Exhibit 4.3
ARMCO INC.
To
STAR BANK, N.A.,
Trustee
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SUPPLEMENTAL INDENTURE NO. 2
Dated as of December 15, 1998
to
INDENTURE
Dated as of November 1, 1993
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U.S. $125,000,000
8 7/8% Notes Due 2008
ARMCO INC.
SUPPLEMENTAL INDENTURE NO. 2
Dated as of December 15, 1998
8 7/8% Initial Notes Due 2008
8 7/8% Exchange Notes Due 2008
SUPPLEMENTAL INDENTURE NO. 2, dated as of December 15, 1998,
between ARMCO INC., a corporation duly organized and existing under the laws of
the State of Ohio with executive offices located at One Oxford Centre, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ (hereinafter sometimes called the "Company")
and Star Bank, N.A., with offices located at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇, ▇▇▇▇▇ (hereinafter sometimes called the "Trustee"), as Trustee under an
indenture of the Company dated as of November 1, 1993 (the "Base Indenture") as
supplemented by Supplemental Indenture No. 1 dated as of November 1, 1993
(together, the "Indenture").
RECITALS OF THE COMPANY
Section 2.01 of the Indenture provides for the issuance from
time to time of debentures, notes, bonds or other evidences of indebtedness (the
"Debt Securities") of the Company, issuable for the purposes and subject to the
limitations contained in the Indenture. The Company has duly authorized the
creation of an issue of its Debt Securities named its 8 7/8% Notes
Due 2008 (hereinafter the "Initial Notes") of the tenor and in the amount
hereinafter set forth and, if and when issued pursuant to a registered exchange
for the Initial Notes as contemplated by the Registration Agreement, the
Company's 8 7/8% Exchange Notes Due 2008, (hereinafter the "Exchange
Notes" and, together with the Initial Notes, the "Notes").
Section 10.01 of the Indenture provides that the Company, when
authorized by a resolution of its Board of Directors, and the Trustee may from
time to time and at any time enter into one or more indentures supplemental to
the Indenture to establish, among other things, the form and terms of Debt
Securities of any series as permitted by Section 2.02 of the Indenture and to
add to the covenants of the Company for the benefit of the Holders of all or any
series of Debt Securities or to surrender any right or power therein conferred
upon the Company.
The Company has duly authorized the execution and delivery of
this Supplemental Indenture No. 2, and all things necessary have been done to
make Notes having an aggregate principal amount of $75,000,000, when executed by
the Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company, and to make this Supplemental
Indenture No. 2 a valid agreement of the Company, in accordance with its terms.
NOW, THEREFORE, THIS SUPPLEMENTAL
INDENTURE NO. 2 WITNESSETH:
For and in consideration of the premises and the purchase of
the Debt Securities of the series provided for herein, it is mutually covenanted
and agreed, for the equal and proportionate benefit of all Holders of the Debt
Securities of such series, as follows:
ARTICLE I.
THE SERIES OF NOTES
SECTION 101. The aggregate principal amount (except as
provided in Section 2.08 of the Indenture) of Notes which may be authenticated
and delivered according to the terms of this Supplemental Indenture No. 2 is
specified in Section 2.2 of Appendix A hereto. The Initial Notes and the
Exchange Notes shall for purposes of the Indenture, constitute a single Series
of Debt Securities.
SECTION 102. Provisions relating to the Initial Notes and the
Exchange Notes are set forth in Appendix A, which is hereby incorporated in and
expressly made part of this Supplemental Indenture No. 2. The Initial Notes and
the Trustee's certificate of authentication shall be substantially in the form
of Exhibit 1 to Appendix A which is hereby incorporated in and expressly made a
part of this Supplemental Indenture No. 2. The Exchange Notes and the Trustee's
certificate of authentication shall be substantially in the form of Exhibit 2 to
Appendix A, which is hereby incorporated in and expressly made a part of this
Supplemental Indenture No. 2. The Notes may have notations, legends or
endorsements required by law, stock exchange rule, agreements to which the
Company is subject, if any, or usage (provided that any such notation, legend or
endorsement is in a form acceptable to the Company). Each Note shall be dated
the date of its authentication. The terms of the Notes set forth in Exhibits 1
and 2 to Appendix A are part of the terms of this Supplemental Indenture No. 2.
If any provision of this Supplemental Indenture No. 2 limits, qualifies, or
conflicts with any term or provision of the Notes, such provision in the Notes
shall control.
ARTICLE II.
RELATION TO INDENTURE; DEFINITIONS
SECTION 201. RELATION TO THE INDENTURE. This Supplemental
Indenture No. 2 constitutes an integral part of the Indenture and shall be
construed in connection with and as part of the Indenture.
