.07, 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 Company shall mail notice of such successor Trustee's
appointment to each Holder.
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If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in aggregate principal amount of the outstanding Notes
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 any resignation or replacement of the Trustee pursuant
to this Section 7.08, the Company's obligations under Section 7.07 shall
continue for the benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, Etc.
--------------------------------
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business (including
the trust created by this Indenture) to, another corporation, the resulting,
surviving or transferee corporation without any further act shall, if such
resulting, surviving or transferee corporation is otherwise eligible hereunder,
be the successor Trustee; provided, however, that such corporation shall be
-------- -------
otherwise qualified and eligible under this Article Seven.
SECTION 7.10. Eligibility; Disqualification.
-----------------------------
This Indenture shall always have a Trustee who satisfies the
requirement of TIA (S)(S) 310(a)(1), (2) and (5). The Trustee (or, in the case
of a Trustee that is a subsidiary of another Bank or a corporation included in a
bank holding company system, the related bank or bank holding company) shall
have a combined capital and surplus of at least $100,000,000 million as set
forth in its most recent published annual report of condition, and have an
office or agency in the City of New York. In addition, if the Trustee is a
subsidiary of another Bank or a corporation included in a bank holding company
system, the Trustee, independently of such bank or bank holding company, shall
meet the capital requirements of TIA (S) 310(a)(2). The Trustee shall comply
with TIA (S) 310(b); provided, however, that there shall be excluded from the
-------- -------
operation of TIA (S) 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 (S) 310(b)(1) are met. The provisions of TIA (S) 310 shall apply to the
Company, as obligor of the Notes.
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SECTION 7.11. Preferential Collection of
Claims Against Company.
--------------------------
The Trustee shall comply with TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated therein.
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
----------------------------------
SECTION 8.01. Termination of Company's Obligations.
------------------------------------
This Indenture will be discharged and will cease to be of further
effect (except as to surviving rights or registration of transfer or exchange of
the Notes, as expressly provided for in this Indenture) as to all outstanding
Notes when (a) either (i) all Notes, theretofore authenticated and delivered
(except lost, stolen or destroyed Notes that have been replaced or paid and
Notes for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to the Company
or discharged from such trust) have been delivered to the Trustee for
cancellation or (ii) all Notes not theretofore delivered to the Trustee for
cancellation have become due and payable and the Company has irrevocably
deposited or caused to be deposited with the Trustee funds in an amount
sufficient to pay and discharge the entire Indebtedness on the Notes not
theretofore delivered to the Trustee for cancellation, for principal of,
premium, if any, and interest on the Notes to the date of deposit together with
irrevocable instructions from the Company directing the Trustee to apply such
funds to the payment thereof at maturity or redemption, as the case may be; (b)
the Company has paid all other sums payable under this Indenture by the Company;
(c) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel stating that all conditions precedent under this Indenture
relating to the satisfaction and discharge of this Indenture have been complied
with; and (d) such satisfaction and discharge will not result in a breach or
violation of, or constitute a default under, this Indenture or any other
material agreement or instrument to which the Company or any of its Subsidiaries
is a party or by which the Company or any of its Subsidiaries is bound.
The Company may, at its option and at any time, elect to have its
obligations discharged with respect to the outstanding Notes ("Legal
Defeasance"). Such Legal Defeasance means that the Company shall be deemed to
have paid and dis-
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charged the entire indebtedness represented by the outstanding Notes, except for
(a) the rights of Holders to receive payments in respect of the principal of,
premium, if any, and interest on the Notes when such payments are due, (b) the
Company's obligations with respect to the Notes concerning issuing temporary
Notes, registration of Notes, mutilated, destroyed, lost or stolen Notes and the
maintenance of an office or agency for payments, (c) the rights, powers, trust,
duties and immunities of the Trustee and the Company's obligations in connection
therewith and (d) the Legal Defeasance provisions of this Section 8.01. In
addition, the Company may, at its option and at any time, elect to have the
obligations of the Company released with respect to covenants contained in
Sections 4.04, 4.08 and 4.10 through 4.19 and Article Five ("Covenant
Defeasance") and thereafter any omission to comply with such obligations shall
not constitute a Default or Event of Default with respect to the Notes. In the
event of Covenant Defeasance, those events described under Section 6.01 (except
those events described in Section 6.01(a),(b),(g) and (h)) will no longer
constitute an Event of Default with respect to the Notes.
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders cash in United States dollars, non-callable
U.S. Government Obligations, or a combination thereof, in such amounts as
will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if any,
and interest on the Notes on the stated date for payment thereof or on the
applicable Redemption Date, as the case may be;
(b) in the case of Legal Defeasance, the Company shall have delivered
to the Trustee an Opinion of Counsel in the United States reasonably
acceptable to the Trustee confirming that (i) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling
or (ii) 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 Legal Defeasance and in either case, and (iii) the Holders
will be subject to U.S. federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such Legal
Defeasance had not occurred;
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(c) in the case of Covenant Defeasance, the Company shall have
delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming 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;
(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or insofar as Events of Default
under Section 6.01(g) or (h) from bankruptcy or insolvency events are
concerned;
(e) such Legal Defeasance or Covenant Defeasance shall not cause the
Trustee to have a conflicting interest with respect to any securities of
the Company;
(f) such Legal Defeasance or Covenant Defeasance shall not result in
a breach or violation of, or constitute a default under, any material
agreement or instrument to which the Company is a party or by which it is
bound;
(g) such Legal Defeasance or Covenant Defeasance shall not result in
the trust arising from such deposit constituting an investment company
within the meaning of the Investment Company Act of 1940, as amended,
unless such trust shall be registered under such Act or exempt from
registration thereunder;
(h) the Company shall have delivered to the Trustee an Opinion of
Counsel in the United States to the effect that after the 91st day
following the deposit, the trust funds will not be subject to Xxxxxxx 000
xx xxx Xxxxxx Xxxxxx Bankruptcy Code;
(i) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the
intent of preferring the Holders over any other creditors of the Company or
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company or others;
(j) no event or condition shall exist that would prevent the Company
from making payments of the principal of, premium, if any, and interest on
the Notes on the date of such deposit; and
(k) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each
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stating that all conditions precedent under this Indenture to either
defeasance or covenant defeasance, as the case may be, have been complied
with.
