EXHIBIT 4.3
EXECUTION COPY
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TFM, S.A. de C.V.,
AS ISSUER
AND
THE BANK OF NEW YORK,
AS TRUSTEE,
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INDENTURE
DATED AS OF JUNE 13, 2002
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12.50% SENIOR NOTES DUE 2012
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CROSS-REFERENCE TABLE
TIA Sections Indenture Sections
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Section 310(a)(1)............................................ 7.10
(a)(2)............................................ 7.10
(b)............................................... 7.03; 7.08
Section 311.................................................. 7.03
Section 313(a)............................................... 7.06
(c).......................................... ... 7.05; 7.06
Section 314(a)............................................... 4.18; 13.02
(a)(4)............................................ 1.01 "Officers' Certificate"
(c)(1)............................................ 13.03
(c)(2)............................................ 13.03
(e)............................................... 1.01 "Officers' Certificate,"
"Opinion of Counsel"
Section 315(a)-(d)........................................... 7.02
Section 316(a)............................................... 6.06
(b)............................................... 6.07
Section 317(a)(1)............................................ 6.08
(a)(2)............................................ 6.09
Section 318(a)............................................... 13.01
(c)............................................... 13.01
Note: The Cross-Reference Table shall not for any purpose be deemed to be a
part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE................................................... 2
SECTION 1.01. Definitions......................... ............................................... 2
SECTION 1.02. Incorporation by Reference of Trust Indenture Act................................... 20
SECTION 1.03. Rules of Construction............................................................... 21
ARTICLE TWO THE NOTES.................................................................................... 21
SECTION 2.01. Form and Dating..................................................................... 21
SECTION 2.02. Restrictive Legends................................................................. 22
SECTION 2.03. Execution, Authentication and Denominations......................................... 23
SECTION 2.04. Registrar and Paying Agent.......................................................... 24
SECTION 2.05. Paying Agent to Hold Money in Trust................................................. 25
SECTION 2.06. Transfer and Exchange............................................................... 25
SECTION 2.07. Book-Entry Provisions for Global Notes.............................................. 26
SECTION 2.08. Special Transfer Provisions......................................................... 28
SECTION 2.09. Replacement Notes................................................................... 30
SECTION 2.10. Outstanding Notes................................................................... 31
SECTION 2.11. Temporary Notes..................................................................... 31
SECTION 2.12. Cancellation........................................................................ 31
SECTION 2.13. CUSIP Numbers....................................................................... 32
SECTION 2.14. Defaulted Interest.................................................................. 32
SECTION 2.15. Issuance of Additional Notes........................................................ 32
ARTICLE THREE REDEMPTION................................................................................. 32
SECTION 3.01. Optional Redemption................................................................. 32
SECTION 3.02. Redemption for Changes in Withholding Taxes......................................... 33
SECTION 3.03. Notices to Trustee.................................................................. 33
SECTION 3.04. Selection of Notes to Be Redeemed................................................... 33
SECTION 3.05. Add On Notes........................................................................ 33
SECTION 3.06. Notice of Redemption................................................................ 34
SECTION 3.07. Effect of Notice of Redemption...................................................... 35
SECTION 3.08. Deposit of Redemption Price......................................................... 35
SECTION 3.09. Payment of Notes Called for Redemption.............................................. 35
SECTION 3.10. Notes Redeemed in Part.............................................................. 35
ARTICLE FOUR COVENANTS................................................................................... 36
SECTION 4.01. Payment of Notes.................................................................... 36
SECTION 4.02. Maintenance of Office or Agency..................................................... 36
SECTION 4.03. Limitation on Indebtedness.......................................................... 36
SECTION 4.04. Limitation on Restricted Payments................................................... 39
SECTION 4.05. Limitation on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries............................................................. 42
SECTION 4.06. Limitation on the Issuance and Sale of Capital Stock of Restricted
Subsidiaries........................................................................ 43
SECTION 4.07. Limitation on Issuances of Guarantees by Restricted Subsidiaries.................... 44
SECTION 4.08. Limitation on Transactions with Stockholders and Affiliates......................... 44
SECTION 4.09. Limitation on Liens................................................................. 45
SECTION 4.10. Limitation on Sale-Leaseback Transactions........................................... 46
SECTION 4.11. Limitation on Asset Sales........................................................... 46
SECTION 4.12. Repurchase of Notes upon a Change of Control........................................ 47
SECTION 4.13. Existence........................................................................... 47
SECTION 4.14. Payment of Taxes and Other Claims................................................... 47
SECTION 4.15. Maintenance of Properties and Insurance............................................. 48
SECTION 4.16. Notice of Defaults.................................................................. 48
SECTION 4.17. Compliance Certificates............................................................. 48
SECTION 4.18. Commission Reports and Reports to Holders........................................... 49
SECTION 4.19. Waiver of Stay, Extension or Usury Laws............................................. 49
SECTION 4.20. Additional Amounts.................................................................. 49
SECTION 4.21. Comision Nacional Bancaria y de Valores............................................. 52
ARTICLE FIVE SUCCESSOR CORPORATION....................................................................... 52
SECTION 5.01. When Company May Merge, Etc......................................................... 52
SECTION 5.02. Successor Substituted............................................................... 53
ARTICLE SIX DEFAULT AND REMEDIES......................................................................... 53
SECTION 6.01. Events of Default................................................................... 53
SECTION 6.02. Acceleration........................................................................ 55
SECTION 6.03. Other Remedies...................................................................... 55
SECTION 6.04. Waiver of Past Defaults............................................................. 56
SECTION 6.05. Control by Majority................................................................. 56
SECTION 6.06. Limitation on Suits................................................................. 56
SECTION 6.07. Rights of Holders to Receive Payment................................................ 57
SECTION 6.08. Collection Suit by Trustee.......................................................... 57
SECTION 6.09. Trustee May File Proofs of Claim.................................................... 57
SECTION 6.10. Priorities.......................................................................... 57
SECTION 6.11. Undertaking for Costs............................................................... 58
SECTION 6.12. Restoration of Rights and Remedies.................................................. 58
SECTION 6.13. Rights and Remedies Cumulative...................................................... 58
SECTION 6.14. Delay or Omission Not Waiver........................................................ 58
ARTICLE SEVEN TRUSTEE.................................................................................... 58
SECTION 7.01. General............................................................................. 58
SECTION 7.02. Certain Rights of Trustee........................................................... 59
SECTION 7.03. Individual Rights of Trustee........................................................ 60
SECTION 7.04. Trustee's Disclaimer................................................................ 60
SECTION 7.05. Notice of Default................................................................... 60
SECTION 7.06. Reports by Trustee to Holders....................................................... 60
SECTION 7.07. Compensation and Indemnity.......................................................... 60
SECTION 7.08. Replacement of Trustee.............................................................. 61
SECTION 7.09. Successor Trustee by Merger, Etc.................................................... 62
SECTION 7.10. Eligibility......................................................................... 62
SECTION 7.11. Money Held in Trust................................................................. 62
SECTION 7.12. Withholding Taxes................................................................... 63
SECTION 7.13. Appointment of Co-Trustee........................................................... 63
ARTICLE EIGHT DISCHARGE OF INDENTURE, DEFEASANCE......................................................... 64
SECTION 8.01. Termination of Company's Obligations................................................ 64
SECTION 8.02. Defeasance and Discharge of Indenture............................................... 65
SECTION 8.03. Defeasance of Certain Obligations................................................... 66
SECTION 8.04. Application of Trust Money.......................................................... 68
SECTION 8.05. Repayment to Company................................................................ 68
SECTION 8.06. Reinstatement....................................................................... 68
ARTICLE NINE AMENDMENTS, SUPPLEMENTS AND WAIVERS......................................................... 69
SECTION 9.01. Without Consent of Holders.......................................................... 69
SECTION 9.02. With Consent of Holders............................................................. 69
SECTION 9.03. Revocation and Effect of Consent.................................................... 70
SECTION 9.04. Notation on or Exchange of Notes.................................................... 71
SECTION 9.05. Trustee to Sign Amendments, Etc..................................................... 71
SECTION 9.06. Conformity with Trust Indenture Act................................................. 71
ARTICLE TEN [INTENTIONALLY OMITTED]...................................................................... 71
ARTICLE ELEVEN [INTENTIONALLY OMITTED]................................................................... 71
ARTICLE TWELVE [INTENTIONALLY OMITTED]................................................................... 71
ARTICLE THIRTEEN MISCELLANEOUS........................................................................... 71
SECTION 13.01. Trust Indenture Act of 1939......................................................... 71
SECTION 13.02. Notices............................................................................. 71
SECTION 13.03. Certificate and Opinion as to Conditions Precedent.................................. 73
SECTION 13.04. Statements Required in Certificate or Opinion....................................... 74
SECTION 13.05. Meetings of Noteholders............................................................. 74
SECTION 13.06. Rules by Trustee, Paying Agent or Registrar......................................... 74
SECTION 13.07. Payment Date Other Than a Business Day.............................................. 74
SECTION 13.08. Governing Law; Submission to Jurisdiction; Agent for Service........................ 74
SECTION 13.09. Currency Indemnity.................................................................. 75
SECTION 13.10. No Adverse Interpretation of Other Agreements....................................... 75
SECTION 13.11. No Recourse Against Others.......................................................... 75
SECTION 13.12. Successors.......................................................................... 75
SECTION 13.13. Duplicate Originals................................................................. 76
SECTION 13.14. Separability........................................................................ 76
SECTION 13.15. Table of Contents, Headings, Etc.................................................... 76
INDENTURE, dated as of June 13, 2002, between TFM, S.A. de C.V., a
variable capital company (sociedad anonima de capital variable) organized under
the laws of Mexico, as Issuer (the "Company"), The Bank of New York, a New York
banking corporation, as Trustee (in such capacity, the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance of the Company's 12.50% Senior Notes due
2012 (the "Notes") issuable as provided in this Indenture of which $180,000,000
in aggregate principal amount will be initially issued on the Closing Date.
Subject to the conditions set forth in the Indenture and without the consent of
the Holders, the Company may issue Add On Notes as provided for herein.
Pursuant to the Registration Rights Agreement (as defined herein), the Notes
may become freely transferable upon the consummation of an exchange offer for
the Notes or upon the effectiveness of a shelf registration statement with
respect to the Notes. All things necessary to make this Indenture a valid
agreement of the Company, in accordance with its terms, have been done, and the
Company has done all things necessary to make the Notes, when executed by the
Company and authenticated and delivered by the Trustee hereunder and duly
issued by the Company, the valid and legally binding obligations of the Company
as hereinafter provided.
This Indenture will be subject to, and shall be governed by, the
provisions of the Trust Indenture Act of 1939, as amended, that are required to
be a part of and to govern indentures qualified under the Trust Indenture Act
of 1939, as amended.
AND THIS INDENTURE FURTHER WITNESSETH
For and in consideration of the premises and the purchase of the Notes
by the Holders (as defined herein) thereof, it is mutually covenanted and
agreed, for the equal and proportionate benefit of all Holders, as follows.
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Indebtedness" means Indebtedness of a Person existing at the
time such Person becomes a Restricted Subsidiary or assumed in connection with
an Asset Acquisition by the Company or a Restricted Subsidiary and not Incurred
in connection with, or in anticipation of, such Person becoming a Restricted
Subsidiary or such Asset Acquisition; provided that Indebtedness of such Person
which is redeemed, defeased, retired or otherwise repaid at the time of or
immediately upon consummation of the transactions by which such Person becomes
a Restricted Subsidiary or such Asset Acquisition shall not be Acquired
Indebtedness.
"Acquisition" means the acquisition of 80% of the outstanding share
capital of the Company by Grupo TFM.
"Acquisition Date" means the date on which the Acquisition was
consummated, or June 23, 1997.
"Acquisition Transactions" has the meaning provided in Section 4.04.
"Additional Amounts" has the meaning set forth in Section 4.20.
"Add On Note Board Resolutions" means resolutions duly adopted by the
Board of Directors of the Company and delivered to the Trustee in an Officers'
Certificate providing for the issuance of Add On Notes.
"Add On Note Supplemental Indenture" means a supplement to this
Indenture duly executed and delivered by the Company and the Trustee pursuant
to Article 9 providing for the issuance of Add On Notes.
"Add On Notes" means the Company's 12.50% Senior Notes Due 2012
originally issued after the Closing Date pursuant to Section 3.05, including
any replacement Notes and any Exchange Notes as specified in the relevant Add
On Note Board Resolutions or Add On Note Supplemental Indenture issued therefor
in accordance with this Indenture.
"Adjusted Consolidated Net Income" means, for any period, the
aggregate net income (or loss) of the Company and its Restricted Subsidiaries
for such period determined in conformity with IAS; provided that the following
items shall be excluded in computing Adjusted Consolidated Net Income (without
duplication): (i) the net income of any Person (other than net income
attributable to a Restricted Subsidiary) in which any Person (other than the
Company or any of its Restricted Subsidiaries) has a joint interest and the net
income of any Unrestricted Subsidiary, except to the extent of the amount of
dividends or other distributions actually paid to the Company or any of its
Restricted Subsidiaries by such other Person or such Unrestricted Subsidiary
during such period; (ii) solely for the purposes of calculating the amount of
Restricted Payments that may be made pursuant to clause (C) of the first
paragraph of Section 4.04 (and in
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such case, except to the extent includible pursuant to clause (i) above, the
net income (or loss) of any Person accrued prior to the date it becomes a
Restricted Subsidiary or is merged into or consolidated with the Company or any
of its Restricted Subsidiaries or all or substantially all of the property and
assets of such Person are acquired by the Company or any of its Restricted
Subsidiaries; (iii) the net income of any Restricted Subsidiary to the extent
that the declaration or payment of dividends or similar distributions by such
Restricted Subsidiary of such net income is not at the time permitted by the
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to such
Restricted Subsidiary; (iv) any gains or losses (on an after-tax basis)
attributable to Asset Sales; (v) except for purposes of calculating the amount
of Restricted Payments that may be made pursuant to clause (C) of the first
paragraph of Section 4.04, any amount paid or accrued as dividends on Preferred
Stock of the Company or any Restricted Subsidiary owned by Persons other than
the Company and any of its Restricted Subsidiaries; and (vi) all extraordinary
gains and extraordinary losses.
"Adjusted Consolidated Net Tangible Assets" means the total amount of
assets of the Company and its Restricted Subsidiaries (less applicable
depreciation, amortization and other valuation reserves), except to the extent
resulting from write-ups of capital assets following the Closing Date (but
including write-ups in connection with accounting for acquisitions in
conformity with IAS), after deducting therefrom (i) all current liabilities of
the Company and those of its Restricted Subsidiaries (excluding intercompany
items) and (ii) all goodwill, trade names, trademarks, patents, unamortized
debt discount and expense and other like intangibles, all as set forth on the
most recent quarterly or annual consolidated balance sheet of the Company and
that of its Restricted Subsidiaries, prepared in conformity with IAS and filed
with the Commission or provided to the Trustee pursuant to Section 4.18.
"Affiliate" means, as applied to any Person, any other Person directly
or indirectly controlling, controlled by, or under direct or indirect common
control with, such Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means any Registrar, Paying Agent, authenticating agent or
co-Registrar.
"Agent Members" has the meaning provided in Section 2.07(a).
"Asset Acquisition" means (i) an investment by the Company or any of
its Restricted Subsidiaries in any other Person pursuant to which such Person
shall become a Restricted Subsidiary of the Company or shall be merged into or
consolidated with the Company or any of its Restricted Subsidiaries; provided
that such Person's primary business is related, ancillary or complementary to
the businesses of the Company and those of its Restricted Subsidiaries on the
date of such investment or (ii) an acquisition by the Company or any of its
Restricted Subsidiaries of the property and assets of any Person other than the
Company or any of its Restricted Subsidiaries that constitute substantially all
of a division or line of business of such Person; provided that the property
and assets acquired are related, ancillary or
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complementary to the businesses of the Company and those of its Restricted
Subsidiaries on the date of such acquisition.
"Asset Disposition" means the sale or other disposition by the Company
or any of its Restricted Subsidiaries (other than to the Company or a
Restricted Subsidiary) of (i) all or substantially all of the Capital Stock of
any Restricted Subsidiary of the Company or (ii) all or substantially all of
the assets that constitute a division or line of business of the Company or any
of its Restricted Subsidiaries.
"Asset Sale" means any sale, transfer or other disposition (including
by way of merger, consolidation or sale-leaseback transaction) in one
transaction or a series of related transactions by the Company or any of its
Restricted Subsidiaries to any Person other than the Company or any of its
Restricted Subsidiaries of (i) all or any of the Capital Stock of any
Restricted Subsidiary, (ii) all or substantially all of the property and assets
of an operating unit or business of the Company or any of its Restricted
Subsidiaries or (iii) any other property and assets of the Company or any of
its Restricted Subsidiaries (other than the Capital Stock, property or assets
of an Unrestricted Subsidiary) outside the ordinary course of business of the
Company or such Restricted Subsidiary and, in each case, that is not governed
by the provisions of the Indenture applicable to mergers, consolidations and
sales of all or substantially all of the assets of the Company; provided that
"Asset Sale" shall not include (a) sales or other dispositions of inventory,
receivables and other current assets (which shall not include locomotives or
rolling stock) or (b) sales or other dispositions of assets for consideration
at least equal to the fair market value of the assets sold or disposed of,
provided that the consideration received would satisfy clause (B) of the first
paragraph of Section 4.11.
"Average Life" means, at any date of determination with respect to any
debt security, the quotient obtained by dividing (i) the sum of the products of
(a) the number of years from such date of determination to the dates of each
successive scheduled principal payment of such debt security and (b) the amount
of such principal payment by (ii) the sum of all such principal payments.
"Board of Directors" means the Board of Directors of the Company or
the Executive Committee thereof, if duly authorized to act with respect to this
Indenture.
"Board Resolution" means a copy of a resolution, certified by the
Secretary, Pro-Secretary or any Assistant Secretary of the Company, as required
by the context to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in The City of New York, or in the city of the Corporate
Trust Office of the Trustee, are authorized by law to close.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) in equity of such Person, whether now outstanding or
issued after the Closing Date, including, without limitation, all Common Stock
and Preferred Stock.
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"Capitalized Lease" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) of which the discounted present
value of the rental obligations of such Person as lessee, in conformity with
IAS, is required to be capitalized on the balance sheet of such Person.
"Capitalized Lease Obligations" means the discounted present value of
the rental obligations under a Capitalized Lease.
"Change of Control" means such time as (i) the Existing Holders cease
to be the ultimate "beneficial owners" (defined in Rule 13d-3 under the
Exchange Act and including by reason of any change in the ultimate "beneficial
ownership" of the Capital Stock of Grupo TFM) of Voting Stock representing more
than 50% of the total voting power of the total Voting Stock of Grupo TFM on a
fully diluted basis; (ii) individuals who on the Closing Date constitute the
Board of Directors of the Company or Grupo TFM (together with any new directors
whose election by the Board of Directors or by the Company's stockholders or
Grupo TFM's stockholders, as the case may be, was approved by a vote of at
least two-thirds of the members of such Board of Directors then in office who
either were members of such Board of Directors on the Closing Date or whose
election or nomination for election was previously so approved or who were
appointed by one or more of its Existing Holders) cease for any reason to
constitute a majority of the members of such Board of Directors then in office;
or (iii) Grupo TFM does not own all of the outstanding Voting Stock of the
Company other than as a result of (A) one or more primary offerings of the
Common Stock of the Company having, in the aggregate, voting power equal to or
less than 35% of the total voting power of the Voting Stock of the Company or
(B) a merger, consolidation, sale, transfer or lease solely between Grupo TFM
and the Company.
"Closing Date" means the date on which the Notes are originally issued
under this Indenture.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the TIA, then the body
performing such duties at such time.
"Common Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or nonvoting) of such Person's equity, other than Disqualified Stock of
such Person, whether now outstanding or issued after the Closing Date,
including all Common Stock or Preferred Stock (other than Disqualified Stock).
For purposes of this definition, "Common Stock" shall include all shares,
interests, participations and equivalents corresponding to common stock (other
than Disqualified Stock) under the laws of the jurisdiction in which such
Person is organized.
"Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to Article Five of this
Indenture and thereafter means the successor.
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"Company Order" means a written request or order signed in the name of
the Company (i) by its Chief Executive Officer and (ii) by one of its Directors
and delivered to the Trustee.
"Concession Title" means the right of the Company for a period of 30
years to be the exclusive provider (subject to certain trackage rights) of
freight transportation services over the Northeast Rail Lines and for an
additional 20 years to be a non-exclusive provider of such services granted by
the Mexican government pursuant to the Concession Title, subject in all cases
to the terms and conditions of the Concession Title, as in effect on the
Acquisition Date.
"Consolidated EBITDA" means, for any period, the sum of the amounts
for such period of (i) Adjusted Consolidated Net Income, (ii) Consolidated
Interest Expense, to the extent such amount was deducted in calculating
Adjusted Consolidated Net Income, (iii) income and asset taxes, to the extent
such amount was deducted in calculating Adjusted Consolidated Net Income (other
than income taxes (either positive or negative) attributable to extraordinary
and non-recurring gains or losses or sales of assets), (iv) depreciation
expense, to the extent such amount was deducted in calculating Adjusted
Consolidated Net Income, (v) amortization expense, to the extent such amount
was deducted in calculating Adjusted Consolidated Net Income, and (vi) all
other non-cash items reducing Adjusted Consolidated Net Income (other than
items that will require cash payments and for which an accrual or reserve is,
or is required by IAS to be, made, but including fees payable by the Company
under the Management Services Agreements which are unpaid and for which an
accrual is made), less all non-cash items increasing Adjusted Consolidated Net
Income, all as determined on a consolidated basis for the Company and its
Restricted Subsidiaries in conformity with IAS; provided that, if any
Restricted Subsidiary is not a Wholly Owned Restricted Subsidiary, Consolidated
EBITDA shall be reduced (to the extent not otherwise reduced in accordance with
IAS) by an amount equal to (A) the amount of the Adjusted Consolidated Net
Income attributable to such Restricted Subsidiary multiplied by (B) the
quotient of (1) the number of shares of outstanding Common Stock of such
Restricted Subsidiary not owned on the last day of such period by the Company
or any of its Restricted Subsidiaries divided by (2) the total number of shares
of outstanding Common Stock of such Restricted Subsidiary on the last day of
such period.
"Consolidated Interest Expense" means, for any period, the aggregate
amount of interest in respect of Indebtedness (including amortization of
original issue discount on any Indebtedness and the interest portion of any
deferred payment obligation, calculated in accordance with the effective
interest method of accounting; all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance
financing; the net costs associated with Interest Rate Agreements; and interest
paid (by any Person) with respect to Indebtedness that is Guaranteed or secured
by the Company or any of its Restricted Subsidiaries) and all but the principal
component of rentals in respect of Capitalized Lease Obligations paid, accrued
or scheduled to be paid or to be accrued by the Company and its Restricted
Subsidiaries during such period; excluding, however, (i) any amount of such
interest of any Restricted Subsidiary if the net income of such Restricted
Subsidiary is excluded in the calculation of Adjusted Consolidated Net Income
pursuant to clause (iii) of the definition thereof (but only in the same
proportion as the net income of such Restricted Subsidiary is excluded from the
calculation of Adjusted Consolidated Net Income pursuant to clause (iii) of the
definition thereof) and (ii) any premiums, fees and expenses (and any
amortization
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thereof) payable in connection with the offer of the Existing Securities and
the Notes, the Exchange Offer or the Shelf Registration Statement with respect
to the Notes, all as determined on a consolidated basis (without taking into
account Unrestricted Subsidiaries) in conformity with IAS.
"Consolidated Net Worth" means, at any date of determination,
stockholders' equity as set forth on the most recently available quarterly or
annual consolidated balance sheet of the Company and its Restricted
Subsidiaries (which shall be as of a date not more than 90 days prior to the
date of such computation, and which shall not take into account Unrestricted
Subsidiaries), less any amounts attributable to Disqualified Stock or any
equity security convertible into or exchangeable for Indebtedness, the cost of
treasury stock and the principal amount of any promissory notes receivable from
the sale of the Capital Stock of the Company or any of its Restricted
Subsidiaries, each item to be determined in conformity with IAS.
"Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date of this Indenture,
located at The Bank of New York, 00 Xxxxx Xxxxxx, 00xx xxxxx, Xxx Xxxx, XX
00000, Attention: Global Finance Unit.
"Currency Agreement" means any foreign exchange contract, currency
swap agreement or other similar agreement or arrangement.
"Default" means any event that is, or after notice or passage of time
or both would be, an Event of Default.
"Depositary" means The Depository Trust Company, its nominees, and
their respective successors.
"Disqualified Stock" means any class or series of Capital Stock of any
Person that by its terms or otherwise is (i) required to be redeemed prior to
the Stated Maturity of the Notes; (ii) redeemable at the option of the holder
of such class or series of Capital Stock at any time prior to the Stated
Maturity of the Notes; or (iii) convertible into or exchangeable for Capital
Stock referred to in clause (i) or (ii) above or Indebtedness having a
scheduled maturity prior to the Stated Maturity of the Notes; provided that any
Capital Stock that would not constitute Disqualified Stock but for provisions
thereof giving holders thereof the right to require such Person to repurchase
or redeem such Capital Stock upon the occurrence of an "asset sale" or "change
of control" occurring prior to the Stated Maturity of the Notes shall not
constitute Disqualified Stock if the "asset sale" or "change of control"
provisions applicable to such Capital Stock are no more favorable to the
holders of such Capital Stock than the provisions contained in Section 4.11 and
Section 4.12 and such Capital Stock specifically provides that such Person will
not repurchase or redeem any such stock pursuant to such provision prior to the
Company's repurchase of such Notes as are required to be repurchased pursuant
to Section 4.11 and Section 4.12. Notwithstanding the foregoing, Series L
shares of Grupo TFM and the Class III Series A shares and Class III Series B
shares of the Company owned by Mexico shall be deemed not to be Disqualified
Stock.