SECTION 202. DEFINITIONS IN THE INDENTURE. For all purposes of
this Supplemental Indenture No. 2, capitalized terms used herein without
definition shall have the meanings specified in the Indenture. If any term is
defined in this Supplemental Indenture No. 2
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and in the Indenture, such term shall have the meaning assigned to it in this
Supplemental Indenture No. 2.
SECTION 203. DEFINITIONS. For all purposes of this
Supplemental Indenture No. 2, except as expressly provided or the context
otherwise requires:
"Additional Assets" means (i) any Property or assets (other
than Indebtedness and Capital Stock) that the Board of Directors determines to
be useful in the conduct of the business of the Company and its Subsidiaries,
whether or not such business is conducted on the date of the original issuance
of the Notes ("Approved Business"), (ii) the Capital Stock of a Person that
becomes a Restricted Subsidiary as a result of the acquisition of such Capital
Stock by the Company or another Restricted Subsidiary, or (iii) Capital Stock
constituting a minority interest in any Person that at such time is a Restricted
Subsidiary; PROVIDED, HOWEVER, that any such Restricted Subsidiary described in
clause (ii) or (iii) above is primarily engaged in an Approved Business.
"Additional Core Assets" means (i) any Property or assets
(other than Indebtedness or Capital Stock) used or intended for use in the Core
Business, (ii) the Capital Stock of a Person engaged in the Core Business that
becomes a Restricted Subsidiary as a result of the acquisition of such Capital
Stock by the Company or another Restricted Subsidiary engaged in the Core
Business, or (iii) Capital Stock constituting a minority interest in any Person
that at such time is a Restricted Subsidiary engaged in the Core Business.
"Affiliate" means, as to any Person, any other Person which
directly or indirectly controls, or is under common control with, or is
controlled by, such Person. As used in this definition, "control" (including,
with its correlative meanings, "controlled by" and "under common control with")
shall mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of securities or
partnership, membership or other ownership interests, by contract or otherwise),
provided that, in any event, each Unrestricted Subsidiary shall be deemed to be
an Affiliate of the Company and of each other Subsidiary. Notwithstanding the
foregoing, no individual shall be deemed to be an Affiliate of a Person solely
by reason of his or her being an officer or director (or equivalent) of such
Person and neither the Company nor any of its Restricted Subsidiaries shall be
deemed to be Affiliates of each other.
"AFSC" means Armco Financial Services Corporation.
"Asset Sale" means, with respect to any Person, any transfer,
conveyance, sale, lease or other disposition (including, without limitation,
dispositions pursuant to any consolidation or merger, but excluding any
Restricted Payment or Sale and Leaseback Transaction) by such Person or any of
its Restricted Subsidiaries (including any consolidation, merger or other sale
of any such Restricted Subsidiaries with, into or to another Person in a
transaction in which such Restricted Subsidiary ceases to be a Restricted
Subsidiary, but excluding a disposition by a Restricted Subsidiary of such
Person to such Person or a wholly owned Restricted Subsidiary of such Person or
by such Person to a wholly owned Restricted Subsidiary of such Person) in any
single transaction or series of transactions of (i) shares of
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Capital Stock (other than directors' qualifying shares) or other ownership
interests of a Restricted Subsidiary of such Person, (ii) all or substantially
all the Property of any division, business segment or comparable line of
business of such Person or any of its Restricted Subsidiaries or (iii) any other
Property of such Person or any of its Restricted Subsidiaries having a Fair
Market Value in excess of $5,000,000 and transferred, conveyed, sold, leased or
otherwise disposed of outside of the ordinary course of business of such Person
or Restricted Subsidiary; PROVIDED that the term "Asset Sale," when used with
respect to the Company, shall not include (x) any asset disposition permitted
pursuant to Section 310 which constitutes a disposition of all or substantially
all of the Company's assets, (y) a disposition of obsolete assets in the
ordinary course of business or (z) a sale or transfer of accounts receivable
under the Credit Facilities.