Notwithstanding the foregoing, the Opinion of Counsel required by
clauses (b)(i) and (c) above need not be delivered if all the Notes not
theretofore delivered to the Trustee for cancellation (i) have become due and
payable, (ii) will become due and payable on the maturity date within one year
or (iii) are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption by such
Trustee in the name, and at the expense, of the Company.
SECTION 8.02. Application of Trust Money.
--------------------------
The Trustee or Paying Agent shall hold in trust U.S. Legal Tender or
U.S. Government Obligations deposited with it pursuant to Section 8.01, and
shall apply the deposited U.S. Legal Tender and the money from U.S. Government
Obligations in accordance with this Indenture to the payment of the principal of
and interest on the Notes. The Trustee shall be under no obligation to invest
said U.S. Legal Tender or U.S. Government Obligations.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the Legal Tender or U.S.
Government Obligations deposited pursuant to Section 8.01 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of outstanding Notes.
SECTION 8.03. Repayment to the Company.
------------------------
Subject to Sections 7.07 and 8.01, the Trustee and the Paying Agent
shall promptly pay to the Company upon request any excess U.S. Legal Tender or
U.S. Government Obligations held by them at any time and thereupon shall be
relieved from all liability with respect to such money. 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 one year;
provided, however, that the Company shall, if requested by the Trustee or Paying
-------- -------
Agent, give to the Trustee or Paying Agent, indemnification reasonably
satisfactory to it against any and all liability which may be incurred by it by
reason of such paying; provided, further, that the Trustee or such Paying Agent,
-------- -------
before being required to make any payment, may at the expense of the Company
cause to be published once in a newspaper of general circulation in the City of
New York or mail to each Holder entitled to such money no-
-88-
xxxx that such money remains unclaimed and that after a date specified therein
which shall be at least 30 days from the date of such publication or mailing any
unclaimed balance of such money then remaining will be repaid to the Company.
After payment to the Company, Holders entitled to such money must look to the
Company for payment as general creditors unless an applicable law designates
another Person, and all liability of the Trustee and such Paying Agent with
respect to such money shall cease.
SECTION 8.04. Reinstatement.
-------------
If the Trustee or Paying Agent is unable to apply any U.S. Legal
Tender or U.S. Government Obligations in accordance with Section 8.01 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 Notes shall
be revived and reinstated as though no deposit had occurred pursuant to Section
8.01 until such time as the Trustee or Paying Agent is permitted to apply all
such U.S. Legal Tender or U.S. Government Obligations in accordance with Section
8.01; provided, however, that if the Company has made any payment of interest on
-------- -------
or principal of any Notes because of the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the U.S. Legal Tender or U.S. Government Obligations
held by the Trustee or Paying Agent.
SECTION 8.05. Acknowledgment of Discharge
by Trustee.
---------------------------
After (i) the conditions of Section 8.01 have been satisfied, (ii) the
Company has paid or caused to be paid all other sums payable hereunder by the
Company and (iii) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent referred to in clause (i) above relating to the satisfaction and
discharge of this Indenture have been complied with, the Trustee upon request
shall acknowledge in writing the discharge of the Company's obligations under
this Indenture except for those surviving obligations specified in Section 8.01,
provided the legal counsel delivering such Opinion of Counsel may rely as to
--------
matters of fact on one or more Officers' Certificates of the Company.
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ARTICLE NINE
MODIFICATION OF THE INDENTURE
-----------------------------
SECTION 9.01. Without Consent of Holders.
--------------------------
Subject to the provisions of Section 9.02, the Company, when
authorized by a Board Resolution, and the Trustee may amend, waive or supplement
this Indenture without notice to or consent of any Holder: (a) to cure any
ambiguity, defect or inconsistency; (b) to comply with Section 5.01 of this
Indenture; (c) to provide for uncertificated Notes in addition to certificated
Notes; (d) to comply with any requirements of the Commission in order to effect
or maintain the qualification of this Indenture under the TIA; or (e) to make
any change that would provide any additional benefit or rights to the Holders or
that does not materially adversely affect the rights of any Holder; provided,
--------
however, that the Company has delivered to the Trustee an Opinion of Counsel
-------
stating that such change does not materially adversely affect the legal rights
of any Holder.
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such amended or supplemental Indenture, and
upon receipt by the Trustee of the documents described in Section 9.06, the
Trustee shall join with the Company in the execution of any amended or
supplemental Indenture authorized or permitted by the terms of this Indenture
and to make any further appropriate agreements and stipulations which may be
therein contained, but the Trustee may but shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
SECTION 9.02. With Consent of Holders.
-----------------------
The Company and the Trustee may amend or supplement this Indenture or
the Notes or any amended or supplemental Indenture with the written consent of
the Holders of not less than a majority in aggregate principal amount of the
Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or, tender offer or exchange offer for, the
Notes).
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such amended or supplemental Indenture, and
upon the filing with the Trustee of evidence satisfactory to the Trustee of the
consent of the Holders as aforesaid, and upon receipt by the Trustee of the
documents described in Section 9.06, the Trustee shall join with the Company in
the execution of such amended or supplemen-
-90-
tal Indenture unless such amended or supplemental Indenture affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise, in
which case the Trustee may in its sole discretion, but shall not be obligated
to, enter into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment or waiver,
but it shall be sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders affected thereby a notice
describing the amendment, supplement or waiver. Any failure of the Company to
mail such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such amended or supplemental Indenture or waiver.
Subject to Sections 6.04 and 6.07, the Holders of a majority in aggregate
principal amount of the Notes then outstanding may waive compliance in a
particular instance by the Company with any provision of this Indenture or the
Notes. However, without the consent of each Holder affected thereby, an
amendment or waiver may not, directly or indirectly: (i) change the maturity of
the principal of, or any installment of interest on, any such Note or alter the
optional redemption or repurchase provisions of any such Note or this Indenture
in a manner adverse to the Holders; (ii) reduce the principal amount of (or the
premium of) any such Note; (iii) reduce the rate of or extend the time for
payment of interest on any such Note; (iv) change the place or currency of
payment of principal of (or premium) or interest on any such Note; (v) modify
any provisions of this Indenture relating to the waiver of past defaults (other
than to add sections of this Indenture or the Notes subject thereto) or the
right of the holders of Notes to institute suit for the enforcement of any
payment on or with respect to any such Note or the modification and amendment
provisions of this Indenture and the Notes (other than to add sections of this
Indenture or the Notes which may not be amended, supplemented or waived without
the consent of each Holder therein affected); (vi) reduce the percentage of the
principal amount of outstanding Notes necessary for amendment to or waiver of
compliance with any provision of this Indenture or the Notes or for waiver of
any Default in respect thereof; (vii) waive a default in the payment of
principal of, premium, if any, or interest on, or redemption payment with
respect to, the Notes (except a rescission of acceleration of the Notes by the
Holders thereof as provided in this Indenture and a waiver of the payment
default that resulted from such acceleration); (viii) modify the ranking or
priority of any Note in any manner adverse to Holders; or (ix) following the
occurrence of a Change of Control or an Asset Sale, modify the provisions of
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any covenant (or the related definitions) in this Indenture requiring the
Company to make and consummate a Change of Control Offer with respect to such
Change of Control or an Asset Sale Offer with respect to such Asset Sale or
modify any of the provisions or definitions with respect thereto in a manner
materially adverse to the Holders affected thereby otherwise than in accordance
with this Indenture.