"Event of Default" has the meaning set forth in Section 6.01.
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"Excess Proceeds" has the meaning set forth in Section 4.11.
"Exchange Act" means the United States Securities Exchange Act of
1934, as amended.
"Exchange Notes" means any securities of the Company containing terms
identical to the Notes (except that such Exchange Notes (i) shall be registered
under the Securities Act, (ii) will not provide for an increase in the rate of
interest (other than with respect to overdue amounts) and (iii) will not
contain terms with respect to transfer restrictions) that are issued and
exchanged for the Notes pursuant to the Registration Rights Agreement and this
Indenture.
"Exchange Offer" means the exchange offer by the Company of Exchange
Notes for the Notes.
"Existing Holders" means KCSI and Grupo TMM.
"Existing Indentures" means the indentures, each dated as of June 16,
1997, as amended or supplemented, among the Company, as issuer, Grupo TFM, as
Guarantor, The Bank of New York, as Trustee and Deutsche Bank Luxembourg S.A.,
as Paying Agent, under which the Existing Securities were issued.
"Existing Securities" means the outstanding 10.25% Senior Notes due
2007 and 11.75% Senior Discount Debentures due 2009 of TFM, which are
guaranteed by Grupo TFM.
"fair market value" means the price that would be paid in an
arm's-length transaction between an informed and willing seller under no
compulsion to sell and an informed and willing buyer under no compulsion to
buy, as determined in good faith by the Board of Directors, whose determination
shall be conclusive if evidenced by a Board Resolution.
"FNM" means Ferrocarriles Nacionales de Mexico, and its successors and
assigns.
"Global Notes" has the meaning provided in Section 2.01.
"Government Securities" means direct obligations of, obligations fully
and unconditionally guaranteed by, or participation in pools consisting solely
of (or repurchase transactions relating to) obligations of or obligations fully
and unconditionally guaranteed by the United States of America for the payment
of which guarantee or obligations the full faith and credit of the United
States of America is pledged and which are not callable or redeemable at the
option of the issuer thereof.
"Grupo TFM" means Grupo Transportacion Ferroviaria Mexicana, S.A. de
C.V., a sociedad anonima de capital variable organized under the laws of
Mexico, and its successors and assigns.
-8-
"Grupo TMM" means Grupo TMM, S.A. de C.V. (formerly Grupo Servia, S.A.
de C.V.), a sociedad anonima de capital variable organized under the laws of
Mexico, and its successors and assigns.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing (whether pursuant to a guaranty, a
fianza, an aval or otherwise) any Indebtedness of any other Person and, without
limiting the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of such Person (i) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Indebtedness of such other
Person (whether arising by virtue of partnership arrangements, or by agreements
to keep-well, to purchase assets, goods, securities or services (unless such
purchase arrangements are on arm's-length terms and are entered into in the
ordinary course of business), to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for purposes of
assuring in any other manner the obligee of such Indebtedness of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); provided that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business or obligations
arising, in the ordinary course of business, from contracting for interline
railroad services. The term "Guarantee" used as a verb has a corresponding
meaning.
"Guaranteed Indebtedness" has the meaning set forth in Section 4.07.
"Holder" or "Noteholder" means the registered holder of any Note.
"IAS" means accounting principles issued by the International
Accounting Standards Committee as in effect on the Closing Date and the
accounting principles and policies of the Company and its Restricted
Subsidiaries, as in effect on the Closing Date. All ratios and computations
shall be computed in conformity with IAS applied on a consistent basis in U.S.
dollars, except that calculations made for purposes of determining compliance
with the terms of the covenants and with other provisions of this Indenture
shall be made without giving effect to the matters referred to in clause (ii)
of the last sentence of the definition of "Consolidated Interest Expense."
"Incur" means, with respect to any Indebtedness, to incur, create,
issue, assume, Guarantee or otherwise become liable for or with respect to, or
become responsible for, the payment of, contingently or otherwise, such
Indebtedness, including an "Incurrence" of Acquired Indebtedness; provided that
neither the accrual of interest nor the accretion of original issue discount
shall be considered an Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person at any date of
determination (without duplication), (i) all indebtedness of such Person for
borrowed money, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) all obligations of such
Person in respect of letters of credit or other similar instruments (including
reimbursement obligations with respect thereto, but excluding obligations with
respect to letters of credit (including trade letters of credit) securing
obligations (other than obligations described in (i) or (ii) above or (v), (vi)
or (vii) below) entered into in the ordinary course of business of such Person
to the extent such letters of credit are not drawn upon or, if drawn upon, to
the extent such drawing is reimbursed no later than the third Business Day
following receipt by such
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Person of a demand for reimbursement), (iv) all obligations of such Person to
pay the deferred and unpaid purchase price of property or services, which
purchase price is due more than six months after the date of placing such
property in service or taking delivery and title thereto or the completion of
such services, except Trade Payables, (v) all obligations of such Person as
lessee under Capitalized Leases (but not operating leases), (vi) all
Indebtedness of other Persons secured by a Lien on any asset of such Person,
whether or not such Indebtedness is assumed by such Person; provided that the
amount of such Indebtedness shall be the lesser of (A) the fair market value of
such asset at such date of determination and (B) the amount of such
Indebtedness, (vii) all Indebtedness of other Persons Guaranteed by such Person
to the extent such Indebtedness is Guaranteed by such Person and (viii) to the
extent not otherwise included in this definition, obligations under Currency
Agreements and Interest Rate Agreements. The amount of Indebtedness of any
Person at any date shall be the outstanding balance at such date of all
unconditional obligations as described above and, with respect to contingent
obligations, the maximum liability upon the occurrence of the contingency
giving rise to the obligation, provided (A) that the amount outstanding at any
time of any Indebtedness issued with original issue discount is the face amount
of such Indebtedness less the unamortized portion of the original issue
discount of such Indebtedness at the time of its issuance as determined in
conformity with IAS, (B) that money borrowed and set aside at the time of the
Incurrence of any Indebtedness in order to prefund the payment of interest on
such Indebtedness shall be deemed not to be "Indebtedness" and (C) that
Indebtedness shall not include any liability for federal, state, local or other
taxes of any jurisdiction. For the purposes of computing the amount of
Indebtedness of any Person outstanding at any time, all such items shall be
excluded to the extent that they would be eliminated as intercompany items for
purposes of such Person's consolidated financial statements.
"Indenture" means this Indenture as originally executed or as it may
be amended or supplemented from time to time by one or more indentures
supplemental to this Indenture entered into pursuant to the applicable
provisions of this Indenture.
"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) of Regulation D under the Securities Act.
"Interest Coverage Ratio" means, on any Transaction Date, the ratio of
(i) the aggregate amount of Consolidated EBITDA for the then most recent four
fiscal quarters prior to such Transaction Date for which reports have been
filed with the Commission or provided to the Trustee pursuant to Section 4.18
(the "Four Quarter Period") to (ii) the aggregate Consolidated Interest Expense
during such Four Quarter Period. In making the foregoing calculation, (A) pro
forma effect shall be given to any Indebtedness Incurred or repaid during the
period (the "Reference Period") commencing on the first day of the Four Quarter
Period and ending on the Transaction Date (other than Indebtedness Incurred or
repaid under a revolving credit or similar arrangement to the extent of the
commitment thereunder (or under any predecessor revolving credit or similar
arrangement) in effect on the last day of such Four Quarter Period unless any
portion of such Indebtedness is projected, in the reasonable judgment of the
senior management of the Company, to remain outstanding for a period in excess
of 12 months from the date of the Incurrence thereof), in each case as if such
Indebtedness had been Incurred or repaid on the first day of such Reference
Period, (B) Consolidated Interest Expense attributable to interest on any
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Indebtedness (whether existing or being Incurred) computed on a pro forma basis
and bearing a floating interest rate shall be computed as if the rate in effect
on the Transaction Date (taking into account any Interest Rate Agreement
applicable to such Indebtedness if such Interest Rate Agreement has a remaining
term in excess of 12 months or, if shorter, at least equal to the remaining
term of such Indebtedness) had been the applicable rate for the entire period;
(C) pro forma effect shall be given to Asset Dispositions and Asset
Acquisitions (including giving pro forma effect to the application of proceeds
of any Asset Disposition) that occur during such Reference Period as if they
had occurred and such proceeds had been applied on the first day of such
Reference Period; and (D) pro forma effect shall be given to asset dispositions
and asset acquisitions (including giving pro forma effect to the application of
proceeds of any asset disposition) that have been made by any Person that has
become a Restricted Subsidiary or has been merged with or into the Company or
any Restricted Subsidiary during such Reference Period and that would have
constituted Asset Dispositions or Asset Acquisitions had such transactions
occurred when such Person was a Restricted Subsidiary as if such asset
dispositions or asset acquisitions were Asset Dispositions or Asset
Acquisitions that occurred on the first day of such Reference Period; provided
that, to the extent that clause (C) or (D) of this sentence requires that pro
forma effect be given to an Asset Acquisition or Asset Disposition, such pro
forma calculation shall be based upon the four full fiscal quarters immediately
preceding the Transaction Date of the Person, or division or line of business
of the Person, that is acquired or disposed for which financial information is
available.
"Interest Payment Date" means each semiannual interest payment date on
June 15 and December 15 of each year, commencing December 15, 2002.
"Interest Rate Agreement" means any interest rate protection
agreement, interest rate future agreement, interest rate option agreement,
interest rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate hedge agreement, option or future contract or other
similar agreement or arrangement.
"Investment" in any Person means any direct or indirect advance, loan
or other extension of credit (including, without limitation, by way of
Guarantee or similar arrangement; but excluding advances to customers in the
ordinary course of business that are, in conformity with IAS, recorded as
accounts receivable on the balance sheet of the Company or its Restricted
Subsidiaries) or capital contribution to (by means of any transfer of cash or
other property to others or any payment for property or services for the
account or use of others), or any purchase or acquisition of Capital Stock,
bonds, notes, debentures or other similar instruments issued by, such Person
and shall include (i) the designation of a Restricted Subsidiary as an
Unrestricted Subsidiary and (ii) the fair market value of the Capital Stock (or
any other Investment), held by the Company or any of its Restricted
Subsidiaries, of (or in) any Person that has ceased to be a Restricted
Subsidiary, including, without limitation, by reason of any transaction
permitted by clause (iii) of Section 4.06; provided that the value of any
investment outstanding at any time shall be deemed to be equal to the amount of
such Investment on the date made, less the return of capital to the Company and
its Restricted Subsidiaries with respect to such Investment (up to the amount
of such Investment on the date made). For purposes of the definition of
"Unrestricted Subsidiary" and Section 4.04, (i) "Investment" shall include the
fair market value of the assets (net of liabilities (other than liabilities to
the Company or any of its Restricted Subsidiaries)) of any Restricted
Subsidiary at the time that such Restricted Subsidiary is designated an
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Unrestricted Subsidiary, (ii) the fair market value of the assets (net of
liabilities (other than liabilities to the Company or any of its Restricted
Subsidiaries)) of any Unrestricted Subsidiary at the time that such
Unrestricted Subsidiary is designated a Restricted Subsidiary shall be
considered a reduction in outstanding Investments, and (iii) any property
transferred to or from an Unrestricted Subsidiary shall be valued at its fair
market value at the time of such transfer.
"KCSI" means Kansas City Southern Industries, Inc., a Delaware
corporation, and its successors and assigns.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including, without limitation, any conditional sale
or other title retention agreement or lease in the nature thereof or any
agreement to give any security interest).
"Management Services Agreements" means, collectively, the Management
Services Agreement between the Company and TMM dated May 9, 1997 and the
Management Services Agreement between the Company and KCS Transportation
Company dated May 9, 1997.
"Mexican Withholding Taxes" has the meaning set forth in Section 4.20.
"Mexico" means xxx Xxxxxxx Xxxxxx Xxxxxxxxx (xxx Xxxxxx Xxxxxxx
Xxxxxx) and any branch of power, ministry, department, authority or statutory
corporation or other entity (including a trust), owned or controlled directly
or indirectly by the Estados Unidos Mexicanos or any of the foregoing or
created by law as a public entity.
"Moody's" means Xxxxx'x Investors Service, Inc. and its successors.
"Nafin" means Nacional Financiera, S.N.C., a Mexican national credit
institution and development bank, and its successors and assigns.
"Net Cash Proceeds" means (a) with respect to any Asset Sale, the
proceeds of such Asset Sale in the form of cash or cash equivalents, including
payments in respect of deferred payment obligations (to the extent
corresponding to the principal, but not interest, component thereof) when
received in the form of cash or cash equivalents (except to the extent such
obligations are financed or sold with recourse to the Company or any Restricted
Subsidiary) and proceeds from the conversion of other property received when
converted to cash or cash equivalents, net of (i) brokerage commissions and
other fees and expenses (including fees and expenses of counsel and investment
bankers) related to such Asset Sale, (ii) provisions for all taxes (whether or
not such taxes will actually be paid or are payable) as a result of such Asset
Sale without regard to the consolidated results of operations of the Company
and its Restricted Subsidiaries, taken as a whole, (iii) payments made to repay
Indebtedness or any other obligation outstanding at the time of such Asset Sale
that either (A) is secured by a Lien on the property or assets sold or (B) is
required to be paid as a result of such sale and (iv) appropriate amounts to be
provided by the Company or any Restricted Subsidiary of the Company as a
reserve against any liabilities associated with 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, all as determined
in conformity with IAS and (b) with respect to any issuance or sale of Capital
Stock,
-12-
the proceeds of such issuance or sale in the form of cash or cash equivalents,
including payments in respect of deferred payment obligations (to the extent
corresponding to the principal, but not interest, component thereof) when
received in the form of cash or cash equivalents (except to the extent such
obligations are financed or sold with recourse to the Company or any Restricted
Subsidiary) and proceeds from the conversion of other property received when
converted to cash or cash equivalents, net of attorneys' fees, accountants'
fees, underwriters' or placement agents' fees, discounts or commissions and
brokerage, consultant and other fees incurred in connection with such issuance
or sale and net of taxes paid or payable as a result thereof.
"Non-U.S. Person" means a person who is not a U.S. person, as defined
in Regulation S.
"Northeast Rail Lines" means that portion of the Mexican railroad
system that is the subject of the Concession Title.
"Note Register" has the meaning provided in Section 2.04.
"Notes" means any of the notes, as defined in the first paragraph of
the recitals hereof, that are authenticated and delivered under this Indenture.
For all purposes of this indenture, the term "Notes" shall include any Exchange
Notes to be issued and exchanged for any Notes pursuant to the Registration
Rights Agreement and this Indenture and, for purposes of this Indenture, all
Notes and Exchange Notes shall vote together as one series of Notes under this
Indenture.
"Offer to Purchase" means an offer to purchase Notes by the Company
from the Holders commenced by mailing a notice to the Trustee and each Holder
that, unless otherwise required by applicable law, shall state: (i) the
covenant pursuant to which the offer is being made and that all Notes validly
tendered will be accepted for payment on a pro rata basis; (ii) the purchase
price and the date of purchase (which shall be a Business Day no earlier than
30 days nor later than 60 days from the date such notice is mailed) (the
"Payment Date"); (iii) that any Note not tendered will continue to accrue
interest pursuant to its terms; (iv) that, unless the Company defaults in the
payment of the purchase price, any Note accepted for payment pursuant to the
Offer to Purchase shall cease to accrue interest on and after the Payment Date;
(v) that Holders electing to have a Note purchased pursuant to the Offer to
Purchase will be required to surrender the Note, together with the form
entitled "Option of the Holder to Elect Purchase" on the reverse side thereof
completed, to the Paying Agent at the address specified in the notice prior to
the close of business on the Business Day immediately preceding the Payment
Date; (vi) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the third
Business Day immediately preceding the Payment Date, a telegram, facsimile
transmission or letter setting forth the name of such Holder, the principal
amount at maturity of Notes delivered for purchase and a statement that such
Holder is withdrawing his election to have such Notes purchased; and (vii) that
Holders whose Notes are being purchased only in part will be issued Notes equal
in principal amount at maturity to the unpurchased portion thereof surrendered;
provided that each Note purchased and each Note issued shall be in a principal
amount at maturity of $100 or integral multiples thereof. On the Payment Date,
the Company shall (i) accept for payment on a pro rata basis Notes or portions
thereof tendered pursuant to an Offer to Purchase; (ii) deposit with the Paying
Agent money
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sufficient to pay the purchase price of all Notes or portions thereof so
accepted; and (iii) deliver, or cause to be delivered, to the Trustee all Notes
or portions thereof so accepted together with an Officers' Certificate
specifying the relevant Notes or portions thereof accepted for payment by the
Company. The Paying Agent shall promptly mail to the Holders of the Notes so
accepted, payment in an amount equal to the purchase price, and the Trustee
shall promptly authenticate and mail to such Holders a Note, equal in principal
amount at maturity to any unpurchased portion of the Note surrendered. The
Company will publicly announce the results of an Offer to Purchase as soon as
practicable after the Payment Date. The Trustee shall act as the Paying Agent
for an Offer to Purchase. The Company will comply with 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 the event that the Company
is required to repurchase the Notes pursuant to an Offer to Purchase.
"Officer" means, with respect to the Company, (i) the Chief Executive
Officer, the Chief Operating Officer, or any Vice President, and (ii) the Chief
Financial Officer, the Treasurer or any Assistant Treasurer, or the Secretary,
Pro-Secretary or any Assistant Secretary or any Director or Alternate Director.
"Officers' Certificate" means a certificate signed by one Officer
listed in clause (i) of the definition thereof and one Officer listed in clause
(ii) of the definition thereof; provided, however, that any such certificate
may be signed by any two of the Officers listed in clause (i) of the definition
thereof in lieu of being signed by one Officer listed in clause (i) of the
definition thereof and one Officer listed in clause (ii) of the definition
thereof. Each Officers' Certificate (other than certificates provided pursuant
to TIA Section 314(a)(4)) shall include the statements provided for in TIA
Section 314(e).
"Offshore Global Notes" has the meaning set forth in Section 2.01.
"Offshore Physical Notes" has the meaning set forth in Section 2.01.
"Offshore Securities Exchange Date" has the meaning set forth in
Section 2.01.
"Opinion of Counsel" means a written opinion signed by legal counsel
who may be an employee of or counsel to the Company. Each such Opinion of
Counsel shall include the statements provided for in TIA Section 314(e).
"Pari Passu Indebtedness" has the meaning set forth in Section 4.11.
"Paying Agent" has the meaning provided in Section 2.04, except that,
for the purposes of Article Eight, the Paying Agent shall not be the Company or
a Subsidiary of the Company or an Affiliate of any of them. The term "Paying
Agent" includes any additional Paying Agent.
"Permanent Offshore Global Notes" has the meaning provided in Section
2.01.
"Permitted Investment" means (i) an Investment in the Company or a
Restricted Subsidiary or a Person which will, upon the making of such
Investment, become a Restricted Subsidiary or be merged or consolidated with or
into or transfer or convey all or substantially all
-14-
of its assets to the Company or a Restricted Subsidiary; provided that such
person's primary business is related, ancillary or complementary to the
businesses of the Company and its Restricted Subsidiaries on the date of such
investment; (ii) Temporary Cash Investments; (iii) payroll, travel and similar
advances to cover matters that are expected at the time of such advances
ultimately to be treated as expenses in accordance with IAS; and (iv) stock,
obligations or securities received in satisfaction of judgments.
"Permitted Liens" means (i) Liens for taxes, assessments, governmental
charges or claims that are being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a
reserve or other appropriate provision, if any, as shall be required in
conformity with IAS shall have been made; (ii) statutory and common law Liens
of landlords and carriers, warehousemen, mechanics, suppliers, materialmen,
repairmen or other similar Liens arising in the ordinary course of business and
with respect to amounts not yet delinquent or being contested in good faith by
appropriate legal proceedings promptly instituted and diligently conducted and
for which a reserve or other appropriate provision, if any, as shall be
required in conformity with IAS shall have been made; (iii) Liens incurred or
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security; (iv)
Liens incurred or deposits made to secure the performance of tenders, bids,
leases, statutory or regulatory obligations, bankers' acceptances, surety and
appeal bonds, government contracts, performance and return-of-money bonds and
other obligations of a similar nature incurred in the ordinary course of
business (exclusive of obligations for the payment of borrowed money); (v)
easements, rights-of-way, municipal and zoning ordinances and similar charges,
encumbrances, title defects or other irregularities that do not materially
interfere with the ordinary course of business of the Company or any of its
Restricted Subsidiaries; (vi) Liens (including extensions and renewals thereof)
upon real or personal property acquired after the Closing Date; provided that
(a) such Lien is created solely for the purpose of securing Indebtedness
Incurred, in accordance with Section 4.03, to finance the cost (including the
cost of improvement, lease or construction) of the item of property or assets
subject thereto and such Lien is created prior to, at the time of or within six
months after the later of the acquisition, the completion of construction or
the commencement of full operation or the lease of such property, (b) the
principal amount of the Indebtedness secured by such Lien does not exceed 100%
of such cost and (c) any such Lien shall not extend to or cover any property or
assets other than such item of property or assets and any improvements on such
item; (vii) licenses, leases or subleases granted to others that do not
materially interfere with the ordinary course of business of the Company and
its Restricted Subsidiaries, taken as a whole; (viii) Liens encumbering
property or assets under construction arising from progress or partial payments
by one of the customers of the Company or its Restricted Subsidiaries relating
to such property or assets; (ix) any interest or title of a lessor or licensor
in the property subject to any Capitalized Lease, operating lease or license
agreement; (x) Liens arising from filing Uniform Commercial Code or similar
financing statements regarding leases; (xi) Liens on property of, or on shares
of stock or Indebtedness of, any Person existing at the time such Person
becomes, or becomes a part of, any Restricted Subsidiary; provided that such
Liens do not extend to or cover any property or assets of the Company or any
Restricted Subsidiary other than the property or assets acquired; (xii) Liens
in favor of the Company or any Restricted Subsidiary; (xiii) Liens arising from
the rendering of a final judgment or order against the Company or any
Restricted Subsidiary of the Company that does not give rise to an Event of
Default; (xiv) Liens securing reimbursement obligations with respect to letters
of credit that encumber documents and other
-15-
property relating to such letters of credit and the products and proceeds
thereof; (xv) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods; (xvi) Liens encumbering customary initial deposits and
margin deposits, and other Liens, in each case, securing Indebtedness under
Interest Rate Agreements and Currency Agreements and forward contracts,
options, futures contracts, futures options or similar agreements or
arrangements designed solely to protect the Company or any of its Restricted
Subsidiaries from fluctuations in interest rates, currencies or the price of
commodities; (xvii) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into by the
Company or any of its Restricted Subsidiaries in the ordinary course of
business; (xviii) Liens on or sales of receivables; (xix) Liens on any assets
acquired by the Company or any Restricted Subsidiary after the Closing Date,
which Liens were in existence prior to the acquisition of such assets (to the
extent that such Liens were not created in contemplation of or in connection
with such acquisition), provided that such Liens are limited to the assets so
acquired and the proceeds thereof; (xx) Liens existing or arising under the
Concession Title; (xxi) Liens Incurred in accordance with the terms of this
Indenture in favor of the Trustee under this Indenture; and (xxii) Liens
permitted under the Existing Indentures.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof or any other entity.
"Physical Note" has the meaning provided in Section 2.01.
"Preferred Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of such Person's preferred or preference equity,
whether now outstanding or issued after the Closing Date, including, without
limitation, all series and classes of such preferred stock or preference stock.
"principal" of a debt security, including the Notes, means the
principal amount due on the Stated Maturity as shown on such debt security.
"Private Placement Legend" means the legend initially set forth on the
Notes in the form set forth in Section 2.02.
"Public Equity Offering" means an underwritten primary public offering
of Common Stock of the Company or Grupo TFM pursuant to an effective
registration statement under the Securities Act.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Redemption Date," when used with respect to any Note to be redeemed,
means the date fixed for such redemption by or pursuant to this indenture.
"Redemption Price," when used with respect to any Note to be redeemed,
means the price at which such Note is to be redeemed pursuant to this Indenture.
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"Registrar" has the meaning provided in Section 2.04.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Closing Date, between the Company, Xxxxxxx Xxxxx
Xxxxxx Inc. and X.X. Xxxxxx Securities Inc.
"Registration Statement" means the Registration Statement as defined
and described in the Registration Rights Agreement.
"Regular Record Date" for the interest payable on any interest Payment
Date means the June 1 or December 1 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date.
"Regulation S" means Regulation S under the Securities Act.
"Released Indebtedness" means, with respect to any Asset Sale,
Indebtedness (i) which is owed by the Company or any Restricted Subsidiary (the
"Obligors") prior to such Asset Sale, (ii) which is assumed by the purchaser or
any affiliate thereof in connection with such Asset Sale and (iii) with respect
to which the Obligors receive written unconditional releases from each creditor
no later than the closing date of such Asset Sale.