"Attributable Value" means, as to any particular lease under
which any Person is at the time liable other than a Capital Lease Obligation,
and at any date as of which the amount thereof is to be determined, the total
net amount of rent required to be paid by such Person under such lease during
the initial term thereof as determined in accordance with GAAP, discounted from
the last date of such initial term to the date of determination at a rate per
annum equal to the discount rate which would be applicable to a Capital Lease
Obligation with like term in accordance with GAAP. The net amount of rent
required to be paid under any such lease for any such period shall be the
aggregate amount of rent payable by the lessee with respect to such period after
excluding amounts required to be paid on account of insurance, taxes,
assessments, utility, operating and labor costs and similar charges. In the case
of any lease which is terminable by the lessee upon the payment of a penalty,
such net amount shall also include the amount of such penalty, but no rent shall
be considered as required to be paid under such lease subsequent to the first
date upon which it may be so terminated. "Attributable Value" means, as to a
Capital Lease Obligation under which any Person is at the time liable and at any
date as of which the amount thereof is to be determined, the capitalized amount
thereof that would appear on the face of the balance sheet of such Person in
accordance with GAAP.
"Average Life" means, as of any date, with respect to any debt
security or redeemable Preferred Stock, the quotient obtained by dividing (i)
the sum of the products of (x) the number of years from such date to the date of
each scheduled principal or redemption (including any sinking fund or mandatory
redemption payment requirements) of such debt or equity security multiplied in
each case by (y) the amount of such principal or redemption payment by (ii) the
sum of all such principal or redemption payments.
"Bankruptcy Code" means the Federal Bankruptcy Act or Title 11
of the United States Code.
"Capital Expenditure Indebtedness" means Indebtedness Incurred
by any Person to finance the purchase or construction of any Property acquired
(other than from an Affiliate) or constructed by such Person so long as (i) the
purchase or construction price for such Property is or should be included in
"addition to property, plant or equipment" in accordance with GAAP, (ii) the
acquisition or construction of such Property is not part of any acquisition of a
Person or business unit, and (iii) such Indebtedness is Incurred within 360 days
of the acquisition or completion of construction of such Property.
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"Capital Lease Obligation" of any Person means the obligation
to pay rent or other payment amounts under a lease of (or other Indebtedness
arrangement conveying the right to use) real or personal property of such Person
which is required to be classified and accounted for as a capital lease or a
liability on the face of a balance sheet of such Person in accordance with GAAP.
"Capital Stock" in any Person means any and all shares,
interests, participations or other equivalents in the equity interest (however
designated) in such Person and any rights (other than debt securities
convertible into an equity interest), warrants or options to subscribe for or to
acquire an equity interest in such Person.
"Change of Control" means an event or series of events by
which (i)(A) the Company consolidates with or merges into any other Person or
conveys, transfers or leases all or substantially all of its assets to any
Person or group of Persons or (B) any Person consolidates with or merges into
the Company, in the case of either (A) or (B) pursuant to a transaction or
series of transactions (other than a transaction or series of transactions
between the Company and a wholly owned Restricted Subsidiary of the Company) as
a result of which the existing shareholders of the Company immediately prior
thereto hold less than 50% of the combined voting power of the Voting Stock of
the surviving Person, or (ii) any "person" or "group" (each as defined in
Section 13(d)(3) of the Exchange Act) becomes the "beneficial owner" (as defined
under Rule 13d-3 of the Exchange Act), directly or indirectly, of 50% or more of
the total voting power of all classes of Voting Stock of the Company, or (iii)
during any period of two consecutive years, individuals who at the beginning of
such period constituted the Board of Directors (together with any new or
replacement directors whose election by the Board of Directors or whose
nomination for election by the Company's stockholders was approved by a vote of
at least 66 2/3% of the directors then still in office who were either directors
at the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
directors then in office.
"Change of Control Offer" has the meaning given such term in
Section 305(a).
"Change of Control Payment Date" has the meaning given such
term in Section 305(b).
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the Notes.
"Comparable Treasury Price" means, with respect to any
redemption date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third business day preceding such redemption date, as set forth in the
daily statistical release (or any successor release) published by the Federal
Reserve Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Securities" or (ii) if such release (or any successor release) is not published
or does not contain such prices on such business day, (A) the average of the
Reference Treasury Dealer Quotations
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for such redemption date, (B) if the Trustee is able to obtain only one
Reference Treasury Dealer Quotation from the Reference Treasury Dealers, such
Quotation, or (C) if the Trustee is not able to obtain any Reference Treasury
Dealer Quotations from the Reference Treasury Dealers, the average of the
Reference Treasury Dealer Quotations obtained from two other Primary Treasury
Dealers designated by the Company as Reference Treasury Dealers for the purpose
of determining such Comparable Treasury Price.