SECTION 9.03. Compliance with TIA.
-------------------
Every amendment, waiver or supplement of this Indenture or the Notes
shall comply with the TIA as then in effect; provided, however, that this
-------- -------
Section 9.03 shall not of itself require that this Indenture or the Trustee be
qualified under the TIA or constitute any admission or acknowledgment by any
party hereto that any such qualification is required prior to the time this
Indenture and the Trustee are required by the TIA to be so qualified.
SECTION 9.04. Revocation and Effect of Consents.
---------------------------------
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Note or portion of a Note that evidences the same debt as the
consenting Holder's Note, even if notation of the consent is not made on any
Note. Subject to the following paragraph, any such Holder or subsequent Holder
may revoke the consent as to such Holder's Note or portion of such Note by
notice to the Trustee or the Company received before the date on which the
Trustee receives an Officers' Certificate certifying that the Holders of the
requisite principal amount of Notes have consented (and not theretofore revoked
such consent) to the amendment, supplement or waiver. An amendment, supplement
or waiver becomes effective upon receipt by the Trustee of such Officers'
Certificate and evidence of consent by the Holders of the requisite percentage
in principal amount of outstanding Notes.
The Company may, but shall not be obligated to, fix a Record Date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a Record Date is fixed, then notwithstanding the
second sentence of 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 revoke any consent previously given, whether or
not such Persons continue to be Holders after such Record Date. No such consent
shall be valid or effective for more than 90 days after such Record Date unless
consents from Holders of the requisite percentage in principal amount of
outstanding Notes required hereunder for the
-92-
effectiveness of such consents shall have also been given and not revoked within
such 90 day period.
SECTION 9.05. Notation on or Exchange of Notes.
--------------------------------
If an amendment, supplement or waiver changes the terms of a Note, the
Trustee may require the Holder of such Note to deliver it to the Trustee. The
Trustee may place an appropriate notation on the Note about the changed terms
and return it to the Holder. Alternatively, if the Company or the Trustee so
determine, the Company in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms.
SECTION 9.06. Trustee To Sign Amendments, Etc.
-------------------------------
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article Nine; provided, however, that the Trustee
-------- -------
may, but shall not be obligated to, execute any such amendment, supplement or
waiver that affects the Trustee's own rights, duties or immunities under this
Indenture. In executing such amendment, supplement or waiver the Trustee shall
be entitled to receive indemnity reasonably satisfactory to it, and shall be
fully protected in relying upon an Opinion of Counsel and an Officers'
Certificate of the Company, stating that no Event of Default shall occur as a
result of such amendment, supplement or waiver and that the execution of such
amendment, supplement or waiver is authorized or permitted by this Indenture,
provided, however, that the legal counsel delivering such Opinion of Counsel may
-------- -------
rely as to matters of fact on one or more Officers' Certificates of the Company.
Such Opinion of Counsel shall not be an expense of the Trustee.
ARTICLE TEN
MISCELLANEOUS
-------------
SECTION 10.01. TIA 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; provided, however, that this Section
-------- -------
10.01 shall not of itself require that this Indenture or the Trustee be
qualified under the TIA or constitute any admission or acknowledgment by any
party hereto that any such qualification is required prior to the time this
Indenture and the Trustee are required by the TIA to be so qualified.
-93-
SECTION 10.02. Notices.
-------
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
if to the Company:
California Steel Industries, Inc.
00000 Xxx Xxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telecopier Number: (000) 000-0000
Attention: Executive Vice President, Finance
With a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Telecopier Number: (000) 000-0000
Attention: Xxxxx Xxxxxx, Esq.
if to the Trustee:
State Street Bank and Trust Company of California, N.A.
000 Xxxx 0xx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Telecopier Number: (000) 000-0000
Attention: Corporate Trust Administration
(California Steel Industries, Inc.
8 1/2 % Senior Notes due 2009)
The Company and the Trustee by written notice to the other may
designate additional or different addresses for notices to such Person. Any
notice or communication to the Company or the Trustee shall be deemed to have
been given or made as of the date so delivered if hand delivered; when answered
back, if telexed; when receipt is acknowledged, if faxed; and five (5) calendar
days after mailing if sent by registered or certified mail, postage prepaid
(except that a notice of change of address shall not be deemed to have been
given until actually received by the addressee).
-94-
Any notice or communication mailed to a Holder shall be mailed to him
by first class mail or other equivalent means at his address as it appears on
the registration books of the Registrar ten (10) days prior to such mailing and
shall be sufficiently given to him if so mailed within the time prescribed. Any
notice or communication shall also be so mailed to any Person described in TIA
(S) 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not the addressee receives it.
SECTION 10.03. Communications by Holders with Other Holders.
--------------------------------------------
Holders may communicate pursuant to TIA (S) 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company,
the Trustee, the Registrar and any other Person shall have the protection of TIA
(S) 312(c).
SECTION 10.04. Certificate and Opinion as to Conditions Precedent.
--------------------------------------------------
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate, in form and substance satisfactory to
the Trustee, stating that, in the opinion of the signers, all conditions
precedent to be performed by the Company, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent to be performed by the Company, if
any, provided for in this Indenture relating to the proposed action have
been complied with (which counsel, as to factual matters, may rely on an
Officers' Certificate).
SECTION 10.05. Statements Required in Certificate or Opinion.
---------------------------------------------
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture, other than the Officers'
Certificate required by Section 4.06, shall include:
-95-
(1) a statement that the Person 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 Person, 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 each such
Person, such condition or covenant has been complied with.
SECTION 10.06. Rules by Trustee, Paying Agent, Registrar.