"Responsible Officer," when used with respect to the Trustee, means
any vice president, any assistant treasurer, any trust officer or assistant
trust officer, or any other officer of the Trustee in its Corporate Trust
Department having direct responsibility for the administration of this
Indenture and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his or her
knowledge of and familiarity with the particular subject and who shall have
direct responsibility for the administration of this Indenture.
"Restricted Payments" has the meaning set forth in Section 4.04.
"Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
"S&P" means Standard & Poor's Ratings Group and its successors.
"Securities Act" means the United States Securities Act of 1933, as
amended.
"Senior Secured Credit Facilities" means the credit agreement, dated
as of June 23, 1997, among the Company, Grupo TFM, the banks party thereto,
Xxxxxx Xxxxxxx Senior Funding, Inc., as syndication agent and as arranger, The
Chase Manhattan Bank, as administrative agent, and Xxxxxxx Xxxxx Capital
Corporation, as documentation agent, together with all other agreements,
instruments and documents executed or delivered pursuant 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, replaced or otherwise modified from time to time,
including any agreement
-17-
extending the maturity of, refinancing, replacing or otherwise restructuring
(including by way of adding 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.
"Shelf Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"Significant Subsidiary" means, at any date of determination, any
Restricted Subsidiary of the Company that, together with its Subsidiaries, (i)
for the most recent fiscal year of the Company, accounted for more than 10% of
the consolidated revenues of the Company and its Restricted Subsidiaries or
(ii) as of the end of such fiscal year, was the owner of more than 10% of the
consolidated assets of the Company and those of its Restricted Subsidiaries,
all as set forth on the most recently available consolidated financial
statements of the Company for such fiscal year.
"Stated Maturity" means (i) with respect to any debt security, the
date specified in such debt security as the fixed date on which the final
installment of principal of such debt security is due and payable and (ii) with
respect to any scheduled installment of principal of or interest on any debt
security, the date specified in such debt security as the fixed date on which
such installment is due and payable.
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the voting power
of the outstanding Voting Stock is owned, directly or indirectly, by such
Person and one or more other Subsidiaries of such Person.
"Temporary Cash Investment" means any of the following: (i) direct
obligations of the United States of America or any agency thereof or
obligations fully and unconditionally guaranteed by the United States of
America or any agency thereof, (ii) time deposit accounts, certificates of
deposit and money market deposits denominated and payable in U.S. dollars
maturing within 180 days of the date of acquisition thereof issued by a bank or
trust company which is organized under the laws of the United States of
America, any state thereof or any foreign country recognized by the United
States of America, and which bank or trust company has capital, surplus and
undivided profits aggregating in excess of $200 million (or the foreign
currency equivalent thereof) and has outstanding debt which is rated "A" (or
such similar equivalent rating) or higher by S&P or Moody's or any money-market
fund denominated and payable in U.S. dollars sponsored by a registered broker
dealer or mutual fund distributor, (iii) repurchase obligations with a term of
not more than 30 days for underlying securities of the types described in
clause (i) above entered into with a bank meeting the qualifications described
in clause (ii) above, (iv) commercial paper denominated and payable in U.S.
dollars, maturing not more than 90 days after the date of acquisition, issued
by a corporation (other than an Affiliate of the Company) organized and in
existence under the laws of the United States of America or any state thereof
with a rating at the time as of which any investment therein is made of "P-1"
(or higher) according to Moody's or "A-1" (or higher) according to S&P, (v)
securities with maturities of six months or less from the date of acquisition
issued or fully and unconditionally guaranteed by any state, commonwealth or
territory of the United States of
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America, or by any political subdivision or taxing authority thereof, and rated
at least "A" by S&P or Moody's, (vi) Certificados de la Tesoreria de la
Federacion (Cetes) or Bonos de Desarrollo del Gobierno Federal (Bondes) issued
by the Mexican government and maturing not more than 180 days after the
acquisition thereof, (vii) Investments in money market funds substantially all
of whose assets are comprised of securities of the types described in clauses
(i) through (vi) above, (viii) demand deposit accounts with U.S. banks (or
Mexican banks specified in clause (ix) of this definition) maintained in the
ordinary course of business; and (ix) certificates of deposit, bank promissory
notes and bankers' acceptances denominated in pesos, maturing not more than 180
days after the acquisition thereof and issued or guaranteed by any one of the
five largest banks (based on assets as of the immediately preceding December
31) organized under the laws of Mexico and which are not under intervention or
controlled by the Instituto para la Proteccion al Ahorro Bancario or any
successor thereto.
"Tex-Mex Railway" means the Texas Mexican Railway Company, a Texas
corporation, and its successors.
"TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended (15 U.S. Code Sections 77aaa-77bbb), as in effect on the date this
Indenture was executed, except as provided in Section 9.06.
"TMM" means Transportacion Maritima Mexicana, S.A. de C.V., a sociedad
anonima de capital variable organized under the laws of Mexico, and its
successors and assigns.
"Trade Payables" means, with respect to any Person, any accounts
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries
arising in the ordinary course of business in connection with the acquisition
of goods or services.
"Transaction Date" means, with respect to the Incurrence of any
Indebtedness by the Company or any of its Restricted Subsidiaries, the date
such Indebtedness is to be Incurred and, with respect to any Restricted
Payment, the date such Restricted Payment is to be made.
"Trustee" means the party named as such in the first paragraph of this
Indenture until a successor replaces it in accordance with the provisions of
Article Seven of this Indenture and thereafter means such successor.
"United States Bankruptcy Code" means the Bankruptcy Reform Act of
1978, as amended and as codified in Title 11 of the United States Code, as
amended from time to time hereafter, or any successor federal bankruptcy law.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
at the time of determination shall be designated an Unrestricted Subsidiary by
the Board of Directors in the manner provided below and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors of the Company may designate
any Restricted Subsidiary (including any newly acquired or newly formed
Subsidiary of the Company) to be an Unrestricted Subsidiary unless such
Subsidiary owns any Capital Stock of, or owns or holds any Lien on any property
of, the Company or any Restricted Subsidiary; provided that (A) any Guarantee
by the Company or any Restricted Subsidiary of any Indebtedness of the
Subsidiary being so designated shall be deemed
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an "Incurrence" of such Indebtedness and an "Investment" by the Company or such
Restricted Subsidiary (or both, if applicable) at the time of such designation;
(B) either (I) the Subsidiary to be so designated has total assets of $1,000 or
less or (II) if such Subsidiary has assets greater than $1,000, such
designation would be permitted under Section 4.04; and (C) if applicable, the
Incurrence of Indebtedness and the Investment referred to in clause (A) of this
proviso would be permitted under Section 4.03 and Section 4.04. The Board of
Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that (x) all Liens and Indebtedness of such Unrestricted
Subsidiary outstanding immediately after such designation would, if Incurred at
such time, have been permitted to be Incurred for all purposes of this
Indenture and (y) no Default or Event of Default shall have occurred and be
continuing at the time of or immediately after giving effect to such
designation. Any such designation by the Board of Directors shall be evidenced
to the Trustee by promptly filing with such Trustee a copy of the Board
Resolution giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
"U.S. Global Notes" has the meaning provided in Section 2.01.
"U.S. Person" has the meaning ascribed thereto in Rule 902 under the
Securities Act.
"U.S. Physical Notes" has the meaning provided in Section 2.01.
"Voting Stock" means with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person, excluding, however, Series L shares of Grupo TFM and Class III Series A
shares and Class III Series B shares of the Company owned by Mexico as of the
Acquisition Date and any class or kind of Capital Stock which has limited or
restricted voting rights (i.e., having the power to vote for the election of a
minority of the directors, managers or other voting members of the governing
body of such Person) under the by-laws of such Person or under Mexican law.
"Wholly Owned" means, with respect to any Subsidiary of any Person,
the ownership of all of the outstanding Capital Stock of such Subsidiary (other
than any director's qualifying shares or Investments by foreign nationals
mandated by applicable law) by such Person or one or more Wholly Owned
Subsidiaries of such Person.
SECTION 1.02. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.The following
TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes;
"indenture security holder" means a Holder or a Noteholder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
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"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 or defined by a rule of the
Commission and not otherwise defined herein have the meanings assigned to them
therein.
SECTION 1.03. Rules of Construction. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it:
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with IAS;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and words in the
plural include the singular;
(v) provisions apply to successive events and transactions;
(vi) "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
(vii) all references to Sections or Articles refer to Sections or
Articles of this Indenture unless otherwise indicated.
ARTICLE TWO
THE NOTES
SECTION 2.01. Form and Dating. The Notes and the Trustee's
certificate of authentication shall be substantially in the form annexed hereto
as Exhibit A. The Notes may have such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture and may have letters, notations, legends or endorsements required by
law, stock exchange agreements to which the Company is subject or usage. Any
portion of the text of any Note may be set forth on the reverse thereof, with
an appropriate reference thereto on the face of the Note. The Company shall
approve the form of the Notes and any notation, legend or endorsement on the
Notes. Each Note shall be dated the date of its authentication.
The terms and provisions contained in the form of the Notes annexed
hereto as Exhibit A shall constitute, and are hereby expressly made, a part of
this Indenture. Each of the Company, the Trustee and the Paying Agent, by its
execution and delivery of this Indenture, expressly agrees to the terms and
provisions of the Notes applicable to it and to be bound thereby.
Notes offered and sold in reliance on Rule 144A shall be issued in the
form of one or more permanent global Notes in registered form, substantially in
the form set forth in Exhibit
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A (the "U.S. Global Notes"), deposited with the Trustee, as custodian for the
Depositary, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The aggregate principal amount of the U.S. Global Notes
may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depositary or its nominee, as
hereinafter provided.
Notes offered and sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of one or more global Notes
in registered form substantially in the form set forth in Exhibit A (the
"Offshore Global Notes"), registered in the name of the nominee of the
Depositary, deposited with the Trustee, as custodian for the Depositary, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The aggregate principal amount of the Offshore Global Notes may from
time to time be increased or decreased by adjustments made in the records of
the Trustee, as custodian for the Depositary or its nominee, as herein provided.
Notes which are offered and sold to Institutional Accredited Investors
which are not QIBs (other than in offshore transactions in reliance on
Regulation S) shall be issued in the form of permanent certificated Notes in
registered form in substantially the form set forth in Exhibit A (the "U.S.
Physical Notes"). Notes issued pursuant to Section 2.07 in exchange for
interests in the U.S. Global Notes or the Offshore Global Notes shall be in the
form of U.S. Physical Notes or in the form of permanent certificated Notes in
registered form substantially in the form set forth in Exhibit A (the "Offshore
Physical Notes"), respectively.
The Offshore Physical Notes and U.S. Physical Notes are sometimes
collectively herein referred to as the "Physical Notes." The U.S. Global Notes
and the Offshore Global Notes are sometimes referred to as the "Global Notes."
The definitive Notes shall be typed, printed, lithographed or engraved
or produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities exchange on which the Notes may
be listed, all as determined by the officers executing such Notes, as evidenced
by their execution of such Notes.
SECTION 2.02. Restrictive Legends. (a) Unless and until a Note is
exchanged for an Exchange Note in connection with an effective Registration
Statement pursuant to the Registration Rights Agreement, the U.S. Global Notes
and each U.S. Physical Note shall bear the legend set forth below on the face
thereof:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THESE
SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT OR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH
REGULATIONS S UNDER THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER JURISDICTION.
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(b) Each Global Note, whether or not an Exchange Note, shall
also bear the following legend on the face thereof:
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE COMPANY OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE
SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN SECTION 2.08 OF THE INDENTURE.
SECTION 2.03. Execution, Authentication and Denominations.
Two Officers shall execute the Notes for the Company by facsimile or manual
signature in the name and on behalf of the Company.
If an Officer whose signature is on a Note no longer holds that office
at the time the Trustee or authenticating agent authenticates the Note, the
Note shall be valid nevertheless.
A Note shall not be valid until the Trustee or authenticating agent
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 or an authenticating agent shall upon receipt of a Company
Order authenticate for original issue Notes in the aggregate principal amount
of up to U.S. $180,000,000, plus any Exchange Notes that may be issued pursuant
to the Registration Rights Agreement or Add On Note issued hereunder; provided
that the Trustee shall receive an Officers' Certificate and an Opinion of
Counsel of the Company in connection with such authentication of Notes. The
Opinion of Counsel shall be to the effect that:
(a) the form and terms of such Notes have been established by
or pursuant to a Board Resolution or an indenture supplemental hereto in
conformity with the provisions of this Indenture;
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(b) such supplemental indenture, if any, when executed and
delivered by the Company, the Trustee and the Paying Agent, will
constitute a valid and binding obligation of the Company;
(c) such Notes, when authenticated and delivered by the Trustee and
issued by the Company in the manner and subject to any conditions specified
in such Opinion of Counsel, will constitute valid and binding obligations
of the Company in accordance with their terms and will be entitled to the
benefits of this Indenture, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; and
(d) the Company has been duly incorporated in, and is a validly
existing corporation under the laws of Mexico or the United States.
Such Company Order shall specify the amount of Notes to be
authenticated and the date on which the original issue of Notes is to be
authenticated. The aggregate principal amount of Notes outstanding at any time
may not exceed the amount set forth above except for Notes authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of,
other Notes pursuant to Section 2.06, 2.09, 2.10 or 2.11.
The Trustee may appoint an authenticating agent to authenticate Notes.
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 an Affiliate of the Company.
The Notes shall be issuable only in registered form without coupons
and only in denominations of U.S.$100 in principal amount and any integral
multiple of U.S.$100 in excess thereof.
SECTION 2.04. Registrar and Paying Agent. The Company shall
maintain an office or agency where Notes may be presented for registration of
transfer or for exchange (the "Registrar"), an office or agency where Notes may
be presented for payment (the "Paying Agents") and an office or agency where
notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served, which shall be in the Borough of Manhattan, the City
of New York and any other jurisdiction where the Company deems necessary or
appropriate. The Company shall cause the Registrar acting as agent of the
Company to keep a register of the Notes and of their transfer and exchange (the
"Note Register"). The Company may have one or more co-Registrars and one or
more additional Paying Agents.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent. The Company shall give
prompt written notice to the Trustee of the name and address of any such Agent
and any change in the address of such Agent. If the Company fails to maintain a
Registrar, Paying Agent and/or agent for service of notices and demands, the
Trustee shall act as such Registrar, Paying Agent and/or agent for service of
notices and demands for so long as such failure shall continue. The Company may
remove any Agent upon written
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notice to such Agent and the Trustee; provided that no such removal shall
become effective until (i) the acceptance of an appointment by a successor
Agent to such Agent as evidenced by an appropriate agency agreement entered
into by the Company and such successor Agent and delivered to the Trustee or
(ii) notification to the Trustee that the Trustee shall serve as such Agent
until the appointment of a successor Agent in accordance with clause (i) of
this proviso. The Company, any Subsidiary of the Company, or any Affiliate of
any of them may act as Paying Agent, Registrar or co-Registrar, and/or agent
for service of notices and demands; provided, however, that neither the
Company, a Subsidiary of the Company nor an Affiliate of any of them shall act
as Paying Agent in connection with the defeasance of the Notes or the discharge
of this Indenture under Article Eight.
The Company initially appoints the Trustee as Registrar, Paying Agent,
authenticating agent and agent for service of notices and demands. If, at any
time, the Trustee is not the Registrar, the Registrar shall make available to
the Trustee on or before each Interest Payment Date and at such other times as
the Trustee may reasonably request, the names and addresses of the Holders as
they appear in the Note Register.
SECTION 2.05. Paying Agent to Hold Money in Trust. Not later than
12:00 noon, New York City time, on each due date of the principal, premium, if
any, and interest on any Notes, the Company shall deposit with the Paying Agent
money in immediately available funds sufficient to pay such principal, premium,
if any, and interest so becoming due. The Company shall require each Paying
Agent, if any, 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
money held by the Paying Agent for the payment of principal of, premium, if
any, and interest on the Notes (whether such money has been paid to it by the
Company or any other obligor on the Notes), and that such Paying Agent shall
promptly 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 pay all money held by it to the Trustee and account for any
funds 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 pay all money held by it to the Trustee and to account for any funds
disbursed. Upon doing so, the Paying Agent shall have no further liability for
the money so paid over to the Trustee. If the Company or any Subsidiary of the
Company or any Affiliate of any of them acts as Paying Agent, it will, on or
before each due date of any principal of, premium, if any, or interest on the
Notes, segregate and hold in a separate trust fund for the benefit of the
Holders a sum of money sufficient to pay such principal, premium, if any, or
interest so becoming due until such sum of money shall be paid to such Holders
or otherwise disposed of as provided in this Indenture, and will promptly
notify the Trustee of its action or failure to act as required by this Section
2.05.
SECTION 2.06. Transfer and Exchange. The Notes are issuable only
in registered form. A Holder may transfer a Note by written application to the
Registrar stating the name of the proposed transferee and otherwise complying
with the terms of this Indenture. No such transfer shall be effected until, and
such transferee shall succeed to the rights of a Holder only upon, registration
of the transfer by the Registrar in the Note Register. Prior to the
registration of any transfer by a Holder as provided herein, the Company, the
Trustee and any agent of the Company shall treat the person in whose name the
Note is registered as the owner thereof for all purposes whether or not the
Note shall be overdue, and neither the Company, the
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Trustee nor any such agent shall be affected by notice to the contrary.
Furthermore, any Holder of a Global Note shall, by acceptance of such Global
Note, agree that transfers of beneficial interests in such Global Note may be
effected only through a book-entry system maintained by the Depositary (or its
agent), and that ownership of a beneficial interest in the Note shall be
required to be reflected in a book entry. When Notes are presented to the
Registrar or a co-Registrar with a request to register the transfer or to
exchange them for an equal principal amount of Notes of other authorized
denominations (including an exchange of Notes for Exchange Notes), the
Registrar shall register the transfer or make the exchange as requested if its
requirements for such transactions are met; provided that no exchanges of Notes
for Exchange Notes shall occur until a Registration Statement shall have been
declared effective by the Commission and that any Notes that are exchanged for
Exchange Notes shall be cancelled by the Trustee. To permit registrations of
transfers and exchanges in accordance with the terms, conditions and
restrictions hereof, the Company shall execute and the Trustee shall
authenticate Notes at the Registrar's request. No service charge shall be made
to any Holder for any registration of transfer or exchange or redemption of the
Notes, but the Company may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or other similar governmental charge
payable upon transfers, exchanges or redemptions pursuant to Section 2.11,
3.08. 4.11, 4.12 or 9.04).
The Registrar shall not be required (i) to issue, register the
transfer of or exchange any Note during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Notes selected for redemption under Section 3.03 or Section 3.09 and ending at
the close of business on the day of such mailing or (ii) to register the
transfer of or exchange any Note so selected for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
SECTION 2.07. Book-Entry Provisions for Global Notes. (a) The U.S.
Global Notes and Offshore Global Notes initially shall (i) be registered in
the name of the Depositary for such Global Notes or the nominee of such
Depositary, (ii) be delivered to the Trustee as custodian for such Depositary
and (iii) bear legends as set forth in Section 2.02.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depositary, or the Trustee as its custodian, or under any
Global Note, and the Depositary 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 Depositary or impair, as between the Depositary
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a beneficial owner of any Note.
(b) Transfers of a Global Note shall be limited to transfers of
such Global Note in whole, but not in part, to the Depositary, its successors
or their respective nominees. Interests of beneficial owners in a Global Note
may be transferred in accordance with the applicable rules and procedures of
the Depositary and the provisions of Section 2.08. In addition, U.S. Physical
Notes and Offshore Physical Notes shall be transferred to all beneficial
-26-
owners in exchange for their beneficial interests in the U.S. Global Notes or
the Offshore Global Notes, respectively, if (i) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for the U.S.
Global Notes or the Offshore Global Notes, as the case may be, 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 request to the foregoing effect from the Depositary.
(c) Any beneficial interest in one of the Global Notes that is
transferred to a person who takes delivery in the form of an interest in the
other Global Note will, upon transfer, cease to be an interest in such Global
Note and become an interest in the other Global Note and, accordingly, will
thereafter be subject to all transfer restrictions, if any, and other
procedures applicable to beneficial interests in such other Global Note for as
long as it remains such an interest.
(d) In connection with any transfer pursuant to paragraph (b) of
this Section of a portion of the beneficial interests in the U.S. Global Notes
to beneficial owners who are required to hold U.S. Physical Notes, the
Registrar shall reflect on its books and records the date and a decrease in the
principal amount of the U.S. Global Notes in an amount equal to the principal
amount of the beneficial interest in the U.S. Global Notes to be transferred,
and the Company shall execute, and the Trustee shall authenticate and deliver,
one or more U.S. Physical Notes of like tenor and amount.
(e) In connection with the transfer of the entire U.S. Global
Notes or Offshore Global Notes to beneficial owners pursuant to paragraph (b)
of this Section, the U.S. Global Notes or Offshore Global Notes, as the case
may be, 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 Depositary in exchange for its
beneficial interest in the U.S. Global Notes or Offshore Global Notes, as the
case may be, an equal aggregate principal amount of U.S. Physical Notes or
Offshore Physical Notes, as the case may be, of authorized denominations.
(f) Any U.S. Physical Note delivered in exchange for an interest
in the U.S. Global Notes pursuant to paragraph (b) or (d) of this Section
shall, except as otherwise provided by paragraph (f)(i)(x) and paragraph (f) of
Section 2.08, bear the legend regarding transfer restrictions applicable to the
U.S. Physical Note set forth in Section 2.02.
(g) Any Offshore Physical Note delivered in exchange for an
interest in the Offshore Global Notes pursuant to paragraph (b) of this Section
shall, except as otherwise provided by paragraph (e) of Section 2.08, bear the
legend regarding transfer restrictions applicable to the Offshore Physical Note
set forth in Section 2.02.
(h) The registered 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.
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(i) QIBs that are beneficial owners of interests in a Global Note
may receive Physical Notes (which shall bear the Private Placement Legend if
required by Section 2.02) in accordance with the procedures of the Depositary;
in connection with the execution, authentication and delivery of such Physical
Notes, the Registrar shall reflect on its books and records a decrease in the
principal amount of the relevant Global Note equal to the principal amount of
such Physical Notes and the Company shall execute and the Trustee shall
authenticate and deliver one or more Physical Notes having an equal aggregate
principal amount.
SECTION 2.08. Special Transfer Provisions. Unless and until a Note
is exchanged for an Exchange Note in connection with an effective Registration
Statement pursuant to the Registration Rights Agreement, the following
provisions shall apply:
(a) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a U.S. Physical
Note or an interest in the U.S. Global Notes to a QIB (excluding transfers
outside the United States in compliance with Regulation S):
(i) If the Note to be transferred consists of (x) U.S.
Physical Notes, 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 or (y) an interest in the U.S.
Global Notes, the transfer of such interest may be effected only
through the book-entry system maintained by the Depositary.
(ii) If the proposed transferor is an Agent Member, and the
Note to be transferred consists of U.S. Physical Notes, upon
receipt by the Registrar of the documents referred to in clause (i)
and instructions given in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the U.S.
Global Notes in an amount equal to the principal amount of the U.S.
Physical Notes to be transferred, and the Trustee shall cancel the
Physical Note so transferred.
(b) Transfers of Interests in the Permanent Offshore Global Notes
or Offshore Physical Notes. With respect to any transfer of interests in
the Offshore Global Notes or
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Offshore Physical Notes to U.S. Persons, the Registrar shall register the
transfer of any such Note without requiring any additional certification.
(c) Transfers Outside the United States in Compliance With
Regulation S at Any Time. The following provisions shall apply with
respect to any transfer of a U.S. Physical Note or an interest in the U.S.
Global Notes outside the United States in compliance with Regulation S:
(i) The Registrar shall register any proposed transfer of
a Note outside the United States in compliance with Regulation S only
upon receipt of a certificate substantially in the form of Exhibit C
from the proposed transferor.
(ii) (A) If the proposed transferor is an Agent Member
holding a beneficial interest in the U.S. Global Notes, upon receipt
by the Registrar of (x) the documents required by paragraph (i) and
(y) instructions in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date and a decrease in the principal amount of the U.S.
Global Notes in an amount equal to the principal amount of the
beneficial interest in the U.S. Global Notes to be transferred, and
(B) if the proposed transferee is an Agent Member, upon receipt by
the Registrar of instructions given in accordance with the
Depositary's and the Registrar's procedures, the Registrar shall
reflect on its books and records the date and an increase in the
principal amount of the Offshore Global Notes in an amount equal to
the principal amount of the U.S. Physical Notes or the U.S. Global
Notes, as the case may be, to be transferred, and the Trustee shall
cancel the Physical Note, if any, so transferred or decrease the
amount of the U.S. Global Notes.
(d) Transfers to Non-QIB Institutional Accredited Investors. The
following provisions shall apply with respect to the registration of any
proposed transfer of a U.S. Physical Note or an interest in the U.S.
Global Notes to any Institutional Accredited Investor which is not a QIB
(excluding transfers outside the United States in reliance on Regulation
S):
(i) The Registrar shall register the transfer of any Note,
whether or not such Note bears the Private Placement Legend, if (x)
the requested transfer is after the time period referred to in Rule
144(k) under the Securities Act as in effect with respect to such
transfer or (y) the proposed transferee has delivered to the
Registrar (A) a certificate substantially in the form of Exhibit D
hereto and (B) if the aggregate principal amount of the Notes being
transferred is less than U.S.$250,000 at the time of such transfer,
an Opinion of Counsel acceptable to the Company that such transfer is
in compliance with the Securities Act.