"Consolidated EBITDA" of any Person means, for any period, the
Consolidated Net Income of such Person, (i) increased (to the extent deducted in
determining Consolidated Net Income) by the sum of (A) all income taxes of such
Person and its Restricted Subsidiaries paid or accrued in accordance with GAAP
(other than income taxes attributable to extraordinary gains), (B) the
Consolidated Interest Expense of such Person and its Restricted Subsidiaries for
such period, other than interest capitalized by such Person or its Restricted
Subsidiaries during such period, (C) depreciation and amortization expenses of
such Person and its Restricted Subsidiaries for such period, including without
limitation, amortization of capitalized debt issuance costs, and (D) other
non-cash items of such Person and its Restricted Subsidiaries for such period to
the extent such non-cash items reduce Consolidated Net Income (excluding any
non-cash charge that will require cash payments and for which an accrual or
reserve is, or is required by GAAP to be, made) MINUS non-cash items to the
extent such non-cash items increase the Consolidated Net Income (excluding any
items which represent the reversal of any accrual or reserve for cash charges
established in any prior period) of such Person and its Restricted Subsidiaries
and (ii) decreased (to the extent included in determining Consolidated Net
Income) by any revenues accrued but not received by such Person or any of its
Restricted Subsidiaries from any other Person (other than such Person or its
Restricted Subsidiaries) in respect of any Investment for such period, all as
determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Coverage Ratio" means, with respect to
any Person, the ratio of (i) the aggregate amount of Consolidated EBITDA of such
Person for the four consecutive fiscal quarters for which consolidated financial
statements in respect thereof are available immediately prior to the relevant
Transaction Date (the "Determination Period") to (ii) the aggregate amount of
Consolidated Interest Expense of such Person for the Determination Period;
PROVIDED, HOWEVER, that for purposes of calculating the Consolidated Interest
Coverage Ratio of any specified Person, the Consolidated EBITDA and Consolidated
Interest Expense of such specified Person shall be calculated on a PRO FORMA
basis as if the transaction giving rise to the need to calculate the
Consolidated Interest Coverage Ratio had taken place on the first day of the
Determination Period, and shall (A) include the Consolidated Interest Expense in
respect of any Indebtedness Incurred by such Person subsequent to the first day
of the Determination Period and prior to the Transaction Date as if such
Indebtedness had been Incurred on the first day of the Determination Period, (B)
exclude, from the first day of the Determination Period, the Consolidated
Interest Expense in respect of (1) any Indebtedness of such Person that has been
redeemed or retired subsequent to the first day of the Determination Period and
prior to the Transaction Date and (2) if the transaction giving rise to the need
to calculate the Consolidated Interest Coverage Ratio is an Incurrence of
Indebtedness, any Indebtedness (x) that the Company anticipates as of the time
of determination will be redeemed or retired with the proceeds of, and within 90
days following the Incurrence of, such Indebtedness giving rise to such need or
(y)
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with respect to which the Company has deposited or caused to be deposited
irrevocably with the Trustee or Fiscal Agent for such Indebtedness funds
sufficient to redeem or retire such Indebtedness or has irrevocably committed to
redeem such Indebtedness, (C) include the Consolidated EBITDA and Consolidated
Interest Expense of any other Person acquired subsequent to the first day of the
Determination Period and prior to the Transaction Date by such specified Person
as a Restricted Subsidiary of such specified Person as if such Person had been
acquired on the first day of the Determination Period, (D) exclude, from the
first day of the Determination Period, the Consolidated EBITDA of such specified
Person directly attributable to any Property of such specified Person
(including, without limitation, Capital Stock) which was the subject of an Asset
Sale at any time subsequent to the first day of the Determination Period and
prior to the Transaction Date and (E) for purposes of Section 303 and Section
310 where the Consolidated Interest Coverage Ratio is calculated to give effect
to the transaction giving rise to the need to calculate the Consolidated
Interest Coverage Ratio, such calculation shall also include the Consolidated
EBITDA and Consolidated Interest Expense of any other Person to be acquired by
such specified Person as a Restricted Subsidiary of such specified Person in
connection with the transaction giving rise to the need to calculate the
Consolidated Interest Coverage Ratio. When the Consolidated Interest Coverage
Ratio is determined with respect to the Company, the term "Restricted
Subsidiary" shall be deemed to include any Unrestricted Subsidiary that became a
Restricted Subsidiary at any time between the first day of the Determination
Period and the Transaction Date, PROVIDED that such Subsidiary is a Restricted
Subsidiary on the Transaction Date.