-----------------------------------------
The Trustee may make reasonable rules in accordance with the Trustee's
customary practices for action by or at a meeting of Holders. The Paying Agent
or Registrar may make reasonable rules for its functions.
SECTION 10.07. Legal Holidays.
--------------
A "Legal Holiday" used with respect to a particular place of payment
-------------
is a Saturday, a Sunday or a day on which banking institutions in New York, New
York or at such place of payment are not required to be open. If a payment date
is a Legal Holiday at such place, payment may be made at such place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
SECTION 10.08. Governing Law.
-------------
This Indenture and the Notes 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.
SECTION 10.09. No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any of its Subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
-96-
SECTION 10.10. No Personal Liability.
---------------------
No director, officer, employee or stockholder, as such, of the
Company, as such, shall have any liability for any obligations of the Company
under the Notes, this Indenture or the Registration Rights Agreement or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder of Notes by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes.
SECTION 10.11. Successors.
----------
All agreements of the Company in this Indenture and the Notes shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
SECTION 10.12. Duplicate Originals.
-------------------
All parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together shall represent the
same agreement.
SECTION 10.13. Severability.
------------
In case any one or more of the provisions in this Indenture or in the
Notes shall be held invalid, illegal or unenforceable, in any respect for any
reason, the validity, legality and enforceability of any such provision in every
other respect and of the remaining provisions shall not in any way be affected
or impaired thereby, it being intended that all of the provisions hereof shall
be enforceable to the full extent permitted by law.
SECTION 10.14. Independence of Covenants.
-------------------------
All covenants and agreements in this Indenture and the Notes shall be
given independent effect so that if any particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or otherwise be within the limitations of, another covenant shall
not avoid the occurrence of a Default or an Event of Default if such action is
taken or condition exists.
-97-
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.
CALIFORNIA STEEL INDUSTRIES, INC.
By: /s/ Celo Xxxxxxxx Xxxxxxxxx
---------------------------
Name: CELO XXXXXXXX XXXXXXXXX
Title: PRESIDENT AND CHIEF
EXECUTIVE OFFICER
STATE STREET BANK AND TRUST COM-
PANY OF CALIFORNIA, N.A.,
as Trustee
By: /s/ Xxxx X'Xxxxx
------------------------------
Name: XXXX X'XXXXX
Title: VICE PRESIDENT
-98-
EXHIBIT A
---------
CUSIP No.: [ ]
CALIFORNIA STEEL INDUSTRIES, INC.
8 1/2% SENIOR NOTE DUE 2009
No. [ ] $
CALIFORNIA STEEL INDUSTRIES, INC., a Delaware corporation (the
"Company", which term includes any successor entities), for value received
promise to pay to __________________________ or registered assigns the principal
sum of ($ ) Dollars on April 1, 2009.
Interest Payment Dates: April 1 and October 1, commencing October 1,
1999
Record Dates: March 15 and September 15
Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officers and a facsimile of its
corporate seal to be affixed hereto or imprinted hereon.
CALIFORNIA STEEL INDUSTRIES, INC.
By: ____________________________
Name:
Title:
By: ____________________________
Name:
Title:
Dated:
A-1
Certificate of Authentication
This is one of the 8 1/2% Senior Notes due 2009 referred to in the
within-mentioned Indenture.
STATE STREET BANK AND TRUST COM-
PANY OF CALIFORNIA, N.A., as
Trustee
By: _____________________________
Authorized Signatory
Date of Authentication:
A-2
(REVERSE OF SECURITY)
8 1/2% Senior Note due 2009
1. Interest. California Steel Industries, Inc. (the "Company"),
--------
promises to pay interest on the principal amount of this Note at the rate per
annum shown above. Interest on the Notes will accrue from the most recent date
on which interest has been paid or, if no interest has been paid, from April 6,
1999. The Company will pay interest semi-annually in arrears on each Interest
Payment Date, commencing October 1, 1999. Interest will be computed on the basis
of a 360-day year of twelve 30-day months and, in the case of a partial month,
the actual number of days elapsed.
The Company shall pay interest on overdue principal and on overdue
installments of interest from time to time on demand at the rate borne by the
Notes and on overdue installments of interest (without regard to any applicable
grace periods) to the extent lawful.
2. Method of Payment. The Company shall pay interest on the Notes
-----------------
(except defaulted interest) to the Persons who are the registered Holders at the
close of business on the Record Date immediately preceding the Interest Payment
Date even if the Notes are cancelled on registration of transfer or registration
of exchange (including pursuant to an Exchange Offer (as defined in the
Registration Rights Agreement)) after such Record Date. Holders must surrender
Notes to a Paying Agent to collect principal payments. The Company shall 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 ("U.S. Legal Tender").
However, the Company may pay principal and interest by its check payable in such
U.S. Legal Tender. The Company may deliver any such interest payment to the
Paying Agent or to a Holder at the Holder's registered address.
3. Paying Agent and Registrar. Initially, State Street Bank and
--------------------------
Trust Company of California, N.A. (the "Trustee") will act as Paying Agent and
Registrar. The Company may change any Paying Agent, Registrar or co-Registrar
without notice to the Holders.
4. Indenture. The Company issued the Notes under an Indenture, dated
---------
as of April 6, 1999 (the "Indenture"), between the Company and the Trustee.
This Note is one of a duly authorized issue of Initial Notes of the Company
designated as its 8 1/2% Senior Notes due 2009 (the "Initial Notes"). The Notes
are limited in aggregate principal amount to
A-3
$150,000,000. The Notes include the Initial Notes and the Exchange Notes (as
defined in the Indenture) issued in exchange for the Initial Notes pursuant to
the Registration Rights Agreement. The Initial Notes and the Exchange Notes are
treated as a single class of securities under the Indenture. Capitalized terms
herein are used as defined in the Indenture unless otherwise defined herein. The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code
(S)(S) 77aaa-77bbbb) (the "TIA"), as in effect on the date of the Indenture.
Notwithstanding anything to the contrary herein, the Notes are subject to all
such terms, and Holders of Notes are referred to the Indenture and said Act for
a statement of them. The Notes are general unsecured obligations of the Company.
Each Holder, by accepting a Note, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time in accordance with its terms.