(ii) If the proposed transferor is an Agent Member holding
a beneficial interest in the U.S. Global Notes, upon receipt by the
Registrar of (x) the documents, if any, required by paragraph (i) and
(y) instructions given in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date and a decrease in the principal
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amount of the U.S. Global Notes in an amount equal to the principal
amount of the beneficial interest in the U.S. Global Notes to be
transferred, and the Company shall execute, and the Trustee shall
authenticate and deliver, one or more U.S. Physical Notes of like
tenor and amount.
(e) 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 either (i) the circumstances
contemplated by the fourth paragraph of Section 2.01 or paragraph (d)(7)
or (e)(i)(x) of this Section 2.08 exist 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.
(f) 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 not register a transfer
of any Note unless such transfer complies with the restrictions on
transfer of such Note set forth in this Indenture. In connection with any
transfer of Notes to a Person that is not a QIB, each Holder agrees by its
acceptance of the Notes to furnish the Registrar or 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 a transaction not subject to, the registration
requirements of the Securities Act; provided that the Registrar shall not
be required to determine (but may rely on a determination made by the
Company with respect to) the sufficiency of any such certifications, legal
opinions or other information.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.07 or this Section 2.08.
The Company shall have the right to inspect and make copies of all such
letters, notices or other written communications at any reasonable time upon
the giving of reasonable written notice to the Registrar.
SECTION 2.09. Replacement Notes. If a mutilated Note is
surrendered to the Trustee or if the Holder claims that the Note has been lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Note of like tenor and principal amount and bearing
a number not contemporaneously outstanding; provided that the requirements of
the second paragraph of Section 2.10 are met. If required by the Trustee or the
Company, an indemnity bond must be furnished that is sufficient in the judgment
of both the Trustee and the Company to protect the Company, the Trustee or any
Agent from any loss that any of them may suffer if a Note is replaced. The
Company may charge such Holder for its expenses and the expenses of the Trustee
in replacing a Note. In case any such mutilated, lost, destroyed or wrongfully
taken Note has become or is about to become due and payable, the Company in its
discretion may pay such Note instead of issuing a new Note in replacement
thereof.
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Every replacement Note is an additional obligation of the Company and
shall be entitled to the benefits of this Indenture.
SECTION 2.10. Outstanding Notes. Notes outstanding at any time are
all Notes that have been authenticated by the Trustee except for those
cancelled by it, those delivered to it for cancellation and those described in
this Section 2.10 as not outstanding.
If a Note is replaced pursuant to Section 2.09, it ceases to be
outstanding unless and until the Trustee and the Company receive proof
reasonably satisfactory to them that the replaced Note is held by a bona fide
purchaser.
If the Paying Agent (other than the Company or an Affiliate of the
Company) holds on the maturity date money sufficient to pay Notes payable on
that date, then on and after that date such Notes cease to be outstanding and
interest on them shall cease to accrue.
A Note does not cease to be outstanding because the Company or one of
its Affiliates holds such Note, provided, however, that, in determining whether
the Holders of the requisite principal amount of the outstanding Notes have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Notes owned by the Company or any other obligor upon the Notes or
any Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes which the Responsible Officer
Trustee actually knows to be so owned shall be so disregarded. Notes so owned
which have been pledged in good faith may be regarded as outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so
to act with respect to such Notes and that the pledgee is not the Company or
any other obligor upon the Notes or any Affiliate of the Company or of such
other obligor.
SECTION 2.11. Temporary Notes. Until definitive Notes are ready
for delivery, the Company may prepare and the Trustee shall authenticate
temporary Notes. Temporary Notes shall be substantially in the form of
definitive Notes but may have insertions, substitutions, omissions and other
variations determined to be appropriate by the Officers executing the temporary
Notes, as evidenced by their execution of such temporary Notes. If temporary
Notes are issued, the Company will cause definitive Notes to be prepared
without unreasonable delay. After the preparation of definitive Notes, the
temporary Notes shall be exchangeable for definitive Notes upon surrender of
the temporary Notes at the office or agency of the Company designated for such
purpose pursuant to Section 4.02, without charge to the Holder. Upon surrender
for cancellation of any one or more temporary Notes the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor a like
principal amount of definitive Notes of authorized denominations. Until so
exchanged, the temporary Notes shall be entitled to the same benefits under
this Indenture as definitive Notes.
SECTION 2.12. Cancellation. The Company at any time may deliver to
the Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and may
deliver to the Trustee for cancellation any Notes previously authenticated
hereunder which the Company has not issued and sold. The Registrar and the
Paying Agent shall forward to the Trustee any Notes
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surrendered to them for transfer, exchange or payment. The Trustee shall cancel
all Notes surrendered for transfer, exchange, payment or cancellation and shall
dispose of them in accordance with its normal procedure. The Company shall not
issue new Notes to replace Notes it has paid in full or delivered to the
Trustee for cancellation.
SECTION 2.13. CUSIP Numbers. The Company in issuing the Notes may
use "CUSIP," "CINS" or "ISIN" numbers (if then generally in use), and the
Trustee shall use "CUSIP" numbers, "CINS" or "ISIN" numbers, as the case may
be, in notices of redemption or exchange as a convenience to Holders; provided
that any such notice shall state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of redemption or exchange and that reliance may be placed only on
the other identification numbers printed on the Notes. The Company will
promptly notify the Trustee of any change in "CUSIP," "CINS" or "ISIN" numbers
for the Notes.
SECTION 2.14. Defaulted Interest. If the Company defaults in a
payment of interest on the Notes, it shall pay, or shall deposit with the
Paying Agent money in immediately available funds sufficient to pay, the
defaulted interest, plus (to the extent lawful) interest on the defaulted
interest, to the Persons who are Holders on a subsequent special record date. A
special record date, as used in this Section 2.14 with respect to the payment
of any defaulted interest, shall mean the 15th day next preceding the date
fixed by the Company for the payment of defaulted interest, whether or not such
day is a Business Day. At least 15 days before the subsequent special record
date, the Company shall mail to each Holder and to the Trustee a notice that
states the subsequent special record date, the payment date and the amount of
defaulted interest to be paid.
SECTION 2.15. Issuance of Additional Notes.The Company may,
subject to Article Four of this Indenture, issue additional Notes under this
Indenture. The Notes issued on the Closing Date and any additional Notes
subsequently issued shall be treated as a single class for all purposes under
this Indenture.
ARTICLE THREE
SECTION
SECTION 3.01. Optional Redemption. The Notes will be redeemable, at
the Company's option, in whole at any time or in whole or in part from time to
time, on or after June 15, 2007 and prior to maturity, upon not less than 30
nor more than 60 days' prior notice mailed by first class mail to each Holders'
last address as it appears in the Note Register, at the following Redemption
Prices (expressed in percentages of principal amount), plus accrued and unpaid
interest, if any, to the Redemption Date (subject to the right of Holders of
record on the relevant Regular Record Date that is on or prior to the
Redemption Date to receive interest due on an Interest Payment Date), if
redeemed during the 12-month period commencing June 15, of the years set forth
below:
Year Redemption Price
---- ----------------
2007 106.250%
2008 104.167%
2009 102.083%
2010 100.000%
2011 100.000%
2012 100.000%
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SECTION 3.02. Redemption for Changes in Withholding Taxes. The
Notes will be subject to redemption, in whole but not in part, at the option of
the Company at any time at 100% of their principal amount together with accrued
interest thereon, if any, to the Redemption Date, in the event the Company has
become or would become obligated to pay, on the next date on which any amount
would be payable with respect to the Notes, any Additional Amounts in excess of
those attributable to a withholding tax rate of 4.9% as a result of a change in
or amendment to the laws (including any regulations or general rules
promulgated thereunder) of Mexico (or any political subdivision or taxing
authority thereof or therein), or any change in or amendment to any official
position regarding the application, administration or interpretation of such
laws, regulations or general rules, including a holding of a court of competent
jurisdiction, which change or amendment is announced or becomes effective on or
after June 6, 2002. The Company shall not, however, have the right to redeem
Notes from a Holder pursuant to this Section except to the extent that it is
obligated to pay Additional Amounts to such Holder that are greater than the
Additional Amounts that would be payable based on a Mexican withholding tax
rate of 4.9%.
SECTION 3.03. Notices to Trustee. If the Company elects to redeem
Notes pursuant to Section 3.02, it shall notify the Trustee in writing of the
Redemption Date and the principal amount of Notes to be redeemed.
The Company shall give each notice provided for in this Section 3.03
in an Officers' Certificate at least 60 days before the Redemption Date (unless
a shorter period shall be satisfactory to the Trustee).
SECTION 3.04. Selection of Notes to Be Redeemed. If less than all
of the Notes are to be redeemed at any time, the Trustee shall select the Notes
to be redeemed in compliance with the requirements, as certified to it by the
Company, 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, by lot or such other method as the Trustee in its sole discretion
shall deem to be appropriate; provided that no Notes of U.S.$100 in principal
amount or less shall be redeemed in part.
The Trustee shall make the selection from the Notes outstanding and
not previously called for redemption. Notes in denominations of U.S.$100 in
principal amount may only be redeemed in whole. The Trustee may select for
redemption portions (equal to U.S.$100 in principal amount or any integral
multiple thereof) of Notes that have denominations larger than U.S.$100 in
principal amount. Provisions of this Indenture that apply to Notes called for
redemption also apply to portions of Notes called for redemption. The Trustee
shall notify the Company and the Registrar promptly in writing of the Notes or
portions of Notes to be called for redemption.
SECTION 3.05. Add On Notes. The Company may, from time to time,
subject to compliance with any other applicable provisions of this Indenture,
without the consent
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of the Holders, create and issue pursuant to this Indenture additional Notes
("Add On Notes") having terms and conditions identical to those of the other
outstanding Notes, except that Add On Notes:
(i) may have a different issue date from other outstanding
Notes;
(ii) may have a different amount of interest payable on the
first Interest Payment Date after issuance than is payable on other
outstanding Notes; and
(iii) may have terms specified in the Add On Note Board
Resolution or Add On Note Supplemental Indenture for such Add On
Notes making appropriate adjustments to this Article 3 and Exhibit A
(and related definitions) applicable to such Add On Notes in order to
conform to and ensure compliance with the Securities Act (or other
applicable securities laws) and any registration rights or similar
agreement applicable to such Add On Notes, which are not adverse in
any material respect to the Holder of any outstanding Notes (other
than such Add On Notes).
SECTION 3.06. Notice of Redemption. With respect to any redemption
of Notes pursuant to Section 3.02, at least 30 days but not more than 60 days
before a Redemption Date, the Company shall mail a notice of redemption by
first class mail to each Holder whose Notes are to be redeemed.
The notice shall identify the Notes to be redeemed and shall
state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the name and address of the Paying Agent;
(iv) that Notes called for redemption must be surrendered to
the Paying Agent in order to collect the Redemption Price;
(v) that, unless the Company defaults in making the
redemption payment, interest on Notes called for redemption ceases to
accrue on and after the Redemption Date and the only remaining right
of the Holders is to receive payment of the Redemption Price plus
accrued interest to the Redemption Date upon surrender of the Notes
to the Paying Agent;
(vi) that, if any Note is being redeemed in part, the portion
of the principal amount (equal to U.S.$100 in principal amount or any
integral multiple thereof) of such Note to be redeemed and that, on
and after the Redemption Date, upon surrender of such Note, a new
Note or Notes in principal amount equal to the unredeemed portion
thereof will be reissued; and
(vii) that, if any Note contains a CUSIP, CINS or ISIN number
as provided in Section 2.13, no representation is being made as to
the correctness of the CUSIP, CINS or ISIN number either as printed
on the Notes or as contained in the notice of redemption
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and that reliance may be placed only on the other identification
numbers printed on the Notes.
At the Company's request (which request may be revoked by the Company
at any time prior to the time at which the Trustee shall have given such notice
to the Holders), made in writing to the Trustee at least 60 days (or such
shorter period as shall be satisfactory to the Trustee) before a Redemption
Date, the Trustee shall give the notice of redemption in the name and at the
expense of the Company. If, however, the Company gives such notice to the
Holders, the Company shall concurrently deliver to the Trustee an Officers'
Certificate stating that such notice has been given.
SECTION 3.07. Effect of Notice of Redemption. Once notice of
redemption is mailed, Notes called for redemption become due and payable on the
Redemption Date and at the Redemption Price. Upon surrender of any Notes to the
Paying Agent, such Notes shall be paid at the Redemption Price, plus accrued
interest, if any, to the Redemption Date.
Notice of redemption shall be deemed to be given when mailed, whether
or not the Holder receives the notice, in any event, failure to give such
notice, or any defect therein, shall not affect the validity of the proceedings
for the redemption of Notes held by Holders to whom such notice was properly
given.
SECTION 3.08. Deposit of Redemption Price. Prior to 12:00 noon on
any Redemption Date, the Company shall deposit with the Paying Agent (or, if
the Company is acting as its own Paying Agent, shall segregate and hold in
trust as provided in Section 2.05) money sufficient to pay the Redemption Price
of and accrued interest on all Notes to be redeemed on that date other than
Notes or portions thereof called for redemption on that date that have been
delivered by the Company to the Trustee for cancellation.
SECTION 3.09. Payment of Notes Called for Redemption. If notice of
redemption has been given in the manner provided above, the Notes or portion of
Notes specified in such notice to be redeemed shall become due and payable on
the Redemption Date at the Redemption Price stated therein, together with
accrued interest to such Redemption Date, and on and after such date (unless
the Company shall default in the payment of such Notes at the Redemption Price
and accrued interest to the Redemption Date, in which case the principal, until
paid, shall bear interest from the Redemption Date at the rate prescribed in
the Notes), such Notes shall cease to accrue interest. Upon surrender of any
Note for redemption in accordance with a notice of redemption, such Note shall
be paid and redeemed by the Company at the Redemption Price, together with
accrued interest, if any, to the Redemption Date; provided that installments of
interest whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders registered as such at the close of business on the
relevant Regular Record Date.
SECTION 3.10. Notes Redeemed in Part. Upon surrender of any Note
that is redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Note equal in principal amount to
the unredeemed portion of such surrendered Note.
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ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes. 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 this indenture. An installment of
principal, premium, if any, or interest shall be considered paid on the date
due if the Trustee or Paying Agent (other than the Company, a Subsidiary of the
Company, or any Affiliate of any of them) holds on that date money designated
for and sufficient to pay the installment. If the Company or any Subsidiary of
the Company or any Affiliate of any of them acts as Paying Agent, an
installment of principal, premium, if any, or interest shall be considered paid
on the due date if the entity acting as Paying Agent complies with the last
sentence of Section 2.05. As provided in Section 6.09, upon any bankruptcy or
reorganization procedure relative to the Company, the Trustee shall serve as
the Paying Agent and conversion agent, if any, for the Notes.
The Company shall pay interest on overdue principal, premium,
if any, and interest on overdue installments of interest, to the extent lawful,
at the rate per annum specified in the Notes.
SECTION 4.02. Maintenance of Office or Agency. The Company will
maintain an office or agency where Notes may be surrendered for registration of
transfer or exchange or for presentation for payment and where notices and
demands to or upon the Company in respect of the Notes and this indenture may
be served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 13.02.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
the City of New York for such purposes. The Company will give prompt written
notice to the Trustee of any such designation or rescission and of any change
in the location of any such other office or agency.
The Company hereby initially designates the Corporate Trust Office of
the Trustee, as such office of the Company in accordance with Section 2.04.
SECTION 4.03. Limitation on Indebtedness. The Company will not,
and will not permit any of its Restricted Subsidiaries to, Incur any
Indebtedness (other than the Notes and Indebtedness existing on the Closing
Date); provided that the Company may Incur Indebtedness if, after giving effect
to the Incurrence of such Indebtedness and the receipt and application of the
proceeds therefrom, the Interest Coverage Ratio would be greater than (i) if
the Indebtedness is Incurred during the period beginning after the date upon
which this Indenture is
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executed and ending on October 31, 2003, 3.0:1 and (ii) if the Indebtedness is
Incurred thereafter, 2.5:1.
Notwithstanding the foregoing, the Company and any of its Restricted
Subsidiaries (except as specified below) may Incur each and all of the
following:
(a) (i) Indebtedness outstanding at any time in an aggregate
principal amount not to exceed $50 million that is Incurred solely for the
purpose of financing the cost of improvements or construction related to the
properties of Mexrail and the Texas Mexican Railway Company, the net proceeds
of which are applied to finance the cost of such improvements or construction;
and
(ii) Indebtedness owed:
(A) to the Company evidenced by an unsubordinated promissory note
or
(B) to any of its Restricted Subsidiaries, provided that any event
which results in any such Restricted Subsidiary ceasing to be a Restricted
Subsidiary or any subsequent transfer of such Indebtedness (other than to
the Company or another Restricted Subsidiary) shall be deemed, in each
case, to constitute an Incurrence of such indebtedness not permitted by
this clause (ii);
(iii) Indebtedness issued in exchange for, or the net
proceeds of which are used to refinance or refund, then outstanding
Indebtedness (other than Indebtedness Incurred under clause (ii),
(iv), (viii) or (ix) of this paragraph), and any refinancings thereof
in an amount not to exceed the amount so refinanced or refunded (plus
premiums, accrued interest, fees and expenses); provided that
Indebtedness the proceeds of which are used to refinance or refund
the Notes or Indebtedness that is pari passu with, or subordinated in
right of payment to, the Notes shall only be permitted under this
clause (iii) if:
(A) in case the Notes are refinanced in part or the Indebtedness to
be refinanced is pari passu with the Notes, such new Indebtedness, by its
terms or by the terms of any agreement or instrument pursuant to which
such new Indebtedness is outstanding, is expressly made pari passu with,
or subordinate in right of payment to, the remaining Notes;
(B) in case the Indebtedness to be refinanced is subordinated in
right of payment to the Notes, such new Indebtedness, by its terms or by
the terms of any agreement or instrument pursuant to which such new
Indebtedness is issued or remains outstanding, is expressly made
subordinate in right of payment to the Notes, at least to the extent that
the Indebtedness to be refinanced is subordinated to the Notes; and
(C) such new Indebtedness, determined as of the date of Incurrence
of such new Indebtedness, does not mature prior to the Stated Maturity of
the Indebtedness to be refinanced or refunded, and the Average Life of
such new Indebtedness is at least equal to the remaining Average Life of
the Indebtedness to be refinanced or refunded; and
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provided further that in no event may Indebtedness of the Company be
refinanced by means of any Indebtedness of any Restricted Subsidiary
pursuant to this clause (iii);
(iv) Indebtedness:
(A) in respect of performance, surety or appeal bonds provided in
the ordinary course of business;
(B) under Currency Agreements and Interest Rate Agreements;
provided that such agreements (a) are designed solely to protect the
Company or its Restricted Subsidiaries against fluctuations in foreign
currency exchange rates or interest rates and (b) do not increase the
Indebtedness of the obligor outstanding at any time other than as a result
of fluctuations in foreign currency exchange rates or interest rates or by
reason of fees, indemnities and compensation payable thereunder; and
(C) arising from agreements providing for indemnification,
adjustment of purchase price or similar obligations, or from Guarantees or
letters of credit, surety bonds or performance bonds securing any
obligations of the Company or any of its Restricted Subsidiaries pursuant
to such agreements, in any case Incurred in connection with the
disposition of any business, assets or Restricted Subsidiary of the
Company (other than Guarantees of Indebtedness Incurred by any Person
acquiring all or any portion of such business, assets or Restricted
Subsidiary of the Company for the purpose of financing such acquisition),
in a principal amount not to exceed the gross proceeds actually received
by the Company or any Restricted Subsidiary in connection with such
disposition;
(v) Indebtedness of the Company, to the extent the net
proceeds thereof are promptly used to purchase Notes tendered in an
Offer to Purchase made as a result of a Change of Control;
(vi) Indebtedness of the Company to the extent the net
proceeds thereof are promptly deposited to defease the Notes in
accordance with Article Eight;
(vii) Guarantees of Indebtedness of the Company by any
Restricted Subsidiary provided the Guarantee of such Indebtedness is
permitted by and made in accordance with Section 4.07;
(viii) Indebtedness of the Company under Capitalized Leases
in an amount not to exceed at any one time outstanding the greater of
$75 million or 15% of the Adjusted Consolidated Net Tangible Assets
of the Company; and
(ix) Indebtedness of the Company not to exceed $50 million
at any one time outstanding which may, but need not be, Incurred
under the Senior Secured Credit Facilities.
(b) Notwithstanding any other provision of this Section 4.03, the
maximum amount of Indebtedness that the Company or a Restricted Subsidiary may
Incur pursuant to this
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Section 4.03 shall not be deemed to be exceeded, with respect to any
outstanding Indebtedness due solely to the result of fluctuations in the
exchange rates of currencies.
(c) For purposes of determining any particular amount of
Indebtedness under this Section 4.03,
(i) Guarantees, Liens or obligations with respect to
letters of credit supporting Indebtedness otherwise included in the
determination of such particular amount shall not be included and
(ii) any Liens granted pursuant to the equal and ratable
provisions referred to in Section 4.09 shall not be treated as
Indebtedness.
For purposes of determining compliance with this Section 4.03, in the
event that an item of Indebtedness meets the criteria of more than one of the
types of Indebtedness described in the above clauses, the Company, in its sole
discretion, shall classify such item of Indebtedness and only be required to
include the amount and type of such Indebtedness in one of such clauses.
SECTION 4.04. Limitation on Restricted Payments. The Company will
not, and will not permit any Restricted Subsidiary to, directly or indirectly,
(i) declare or pay any dividend or make any distribution on or
with respect to its Capital Stock or that of such Restricted Subsidiary
(other than (x) dividends or distributions payable solely in shares of its
Capital Stock or that of such Restricted Subsidiary (other than
Disqualified Stock) or in options, warrants or other rights to acquire
shares of such Capital Stock and (y) pro rata dividends or distributions
on Common Stock of Restricted Subsidiaries held by minority stockholders
(provided that such dividends do not in the aggregate exceed the minority
stockholders' pro rata share of such Restricted Subsidiaries' net income
from the first day of the fiscal quarter beginning immediately following
the Closing Date) held by Persons other than the Company or any of its
Restricted Subsidiaries;
(ii) purchase, redeem, retire or otherwise acquire for value any
shares of Capital Stock of (A) the Company or an Unrestricted Subsidiary
(including options, warrants or other rights to acquire such shares of
Capital Stock) held by any Person or (B) a Restricted Subsidiary
(including options, warrants or other rights to acquire such shares of
Capital Stock) held by any Affiliate of the Company (other than a Wholly
Owned Restricted Subsidiary) or any holder (or any Affiliate of such
holder) of 5% or more of the Capital Stock of the Company;
(iii) make any voluntary or optional principal payment, or voluntary
or optional redemption, repurchase, defeasance, or other acquisition or
retirement for value, of Indebtedness of the Company that is subordinated
in right of payment to the Notes; or
(iv) make any Investment, other than a Permitted Investment, in
any Person
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(such payments or any other actions described in clauses (i) through (iv)
above being collectively "Restricted Payments") if, at the time of, and
after giving effect to, the proposed Restricted Payment:
(A) a Default or Event of Default shall have occurred and be
continuing;
(B) the Company could not Incur at least $1.00 of Indebtedness
under the first paragraph of Section 4.03; or
(C) the aggregate amount of all Restricted Payments (the amount,
if other than in cash,to be determined in good faith by the Board of
Directors of the Company, whose determination shall be conclusive and
evidenced by a Board Resolution) made after April 1, 2002 shall exceed the
sum of
(1) 50% of the aggregate amount of the Adjusted Consolidated Net
Income (or, if the Adjusted Consolidated Net Income is a loss, minus 100%
of the amount of such loss) (determined by excluding income resulting from
transfers of assets by the Company or a Restricted Subsidiary to an
Unrestricted Subsidiary) accrued on a cumulative basis during the period
(taken as one accounting period) beginning on April 1, 2002 and ending on
the last day of the last fiscal quarter preceding the Transaction Date for
which reports have been filed or provided to the Trustee pursuant to
Section 4.18 plus
(2) the aggregate Net Cash Proceeds received by the Company on or
after April 1, 2002 from a capital contribution or the issuance and sale
permitted by this Indenture of Capital Stock of the Company (other than
Disqualified Stock) to a Person who is not a Subsidiary of the Company,
including an issuance or sale permitted by this Indenture of Indebtedness
of the Company for cash subsequent to the Closing Date upon the conversion
of such Indebtedness into Capital Stock (other than Disqualified Stock) of
the Company, or from the issuance to a Person who is not a Subsidiary of
the Company of any options, warrants or other rights to acquire Capital
Stock of the Company (in each case, exclusive of any Disqualified Stock or
any options, warrants or other rights that are redeemable at the option of
the holder, or are required to be redeemed, prior to the Stated Maturity
of the Notes) plus
(3) an amount equal to the net reduction in Investments (other
than reductions in Permitted Investments) in any Person on or after April
1, 2002 resulting from payments of interest on Indebtedness, dividends,
repayments of loans or advances, or other transfers of assets, in each
case to the Company or any of its Restricted Subsidiaries or from the Net
Cash Proceeds from the sale of any such Investment (except, in each case,
to the extent any such payment or proceeds are included in the calculation
of Adjusted Consolidated Net Income), or from redesignations of
Unrestricted Subsidiaries as Restricted Subsidiaries (valued in each case
as provided in the definition of "Investment"), not to exceed, in each
case, the amount of Investments previously made by the Company or any
Restricted Subsidiary in such Person or Unrestricted Subsidiary.
The foregoing provision shall not be violated by reason of:
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(i) the payment of any dividend within 60 days after the date of
declaration thereof if, at said date of declaration, such payment would
comply with the foregoing paragraph;
(ii) the redemption, repurchase, retirement, defeasance or other
acquisition for value of Indebtedness of the Company that is subordinated
in right of payment to the Notes, including premium, if any, and accrued
and unpaid interest, with the proceeds of, or in exchange for,
Indebtedness Incurred under clause (iii) of the second paragraph of part
(a) of Section 4.03;
(iii) the repurchase, redemption or other acquisition of Capital
Stock of the Company (or options, warrants or other rights to acquire such
Capital Stock) in exchange for, or out of the proceeds of a substantially
concurrent offering of, shares of Capital Stock (or options, warrants or
other rights to acquire such Capital Stock) (other than Disqualified
Stock) of the Company;
(iv) the making of any principal payment or the repurchase,
redemption, retirement, defeasance or other acquisition for value of
Indebtedness of the Company which is subordinated in right of payment to
the Notes, in exchange for, or out of the proceeds of, a substantially
concurrent offering of, shares of the Capital Stock (other than
Disqualified Stock) of the Company (or options, warrants or other rights
to acquire such Capital Stock);
(v) payments or distributions to dissenting stockholders pursuant
to applicable law, pursuant to or in connection with a consolidation,
merger or transfer of assets that complies with the provisions of this
Indenture applicable to mergers, consolidations and transfers
substantially all of the property and assets of the Company;
(vi) the declaration or payment of dividends on the Common Stock of
the Company following a Public Equity Offering of such Common Stock, of up
to 6% per annum of the Net Cash Proceeds received by the Company in such
Public Equity Offering;
(vii) Investments acquired as a capital contribution or in exchange
for Capital Stock (other than Disqualified Stock) of the Company;
(viii) (A) the repurchase by the Company of Capital Stock of the
Company or that of Grupo TFM from Mexico if after giving effect to such
repurchase and any Indebtedness Incurred to fund such repurchase the
Interest Coverage Ratio would be greater than 4.0:1; and
(B) the repurchase of Capital Stock of Grupo TFM or the Company
from Mexico, to the extent that the consideration paid to Mexico does not
exceed the amount of value added taxes refunded to the Company as a result
of matters pending on June 16, 1997 with respect to such value added
taxes; and
(C) the declaration and payment of dividends in order to effect
subclauses (A) or (B) of this clause (viii);
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(ix) the declaration and payment of dividends to Grupo TFM by the
Company in an amount not to exceed Grupo TFM's operating expenses,
corporate overhead costs and expenses and taxes; provided that the amount
so dividended is actually used for such purpose; and the declaration and
payment of pro rata dividends or distributions on Common Stock of the
Company held by minority stockholders paid in connection with dividends to
Grupo TFM permitted by this clause (ix), provided that such dividends do
not in the aggregate exceed the minority stockholders' pro rata share of
the Company's net income from July 1, 1997, provided that, except in the
case of clauses (i) and (iii), no Default or Event of Default shall have
occurred and be continuing or occur as a consequence of the actions or
payments set forth herein.
Each Restricted Payment permitted pursuant to the preceding paragraph
(other than the Restricted Payment referred to in clause (ii) thereof, an
exchange of Capital Stock for Capital Stock or Indebtedness referred to in
clause (iii) or (iv) thereof, an Investment referred to in clause (vii)
thereof, a repurchase of Capital Stock referred to in clause (viii) (B) thereof
and the dividends referred to in clauses (viii) and (ix) thereof), and the Net
Cash Proceeds from any issuance of Capital Stock referred to in clauses (iii)
and (iv), shall be included in calculating whether the conditions of clause (C)
of the first paragraph of this Section 4.04 have been met with respect to any
subsequent Restricted Payments. In the event the proceeds of an issuance of
Capital Stock of the Company or Grupo TFM are used for the redemption,
repurchase or other acquisition of Notes or Indebtedness that is pari passu
with the Notes, then the Net Cash Proceeds of such issuance shall be included
in clause (C) of the first paragraph of this Section 4.04 only to the extent
such proceeds are not used for such redemption, repurchase or other acquisition
of Indebtedness.
Notwithstanding anything to the contrary in the foregoing provisions
or herein, (i) the foregoing provisions shall not apply to and shall not
prohibit the repurchase by the Company of Capital Stock of Grupo TFM from
Mexico, through FNM and Nafin, as Trustee, or their successors and assigns, and
any subsequent transactions between the Company and Grupo TFM in respect of the
cancellation, conversion or exchange of the Capital Stock of Grupo TFM thereby
purchased by the Company and (ii) neither such purchase by the Company of
Capital Stock of Grupo TFM or any such subsequent transactions, nor the
consideration paid by the Company in connection with such purchase or such
subsequent transactions (such purchase and any subsequent transactions, the
"Acquisition Transactions"), shall be included in calculating whether the
conditions of clause (C) of the first paragraph of this Section 4.04 have been
met with respect to any subsequent Restricted Payments.
SECTION 4.05. Limitation on Dividend and Other Payment
Restrictions Affecting Restricted Subsidiaries. The Company will not, and will
not permit any Restricted Subsidiary to create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any Restricted Subsidiary to (i) pay dividends or make any
other distributions permitted by applicable law on any Capital Stock of such
Restricted Subsidiary owned by the Company or any other Restricted Subsidiary,
(ii) pay any Indebtedness owed to the Company or any other Restricted
Subsidiary, (iii) make loans or advances to the Company or any other Restricted
Subsidiary or (iv) transfer any of its property or assets to the Company or any
other Restricted Subsidiary.
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The foregoing provisions shall not restrict any encumbrances or
restrictions: (i) existing on the Closing Date in this Indenture; (ii) existing
on the Acquisition Date in the Existing Indentures, the Senior Secured Credit
Facilities or any other agreements (including the Concession Title) in effect
on the Closing Date or in effect on June 16, 1997 or on the Acquisition Date,
and any extensions, refinancings, renewals or replacements of such agreements;
provided that the encumbrances and restrictions in any such extensions,
refinancings, renewals or replacements are no less favorable in any material
respect to the Holders than those encumbrances or restrictions that are then in
effect and that are being extended, refinanced, renewed or replaced, (iii)
existing under or by reason of applicable law, (iv) existing with respect to
any Person or the property or assets of such Person acquired by the Company or
any Restricted Subsidiary, existing at the time of such acquisition and not
incurred in contemplation thereof, which encumbrances or restrictions are not
applicable to any Person or the property or assets of any Person other than
such Person or the property or assets of such Person so acquired, (v) in the
case of transfers of any property or assets of a Restricted Subsidiary to the
Company or any other Restricted Subsidiary (A) that restrict in a customary
manner the subletting, assignment or transfer of any property or asset that is
a lease, license, conveyance or contract or similar property or asset, (B)
existing by virtue of any transfer of, agreement to transfer, option or right
with respect to, or Lien on, any property or assets of the Company or any
Restricted Subsidiary not otherwise prohibited by this Indenture or (C) arising
or agreed to in the ordinary course of business, not relating to any
Indebtedness, and that do not, individually or in the aggregate, detract from
the value of property or assets of the Company or any Restricted Subsidiary in
any manner material to the Company or any Restricted Subsidiary, (vi) with
respect to a Restricted Subsidiary and imposed pursuant to an agreement that
has been entered into for the sale or disposition of all or substantially all
of the Capital Stock of or property and assets of, such Restricted Subsidiary;
or (vii) for the benefit of any holder of a Lien permitted under Section 4.09.
Nothing contained in this Section 4.05 shall prevent the Company or
any Restricted Subsidiary from (i) creating, incurring, assuming or suffering
to exist any Liens otherwise permitted in Section 4.09 or (ii) restricting the
sale or other disposition of property or assets of the Company or any of its
Restricted Subsidiaries that secure Indebtedness of the Company or any of its
Restricted Subsidiaries.
SECTION 4.06. Limitation on the Issuance and Sale of Capital Stock
of Restricted Subsidiaries. The Company will not permit any Restricted
Subsidiary, directly or indirectly, to issue or sell, any shares of Capital
Stock of a Restricted Subsidiary (including options, warrants or other rights to
purchase shares of such Capital Stock) except (i) to the Company or a Wholly
Owned Restricted Subsidiary; (ii) issuances of director's qualifying shares or
sales to foreign nationals of shares of Capital Stock of foreign Restricted
Subsidiaries, to the extent required by applicable law; (iii) if, immediately
after giving effect to such issuance or sale, such Restricted Subsidiary would
no longer constitute a Restricted Subsidiary and any Investment in such Person
remaining after giving effect to such issuance or sale would have been
permitted to be made under Section 4.04 if made on the date of such issuance or
sale; or (iv) issuances of Common Stock that has no preference with respect to
dividends or upon liquidation, the Net Cash Proceeds of which are promptly
applied as provided in clause (i) or (ii) of the "Limitation on Asset Sales"
covenant.
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SECTION 4.07. Limitation on Issuances of Guarantees by Restricted
Subsidiaries. The Company will not permit any Restricted Subsidiary, directly
or indirectly, to Guarantee any Indebtedness of the Company which is pari passu
with or subordinate in right of payment to the Notes ("Guaranteed
Indebtedness"), unless (i) such Restricted Subsidiary simultaneously executes
and delivers a supplemental indenture to this Indenture providing for
Guarantees (a "Subsidiary Guarantee") of payment of the Notes by such
Restricted Subsidiary and (ii) such Restricted Subsidiary waives and will not
in any manner whatsoever claim or take the benefit or advantage of, any rights
of reimbursement, indemnity or subrogation or any other rights against the
Company or any other Restricted Subsidiary as a result of any payment by such
Restricted Subsidiary under its Subsidiary Guarantee until the Notes have been
paid in full, in U.S. Dollars; provided that this paragraph shall not be
applicable to any Guarantee of any Restricted Subsidiary (x) that existed at
the time such Person became a Restricted Subsidiary and was not Incurred in
connection with, or in contemplation of, such Person becoming a Restricted
Subsidiary or (y) of Indebtedness Incurred under the Senior Secured Credit
Facilities up to the amount permitted to be Incurred under the second paragraph
of clause (a) of Section 4.03. If the Guaranteed Indebtedness is (A) pari passu
with the Notes, then the Guarantee of such Guaranteed Indebtedness shall be
pari passu with, or subordinated to, the Subsidiary Guarantee or (B)
subordinated to the Notes, then the Guarantee of such Guaranteed Indebtedness
shall be subordinated to the Subsidiary Guarantees at least to the extent that
the Guaranteed Indebtedness is subordinated to the Notes.
Notwithstanding the foregoing, any Subsidiary Guarantee by a
Restricted Subsidiary shall provide by its terms that it shall be automatically
and unconditionally released and discharged upon (i) any sale, exchange or
transfer, to any Person not an Affiliate of the Company, of all of the
Company's and each Restricted Subsidiary's Capital Stock in, or all or
substantially all the assets of, such Restricted Subsidiary (which sale,
exchange or transfer is not prohibited by this Indenture) or (ii) the release
or discharge of the Guarantee which resulted in the creation of such Subsidiary
Guarantee, except a discharge or release by or as a result of payment under
such Guarantee.
SECTION 4.08. Limitation on Transactions with Stockholders and
Affiliates. The Company will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, enter into, renew or extend any transaction
(including, without limitation, the purchase, sale, lease or exchange of
property or assets, or the rendering of any service) with any holder (or any
Affiliate of such holder) of 5% or more of any class of Capital Stock of the
Company, Grupo TFM or with any Affiliate of the Company, Grupo TFM or any
Restricted Subsidiary, except upon fair and reasonable terms no less favorable
to the Company or such Restricted Subsidiary than could be obtained, at the
time of such transaction or, if such transaction is pursuant to a written
agreement, at the time of the execution of the agreement providing therefor, in
a comparable arm's-length transaction with a Person that is not such a holder
or an Affiliate.
The foregoing limitation does not limit, and shall not apply to (i)
transactions (A) approved by a majority of the disinterested members of the
Board of Directors, (B) for which the Company or a Restricted Subsidiary
delivers to the Trustee a written opinion of a United States nationally
recognized investment banking firm (or their Mexican affiliate) stating that
the transaction is fair to the Company or such Restricted Subsidiary from a
financial point of view or
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(C) involving consideration of $2 million or less; (ii) any transaction
between Grupo TFM and the Company, or between Grupo TFM or the Company
and any of the Company's Restricted Subsidiaries or between Restricted
Subsidiaries; (iii) the payment of reasonable and customary regular fees
to the directors and officers of the Company and Grupo TFM; (iv) any
payments or other transactions pursuant to any tax-sharing agreement
between the Company and Grupo TFM or any Subsidiary of the Company with
which the Company files a consolidated tax return or with which the
Company is part of a consolidated group for tax purposes; (v)
contributions in cash to the common equity capital of the Company by
Grupo TFM, KCSI, or Grupo TMM; (vi) any Restricted Payments not
prohibited by Section 4.04; and (vii) any transaction between the Company
or any of its Subsidiaries and (A) Grupo TMM or any of its Affiliates or
(B) KCSI or any of its Affiliates, in each case, relating to the
provision of transportation or transportation-related services approved
in the manner provided in clause (i)(A) above. Notwithstanding the
foregoing, any transaction covered by the first paragraph of this Section
4.08 and not covered by clauses (ii) through (vii) of this paragraph, (a)
the aggregate amount of which exceeds U.S.$5 million in value, must be
approved or determined to be fair in the manner provided for in clause
(i) (A) or (B) above and (b) the aggregate amount of which exceeds
U.S.$15 million in value, must be determined to be fair in the manner
provided for in clause (i)(B) above; provided that such approval or
determination of fairness shall not be required with respect to (a)
payments under the Management Services Agreements as in effect on the
Closing Date; (b) transactions with the Tex-Mex Railway; (c) transactions
with Mexico and its Affiliates in the ordinary course of business,
provided that Mexico and its Affiliates do not beneficially own stock of
the Company having voting power in excess of 10% of the total voting
power of the Voting Stock of the Company; or (d) any equipment lease with
an Affiliate, provided that an Officer's Certificate is furnished to the
Trustee certifying that the terms of the equipment lease are no less
favorable to the Company than the terms offered by an unrelated party.
SECTION 4.09. Limitation on Liens. The Company will not, and will
not permit any Restricted Subsidiary to create, incur, assume or suffer to exist
any Lien on any of its or any Restricted Subsidiary's assets or properties of
any character, or on any shares of Capital Stock or Indebtedness of any
Restricted Subsidiary, without making effective provision for all of the Notes
and all other amounts due under this Indenture to be directly secured equally
and ratably with (or, if the obligation or liability to be secured by such Lien
is subordinated in right of payment to the Notes, prior to) the obligation or
liability secured by such Lien.
The foregoing limitation does not apply to (i) Liens existing on the
Closing Date; (ii) Liens securing obligations under the Senior Secured Credit
Facilities; (iii) Liens granted after the Closing Date on any of the assets or
Capital Stock of the Company or its Restricted Subsidiaries created in favor of
the Holders; (iv) Liens with respect to the assets of a Restricted Subsidiary
granted by such Restricted Subsidiary to the Company or a Wholly Owned
Restricted Subsidiary to secure Indebtedness owing to the Company or such other
Restricted Subsidiary; (v) Liens securing Indebtedness which is Incurred to
refinance secured Indebtedness which is permitted to be Incurred under clause
(iii) of the second paragraph of Section 4.03; provided that such Liens do not
extend to or cover any property or assets of the Company or any of its
Restricted Subsidiary other than the property or assets securing the
Indebtedness being refinanced; (vi) Liens on any property or assets of a
Restricted Subsidiary securing Indebtedness of such Restricted Subsidiary
permitted under Section 4.03; (vii) Liens securing Indebtedness
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which is permitted to be Incurred under clause (i) of paragraph (a) under
Section 4.03; (viii) Permitted Liens; or (ix) Liens permitted under the
Existing Indentures.
SECTION 4.10. Limitation on Sale-Leaseback Transactions. The
Company will not, and will not permit any Restricted Subsidiary to, enter into
any sale-leaseback transaction involving any of its assets or properties
whether now owned or hereafter acquired, whereby the Company or a Restricted
Subsidiary sells or transfers such assets or properties and then or thereafter
leases such assets or properties or any part thereof or any other assets or
properties which the Company or such Restricted Subsidiary, as the case may be,
intends to use for substantially the same purpose or purposes as the assets or
properties sold or transferred.
The foregoing restriction does not apply to any sale-leaseback
transaction if (i) the lease is for a period, including renewal rights, of not
in excess of three years, (ii) the lease secures or relates to industrial
revenue or pollution control bonds, (iii) the transaction is solely between the
Company and any Wholly Owned Restricted Subsidiary or solely between Wholly
Owned Restricted Subsidiaries or (iv) the Company or such Restricted
Subsidiary, within 12 months after the sale or transfer of any assets or
properties is completed, applies an amount not less than the net proceeds
received from such sale in accordance with clause (A) or (B) of the first
paragraph of Section 4.11.
SECTION 4.11. Limitation on Asset Sales. The Company will not, and
will not permit any Restricted Subsidiary to, consummate any Asset Sale, unless
(i) the consideration received by the Company or such Restricted Subsidiary is
at least equal to the fair market value of the assets sold or disposed of and
(ii) at least 80% of the consideration received (excluding any amount of
Released Indebtedness) consists of cash or Temporary Cash Investments. In the
event and to the extent that the Net Cash Proceeds received by the Company or
any of its Restricted Subsidiaries from one or more Asset Sales occurring on or
after the Closing Date in any period of 12 consecutive months exceed 10% of
Adjusted Consolidated Net Tangible Assets (determined as of the date closest to
the commencement of such 12-month period for which a consolidated balance sheet
of the Company and its subsidiaries has been filed or provided to the Trustee
pursuant to Section 4.18), then the Company shall or shall cause the relevant
Restricted Subsidiary to (i) within 12 months after the date Net Cash Proceeds
so received exceed 10% of Adjusted Consolidated Net Tangible Assets (A) apply
an amount equal to such excess Net Cash Proceeds to permanently repay
unsubordinated Indebtedness of the Company, or Indebtedness of any Restricted
Subsidiary of the Company, in each case owing to a Person other than the
Company or any of its Restricted Subsidiaries or (B) invest an equal amount, or
the amount not so applied pursuant to clause (A) (or enter into a definitive
agreement committing to so invest within 12 months after the date of such
agreement), in property or assets (other than current assets) of a nature or
type or that are used in a business (or in a company having property and assets
of a nature or type, or engaged in a business) similar or related to the nature
or type of the property and assets of, or the business of, the Company and its
Restricted Subsidiaries existing on the date of such investment and (ii) apply
(no later than the end of the 12-month period referred to in clause (i)) such
excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as
provided in the following paragraph of this Section 4.11. The amount of such
excess Net Cash Proceeds required to be applied (or to be committed to be
applied) during such 12-month period as set forth in clause (i) of the
preceding sentence and not applied as so required by the end of such period
shall constitute "Excess Proceeds."
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If, as of the first day of any calendar month, the aggregate amount of
Excess Proceeds not theretofore subject to an Offer to Purchase pursuant to
this Section 4.11 totals at least $10 million, the Company must commence, not
later than the fifteenth Business Day of such month, and consummate an Offer to
Purchase from the Holders (and if required by the terms of any Indebtedness
that is pari passu with the Notes ("Pari Passu Indebtedness"), from the holders
of such Pari Passu Indebtedness) on a pro rata basis an aggregate principal
amount of Notes (and Pari Passu Indebtedness) equal to the Excess Proceeds on
such date, at a purchase price equal to 101% of the principal amount of the
Notes (and Pari Passu Indebtedness) plus, in each case, accrued interest (if
any) to the date of purchase.
SECTION 4.12. Repurchase of Notes upon a Change of Control. The
Company must commence, within 30 days of the occurrence of a Change of Control,
and consummate an Offer to Purchase for all Notes then outstanding, at a
purchase price equal to 101% of the principal amount plus interest (if any) to
the date of purchase.
SECTION 4.13. Existence. Subject to Articles Four and Five of this
Indenture, the Company will do or cause to be done all things necessary to
preserve and keep in full force and effect its existence and the existence of
each of its Restricted Subsidiaries in accordance with the respective
organizational documents of the Company and each such Subsidiary and the rights
(whether pursuant to charter, partnership certificate, agreement, statute or
otherwise), material licenses and franchises of the Company and each such
Subsidiary; provided that the Company shall not be required to preserve any
such right, license or franchise, or the existence of any Restricted
Subsidiary, if (a) the maintenance or preservation thereof is no longer
desirable in the conduct of the business of the Company and its Restricted
Subsidiaries taken as a whole or (b) the failure to maintain or preserve any
such right, license or franchise does not have a material adverse effect on the
Company and its Restricted Subsidiaries, taken as a whole. In addition, the
Company agrees to take such actions, within a reasonable time after the Closing
Date (and in any event prior to any proceeding initiated regarding the
dissolution of the Company), as may be necessary to ensure that it shall be in
good standing under the laws of the jurisdiction of its incorporation, provided
that the Company will not be required to take such actions if the failure to be
in good standing would not have a material adverse effect on the Company and
its Restricted Subsidiaries, taken as a whole.
SECTION 4.14. Payment of Taxes and Other Claims. The Company will
pay or discharge and shall cause each of its Subsidiaries to pay or discharge,
or cause to be paid or discharged, before the same shall become delinquent (i)
all material taxes, assessments and governmental charges levied or imposed upon
(a) the Company or any such Subsidiary, (b) the income or profits of any such
Subsidiary which is a corporation or (c) the property of the Company or any
such Subsidiary 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 such Subsidiary, provided 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 the amount, applicability or validity of which is
being contested in good faith by appropriate proceedings and for which adequate
reserves have been established and so long as the non-payment of or failure to
discharge any such tax, assessment, charge or claim would not have a material
adverse effect on the Company and its Restricted Subsidiaries, taken as a
whole.
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SECTION 4.15. Maintenance of Properties and Insurance. The Company
will cause all properties used or useful in the conduct of its business or the
business of any of its Restricted Subsidiaries to be maintained and kept in
good condition, repair and working order (reasonable wear and tear excepted)
and supplied with all necessary equipment and will cause to be made all
necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the judgment of the Company may be necessary so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times; provided that nothing in this Section 4.15 shall
prevent the Company or any such Subsidiary 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 Company,
desirable in the conduct of the business of the Company or such Subsidiary or
would not have a material adverse effect on the Company and its Restricted
Subsidiaries, taken as a whole.
The Company will provide or cause to be provided, for itself and its
Restricted Subsidiaries, reasonably adequate insurance including appropriate
self-insurance) with respect to its properties and business against loss or
damage of the kinds customarily insured against by corporations of established
reputation engaged in the same or similar businesses similarly situated and
owning like properties, of such types and in such amounts, with such
deductibles and by such methods as shall be customary for corporations
similarly situated in the industry in which the Company or such Restricted
Subsidiary, as the case may be, is then conducting business, except to the
extent that failure to carry or maintain any such insurance would not, singly
or in the aggregate, have a material adverse effect on the condition, financial
or otherwise, or the earnings, business or operations of the Company and its
subsidiaries, taken as a whole.
SECTION 4.16. Notice of Defaults. In the event that the Company
becomes aware of any Default or Event of Default, the Company, promptly after
it becomes aware thereof, will give written notice thereof to the Trustee.
SECTION 4.17. Compliance Certificates. (a) The Company shall
deliver to the Trustee, within 90 days after the end of the Company's fiscal
year, an Officers' Certificate stating whether or not the signers know of any
Default or Event of Default that occurred during such fiscal year. Such
certificates shall contain a certification from the principal executive
officer, principal financial officer or principal accounting officer of the
Company that a review has been conducted of the activities of the Company and
the Restricted Subsidiaries and the Company's performance under this Indenture
and that, to their knowledge, the Company has complied with all conditions and
covenants under this Indenture. For purposes of this Section 4.17, such
compliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture. If the Officers of the
Company signing such certificate do know of such a Default or Event of Default,
the certificate shall describe the nature of any such Default or Event of
Default and its status.
(b) The Company shall deliver to the Trustee, within 90 days after
the end of its fiscal year, a certificate signed by the Company's independent
certified public accountants stating (i) that their audit examination has
included a review of the terms of this Indenture and the Notes as they relate
to accounting matters, (ii) that they have read the most recent Officers'
Certificate delivered to the Trustee pursuant to paragraph (a) of this Section
4.17 and (iii) whether, in connection with their audit examination, anything
came to their attention that
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caused them to believe that the Company was not in compliance with any of
the terms, covenants, provisions or conditions of Article Four and
Section 5.01 of this Indenture as they pertain to accounting matters and,
if any Default or Event of Default has come to their attention,
specifying the nature and period of existence thereof; provided that such
independent certified public accountants shall not be liable in respect
of such statement by reason of any failure to obtain knowledge of any
such Default or Event of Default that would not be disclosed in the
course of an audit examination conducted in accordance with generally
accepted auditing standards in effect at the date of such examination.
(c) Within 90 days of the end of the Company's fiscal year, the
Company shall deliver to the Trustee a list of all Significant Subsidiaries.
The Trustee shall have no duty with respect to any such list except to keep it
on file and available for inspection by the Holders.