5. Redemption. The Notes will be redeemable at the option of the
----------
Company, in whole or in part, at any time on and after April 1, 2004, upon not
less than 30 nor more than 60 days' notice, at the following redemption prices
(expressed as percentages of the principal amount thereof) if redeemed during
the twelve-month period commencing on April 1 of the year set forth below, plus,
in each case, accrued and unpaid interest thereon, if any, to the date of
redemption:
Year Percentage
---- ----------
2004............................................. 104.250%
2005............................................. 102.833%
2006............................................. 101.417%
2007 and thereafter.............................. 100.000%
On or before April 1, 2002, the Company may, at its option, use the
net cash proceeds of a Public Equity Offering to redeem up to 35% of the
originally issued aggregate principal amount of the Notes, at a redemption price
in cash equal to 108.500% of the principal amount thereof plus accrued and
unpaid interest thereon, if any, to the date of redemption; provided that at
--------
least 65% of the aggregate principal amount of Notes is outstanding following
such redemption. Notice of any such redemption must be given not later than 60
days after the consummation of the 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 Notes to be redeemed at such
A-4
Holder's registered address. Notes in denominations larger than $1,000 may be
redeemed in part.
Except as set forth in the Indenture, if monies for the redemption of
the Notes called for redemption shall have been deposited with the Paying Agent
for redemption on such Redemption Date, then, unless the Company defaults in the
payment of such redemption price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the redemption price plus accrued interest, if any.
7. Offers to Purchase. Sections 4.14 and 4.15 of the Indenture
------------------
provide that, after certain Asset Sales (as defined in the Indenture) and upon
the occurrence of a Change of Control (as defined in the Indenture), and subject
to further limitations contained therein, the Company will make an offer to
purchase certain amounts of the Notes in accordance with the procedures set
forth in the Indenture.
8. Registration Rights. Pursuant to a registration rights agreement
-------------------
by and among the Company and the Initial Purchasers, the Company will be
obligated to consummate an exchange offer pursuant to which the Holder of this
Note shall have the right to exchange this Note for Exchange Notes (as defined
in the Indenture), which have been registered under the Securities Act, in like
principal amount and having terms identical in all material respects as the
Initial Notes. The Holders of the Initial Notes shall be entitled to receive
certain additional interest payments in the event such exchange offer is not
consummated and upon certain other conditions, all pursuant to and in accordance
with the terms of the registration rights agreement.
9. Denominations; Transfer; Exchange. The Notes are in registered
---------------------------------
form, without coupons, and in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange Notes in accordance
with the Indenture. The Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay certain
transfer taxes or similar governmental charges payable in connection therewith
as permitted by the Indenture. The Registrar need not register the transfer of
or exchange of any Notes or portions thereof selected for redemption.
10. Persons Deemed Owners. The registered Holder of a Note shall be
---------------------
treated as the owner of it for all purposes.
A-5
11. Unclaimed Money. If money for the payment of principal or
---------------
interest remains unclaimed for one year, the Trustee and the Paying Agent will
pay the money back to the Company. After that, all liability of the Trustee and
such Paying Agent with respect to such money shall cease.
12. Discharge Prior to Redemption or Maturity. If the Company at any
-----------------------------------------
time deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations
sufficient to pay the principal of and interest on the Notes to redemption or
maturity and complies with the other provisions of the Indenture relating
thereto, the Company will be discharged from certain provisions of the Indenture
and the Notes (including certain covenants, but including, under certain
circumstances, its obligation to pay the principal of and interest on the Notes
but without affecting the rights of the Holders to receive such amounts from
such deposits).
13. Amendment; Supplement; Waiver. Subject to certain exceptions set
-----------------------------
forth in the Indenture, the Indenture or the Notes may be amended or
supplemented with the written consent of the Holders of a majority in aggregate
principal amount of the Notes then outstanding, and any past Default or Event of
Default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in aggregate principal amount of the Notes
then outstanding. Without notice to or consent of any Holder, the parties
thereto may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency, provide for uncertificated
Notes in addition to or in place of certificated Notes, comply with any
requirements of the Commission in order to effect or maintain the qualification
of the Indenture under the TIA or comply with Article Five of the Indenture or
make any other change that does not adversely affect the rights of any Holder of
a Note.
14. Restrictive Covenants. The Indenture imposes certain limitations
---------------------
on the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, make payments in respect of their Capital
Stock or certain Indebtedness, make certain Investments, create or incur liens,
enter into transactions with Affiliates, create dividend or other payment
restrictions affecting Restricted Subsidiaries of the Company, issue and sell
Capital Stock of Restricted Subsidiaries of the Company, and on the ability of
the Company to merge or consolidate with any other Person or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of the
Company's or its Restricted Subsidiaries' assets or adopt a plan of liquidation.
Such limitations are subject to a number of important qualifications and
exceptions. If no Default has occurred and is continuing,
A-6
after the rating assigned to the Notes by Xxxxx'x and S&P are Investment Grade
and remain as such, the Company and the Restricted Subsidiaries will not be
subject to Sections 4.10, 4.11, 4.12, 4.13, 4.15, 4.17, 4.18 and clause (iii) of
the first paragraph of Section 5.01 of the Indenture. Pursuant to Section 4.06
of the Indenture, the Company must annually report to the Trustee on compliance
with such limitations.
15. Successors. When a successor assumes, in accordance with the
----------
Indenture, all the obligations of its predecessor under the Notes and the
Indenture, the predecessor, subject to certain exceptions, will be released from
those obligations.
16. Defaults and Remedies. If an Event of Default occurs and is
---------------------
continuing, the principal of all Notes then outstanding, plus all accrued and
unpaid interest, if any, to and including the date the Notes are paid, may be
declared due and payable in the manner and with the effect provided in the
Indenture. Holders of Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee is not obligated to enforce the Indenture
or the Notes unless it has received indemnity reasonably satisfactory to it. The
Indenture permits, subject to certain limitations therein provided, Holders of a
majority in aggregate principal amount of the Notes then outstanding to direct
the Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of Notes notice of any continuing Default or Event of Default (except a
Default in payment of principal or interest when due, for any reason or a
Default in compliance with Article Five of the Indenture) if it determines that
withholding notice is in their interest.
17. Trustee Dealings with the Company and Its Subsidiaries. The
------------------------------------------------------
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Notes and may otherwise deal with the Company, its
Subsidiaries or their respective Affiliates as if it were not the Trustee.
18. No Recourse Against Others. No partner, director, officer,
--------------------------
employee or stockholder, as such, of the Company, as such, shall have any
liability for any obligations of the Company under the Notes, the Indenture or
the Registration Rights Agreement or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for the issuance of the Notes.