SECTION 4.18. Commission Reports and Reports to Holders. At all
times from and after the Closing Date, whether or not the Company is then
required to file reports with the Commission, for so long as any Notes are
outstanding, the Company shall file with the Commission all such reports and
other information as it would be required to file with the Commission by
Sections 13 or 15(d) under the Exchange Act if it was subject thereto, unless
the Commission does not permit such filings, in which case the Company shall
provide such reports and other information to the Trustee (within the same time
periods that would be applicable if the Company were required and permitted to
file reports with the Commission) and instruct the Trustee to mail such reports
and other information to Holders at their addresses set forth on the Note
Register. The Company shall supply the Trustee and each Holder or shall supply
to the Trustee for forwarding to each such Holder, without cost to such Holder,
copies of such reports and other information. Delivery of such reports,
information and documents to the Trustee is for informational purposes only and
the Trustee's receipt of such reports, information and documents shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officer's Certificates).
SECTION 4.19. Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other
law that would prohibit or forgive the Company from paying all or any portion
of the principal of, premium, if any, or interest on the Notes as contemplated
herein, wherever enacted, now or at any time hereafter in force, or that may
affect the covenants or the performance of this Indenture; and (to the extent
that it may lawfully do so) the Company expressly waives all benefit or
advantage of any such law and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
SECTION 4.20. Additional Amounts. Any and all payments made by the
Company to the Holders, under or with respect to the Notes, will be made free
and clear of and without withholding or deduction for or on account of any
present or future tax, duty, levy, impost, assessment or other governmental
charge (including any interest or penalties with respect thereto) imposed or
levied by or on behalf of Mexico or any political subdivision thereof or by
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any authority or agency therein or thereof having power to tax
(hereinafter "Mexican Withholding Taxes"), unless the withholding or
deduction of such Mexican Withholding Taxes is required by law or by the
interpretation or administration thereof. In the event any Mexican
Withholding Taxes are required to be so withheld or deducted, the Company
will (i) pay such additional amounts ("Additional Amounts") as will
result in receipt by the Holders of such amounts as would have been
received by them had no such withholding or deduction been required, (ii)
deduct or withhold such Mexican Withholding Taxes and (iii) remit the
full amount so deducted or withheld to the relevant taxing or other
authority. Notwithstanding the foregoing, no such Additional Amounts
shall be payable for or on account of:
(a) any Mexican Withholding Taxes which would not have been
imposed or levied on a Holder but for the existence of any present or
former connection between the Holder or beneficial owner of the Notes and
Mexico or any political subdivision or territory or possession thereof or
area subject to its jurisdiction, including, without limitation, such
Holder or beneficial owner (i) being or having been a citizen or resident
thereof, (ii) maintaining or having maintained an office, permanent
establishment, fixed base or branch therein, or (iii) being or having
been present or engaged in trade or business therein, except for a
connection solely arising from the mere ownership of, or receipt of
payment under, such Note or the exercise of rights under this Indenture;
(b) except as otherwise provided, any estate, inheritance, gift,
sales, transfer, or personal property or similar tax, assessment or other
governmental charge;
(c) any Mexican Withholding Taxes that are imposed or levied by
reason of the failure by the Holder or beneficial owner of such Note to
comply with any certification, identification, information,
documentation, declaration or other reporting requirement which is
required or imposed by a statute, treaty, regulation, general rule or
administrative practice as a precondition to exemption from, or reduction
in the rate of, the imposition, withholding or deduction of any Mexican
Withholding Taxes; provided that at least 60 days prior to (i) the first
payment date with respect to which the Company shall apply this clause
(c) and, (ii) in the event of a change in such certification,
identification, information, documentation, declaration or other
reporting requirement, the first payment date subsequent to such change,
the Company shall have notified the Trustee, in writing, that the Holders
or beneficial owners of the Notes will be required to provide such
certification, identification, information or documentation, declaration
or other reporting;
(d) any Mexican Withholding Taxes that are imposed or levied by
reason of the failure by the Holder or beneficial owner of such Note to
timely comply (subject to the conditions set forth below) with a written
request by or on behalf of the Company to provide information,
documentation or other evidence concerning the nationality, residence,
identity, or registration with the Ministry of Finance and Public Credit
of the Holder or beneficial owner of such Note that is necessary from
time to time to determine the appropriate rate of deduction or
withholding of Mexican Withholding Taxes applicable to such Holder or
beneficial owner; provided that at least 60 days prior to the first payment
date with respect to which the Company shall apply this clause (d), the
Company shall have notified the Trustee, in writing, that such Holders or
beneficial
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owners of the Notes will be required to provide such information,
documentation or other evidence;
(e) the presentation of such Note (where presentation is required)
for payment on a date more than 30 days after the date on which such
payment became due and payable or the date on which payment thereof is
duly provided for, whichever occurs later, except to the extent that the
Holder or the beneficial owner of such Note would have been entitled to
Additional Amounts in respect of such Mexican Withholding Taxes on
presenting such Note for payment on any date during such 30-day period;
(f) any Mexican Withholding Taxes that are payable only by other
than withholding or deduction; or
(g) any combination of item (a), (b), (c), (d), (e), or (f) above.
Notwithstanding the foregoing, the limitations on the Company's
obligation to pay Additional Amounts set forth in clauses (c) and (d) above
shall not apply if the provision of the certification, identification,
information, documentation, declaration or other evidence described in such
clauses (c) and (d) would be materially more onerous, in form, in procedure or
in the substance of information disclosed, to a Holder or beneficial owner of a
Note (taking into account any relevant differences between United States and
Mexican law, regulation or administrative practice) than comparable information
or other applicable reporting requirements imposed or provided for under United
States federal income tax law (including the United States-Mexico Income Tax
Treaty), regulation (including proposed regulations) and administrative
practice. In addition, the limitations on the Company's obligation to pay
Additional Amounts set forth in clauses (c) and (d) above shall not apply if
Rule 3.25.15 published in the Official Gazette of the Federation of Mexico
(Diario Oficial de la Federacion) on May 30, 2002 or a substantially similar
successor of such rule is in effect, unless (i) the provision of the
certification, identification, information, documentation, declaration or other
evidence described in clauses (c) and (d) is expressly required by statute,
regulation, ruling or general rules or administrative practice in order to
apply Rule 3.25.15 (or a substantially similar successor of such rule), the
Company cannot obtain such certification, identification, information,
documentation, declaration or other evidence or satisfy any other reporting
requirements, on its own through reasonable diligence and the Company otherwise
would meet the requirements for application of Rule 3.25.15 (or such successor
of such rule) or (ii) in the case of a Holder or beneficial owner of a Note
that is a pension fund or other tax-exempt organization, such Holder or
beneficial owner would be subject to Mexican Withholding Taxes at a rate less
than that provided by Article 195, Section II, paragraph (a) of the Mexican
Income Tax Law in connection with Rule 3.25.15 if the information,
documentation or other evidence required under clause (d) above were provided.
In addition, clause (c) above shall not be construed to require that a
non-Mexican pension or retirement fund, a non-Mexican tax-exempt organization,
a non-Mexican financial institution or any other Holder or beneficial owner of
a Note register with the Ministry of Finance and Public Credit for the purpose
of establishing eligibility for an exemption from or reduction of Mexican
Withholding Taxes.
The Company will, upon written request, provide the Trustee, the
Holders and the Paying Agent with a duly certified or authenticated copy of an
original receipt of the payment of
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Mexican Withholding Taxes which the Company has withheld or deducted in
respect of any payments made under or with respect to the Notes.
In the event that Additional Amounts actually paid with respect to any
Notes are based on Mexican Withholding Taxes in excess of the appropriate
Mexican Withholding Taxes applicable to the Holder or beneficial owner of such
Notes and, as a result thereof, such Holder or beneficial owner is entitled to
make a claim for a refund of such excess, or credit such excess against Mexican
taxes, then, to the extent it is able to do so without jeopardizing its
entitlement to such refund or credit, such Holder or beneficial owner shall, by
accepting the Notes, be deemed to have assigned and transferred all right,
title and interest to any claim for a refund or credit of such excess to the
Company. By making such assignment and transfer, the Holder or beneficial owner
makes no representation or warranty that the Company will be entitled to
receive such claim for a refund or credit and incurs no other obligation with
respect thereto (including executing or delivering any documents and paying any
costs or expenses of the Company relating to obtaining such refund). Nothing
contained in this paragraph shall interfere with the right of each Holder or
beneficial owner of a Note to arrange its tax affairs in whatever manner it
thinks fit nor oblige any Holder or beneficial owner of a Note to claim any
refund or credit or to disclose any information relating to its tax affairs or
any computations in respect thereof or to do anything that would prejudice its
ability to benefit from any other credits, reliefs, remissions or repayments to
which it may be entitled.
If the Company is obligated to pay Additional Amounts with respect to
any payment under or with respect to the Notes (other than Additional Amounts
payable on the date of this Indenture), the Company will, upon written request,
deliver to the Trustee an Officers' Certificate stating the fact that such
Additional Amounts are payable and the amounts so payable.
In addition, the Company will pay any stamp, issue, registration,
documentary or other similar taxes and other duties (including interest and
penalties with respect thereto) imposed or levied by Mexico (or any political
subdivision or taxing authority thereof or therein) in respect of the creation,
issue and offering of the Notes.
SECTION 4.21. Comision Nacional Bancaria y de Valores. Promptly
after the date of this Indenture, the Company will furnish to the Comision
Nacional Bancaria y de Valores all information necessary to complete the
registration of the Notes in the Special Section of the National Registry of
Securities.
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. When Company May Merge, Etc. The Company will not
consolidate with, merge with or into, or sell, convey, transfer, lease or
otherwise dispose of all or substantially all of its property and assets (as an
entirety or substantially an entirety in one transaction or a series of related
transactions) to, any Person or permit any Person to merge with or into the
Company unless: (i) the Company shall be the continuing Person, or the Person
(if other than the Company) formed by such consolidation or into which the
Company is merged or that acquired or leased such property and assets of the
Company shall be a corporation organized
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and validly existing under the laws of Mexico, the United States of
America or any jurisdiction of either such country and shall expressly
assume, by a supplemental indenture, executed and delivered to the
Trustee, all of the obligations of the Company on all of the Notes and
under this Indenture; (ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing; (iii) immediately after giving effect to such transaction on
a pro forma basis, the Company, or any Person becoming the successor
obligor of the Notes, shall have a Consolidated Net Worth equal to or
greater than the Consolidated Net Worth of the Company immediately prior
to such transaction; (iv) immediately after giving effect to such
transaction on a pro forma basis the Company, or any Person becoming the
successor obligor of the Notes, could incur at least $1.00 of
Indebtedness under the first paragraph of Section 4.03; provided that
this clause (iv) shall not apply to a consolidation or merger with or
into a Wholly Owned Restricted Subsidiary with a positive net worth;
provided that, in connection with any such consolidation or merger, no
consideration (other than Common Stock in the surviving Person or the
Company) shall be issued or distributed to the stockholders of the
Company; and (v) the Company delivers to the Trustee an Officers'
Certificate (attaching the arithmetic computations to demonstrate
compliance with clauses (iii) and (iv)) and Opinion of Counsel, in each
case stating that such consolidation, merger or transfer and such
supplemental indenture complies with this provision and that all
conditions precedent provided for herein relating to such transaction
have been complied with; provided, however, that (A) clauses (iii) and
(iv) above do not apply if, in the good faith determination of the Board
of Directors of the Company, whose determination shall be evidenced by a
Board Resolution, the principal purpose of such transaction is to change
the jurisdiction of incorporation of the Company or to incorporate the
Company under the laws of a state of the United States and (B) only
clause (i) shall apply for a merger of the Company and Grupo TFM; and
provided further that any such transaction shall not have as one of its
purposes the evasion of the foregoing limitations.
SECTION 5.02. Successor Substituted. Upon any consolidation or
merger, or any sale, conveyance, transfer or other disposition of all or
substantially all of the property and assets of the Company in accordance with
Section 5.01 of this Indenture, the successor Person formed by such
consolidation or into which the Company is merged or to which such sale,
conveyance, transfer or other disposition is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default. An "Event of Default" shall occur
with respect to the Notes if:
(a) the Company defaults in the payment of principal of (or
premium, if any, on) any Note when the same becomes due and payable at
maturity, upon acceleration, redemption or otherwise;
(b) the Company defaults in the payment of interest on any Note
when the same becomes due and payable, and such default continues for a
period of 30 days;
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(c) the Company defaults in the performance of or breaches the
provisions of Article Five or fails to make or consummate an Offer to
Purchase in accordance with Section 4.11 or Section 4.12;
(d) the Company defaults in the performance of or breaches any
other covenant or agreement of the Company in this Indenture or under the
Notes (other than a default specified in clause (a), (b) or (c) above),
and such default or breach continues for a period of 30 consecutive days
after written notice by the Trustee or the Holders of 25% or more in
aggregate principal amount of the Notes;
(e) there occurs with respect to any issue or issues of
Indebtedness of the Company or any of its Significant Subsidiaries having
an outstanding principal amount of $10 million or more in the aggregate
for all such issues of all such Persons, whether such Indebtedness now
exists or shall hereafter be created, (I) an event of default that has
caused the holder thereof to declare such Indebtedness to be due and
payable prior to its Stated Maturity and such Indebtedness has not been
discharged in full or such acceleration has not been rescinded or
annulled within 30 days of such acceleration and/or (II) the failure to
make a principal payment at the final (but not any interim) fixed
maturity and such defaulted payment shall not have been made, waived or
extended within 30 days of such payment default;
(f) [intentionally omitted];
(g) any final judgment or order (not covered by insurance) for the
payment of money in excess of $10 million in the aggregate for all such
final judgments or orders against all such Persons (treating any
deductibles, self-insurance or retention as not so covered) shall be
rendered against the Company or any of its Significant Subsidiaries and
shall not be paid or discharged, and there shall be any period of 30
consecutive days following entry of the final judgment or order that
causes the aggregate amount for all such final judgments or orders
outstanding and not paid or discharged against all such Persons to exceed
$10 million during which a stay of enforcement of such final judgment or
order, by reason of a pending appeal or otherwise, shall not be in
effect;
(h) a court having jurisdiction in the premises enters a decree
or order for (A) relief in respect of the Company or any of its
Significant Subsidiaries in an involuntary case under any applicable
bankruptcy, suspension of payments, insolvency or other similar law now
or hereafter in effect, (B) appointment of a receiver, liquidator,
assignee, sindico, custodian, trustee, sequestrator or similar official
of the Company or any of its Significant Subsidiaries or for all or
substantially all of the property and assets of the Company or any of its
Significant Subsidiaries or (C) the winding up or liquidation of the
affairs of the Company or any of its Significant Subsidiaries and, in
each case, such decree or order shall remain unstayed and in effect for a
period of 30 consecutive days;
(i) the Company or any of its Significant Subsidiaries (A)
commences a voluntary case under any applicable bankruptcy, suspension of
payments, insolvency or other similar law now or hereafter in effect, or
consents to the entry of an order for relief in an involuntary case under
any such law, (B) consents to the appointment of or taking
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possession by a receiver, liquidator, assignee, sindico, custodian,
trustee, sequestrator or similar official of the Company or any of its
Significant Subsidiaries or for all or substantially all of the property
and assets of the Company or any of its Significant Subsidiaries or (C)
effects any general assignment for the benefit of creditors; or
(j) (A) the Concession Title shall cease to grant to the Company
the rights (including exclusive rights) originally provided therein and
such cessation has had a material adverse effect on the Company and its
Restricted Subsidiaries taken as a whole; (B) (x) the Concession Title
shall for any reason be terminated and not reinstated within 30 days or
(y) rights provided therein which were originally exclusive to the
Company shall become non-exclusive and the cessation of such exclusivity
has had a material adverse effect on the Company and its Restricted
Subsidiaries, taken as a whole; or (C) the operations of the Northeast
Rail Lines shall be commandeered or repossessed (a requisa) for a period
of 90 days or more.
SECTION 6.02. Acceleration. If an Event of Default (other than an
Event of Default specified in clause (h), (i) or (j)(B)(x) above that occurs
with respect to the Company) occurs and is continuing under this Indenture, the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding, by written notice to the Company (and to the Trustee if
such notice is given by the Holders), may, and the Trustee at the request of
such Holders shall, declare the principal of, premium, if any, and accrued
interest on the Notes to be immediately due and payable. Upon a declaration of
acceleration, such principal of, premium, if any, and accrued interest shall be
immediately due and payable. In the event of a declaration of acceleration
because an Event of Default set forth in clause (e) above has occurred and is
continuing, such declaration of acceleration shall be automatically rescinded
and annulled if the event of default triggering such Event of Default pursuant
to clause (e) shall be remedied or cured by the Company or its Significant
Subsidiary or waived by the holders of the Indebtedness within 60 days after
the declaration of acceleration with respect thereto. If an Event of Default
specified in clause (h), (i) or (j)(B)(x) above occurs with respect to the
Company, the principal of, premium, if any, and accrued interest on the Notes
then outstanding shall ipso facto become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holder.
The Holders of at least a majority in principal amount of the outstanding
Notes, by written notice to the Company and to the Trustee, may waive all past
defaults and rescind and annul a declaration of acceleration and its
consequences if (i) all existing Events of Default, other than the nonpayment
of the principal of, premium, if any, and interest on the Notes that have
become due solely by such declaration of acceleration, have been cured or
waived and (ii) the rescission would not conflict with any judgment or decree
of a court of competent jurisdiction.
SECTION 6.03. Other Remedies. 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 principal of, premium, if any, or interest
on the Notes or to enforce the performance of any provision of the Notes or
this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding.
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SECTION 6.04. Waiver of Past Defaults. Subject to Sections 6.02,
6.07 and 9.02, the Holders of at least a majority in principal amount of the
outstanding Notes, by notice to the Trustee, may waive an existing Default or
Event of Default and its consequences, except a Default in the payment of
principal of, premium, if any, or interest on any Note as specified in clause
(a) or (b) of Section 6.01 or in respect of a covenant or provision of this
Indenture which cannot be modified or amended without the consent of the holder
of each outstanding Note affected. Upon any such waiver, such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default or Event of Default or impair any
right consequent thereto.
SECTION 6.05. Control by Majority. The Holders of at least a
majority in aggregate principal amount of the outstanding Notes may direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on the Trustee; provided
that the Trustee may refuse to follow any direction that conflicts with law or
this Indenture, that may involve the Trustee in personal liability, or that the
Trustee determines in good faith may be unduly prejudicial to the rights of
Holders not joining in the giving of such direction; and provided further that
the Trustee may take any other action it deems proper that is not inconsistent
with any directions received from Holders of Notes pursuant to this Section
6.05.
SECTION 6.06. Limitation on Suits. A Holder may not institute any
proceeding, judicial or otherwise, with respect to this Indenture or the Notes,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:
(i) such Holder has previously given to the Trustee written notice
of a continuing Event of Default;
(ii) the Holders of at least 25% in aggregate principal amount of
outstanding Notes shall have made a written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name
as Trustee hereunder;
(iii) such Holder or Holders have offered to the Trustee indemnity
reasonably satisfactory to the Trustee against any costs, liabilities or
expenses to be incurred in compliance with such request;
(iv) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(v) during such 60-day period, the Holders of a majority in
aggregate principal amount of the outstanding Notes have not given the
Trustee a direction that is inconsistent with such written request.
For purposes of Section 6.05 of this Indenture and this Section
6.06, the Trustee shall comply with TIA Section 316(a) in making any
determination of whether the Holders of the required aggregate principal
amount of outstanding Notes have concurred in any request or direction of
the Trustee to pursue any remedy available to the Trustee or the Holders
with respect to this Indenture or the Notes or otherwise under the law.
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A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder.
SECTION 6.07. Rights of Holders to Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder of a Note to
receive payment of principal of, premium, if any, or interest on such Holder's
Note on or after the respective due dates expressed on such Note, or to bring
suit for the enforcement of any such payment on or after such respective dates,
shall not be impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of Default
in payment of principal, premium or interest 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 of the Notes for the whole amount of principal, premium, if any, and
accrued interest remaining unpaid, together with interest on overdue principal,
premium, if any, and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate
specified in 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.
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 and counsel, and any other amounts due the Trustee under
Section 7.07) and the Holders allowed in any judicial proceedings relative to
the Company (or any other obligor of the Notes), its creditors or its property
and shall be entitled and empowered to collect and receive any monies,
securities or other property payable or deliverable upon conversion or exchange
of the Notes or upon any such claims and to distribute the same, and any
custodian, receiver, assignee, sindico, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders,
to pay to the Trustee any amount due to it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agent and counsel, and
any other amounts due the Trustee under Section 7.07. Nothing herein contained
shall be deemed to empower 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 the money in the following order:
First: to the Trustee for all amounts due under Section 7.07;
Second: to Holders for amounts then due and unpaid for principal of,
premium, if any, and interest on the Notes in respect of which or for the
benefit of which such money has
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been collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Notes for principal,
premium, if any, and interest, respectively; and
Third: to the Company, or as a court of competent jurisdiction may
direct.
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
require any party litigant in such suit to file an undertaking to pay the costs
of the suit, and the court may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by
a Holder pursuant to Section 6.07 of this Indenture, or a suit by Holders of
more than 10% in 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 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, subject to any determination in such proceeding,
the Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Company, the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
SECTION 6.13. Rights and Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or wrongfully taken Notes in Section 2.09, no right or remedy herein
conferred upon or reserved to the Trustee or to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to every other right
and remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any
other appropriate right or remedy.
SECTION 6.14. Delay or Omission Not Waiver. No delay or omission
of the Trustee or of any Holder to exercise any right or remedy accruing upon
any Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein. Every right
and remedy given by this Article Six or by law to the Trustee or to the Holders
may be exercised from time to time, and as often as may be deemed expedient, by
the Trustee or by the Holders, as the case may be.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. General. The duties and responsibilities of the
Trustee shall be as provided by the TIA and as set forth herein.
Notwithstanding the foregoing, no provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise
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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. Whether or not herein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the
liability of or affording protection to the Trustee shall be subject to
the provisions of this Article Seven.
SECTION 7.02. Certain Rights of Trustee. Subject to TIA Sections
315(a) through (d):
(i) the Trustee may conclusively rely, and shall be protected in
acting or refraining from acting, upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or
other paper or document believed by it to be genuine and to have been
signed or presented by the proper person. The Trustee need not investigate
any fact or matter stated in any such document;
(ii) before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in
reliance on such certificate or opinion;
(iii) the Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any attorney or
agent appointed with due care;
(iv) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or
direction of any of the Holders, unless such Holders shall have offered
to the Trustee reasonable security or indemnity satisfactory to it
against the costs, expenses and liabilities that might be incurred by it
in compliance with such request or direction;
(v) the Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within its rights
or powers conferred upon the Trustee, under this Indenture;
(vi) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, conclusively rely upon an Officers' Certificate;
(vii) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness 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 to examine the books, records and
premises of the Company personally or by agent or attorney at the
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expense of the Company and shall incur no liability of any kind by reason
of such inquiry or investigation;
(viii) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it thereunder in good faith and in reliance
thereon;
(ix) the Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact
such a Default is received by the Trustee at the Corporate Trust Office
of the Trustee, and such notice references the Notes and this Indenture;
and
(x) the rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in
each of its capacities hereunder, and to each agent, co-trustee,
custodian and other Person employed to act hereunder.
SECTION 7.03. Individual Rights of Trustee. The Trustee, in its
individual or any other capacity, may become the owner or pledgee of Notes and
may otherwise deal with the Company or its Affiliates with the same rights it
would have if it were not the Trustee. Any Agent may do the same with like
rights. However, the Trustee is subject to TIA Sections 310(b) and 311.
SECTION 7.04. Trustee's Disclaimer. The Trustee (i) makes no
representation as to the validity or adequacy of this Indenture or the Notes,
(ii) shall not he accountable for the Company's use or application of the
proceeds from the Notes and (iii) shall not be responsible for any statement in
the Notes other than its certificate of authentication.
SECTION 7.05. Notice of Default. If any Default or any Event of
Default occurs and is continuing and if such Default or Event of Default is
known to a Responsible Officer of the Trustee, the Trustee shall mail to each
Holder in the manner and to the extent provided in TIA Section 313(c) notice of
the Default or Event of Default within 90 days after it occurs, unless such
Default or Event of Default has been cured; provided, however, that, except in
the case of a default in the payment of the principal of, premium, if any, or
interest on any Note, the Trustee shall be protected in withholding such notice
if and so long as a trust committee of Responsible Officers of the Trustee in
good faith determines that the withholding of such notice is in the interest of
the Holders.
SECTION 7.06. Reports by Trustee to Holders. Within 60 days after
each May 15, beginning with May 15, 2003, the Trustee shall mail to each Holder
as provided in TIA Section 313(c) a brief report dated as of such May 15, if
required by TIA Section 313(a).
SECTION 7.07. Compensation and Indemnity. The Company shall pay to
the Trustee and any Paying Agent such compensation as shall be agreed upon in
writing for its services. The compensation of the Trustee and any Paying Agent
shall not be limited by any law on compensation of a trustee of an express
trust. The Company shall reimburse the Trustee and
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any Paying Agent upon request for all reasonable out-of-pocket expenses
and advances incurred or made by the Trustee and any Paying Agent. Such
expenses shall include the reasonable compensation and expenses of the
Trustee's or Paying Agent's agents and counsel.
The Company shall indemnify the Trustee, its agents and officers, and
any Paying Agent against any and all losses, liabilities, obligations, damages,
penalties, judgments, actions, claims, suits, proceedings, reasonable costs and
expenses (including reasonable fees and disbursements of counsel) of any kind
whatsoever which may be incurred by the Trustee, its agents and officers, or
any Paying Agent arising out of or in connection with the acceptance or
administration of its duties under this Indenture; provided, however, that the
Company need not reimburse any expense or indemnify against any loss,
obligation, damage, penalty, judgment, action, suit, proceeding, reasonable
cost or expense (including reasonable fees and disbursements of counsel) of any
kind whatsoever which may be incurred by the Trustee or any Paying Agent in
connection with any investigative, administrative or judicial proceeding
(whether or not such indemnified party is designated a party to such
proceeding) in which and to the extent that it is determined that the Trustee,
its agents and officers, or any Paying Agent acted with negligence, bad faith
or willful misconduct. The Trustee or any Paying Agent shall notify the Company
promptly of any claim of which a Responsible Officer of the Trustee has
received written notice for which it may seek indemnity. Failure by the Trustee
or any Paying Agent to so notify the Company shall not relieve the Company of
its obligations hereunder, unless the Company is materially prejudiced thereby.
The Company shall defend the claim and the Trustee or any Paying Agent shall
cooperate in the defense. Unless otherwise set forth herein, the Trustee or any
Paying Agent may have separate counsel and the Company shall pay the reasonable
fees and expenses of such counsel. The Company need not pay for any settlement
made without its consent, which consent shall not be unreasonably withheld.
To secure the Company's payment obligations in this Section 7.07, the
Trustee and any Paying Agent shall have a lien prior to the Notes on all money
or property held or collected by the Trustee or any Paying Agent, in its
capacity as Trustee or Paying Agent, except money or property held in trust by
the Trustee or any Paying Agent to pay principal of, premium, if any, and
interest on particular Notes.
If the Trustee or Paying Agent incurs expenses or renders services
after the occurrence of an Event of Default specified in clause (h) or (i) of
Section 6.01, the expenses and the compensation for the services will be
intended to constitute expenses of administration under Title 11 of the United
States Bankruptcy Code or any applicable federal or state law for the relief of
debtors.
The provisions of this Section 7.07 shall survive the termination of
this Indenture and the resignation or removal of the Trustee.
SECTION 7.08. Replacement of Trustee. A resignation or removal of
the Trustee and appointment of a successor Trustee shall become effective only
upon the successor Trustee's acceptance of appointment as provided in this
Section 7.08.
The Trustee may resign at any time by so notifying the Company in
writing at least 30 days prior to the date of the proposed resignation. The
Holders of a majority in principal
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amount of the outstanding Notes may remove the Trustee by so notifying the
Trustee in writing and may appoint a successor Trustee with the consent of the
Company. The Company may at any time remove the Trustee by Company Order given
at least 30 days prior to the date of the proposed removal.
If the Trustee resigns or is removed, or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office,
the Holders of a majority in principal amount of the outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company. If the successor Trustee does not deliver its written acceptance
required by the next succeeding paragraph of this Section 7.08 within 30 days
after the retiring Trustee resigns or is removed, the retiring Trustee at the
expense of the Company, the Company or the Holders of a majority in principal
amount of the outstanding Notes may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company, immediately after the
delivery of such written acceptance, subject to the lien provided in Section
7.07, (i) the retiring Trustee shall transfer all property held by it as
Trustee to the successor Trustee, (ii) the resignation or removal of the
retiring Trustee shall become effective and (iii) the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. A
successor Trustee shall mail notice of its succession to each Holder.
If the Trustee is no longer eligible under Section 7.10, any Holder
who satisfies the requirements of TIA Section 310(b) may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
The Company shall give notice of any resignation and any removal of
the Trustee and each appointment of a successor Trustee to all Holders. Each
notice shall include the name of the successor Trustee and the address of its
Corporate Trust Office.
Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligation 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 to, another corporation or national banking
association, the resulting, surviving or transferee corporation or national
banking association without any further act shall be the successor Trustee with
the same effect as if the successor Trustee had been named as the Trustee
herein.
SECTION 7.10. Eligibility. This Indenture shall always have a
Trustee who satisfies the requirements of TIA Section 310(a)(1). The Trustee
shall have a combined capital and surplus of at least $25 million as set forth
in its most recent published annual report of condition.
SECTION 7.11. Money Held in Trust. The Trustee shall not be liable
for interest on any money received by it except as the Trustee may agree with
the Company. Money
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held in trust by the Trustee need not be segregated from other funds except to
the extent required by law and except for money held in trust under Article
Eight and Article Twelve of this Indenture.
SECTION 7.12. Withholding Taxes. The Trustee, as agent for the
Company, shall exclude and withhold from each payment of principal and interest
and other amounts due hereunder or under the Notes any and all withholding
taxes applicable thereto as required by law. The Trustee agrees to act as such
withholding agent and, in connection therewith, whenever any present or future
taxes or similar charges are required to be withheld with respect to any
amounts payable in respect of the Notes, to withhold such amounts and timely
pay the same to the appropriate authority in the name of and on behalf of the
Holders of the Notes, that it will file any necessary withholding tax returns
or statements when due, and that, as promptly as possible after the payment
thereof, it will deliver to each Holder appropriate documentation showing the
payment thereof, together with such additional documentary evidence as such
Holders may reasonably request from time to time.
SECTION 7.13. Appointment of Co-Trustee. It is the purpose of this
Indenture that there shall be no violation of any law of any jurisdiction
(including particularly the law of the relevant state) denying or restricting
the right of banking corporations or associations to transact business as
trustee in such jurisdiction, It is recognized that in case of litigation under
this Indenture, and in particular in case of the enforcement thereof on
default, or in the case the Trustee deems that by reason of any present or
future law of any jurisdiction it may not exercise any of the powers, rights or
remedies herein granted to the Trustee or hold title to the properties, in
trust, as herein granted or take any action which may be desirable or necessary
in connection therewith, it may be necessary that the Trustee appoint an
individual or institution as a separate or co-trustee. The following provisions
of this Section are adopted to these ends.
In the event that the Trustee appoints an additional individual or
institution as a separate or co-trustee, each and every remedy, power, right,
claim, demand, cause of action, immunity, estate, title, interest and lien
expressed or intended by this Indenture to be exercised by or vested in or
conveyed to the Trustee with respect thereto shall be exercisable by and vest
in such separate or co-trustee but only to the extent necessary to enable such
separate or co-trustee to exercise such powers, rights and remedies, and only
to the extent that the Trustee by the laws of any jurisdiction (including
particularly the relevant state) is incapable of exercising such powers, rights
and remedies and every covenant and obligation necessary to the exercise
thereof by such separate or co-trustee shall run to and be enforceable by
either of them.
Should any instrument in writing from the Issuer be required by the
separate or co-trustee so appointed by the Trustee for more fully and certainly
vesting in and confirming to such properties, rights, powers, trusts, duties
and obligations, any and all such instruments in writing shall, on request, be
executed, acknowledged and delivered by the Company at the expense of the
Company; provided, that if an Event of Default shall have occurred and be
continuing, if the Company does not execute any such instrument within 15 days
after a request therefor, the Trustee shall be empowered as an attorney-in-fact
for the Company to execute any such instrument in the Company's name and stead.
In case any separate or co-trustee or a successor to either shall die, become
incapable of acting, resign or be removed, all the estates, properties, rights,
powers, trusts, duties and obligations of such separate or co-trustee, so far
as
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permitted by law, shall vest in and be exercised by the Trustee until the
appointment of a new trustee or successor to such separate or co-trustee.
ARTICLE EIGHT
DISCHARGE OF INDENTURE, DEFEASANCE
SECTION 8.01. Termination of Company's Obligations. Except as
otherwise provided in this Section 8.01, the Company may terminate its
obligations under the Notes and this Indenture if:
(i) all Notes previously authenticated and delivered (other than
destroyed, lost or stolen Notes that have been replaced or Notes that are
paid pursuant to Section 4.01 or Notes for whose payment money or
securities have theretofore been held in trust and thereafter repaid to
the Company, as provided in Section 8.05) have been delivered to the
Trustee for cancellation and the Company has paid all sums payable by it
hereunder; or
(ii) (A) all Notes not theretofore delivered to the Trustee have
become due and payable, mature within one year or all of them are to be
called for redemption within one year under arrangements satisfactory to
the Trustee for giving the notice of redemption, (B) the Company
irrevocably deposits or causes to be deposited in trust with the Trustee
during such one-year period, under the terms of an irrevocable trust
agreement in form and substance satisfactory to the Trustee, as trust
funds solely for the benefit of the Holders for that purpose, money or
Government Securities sufficient (in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee), without consideration of
any reinvestment of any interest thereon, to pay principal, premium, if
any, and interest on the Notes to maturity or redemption, as the case may
be, and to pay all other sums payable by it hereunder, (C) the Company
has paid all other sums payable by it hereunder, and (D) the Company has
delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel each stating (and such statements shall be true) that (1) all
conditions precedent provided for herein relating to the satisfaction and
discharge of this Indenture have been complied with and (2) 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 (which, in the case of the Opinion of Counsel,
would be any other material agreement or instrument known to such counsel
after due inquiry) to which the Company is a party or by which it is
bound.
With respect to the foregoing clause (i), the Company's obligations
under Section 7.07 shall survive. With respect to the foregoing clause (ii),
the Company's obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.08,
2.09, 2.14, 4.01, 4.02, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive until the
Notes are no longer outstanding. Thereafter, only the Company's obligations in
Sections 7.07, 8.05 and 8.06 shall survive such satisfaction and discharge.
After any such irrevocable deposit, the Trustee upon request shall acknowledge
in writing the discharge of the Company's obligations, as the case may be,
under the Notes and this Indenture, except for those surviving obligations
specified above.
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SECTION 8.02. Defeasance and Discharge of Indenture. The Company
will be deemed to have paid and will be discharged from any and all obligations
in respect of the Notes on the 123rd day after the date of the deposit referred
to in clause (A) of this Section 8.02 if:
(A) with reference to this Section 8.02, the Company has
irrevocably deposited or caused to be irrevocably deposited with the
Trustee (or another trustee satisfying the requirements of Section 7.10
of this Indenture) and conveyed all right, title and interest for the
benefit of the Holders, under the terms of an irrevocable trust agreement
in form and substance reasonably satisfactory to the Trustee as trust
funds in trust, specifically pledged to the Trustee for the benefit of
the Holders as security for payment of the principal of, premium, if any,
and interest, if any, on the Notes, and dedicated solely to the benefit
of the Holders, in and to (1) money in an amount, (2) Government
Securities that, through the payment of interest, premium, if any, and
principal in respect thereof in accordance with their terms, will
provide, not later than one day before the due date of any payment
referred to in this clause (A), money in an amount or (3) a combination
thereof in an amount sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge,
without consideration of the reinvestment of such interest and after
payment of all federal, state and local taxes or other charges and
assessments in respect thereof payable by the Trustee, the principal of,
premium, if any, and accrued interest on the outstanding Notes at the
Stated Maturity of such principal or interest; provided that the Trustee
shall have been irrevocably instructed by the Company to apply such money
or the proceeds of such Government Securities to the payment of such
principal, premium, if any, and interest with respect to the Notes;
(B) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other 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;
(C) immediately after giving effect to such deposit on a pro forma
basis, no Default or Event of Default shall have occurred and be
continuing on the date of such deposit; and no Default or Event of
Default shall occur during the period ending on the 123rd day after such
date of deposit;
(D) the Company shall have delivered to the Trustee (1) either (x)
a ruling directed to the Trustee received from the Internal Revenue
Service to the effect that the Holders will not recognize income, gain or
loss for U.S. federal income tax purposes as a result of the Company's
exercise of its option under this Section 8.02 and will be subject to
United States federal income tax on the same amount and in the same
manner and at the same times as would have been the case if such option
had not been exercised or (y) an Opinion of Counsel to the same effect as
the ruling described in clause (1)(x) above accompanied by a ruling to
that effect published by the Internal Revenue Service, unless such
Opinion of Counsel states that there has been a change in the applicable
United States federal income tax law since the date of this Indenture
such that
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a ruling from the Internal Revenue Service is no longer required, (2)
either (x) an Opinion of Counsel to the effect that, based upon Mexican
tax law then in effect, Holders will not recognize income, gain or loss
for Mexican federal income tax (including withholding tax) purposes as a
result of the Company's exercise of its option under this Section 8.02 and
will be subject to Mexican federal income tax (including withholding tax)
on the same amount and in the same manner and at the same times as would
have been the case if such deposit, defeasance and discharge had not
occurred, or (y) a ruling directed to the Trustee received from the
Mexican taxing authorities to the same effect as the Opinion of Counsel
described in clause (2)(x) above, and (3) an Opinion of Counsel to the
effect that (x) the creation of the defeasance trust does not violate the
Investment Company Act of 1940 and (y) after the passage of 123 days
following the deposit, the trust funds will not be subject to the effect
of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code or Section 15 of the
New York Debtor and Creditor Law in a case commenced by or against the
Company under either such statute;
(E) if the Notes are then listed on a national securities
exchange, the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that such deposit defeasance and discharge will not
cause the Notes to be delisted; and
(F) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, in each case stating that all
conditions precedent provided for herein relating to the defeasance
contemplated by this Section 8.02 have been complied with.
Notwithstanding the foregoing, prior to the end of the 123-day period
referred to in this Section 8.02, none of the Company's obligations under this
Indenture shall be discharged. Subsequent to the end of such 123-day period
with respect to this Section 8.02, the Company's obligations in Sections 2.02,
2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 2.14, 4.01, 4.02, 7.07, 7.08, 8.05
and 8.06 shall survive until the Notes are no longer outstanding. Thereafter,
only the Company's obligations in Sections 7.07, 8.05 and 8.06 shall survive.
If and when a ruling or an Opinion of Counsel referred to in clauses (D)(1) and
(D)(2) of this Section 8.02 may be provided specifically without regard to, and
not in reliance upon, the continuance of the Company's obligations under
Section 4.01, then the Company's obligations under such Section 4.01 shall
cease upon delivery to the Trustee of such ruling or Opinion of Counsel and
compliance with the other conditions precedent provided for herein relating to
the defeasance contemplated by this Section 8.02.
After any such irrevocable deposit, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Notes and this Indenture except for those surviving obligations in the
immediately preceding paragraph.
SECTION 8.03. Defeasance of Certain Obligations. The Company may
omit to comply with any term, provision or condition set forth in clauses (iii)
and (iv) of Section 5.01 and Sections 4.03 through 4.18, and clause (c) of
Section 6.01 with respect to clauses (iii) and (iv) of Section 5.01, and
clauses (d), (e) and (g) of Section 6.01 shall be deemed not to be Events of
Default, in each case with respect to the outstanding Notes, if:
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(i) with reference to this Section 8.03, the Company has
irrevocably deposited or caused to be irrevocably deposited with the
Trustee (or another trustee satisfying the requirements of Section 7.10)
and conveyed all right, title and interest to the Trustee for the benefit
of the Holders, under the terms of an irrevocable trust agreement in form
and substance satisfactory to the Trustee as trust funds in trust,
specifically pledged to the Trustee for the benefit of the Holders as
security for payment of the principal of, premium, if any, and interest,
if any, on the Notes, and dedicated solely to the benefit of the Holders,
in and to (A) money in an amount, (B) Government Securities that, through
the payment of interest and principal in respect thereof in accordance
with their terms, will provide, not later than one day before the due
date of any payment referred to in this clause (i), money in an amount or
(C) a combination thereof in an amount sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in
a written certification thereof delivered to the Trustee, to pay and
discharge, without consideration of the reinvestment of such interest and
after payment of all federal, state, local and foreign taxes or other
charges and assessments in respect thereof payable by the Trustee, the
principal of, premium, if any, and interest on the outstanding Notes on
the Stated Maturity of such principal or interest; provided that the
Trustee shall have been irrevocably instructed to apply such money or the
proceeds of such Government Securities to the payment of such principal,
premium, if any, and interest with respect to the Notes;
(ii) such deposit 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;
(iii) immediately after giving effect to such deposit on a pro forma
basis, no Default or Event of Default shall have occurred and be
continuing on the date of such deposit; and no Default or Event of
Default shall occur during the period ending on the 123rd day after such
date of deposit;
(iv) the Company has delivered to the Trustee an Opinion of Counsel
to the effect that (A)(x) the creation of the defeasance trust does not
violate the Investment Company Act of 1940 and (y) after the passage of
123 days following the deposit, the trust funds will not be subject to
the effect of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code or Section
15 of the New York Debtor and Creditor Law in a case commenced by or
against the Company under either such statute, (B) the Holders will not
recognize income, gain or loss for United States federal income tax
purposes as a result of such deposit and the defeasance of the
obligations referred to in the first paragraph of this Section 8.03 and
will be subject to United States federal income tax on the same amount
and in the same manner and at the same times as would have been the case
if such deposit and defeasance had not occurred and (C) the Holders will
not recognize income, gain or loss for Mexican federal income tax
(including withholding tax) purposes as a result of such deposit and the
defeasance of the obligations referred to in the first paragraph of this
Section 8.03 and will be subject to Mexican federal income tax (including
withholding tax) on the same amount and in the same manner and at the
same times as would have been the case if such deposit and defeasance had
not occurred;
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(v) if the Notes are then listed on a national securities
exchange, the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that such deposit defeasance and discharge will not
cause the Notes to be delisted; and
(vi) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, in each case stating that all
conditions precedent provided for herein relating to the defeasance
contemplated by this Section 8.03 have been complied with.
SECTION 8.04. Application of Trust Money. Subject to Section
8.06, the Trustee or Paying Agent shall hold in trust money or Government
Securities deposited with it pursuant to Section 8.01, 8.02 or 8.03, as the
case may be. and shall apply the deposited money and the money from Government
Securities in accordance with the Notes and this Indenture to the payment of
principal of, premium, if any, and interest on the Notes; but such money need
not be segregated from other funds except to the extent required by law.
SECTION 8.05. Repayment to Company. Subject to Sections 7.07,
8.01, 8.02 and 8.03, the Trustee and the Paying Agent shall promptly pay to the
Company upon request set forth in an Officers' Certificate any excess money
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,
premium, if any, or interest that remains unclaimed for two years; provided
that the Trustee or such Paying Agent before being required to make any payment
may cause to be published at the expense of the Company once in a newspaper of
general circulation in the City of New York or mail to each Holder entitled to
such money at such Holder's address (as set forth in the Note Register) notice
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 8.06. Reinstatement. If the Trustee or Paying Agent is
unable to apply any money or Government Securities in accordance with Section
8.01, 8.02 or 8.03, as the case may be, 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, 8.02 or 8.03, as
the case may be, until such time as the Trustee or Paying Agent is permitted to
apply all such money or Government Securities in accordance with Section 8.01,
8.02 or 8.03, as the case may be; provided that, if the Company has made any
payment of principal of, premium, if any, or interest on 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 money or
Government Securities held by the Trustee or Paying Agent.
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ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders. The Company, when
authorized by resolutions of its Board of Directors, and the Trustee may amend
or supplement this Indenture or the Notes without notice to or the consent of
any Holder:
(1) to cure any ambiguity, defect or inconsistency in this
Indenture; provided that such amendments or supplements shall not
adversely affect the interests of the Holders in any material respect;
(2) to comply with Article Five;
(3) to comply with any requirements of the Commission in
connection with the qualification of this Indenture under the TIA;
(4) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee or any additional Paying Agent; or
(5) to make any change to comply with any requirements in
connection with the listing of the Notes on either the Luxembourg Stock
Exchange or the Irish Stock Exchange that does not materially and
adversely affect the rights of any Holder; or
(6) to provide for the issuance of Add On Notes as permitted by
Section 3.05, which will have terms substantially identical to the other
outstanding Notes except as specified in Section 3.05, and which will be
treated, together with any other outstanding Notes, as a single issue of
securities.
SECTION 9.02. With Consent of Holders. Subject to Sections 6.04
and 6.07 and without prior notice to the Holders, the Company, when authorized
by its Board of Directors (as evidenced by a Board Resolution), and the Trustee
may amend this Indenture and the Notes with the written consent of the Holders
of a majority in principal amount of the Notes then outstanding, and the
Holders of a majority in principal amount of the Notes then outstanding by
written notice to the Trustee may waive future compliance by the Company with
any provision of this Indenture and the Notes.
Notwithstanding the provisions of this Section 9.02, without the
consent of each Holder affected, an amendment or waiver, including a waiver
pursuant to Section 6.04, may not;
(i) change the Stated Maturity of the principal of, or any
installment of interest on, any Note, or reduce the principal amount
thereof or the rate of interest thereon or any premium payable upon the
redemption thereof, or adversely affect any right of repayment at the
option of any Holder of any Note, or change any place of payment where, or
the currency in which, any Note or any premium or the interest thereon is
payable, or impair the right to institute suit for the enforcement of any
such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date);
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(ii) reduce the percentage in principal amount of outstanding Notes
the consent of whose Holders is required for any such supplemental
indenture, for any waiver of compliance with certain provisions of this
Indenture or certain Defaults and their consequences provided for in this
Indenture;
(iii) waive a Default in the payment of principal of, premium, if
any, or interest on, any Note;
(iv) modify Section 4.20 in a manner adverse to the Holders;
(v) modify any of the provisions of this Section 9.02, except to
increase any such percentage or to provide that certain other provisions
of this Indenture cannot be modified or waived without the consent of the
Holder of each outstanding Note affected thereby.
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,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. The Company will
mail supplemental indentures to Holders upon request. 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 supplemental indenture or waiver.
SECTION 9.03. Revocation and Effect of Consent. Until an amendment
or waiver 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 Note of the consenting Holder, even if
notation of the consent is not made on any Note. However, any such Holder or
subsequent Holder may revoke the consent as to its Note or portion of its Note.
Such revocation shall be effective only if the Trustee receives the notice of
revocation before the date the amendment, supplement or waiver becomes
effective. An amendment, supplement or waiver shall become effective on receipt
by the Trustee of written consents from the Holders of the requisite percentage
in principal amount of the 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 last
two sentences 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 consent to such amendment, supplement or waiver or
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.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder unless it is of the type described in any of clauses (i)
through (iv) of Section 9.02. In case of an amendment or waiver of the type
described in clauses (i) through (iv) of Section 9.02, the
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amendment or waiver shall bind each Holder who has consented to it and every
subsequent Holder of a Note that evidences the same indebtedness as the Note of
the consenting Holder.
SECTION 9.04. Notation on or Exchange of Notes. If an amendment,
supplement or waiver changes the terms of a Note, the Trustee may require the
Holder 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 and
the Trustee may place an appropriate notation on any Note thereafter
authenticated. Alternatively, if the Company or the Trustee so determines, the
Company in exchange for the Note shall issue and the Trustee shall authenticate
a new Note that reflects the changed terms. Failure to make the appropriate
notation or issue a new Note shall not affect the validity and effect of such
amendment, supplement or waiver.
SECTION 9.05. Trustee to Sign Amendments, Etc. The Trustee shall
be entitled to receive, and shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article Nine is authorized or permitted by
this Indenture. Subject to the preceding sentence, the Trustee shall sign such
amendment, supplement or waiver if the same does not adversely affect the
rights of the Trustee. 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 or otherwise.
SECTION 9.06. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article Nine shall conform to
the requirements of the TIA as then in effect.
ARTICLE TEN
[Intentionally Omitted]
ARTICLE ELEVEN
[Intentionally Omitted]
ARTICLE TWELVE
[Intentionally Omitted]
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act of 1939. Prior to the
effectiveness of the Registration Statement, this Indenture shall incorporate
and be governed by the provisions of the TIA that are required to be part of
and to govern indentures qualified under the TIA. After the effectiveness of
the Registration Statement, this Indenture shall be subject to the provisions
of the TIA that are required to be a part of this Indenture and shall, to the
extent applicable, be governed by such provisions.
SECTION 13.02. Notices. Any notice or communication shall be
sufficiently given if in writing and delivered in person or mailed by first
class mail, postage prepaid. addressed as follows:
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if to the Company:
TFM, S.A. de C.V.
Xx. Xxxxxxxxxx Xxx Xx. 0000, 0xx Xxxx
Xxxxxxx del Pedregal, C.P.
14010, Delegacion Tlalpan, Mexico, D.F., Mexico
Attention: Chief Financial Officer
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if to the Trustee:
The Bank of New York
00 Xxxxx Xxxxxx
00xx xxxxx
Xxx Xxxx, XX 00000
Attention: Global Finance Unit
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
All notices or communications to a Holder shall be deemed to have been
given upon the mailing by first class mail, postage prepaid, of such notices to
Noteholders at their registered addresses as recorded in the Note Register.
Copies of any such communication or notice to a Holder shall also be mailed to
the Trustee and each Agent at the same time.
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. Except for
a notice to the Trustee, which is deemed given only when received, and except
as otherwise provided in this Indenture, if a notice or communication is mailed
in the manner provided in this Section 13.02, it is duly given, whether or not
the addressee receives it.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken
in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder. All
communication delivered to the Trustee shall be deemed effective when actually
received by the Trustee.
SECTION 13.03. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take or
refrain from taking any action under this Indenture, the Company shall furnish
to the Trustee, if the Trustee so requests:
(i) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(ii) an Opinion of Counsel stating that, in the opinion of such
Counsel, all such conditions precedent have been complied with.