19. Authentication. This Note shall not be valid until the Trustee
--------------
or Authenticating Agent manually signs the certificate of authentication on this
Note.
A-7
20. Governing Law. This Note and the Indenture shall be governed by
-------------
and construed in accordance with the laws of the State of New York, as applied
to contracts made and performed within the State of New York, without regard to
principles of conflict of laws. Each of the parties hereto agrees to submit to
the jurisdiction of the courts of the State of New York in any action or
proceeding arising out of or relating to this Note.
21. Abbreviations and Defined Terms. Customary abbreviations may be
-------------------------------
used in the name of a Holder of a Note or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
22. CUSIP Numbers. Pursuant to a recommendation promulgated by the
-------------
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes as a convenience to the Holders of the
Notes. No representation is made as to the accuracy of such numbers as printed
on the Notes and reliance may be placed only on the other identification numbers
printed hereon.
The Company will furnish to any Holder of a Note upon written request
and without charge a copy of the Indenture, which has the text of this Note.
Requests may be made to: California Steel Industries, Inc., 00000 Xxx
Xxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000.
A-8
ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and
have your signature guaranteed by an Eligible Guarantor Institution (bank, stock
broker, savings and loan association or credit union) with membership in an
approved signature guarantee medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15:
I or we assign and transfer this Note to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code and social security or tax ID number
of assignee)
and irrevocably appoint _____________________________________________, agent to
transfer this Note on the books of the Company. The agent may substitute another
to act for him.
Dated: _____________ Signed: __________________________________________________
(Sign exactly as your name
appears on the other side of
this Note)
Signature Guarantee: ___________________________________________________________
In connection with any transfer of this Note occurring prior to the
date which is the earlier of (i) the date of the declaration by the Commission
of the effectiveness of a registration statement under the Securities Act of
1933, as amended (the "Securities Act") covering resales of this Note (which
effectiveness shall not have been suspended or terminated at the date of the
transfer) and (ii) the undersigned confirms that it has not utilized any general
solicitation or general advertising in connection with the transfer:
[Check One]
---------
(1) __ to the Company or a subsidiary thereof; or
(2) __ pursuant to and in compliance with Rule 144A under the Securities Act
of 1933, as amended; or
A-9
(3) __ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as
amended) that has furnished to the Trustee a signed letter containing
certain representations and agreements (the form of which letter can
be obtained from the Trustee); or
(4) __ outside the United states to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act of 1933, as amended;
or
(5) __ pursuant to the exemption from registration provided by Rule 144 under
the Securities Act of 1933, as amended; or
(6) __ pursuant to an effective registration statement under the Securities
Act of 1933, as amended; or
(7) __ pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended.
and unless the box below is checked, the undersigned confirms that such Note is
not being transferred to an "affiliate" of the Company as defined in Rule 144
under the Securities Act of 1933, as amended (an "Affiliate"):
[_] The transferee is an Affiliate of the Company.
Unless one of the items is checked, the Trustee will refuse to
register any of the Notes evidenced by this certificate in the name of any
person other than the registered Holder thereof; provided, however, that if item
-------- -------
(3), (4), (5) or (7) is checked, the Company or the Trustee may require, prior
to registering any such transfer of the Notes, in their sole discretion, such
written legal opinions, certifications (including an investment letter in the
case of box (3) or (4)) and other information as the Trustee or 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, as amended.
If none of the foregoing items are checked, the Trustee or Registrar
shall not be obligated to register this Note in the name of any person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.17 of the Indenture shall have
been satisfied.
A-10
Dated: _______________________________ Signed: _____________________________
(Sign exactly as name appears
on the other side of this
Note)
Signature Guarantee: __________________________________________________________
A-11
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended 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
A-12
[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.14 or Section 4.15 of the Indenture, check the appropriate
box:
Section 4.14 [ ]
Section 4.15 [ ]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.14 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$___________________
Dated: _____________________ _______________________________________
NOTICE: The signature on this
assignment must correspond with the
name as it appears upon the face of the
within Note in every particular without
alteration or enlargement or any change
whatsoever and be guaranteed.
Signature Guarantee: _______________________________________________
[Signature must be guaranteed by an
Eligible Guarantor Institution (bank,
stock broker, savings and loan
association or credit union) with
membership in an approved signature
guarantee medallion program pursuant to
Securities and Exchange Commission Rule
17Ad-15.]
A-13
EXHIBIT B
---------
CUSIP No.: [ ]
CALIFORNIA STEEL INDUSTRIES, INC.
8 1/2% SENIOR NOTE DUE 2009, SERIES B
No. [ ] $
CALIFORNIA STEEL INDUSTRIES, INC., a Delaware corporation (the
"Company", which term includes any successor entities), for value received,
promises to pay to _______________________ or registered assigns the principal
sum of ($ ) Dollars on April 1, 2009.
Interest Payment Dates: April 1 and October 1, commencing October 1,
1999
Record Dates: March 15 and September 15
Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officers and a facsimile of its
corporate seal to be affixed hereto or imprinted hereon.
CALIFORNIA STEEL INDUSTRIES, INC.
By: _____________________________
Name:
Title:
By: _____________________________
Name:
Title:
Dated:
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Certificate of Authentication
This is one of the 8 1/2% Senior Notes due 2009, Series B referred to
in the within-mentioned Indenture.
STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A.,
as Trustee
By: ___________________________
Authorized Signatory
Date of Authentication:
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(REVERSE OF SECURITY)
8 1/2% Senior Note due 2009, Series B
1. Interest. California Steel Industries, Inc. (the "Company"),
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promises to pay interest on the principal amount of this Note at the rate per
annum shown above. Interest on the Notes will accrue from the most recent date
on which interest has been paid or, if no interest has been paid, from April 6,
1999. The Company will pay interest semi-annually in arrears on each Interest
Payment Date, commencing October 1, 1999. Interest will be computed on the basis
of a 360-day year of twelve 30-day months and, in the case of a partial month,
the actual number of days elapsed.
The Company shall pay interest on overdue principal and on overdue
installments of interest from time to time on demand at the rate borne by the
Notes and on overdue installments of interest (without regard to any applicable
grace periods) to the extent lawful.
2. Method of Payment. The Company shall pay interest on the Notes
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(except defaulted interest) to the Persons who are the registered Holders at the
close of business on the Record Date immediately preceding the Interest Payment
Date even if the Notes are cancelled on registration of transfer or registration
of exchange) after such Record Date. Holders must surrender Notes to a Paying
Agent to collect principal payments. The Company shall 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 ("U.S. Legal Tender"). However,
the Company may pay principal and interest by its check payable in such U.S.
Legal Tender. The Company may deliver any such interest payment to the Paying
Agent or to a Holder at the Holder's registered address.
3. Paying Agent and Registrar. Initially, State Street Bank and
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Trust Company of California, N.A. (the "Trustee") will act as Paying Agent and
Registrar. The Company may change any Paying Agent, Registrar or co-Registrar
without notice to the Holders.
4. Indenture. The Company issued the Notes under an Indenture, dated
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as of April 6, 1999 (the "Indenture"), between the Company and the Trustee. This
Note is one of a duly authorized issue of Initial Notes of the Company
designated as its 8 1/2% Senior Notes due 2009 (the "Initial Notes"). The Notes
are limited in aggregate principal amount to $150,000,000. The Notes include the
Initial Notes and the Exchange Notes issued in exchange for the Initial Notes
pursuant to the Registration Rights Agreement. The Initial Notes and
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the Exchange Notes are treated as a single class of securities under the
Indenture. Capitalized terms herein are used as defined in the Indenture unless
otherwise defined herein. The terms of the Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S. Code (S)(S) 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture. Notwithstanding anything to the contrary
herein, the Notes are subject to all such terms, and Holders of Notes are
referred to the Indenture and said Act for a statement of them. The Notes are
general unsecured obligations of the Company.
Each Holder, by accepting a Note, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time in accordance with its terms.
5. Redemption. The Notes will be redeemable at the option of the
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Company, in whole or in part, at any time on and after April 1, 2004, upon not
less than 30 nor more than 60 days' notice, at the following redemption prices
(expressed as percentages of the principal amount thereof) if redeemed during
the twelve-month period commencing on April 1 of the year set forth below, plus,
in each case, accrued and unpaid interest thereon, if any, to the date of
redemption:
Year Percentage
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2004.................................................. 104.250%
2005.................................................. 102.833%
2006.................................................. 101.417%
2007 and thereafter................................... 100.000%
On or before April 1, 2002, the Company may, at its option, use the
net cash proceeds of a Public Equity Offering to redeem up to 35% of the
originally issued aggregate principal amount of the Notes, at a redemption price
in cash equal to 108.500% of the principal amount thereof plus accrued and
unpaid interest thereon, if any, to the date of redemption; provided that at
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least 65% of the aggregate principal amount of Notes is outstanding following
such redemption. Notice of any such redemption must be given not later than 60
days after the consummation of the Public Equity Offering.
6. Notice of Redemption. Notice of redemption will be mailed at
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least 30 days but not more than 60 days before the Redemption Date to each
Holder of Notes to be redeemed at such Holder's registered address. Notes in
denominations larger than $1,000 may be redeemed in part.
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Except as set forth in the Indenture, if monies for the redemption of
the Notes called for redemption shall have been deposited with the Paying Agent
for redemption on such Redemption Date, then, unless the Company defaults in the
payment of such redemption price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the redemption price plus accrued interest, if any.
7. Offers to Purchase. Sections 4.14 and 4.15 of the Indenture
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provide that, after certain Asset Sales (as defined in the Indenture) and upon
the occurrence of a Change of Control (as defined in the Indenture), and subject
to further limitations contained therein, the Company will make an offer to
purchase certain amounts of the Notes in accordance with the procedures set
forth in the Indenture.
8. Persons Deemed Owners. The registered Holder of a Note shall be
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treated as the owner of it for all purposes.
9. Unclaimed Money. If money for the payment of principal or
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interest remains unclaimed for one year, the Trustee and the Paying Agent will
pay the money back to the Company. After that, all liability of the Trustee and
such Paying Agent with respect to such money shall cease.
10. Discharge Prior to Redemption or Maturity. If the Company at any
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time deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations
sufficient to pay the principal of and interest on the Notes to redemption or
maturity and complies with the other provisions of the Indenture relating
thereto, the Company will be discharged from certain provisions of the Indenture
and the Notes (including certain covenants, but including, under certain
circumstances, its obligation to pay the principal of and interest on the Notes
but without affecting the rights of the Holders to receive such amounts from
such deposits).
11. Amendment; Supplement; Waiver. Subject to certain exceptions set
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forth in the Indenture, the Indenture or the Notes may be amended or
supplemented with the written consent of the Holders of a majority in aggregate
principal amount of the Notes then outstanding, and any past Default or Event of
Default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in aggregate principal amount of the Notes
then outstanding. Without notice to or consent of any Holder, the parties
thereto may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency, provide for uncertificated
Notes in addition to or in place of certificated
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Notes, comply with any requirements of the Commission in order to effect or
maintain the qualification of the Indenture under the TIA or comply with Article
Five of the Indenture or make any other change that does not adversely affect
the rights of any Holder of a Note.
12. Restrictive Covenants. The Indenture imposes certain limitations
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on the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, make payments in respect of their Capital
Stock or certain Indebtedness, make certain Investments, create or incur liens,
enter into transactions with Affiliates, create dividend or other payment
restrictions affecting Restricted Subsidiaries of the Company, issue and sell
Capital Stock of Restricted Subsidiaries of the Company, and on the ability of
the Company to merge or consolidate with any other Person or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of the
Company's or its Restricted Subsidiaries' assets or adopt a plan of liquidation.
Such limitations are subject to a number of important qualifications and
exceptions. If no Default has occurred and is continuing, after the rating
assigned to the Notes by Xxxxx'x and S&P are Investment Grade and remain as
such, the Company and the Restricted Subsidiaries will not be subject to
Sections 4.10, 4.11, 4.12, 4.13, 4.15, 4.17, 4.18 and clause (iii) of the first
paragraph of Section 5.01 of the Indenture. Pursuant to Section 4.06 of the
Indenture, the Company must annually report to the Trustee on compliance with
such limitations.
13. Successors. When a successor assumes, in accordance with the
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Indenture, all the obligations of its predecessor under the Notes and the
Indenture, the predecessor, subject to certain exceptions, will be released from
those obligations.