-73-
SECTION 13.04. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:
(i) a statement that each person signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statement or opinion contained
in such certificate or opinion is based;
(iii) a statement that, in the opinion of each 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
(iv) a statement as to whether or not, in the opinion of each such
person, such condition or covenant has been complied with; provided,
however, that, with respect to matters of fact, an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
SECTION 13.05. Meetings of Noteholders. A meeting of the
Noteholders to consider matters affecting their interests may be called by the
Trustee or the holders of at least 10% in aggregate principal amount of the
applicable outstanding Notes.
SECTION 13.06. Rules by Trustee, Paying Agent or Registrar. The
Trustee may make reasonable rules for action by or at a meeting of Holders. The
Paying Agent or Registrar may make reasonable rules for its functions.
SECTION 13.07. Payment Date Other Than a Business Day. If an
Interest Payment Date, Redemption Date, Change of Control Payment Date, Excess
Proceeds Payment Date, Stated Maturity or date of maturity of any Note shall
not be a Business Day, then payment of principal of, premium, if any, or
interest on such Note, as the case may be, need not be made on such date, but
may be made on the next succeeding Business Day with the same force and effect
as if made on the Interest Payment Date, Change of Control Payment Date, Excess
Proceeds Payment Date, or Redemption Date, or at the Stated Maturity or date of
maturity of such Note; provided that no interest shall accrue for the period
from and after such Interest Payment Date, Change of Control Payment Date,
Excess Proceeds Payment Date, Redemption Date, Stated Maturity or date of
maturity, as the case may be.
SECTION 13.08. Governing Law; Submission to Jurisdiction; Agent for
Service. Each of the parties hereto agrees that the Notes and this Indenture
will be governed by the laws of the State of New York. Each of the parties
hereto hereby submits to the jurisdiction of the U.S. federal and New York
state courts located in the Borough of Manhattan, City and State of New York
for purposes of all legal actions and proceedings instituted in connection with
the Notes and this Indenture, and waives any objection which it may now have or
hereafter have to the laying of venue of any such action or proceeding and any
right to which it may be entitled on account of place of residence or domicile.
The Company has appointed CT Corporation
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System, 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 as the
Company's authorized agent upon which process may be served in any such action.
SECTION 13.09. Currency Indemnity. U.S. dollars are the sole
currency of account and payment for all sums payable by the Company under or in
connection with the Notes, including damages. Any amount received or recovered
in a currency other than U.S. dollars (whether as a result of, or of the
enforcement of, a judgment or order of a court of any jurisdiction, in the
winding-up or dissolution of the Company or otherwise) by any Holder in respect
of any sum expressed to be due to it from the Company shall only constitute a
discharge to the Company to the extent of the dollar amount which the recipient
is able to purchase with the amount so received or recovered in that other
currency on the date of that receipt or recovery (or, if it is not practicable
to make that purchase on that date, on the first date on which it is
practicable to do so). If that dollar amount is less than the dollar amount
expressed to be due to the recipient under any Note, the Company shall
indemnify the recipient against any loss sustained by it as a result. In any
event, the Company shall indemnify the recipient against the cost of making any
such purchase. For the purposes of this Section 13.09, it will be sufficient
for the Holder to certify in a satisfactory manner (indicating the sources of
information used) that it would have suffered a loss had an actual purchase of
U.S. dollars been made with the amount so received in that other currency on
the date of receipt or recovery (or, if a purchase of U.S. dollars on such date
had not been practicable, on the first date on which it would have been
practicable, it being required that the need for a change of date be certified
in the manner mentioned above). These indemnities constitute a separate and
independent obligation from the Company's other obligations, shall give rise to
a separate and independent cause of action, shall apply irrespective of any
indulgence granted by any Holder and shall continue in full force and effect
despite any other judgment, order, claim or proof for a liquidated amount in
respect of any sum due under any Note.
SECTION 13.10. No Adverse Interpretation of Other Agreements. This
Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company. Any such indenture, loan or debt agreement may not be
used to interpret this Indenture.
SECTION 13.11. No Recourse Against Others. No recourse for the
payment of the principal of, premium, if any, or interest on any of the Notes,
or for any claim based thereon or otherwise in respect thereof, and no recourse
under or upon any obligation, covenant or agreement of the Company contained in
this Indenture, or in any of the Notes, or because of the creation of any
Indebtedness represented thereby, shall be had against any incorporator,
stockholder, officer, director, employee or controlling person of the Company,
or of any successor Person thereof, either directly or through the Company or
any successor Person, whether by virtue of any constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise; it being
expressly understood that all such liability is hereby expressly waived and
released as a condition of, and as a consideration for, the execution of this
Indenture and the issue of the Notes.
SECTION 13.12. Successors. All agreements of the Company in this
Indenture and the Notes shall bind their successors. All agreements of the
Trustee in this Indenture shall bind its successors.
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SECTION 13.13. Duplicate Originals. The parties may sign any number
of copies of this Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
SECTION 13.14. Separability. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby
SECTION 13.15. Table of Contents, Headings, Etc. The Table of
Contents, Cross-Reference Table and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not to
be considered a part hereof and shall in no way modify or restrict any of the
terms and provisions hereof.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.
TFM, S.A. de C.V.
By: /s/ Xxxxx Xxxxx Xxxxx
-------------------------------
Name: Xxxxx Xxxxx Xxxxx
Title: Chief Executive Officer
By: /s/ Jacinto Xxxxxx Xxxxxx
-------------------------------
Name: Jacinto Xxxxxx Xxxxxx
Title: Director and Acting Chief
Financial Officer
THE BANK OF NEW YORK, Trustee
By: /s/ Xxxxxx Xxxxxxx
-------------------------------
Name: Xxxxxx Xxxxxxx
Title: Assistant Vice President
EXHIBIT A
[FACE OF NOTE]
TFM, S.A. de C.V.
12.50% Senior Notes 2012
[CUSIP] [000000XX0]
[X00000XX0]
[CINS] [_________]
[ISIN] [_________]
U.S.$______
No.
TFM, S.A. de C.V., a corporation (sociedad anonima de capital
variable) organized under the laws of Mexico (the "Company", which term
includes any successor under the Indenture hereinafter referred to), for value
received, promises to pay to _____________, or its registered assigns, the
principal sum of _______________ ($_____) on June 15, 2012.
Interest Payment Dates: June 15 and December 15, commencing December
15, 2002.
Regular Record Dates: June 1 and December 1.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall 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.
Date: June 13, 2002 TFM, S.A. de C.V.
By: __________________________
Name: Xxxxxxx Xxxxxx
Title: Acting Chief Financial Officer
By: __________________________
Name: Xxxx Xxxxx
Title: Treasurer
A-2
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 12.50% Senior Notes due 2012 described in the
within-mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
By: __________________________
Authorized Signatory
A-3
[REVERSE SIDE OF NOTE]
TFM, S.A. de C.V.
12.50% Senior Notes due 2012
1. Principal and Interest.
The Company will pay the principal of this Note on June 15, 2012.
The Company promises to pay interest on the principal amount of this
Note on each Interest Payment Date, as set forth below, at the rate per annum
shown above.
Interest will be payable semiannually (to the holders of record of the
Notes at the close of business on the June 1 or December 1 immediately
preceding the Interest Payment Date) on each Interest Payment Date, commencing
December 15, 2002.
Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from June 13, 2002;
provided that, if there is no existing default in the payment of interest and
this Note is authenticated between a Regular Record Date referred to on the
face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such Interest Payment Date. Interest will be computed on the basis
of a 360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal and premium, if
any, and interest on overdue installments of interest, to the extent lawful, at
a rate per annum that is 2% in excess of the rate otherwise payable.
2. Method of Payment.
The Company will pay principal as provided above and interest (except
defaulted interest) on the principal amount of the Notes as provided above on
each June 15 and December 15 to the persons who are Holders (as reflected in
the Note Register at the close of business on June 1 and December 1 immediately
preceding the Interest Payment Date), in each case, even if the Note is
cancelled on registration of transfer or registration of exchange after such
record date; provided that, with respect to the payment of principal, the
Company will not make payment to the Holder unless this Note is surrendered to
a Paying Agent.
The Company will pay principal, premium, if any, and, as provided
above, interest (and Additional Amounts, if any) in money of the United States
that at the time of payment is legal tender for payment of public and private
debts. However, the Company may pay principal, premium, if any, and interest by
its check payable in such money. It may mail an interest check to a Holder's
registered address (as reflected in the Note Register). If a payment date is a
date other than a Business Day at a place of payment, payment may be made at
that place on the next succeeding day that is a Business Day and no interest
shall accrue for the intervening period.
A-4
3. Paying Agent and Registrar.
Initially, the Trustee will act as authenticating agent, Paying Agent
and Registrar. The Company may appoint or change any authenticating agent,
Paying Agent or Registrar without notice. The Company, any Subsidiary or any
Affiliate of any of them may act as Paying Agent, Registrar or co-Registrar.
4. Indenture; Limitations.
The Company issued the Notes under an Indenture dated as of June 13,
2002 (the "Indenture"), between the Company and The Bank of New York, a New
York banking corporation, as trustee (the "Trustee"). Capitalized terms herein
are used as defined in the Indenture unless otherwise indicated. 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. The Notes are subject to all
such terms, and Holders are referred to the Indenture and the Trust Indenture
Act for a statement of all such terms. To the extent permitted by applicable
law, in the event of any inconsistency between the terms of this Note and the
terms of the Indenture, the terms of the Indenture shall control.
The Notes are general unsecured obligations of the Company. The
Indenture limits the aggregate principal amount of the Notes to
U.S.$180,000,000 plus any Add On Notes or Exchange Notes that may be issued in
exchange for Notes pursuant to the Registration Rights Agreement.
5. Optional Redemption.
The Notes will be redeemable, at the Company's option, in whole at any
time or in whole or in part from time to time, on or after June 15, 2007 and
prior to maturity, upon not less than 30 nor more than 60 days' prior notice
mailed by first class mail to each Holders' last address as it appears in the
Note Register, at the following Redemption Prices (expressed in percentages of
principal amount), plus accrued and unpaid interest, if any, to the Redemption
Date (subject to the right of Holders of record on the relevant Regular Record
Date that is on or prior to the Redemption Date to receive interest due on an
Interest Payment Date), if redeemed during the 12-month period commencing June
15, of the years set forth below:
Year Redemption Price
---- ----------------
2007 106.250%
2008 104.167%
2009 102.083%
2010 100.000%
2011 100.000%
2012 100.000%
6. Redemption for Changes in Withholding Taxes.
The Notes will be subject to redemption, in whole but not in part, at
the option of the Company at any time at 100% of their principal amount
together with accrued interest thereon, if any, to the Redemption Date, in the
event the Company has become or would become
A-5
obligated to pay, on the next date on which any amount would be payable with
respect to the Notes, any Additional Amounts in excess of those attributable to
a withholding tax rate of 4.9% as a result of a change in or amendment to the
laws (including any regulations or general rules promulgated thereunder) of
Mexico (or any political subdivision or taxing authority thereof or therein),
or any change in or amendment to any official position regarding the
application, administration or interpretation of such laws, regulations or
general rules, including a holding of a court of competent jurisdiction, which
change or amendment is announced or becomes effective on or after June 6, 2002.
The Company shall not, however, have the right to redeem Notes from a Holder
pursuant to this Section except to the extent that it is obligated to pay
Additional Amounts to such Holder that are greater than the Additional Amounts
that would be payable based on a Mexican Withholding Tax rate of 4.9%.
7. Partial Redemption.
In the case of any partial redemption, selection of the Notes for
redemption will be made by the Trustee in compliance with the requirements of
the principal national securities exchange, if any, on which such Notes are
listed or, if such Notes are not listed on a national securities exchange, by
lot or by such other method as such Trustee in its sole discretion shall deem
to be fair and appropriate; provided that no Note of U.S.$100 in principal
amount or less shall be redeemed in part. If any Note is to be redeemed in part
only, the notice of redemption relating to such Note shall state the portion of
the principal amount thereof to be redeemed. A Note in principal amount equal
to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Note.
8. Notice of Redemption.
Notice of any redemption pursuant to Section 5 hereof 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 his or her last address as it appears in the
Note Register. Notice of any redemption pursuant to Section 6 hereof will be
mailed at least six days before the Redemption Date to each Holder of Notes to
be redeemed at his or her last address as it appears in the Note Register.
Notes in original denominations larger than U.S.$100 may be redeemed in part.
On and after the Redemption Date, interest ceases to accrue and the principal
amount shall remain constant (using the principal amount as of the Redemption
Date) on Notes or portions of Notes called for redemption, unless the Company
defaults in the payment of the Redemption Price.
9. Repurchase upon Change of Control.
Upon the occurrence of any Change of Control, each Holder shall have
the right to require the repurchase of its Notes by the Company in cash
pursuant to the offer described in the Indenture at a purchase price equal to
101% of the principal amount thereof on the date of repurchase plus accrued and
unpaid interest, if any, to the date of purchase (the "Change of Control
Payment").
A notice of such Change of Control will be mailed within 30
days after any Change of Control occurs to each Holder at his last address as
it appears in the Note Register. Notes in original denominations larger than
U.S.$100 may be sold to the Company in part. On
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and after the Change of Control Payment Date, interest ceases to accrue and the
principal amount shall remain constant (using the principal amount as of the
Change of Control Payment Date) on Notes or portions of Notes surrendered for
purchase by the Company, unless the Company defaults in the payment of the
Change of Control Payment.
10. Denominations; Transfer; Exchange.
The Notes are in registered form without coupons in denominations of
U.S. $100 of principal amount and multiples of U.S.$100 in excess thereof. A
Holder may register the transfer or exchange of 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 any taxes and fees
required by law or permitted by the Indenture. The Registrar need not register
the transfer or exchange of any Notes selected for redemption. Also, it need
not register the transfer or exchange of any Notes for a period of 15 days
before a selection of Notes to be redeemed is made.
11. Persons Deemed Owners.
A Holder shall be treated as the owner of a Note for all purposes.
12. Unclaimed Money.
If money for the payment of principal, premium, if any, or interest
remains unclaimed for two years, the Trustee and the Paying Agent will pay the
money back to the Company at its request. After that, Holders entitled to the
money must look to the Company for payment, unless an abandoned property law
designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.
13. Discharge Prior to Redemption or Maturity.
The Company's obligations pursuant to the Indenture will be
discharged, except for obligations pursuant to certain sections thereof,
subject to the terms of the Indenture, upon the payment of all the Notes or
upon the irrevocable deposit with the Trustee of U.S. Dollars or Government
Securities sufficient to pay when due principal of and interest on the Notes to
maturity or redemption, as the case may be.
14. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Notes may be
amended or supplemented with the consent of the Holders of at least a majority
in principal amount of the Notes then outstanding, and any existing default or
compliance with any provision may be waived with the consent of the Holders of
at least a majority in principal amount of the Notes then outstanding. Without
notice to or the 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 and make any change that does not materially
and adversely affect the rights of any Holder.
A-7
15. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of the
Company and its Restricted Subsidiaries, among other things, to incur
Additional Indebtedness, make Restricted Payments, use the proceeds from Asset
Sales, enter into sale-leaseback transactions, engage in transactions with
Affiliates or, with respect to the Company, merge, consolidate or transfer
substantially all of their assets. Within 90 days after the end of each fiscal
year, the Company must report to the Trustee on compliance with such
limitations.
16. Successor Persons.
When a successor person or other entity assumes all the obligations of
its predecessor under the Notes and the Indenture, the predecessor person will
be released from those obligations.
17. Defaults and Remedies.
The following events constitute "Events of Default" under the
Indenture: (a) default in the payment of principal of (or premium, if any, on)
any Note when the same becomes due and payable at maturity, upon acceleration,
redemption or otherwise; (b) default in the payment of interest on any Note
when the same becomes due and payable, and such default continues for a period
of 30 days; (c) the Company defaults in the performance of or breaches the
provisions of Article Five of the Indenture or fails to make or consummate an
Offer to Purchase in accordance with Section 4.11 or Section 4.12 of the
Indenture; (d) the Company defaults in the performance of or breaches any other
covenant or agreement of the Company in the Indenture or under this Note (other
than a default specified in clause (a), (b) or (c) above), and such default or
breach continues for a period of 30 consecutive days after written notice by
the Trustee or the Holders of 25% or more in aggregate principal amount of the
Notes; (e) there occurs with respect to any issue or issues of Indebtedness of
the Company or any of its Significant Subsidiaries having an outstanding
principal amount of $10 million or more in the aggregate for all such issues of
all such Persons, whether such Indebtedness now exists or shall hereafter be
created, (I) an event of default that has caused the holder thereof to declare
such Indebtedness to be due and payable prior to its Stated Maturity and such
Indebtedness has not been discharged in full or such acceleration has not been
rescinded or annulled within 30 days of such acceleration and/or (II) the
failure to make a principal payment at the final (but not any interim) fixed
maturity and such defaulted payment shall not have been made, waived or
extended within 30 days of such payment default; (f) [intentionally omitted];
(g) any final judgment or order (not covered by insurance) for the payment of
money in excess of $10 million in the aggregate for all such final judgments or
orders against all such Persons (treating any deductibles, self-insurance or
retention as not so covered) shall be rendered against the Company or any of
its Significant Subsidiaries and shall not be paid or discharged, and there
shall be any period of 30 consecutive days following entry of the final
judgment or order that causes the aggregate amount for all such final judgments
or orders outstanding and not paid or discharged against all such Persons to
exceed $10 million during which a stay of enforcement of such final judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; (h)
a court having jurisdiction in the premises enters a decree or order for (A)
relief in respect of the Company or any of its Significant Subsidiaries in an
involuntary case under any applicable
A-8
bankruptcy, insolvency or other similar law now or hereafter in effect, (B)
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Company or any of its Significant
Subsidiaries or for all or substantially all of the property and assets of the
Company or any of its Significant Subsidiaries or (C) the winding up or
liquidation of the affairs of the Company or any of its Significant
Subsidiaries and, in each case, such decree or order shall remain unstayed and
in effect for a period of 30 consecutive days; (i) the Company or any of its
Significant Subsidiaries (A) commences a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consents to the entry of an order for relief in an involuntary case under any
such law, (B) consents to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of the Company or any of its Significant Subsidiaries or for all or
substantially all of the property and assets of the Company or any of its
Significant Subsidiaries or (C) effects any general assignment for the benefit
of creditors; or (j) (A) the Concession Title shall cease to grant to the
Company the rights (including exclusive rights) originally provided therein and
such cessation has had a material adverse effect on its Restricted Subsidiaries
taken as a whole; (B) (x) the Concession Title shall for any reason be
terminated and not reinstated within 30 days or (y) rights provided therein
which were originally exclusive to the Company shall become non-exclusive and
the cessation of such exclusivity has had a material adverse effect on its
Restricted Subsidiaries, taken as a whole; or (C) the operations of the
Northeast Rail Lines shall be commandeered or repossessed (a requisa) for a
period of 90 days or more. If an Event of Default (other than an Event of
Default specified in clause (h), (i) or (j)(B)(x) above that occurs with
respect to the Company) occurs and is continuing under this Indenture, the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding, by written notice to the Company (and to the Trustee if
such notice is given by the Holders), may, and the Trustee at the request of
such Holders shall, declare the principal of, premium, if any, and accrued
interest on the Notes to be immediately due and payable.
If a bankruptcy or insolvency default with respect to the Company any
of its Significant Subsidiaries occurs and is continuing, the Notes
automatically become due and payable. Holders may not enforce the Indenture or
the Notes except as provided in the Indenture. The Trustee may require
indemnity satisfactory to it before it enforces the Indenture or the Notes.
Subject to certain limitations, Holders of at least a majority in principal
amount of the Notes then outstanding may direct the Trustee in its exercise of
any trust or power.
18. Additional Amounts.
Any payments by the Company under or with respect to the Notes may
require the payment of Additional Amounts as may become payable under Section
4.20 of the Indenture.
19. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from and perform services for the
Company or its Affiliates and may otherwise deal with the Company or its
Affiliates as if it were not the Trustee.
A-9
20. No Recourse Against Others.
No incorporator or any past, present or future partner, shareholder,
other equity holder, officer, director, employee or controlling person as such,
of the Company or of any successor Person shall have any liability for any
obligations of the Company under the Notes or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the Notes.
21. Authentication.
This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.
22. Abbreviations.
Customary abbreviations may be used in the name of a Holder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian) and U/G/M/A (= Uniform Gifts to Minors
Act).
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to TFM, S.A. de
C.V., Xx. Xxxxxxxxxx Xxx Xx. 0000, 0xx Xxxx, Xxxxxxx del Pedregal, C.P. 14010,
Delegacion Tlalpan, Mexico, D.F., Mexico, Attention: Xxxxxxx Xxxxxx, Director
and Acting Chief Financial Officer, and Xxxx Xxxxx, Treasurer.
A-10
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
_________________________________________________________________________
Please print or typewrite name and address including zip code of assignee
_________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ___________________________________________ attorney to transfer
said Note on the books of the Company with full power of substitution in the
premises.
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL NOTES OTHER THAN EXCHANGE NOTES,
PERMANENT OFFSHORE GLOBAL NOTES AND
OFFSHORE PHYSICAL NOTES]
In connection with any transfer of this Note occurring prior to the
date which is the earlier of (i) the date of an effective registration
statement or (ii) the end of the period referred to in Rule 144(k) under the
Securities Act, the undersigned confirms that without utilizing any general
solicitation or general advertising:
[Check One]
[ ] (a) this Note is being transferred in compliance with the exemption from
registration under the Securities Act of 1933, as amended, provided
by Rule 144A thereunder.
or
[ ] (b) this Note is being transferred other than in accordance with (a) above
and documents are being furnished which comply with the conditions of
transfer set forth in this Note and the Indenture.
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If none of the foregoing boxes is checked, the Trustee or other 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 2.08 of the Indenture shall have
been satisfied.
Date: ___________ ________________________________________________________
NOTICE: The signature to this assignment must
correspond with the name as written upon the face of the
within-mentioned instrument in every particular, without
alteration or any change whatsoever.
TO BE COMPLETED BY PURCHASER IF (a) 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.
Date: ____________ __________________________________________________
NOTICE: To be executed by an executive officer
A-12
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to
Section 4.11 or Section 4.12 of the Indenture, check the Box:[ ]
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.11 or Section 4.12 of the Indenture, state the amount:
$_______________________
Date:
Your Signature: _______________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee: ____________________________
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EXHIBIT B
Form of Certificate to Be Delivered
in Connection with Transfers
Pursuant to Regulation S
________________, ____
The Bank of New York
00 Xxxxx Xxxxxx
00xx xxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust Department
Re: TFM, S.A. de C.V. (the "Company")
12.50% Senior Notes
due 2012 (the "Notes")
Ladies and Gentlemen:
In connection with our proposed sale of U.S.$ __________________
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, and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United
States;
(2) at the time the buy order 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;
(3) no directed selling efforts have been made by us in the United
States in contravention of the requirements of Rule 903(b) or Rule 904(b)
of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the U.S. Securities Act of 1933.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested parry 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
EXHIBIT C
Form of Certificate to Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
(Other Than Outside the United States in Reliance on Regulation S)
_____________, _____
The Bank of New York
00 Xxxxx Xxxxxx
00xx xxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust Department
Re: TFM, S.A. de C.V. (the "Company")
12.50% Senior Notes
due 2012 (the "Notes")
Dear Sirs:
in connection with our proposed purchase of U.S.$___________ aggregate
principal amount of the Notes, we confirm that:
1. We understand that any subsequent transfer of the Notes is
subject to certain restrictions and conditions set forth in the Indenture
dated as of June 13, 2002 relating to the Notes (the "Indenture") 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").
2. 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 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 (A) to the Company or any subsidiary thereof, (B) in accordance with
Rule 144A under the Securities Act to a "qualified institutional buyer"
(as defined therein), (C) to an institutional "accredited investor" (as
defined below) that, prior to such transfer, furnishes (or has furnished
on its behalf by a U.S. broker-dealer) to you and to the Company a signed
letter substantially in the form of this letter, (D) outside the United
States in accordance with Rule 904 of Regulation S under the Securities
Act, (E) pursuant to the exemption from registration provided by Rule 144
under the Securities Act, or (F) pursuant to an effective registration
statement under the Securities Act, and we further agree to provide to
any person purchasing any of the Notes from us a notice advising such
purchaser that resales of the Notes are restricted as stated herein.
3. We understand that, on any proposed resale of any Notes, we
will be required to furnish to you and the Company such certifications,
legal opinions and other information as you and the Company may reasonably
require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will
bear a legend to the foregoing effect.
5. We are purchasing notes having a minimum purchase price of not
less than US$250,000 for our own account or for any separate account for
which we are acting.
6. We are an "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act or an entity in which
all of the equity owners are accredited investors within the meaning of
Rule 501(a)(1), (2) or (3) under the Securities Act (an "institutional
accredited investor") able to bear the economic risk of an investment in
the notes.
7. Any purchase of notes by us will be for our own account or
for the account of one or more other institutional accredited investors
for each of which we exercise sole investment discretion (and have
authority to make, and do make, the statements contained in this letter)
or as fiduciary for the account of one or more trusts, each of which is
an "accredited investor" within the meaning of Rule 501(a)(7) under the
Securities Act and for each of which we exercise sole investment
discretion; or we are a "bank" within the meaning of Section 3(a)(2) of
the Securities Act, or a "savings and loan association" or other
institution described in Section 3(a)(5)(A) of the Securities Act, that
is acquiring the notes as fiduciary for the account of one or more
institutions for which we exercise sole investment discretion.
8. We have such knowledge and experience in financial and
business matters so as to be capable of evaluating the merits and risks
of purchasing the notes.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By: ________________________
Authorized Signature
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