14. Defaults and Remedies. If an Event of Default occurs and is
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continuing, the principal of all Notes then outstanding, plus all accrued and
unpaid interest, if any, to and including the date the Notes are paid, may be
declared due and payable in the manner and with the effect provided in the
Indenture. Holders of Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee is not obligated to enforce the Indenture
or the Notes unless it has received indemnity reasonably satisfactory to it. The
Indenture permits, subject to certain limitations therein provided, Holders of a
majority in aggregate principal amount of the Notes then outstanding to direct
the Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of Notes notice of any continuing Default or Event of Default (except a
Default in payment of principal or interest when due, for any reason or a
Default in compliance with Article Five of
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the Indenture) if it determines that withholding notice is in their interest.
15. Trustee Dealings with the Company and Its Subsidiaries. The
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Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Notes and may otherwise deal with the Company, its
Subsidiaries or their respective Affiliates as if it were not the Trustee.
16. No Recourse Against Others. No partner, director, officer,
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employee or stockholder, as such, of the Company, as such, shall have any
liability for any obligations of the Company under the Notes, the Indenture or
the Registration Rights Agreement or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for the issuance of the Notes.
17. Authentication. This Note shall not be valid until the Trustee
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or Authenticating Agent manually signs the certificate of authentication on this
Note.
18. Governing Law. This Note and the Indenture shall be governed by
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and construed in accordance with the laws of the State of New York, as applied
to contracts made and performed within the State of New York, without regard to
principles of conflict of laws. Each of the parties hereto agrees to submit to
the jurisdiction of the courts of the State of New York in any action or
proceeding arising out of or relating to this Note.
19. Abbreviations and Defined Terms. Customary abbreviations may be
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used in the name of a Holder of a Note or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
20. CUSIP Numbers. Pursuant to a recommendation promulgated by the
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Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes as a convenience to the Holders of the
Notes. No representation is made as to the accuracy of such numbers as printed
on the Notes and reliance may be placed only on the other identification numbers
printed hereon.
The Company will furnish to any Holder of a Note upon written request
and without charge a copy of the Indenture, which has the text of this Note.
Requests may be made to:
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California Steel Industries, Inc., 00000 Xxx Xxxxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxxxx 00000.
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ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and
have your signature guaranteed by an Eligible Guarantor Institution (bank, stock
broker, savings and loan association or credit union) with membership in an
approved signature guarantee medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15:
I or we assign and transfer this Note to:
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(Print or type name, address and zip code and social security or tax ID number
of assignee)
and irrevocably appoint _____________________________________________________ ,
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
Dated: _______________________________________ Signed: _______________________
(Sign exactly as name appears
on the other side of this Note)
Signature Guarantee: ______________________________________
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[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.14 or Section 4.15 of the Indenture, check the appropriate
box:
Section 4.14 [ ]
Section 4.15 [ ]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.14 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$___________________
Dated: _______________ __________________________________________________
NOTICE: The signature on this assignment must
correspond with the name as it appears upon the
face of the within Note in every particular
without alteration or enlargement or any change
whatsoever and be guaranteed.
Signature Guarantee: _____________________________
[Signature must be guaranteed by an Eligible Guarantor
Institution (bank, stock broker, savings and loan
association or credit union) with membership in an approved
signature guarantee medallion program pursuant to
Securities and Exchange Commission Rule 17Ad-15.]
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EXHIBIT C
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Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
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Ladies and Gentlemen:
In connection with our proposed purchase of 8 1/2% Senior Notes due
2009 (the "Notes") of California Steel Industries, Inc., a Delaware corporation
(the "Company"), we confirm that:
1. We have received a copy of the Offering Memorandum (the "Offering
Memorandum"), dated April 6, 1999, relating to the Notes and such other
information as we deem necessary in order to make our investment decision.
We acknowledge that we have read and agreed to the matters stated in the
section entitled "Transfer Restrictions" of such Offering Memorandum.
2. We understand that any subsequent transfer of the Notes is
subject to certain restrictions and conditions set forth in the Indenture
relating to the Notes (the "Indenture") as described in the Offering
Memorandum and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes except in compliance with, such
restrictions and conditions and the Securities Act of 1933, as amended (the
"Securities Act"), and all applicable State securities laws.
3. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes may not be offered
or sold within the United States or to, or for the account or benefit of,
U.S. persons except as permitted in the following sentence. We agree, on
our own behalf and on behalf of any accounts for which we are acting as
hereinafter stated, that if we should sell any Notes, we will do so only
(i) to the Company or any subsidiary thereof, (ii) inside the United States
in accordance with Rule 144A under the Securities Act to a "qualified
institutional buyer" (as defined in Rule 144A promulgated under the
Securities Act), (iii) inside the United States to an institutional "ac-
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credited investor" (as defined below) that, prior to such transfer,
furnishes (or has furnished on its behalf by a U.S. broker-dealer) to the
Trustee (as defined in the Indenture) a signed letter containing certain
representations and agreements relating to the restrictions on transfer of
the Notes (the form of which letter can be obtained from the Trustee), (iv)
outside the United States in accordance with Rule 904 of Regulation S
promulgated under the Securities Act to non-U.S. persons, (v) pursuant to
the exemption from registration provided by Rule 144 under the Securities
Act (if available), or (vi) pursuant to an effective registration statement
under the Securities Act, and we further agree to provide to any person
purchasing any of the Notes from us a notice advising such purchaser that
resales of the Notes are restricted as stated herein.
4. We understand that, on any proposed resale of any Notes, we will
be required to furnish to the Trustee and the Company such certification,
legal opinions and other information as the Trustee and the Company may
reasonably require to confirm that the proposed sale complies with the
foregoing restrictions. We further understand that the Notes purchased by
us will bear a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to
be capable of evaluating the merits and risks of our investment in the
Notes, and we and any accounts for which we are acting are each able to
bear the economic risk of our or their investment, as the case may be.
6. We are acquiring the Notes purchased by us for our account or for
one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
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You, the Company, the Trustee and others are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By: ___________________________
Name:
Title:
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EXHIBIT D
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Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
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Re: California Steel Industries, Inc.
(the "Company") 8 1/2% Senior Notes due
2009 (the "Notes")
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Ladies and Gentlemen:
In connection with our proposed sale of aggregate
principal amount of the Notes, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United
States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been pre-
arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Notes.
You, the Company and counsel for the Company are entitled to rely upon
this letter and are irrevocably authorized
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to produce this letter or a copy hereof to any interested party in any
administrative or legal proceedings or official inquiry with respect to the
matters covered hereby. Terms used in this certificate have the meanings set
forth in Regulation S.
Very truly yours,
[Name of Transferor]
By: __________________________
Authorized Signature
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