"Consolidated Interest Expense" means, with respect to any
Person for any period, without duplication (i) the sum of (A) the aggregate
amount of cash and non-cash interest expense (net of interest income) of such
Person and its Restricted Subsidiaries for such period as determined on a
consolidated basis in accordance with GAAP in respect of Indebtedness
(including, without limitation, (u) capitalized interest, (v) any amortization
of debt discount, (w) net costs associated with Interest Rate Protection
Agreements (including any amortization of discounts), (x) the interest portion
of any deferred payment obligation, (y) all accrued interest, and (z) all
commissions, discounts and other fees and charges owed with respect to letters
of credit, bankers' acceptances or similar facilities) paid, accrued or
scheduled to be paid or accrued, during such period; (B) Preferred Stock
dividends of such Person (and of its Restricted Subsidiaries if paid to a Person
other than such Person or its Restricted Subsidiaries) declared and payable in
cash; (C) the portion of any rental obligation of such Person or its Restricted
Subsidiaries in respect of any Capital Lease Obligation allocable to interest
expense in accordance with GAAP; (D) the portion of any rental obligation of
such Person or its Restricted Subsidiaries in respect of any Sale and Leaseback
Transaction allocable to interest expense (determined as if such were treated as
a Capital Lease Obligation); and (E) to the extent any Indebtedness of any other
Person is Guaranteed by such Person or any of its Restricted Subsidiaries (other
than Guarantees relating to obligations of customers, either of such Person or
any of its Restricted Subsidiaries, that are made in the ordinary course of
business consistent with the past practices of such Person or such Restricted
Subsidiaries), the aggregate amount of interest paid, accrued or scheduled to be
paid or accrued, by such other Person during such period attributable to any
such Indebtedness, less (ii) to the extent included in (i) above, amortization
or write-off of deferred financing costs of such Person and its Restricted
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Subsidiaries during such period and any charge related to any premium or penalty
paid in connection with redeeming or retiring any Indebtedness of such Person
and its Restricted Subsidiaries prior to its Stated Maturity; in the case of
both (i) and (ii) above, after elimination of intercompany accounts among such
Person and its Restricted Subsidiaries and as determined in accordance with
GAAP.
"Consolidated Net Income" of any Person means, for any period,
the aggregate net income (or net loss) of such Person and its Restricted
Subsidiaries for such period on a consolidated basis determined in accordance
with GAAP; PROVIDED that there shall be excluded therefrom, without duplication,
(i) all items classified as extraordinary, (ii) any net loss or net income of
any Person other than such Person and its Restricted Subsidiaries, except to the
extent of the amount of dividends or other distributions actually paid to such
Person or its Restricted Subsidiaries by such other Person during such period,
(iii) the net income of any Person acquired by such Person or any of its
Restricted Subsidiaries in a pooling-of-interests transaction for any period
prior to the date of such acquisition, (iv) any gain or loss, net of taxes,
realized on the termination of any employee pension benefit plan, (v) gains or
losses in respect of Asset Sales by such Person or its Restricted Subsidiaries,
(vi) the net income of any Restricted Subsidiary of such Person to the extent
that the payment of dividends or other distributions to such Person is
restricted by contract or otherwise, except for any dividends or distributions
actually paid by such Restricted Subsidiary to such Person, (vii) any
extraordinary, unusual or nonrecurring gains or losses (and related tax effects)
in accordance with GAAP, and (viii) the effect of the adoption of Statement of
Financial Accounting Standards No. 106 ("SFAS 106") to the extent expenses
recognized pursuant to such adoption exceed the amounts with respect to such
expenses which would have been recognized during such period using the "pay as
you go" accounting method; PROVIDED FURTHER that there shall be included in
determining the net income or net loss of such person expenses that would have
been recognized using the "pay as you go" accounting method to the extent that
such expenses exceed the expenses recognized during such period pursuant to SFAS
106.
"Consolidated Net Tangible Assets" of any Person means the sum
of Tangible Assets of such Person and its Restricted Subsidiaries after
eliminating inter-company items, all determined in accordance with GAAP,
including appropriate deductions for any minority interest in Tangible Assets of
such Restricted Subsidiaries.
"Consolidated Net Worth" of any Person means the stockholders'
equity of such Person and its Restricted Subsidiaries, as determined on a
consolidated basis in accordance with GAAP, less amounts attributable to
Redeemable Stock of such Person.
"Core Business" means the specialty flat-rolled steel
business.
"Corporation" includes corporations, associations, companies
and business trusts.
"Credit Facilities" means the two bank credit facilities dated
as of December 22, 1995 between the Company or Armco Funding Corporation, on the
one hand, and the banks signatory thereto on the other, and all related notes,
collateral documents, guarantees, instruments
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and other agreements executed in connection therewith, as the same may be
amended, modified, supplemented, restated or Refinanced from time to time.
"Default" means any event, act or condition the occurrence of
which is, or after notice or the passage of time or both would be, an Event of
Default.
"Determination Period" has the meaning specified in Section
203 under the definition of "Consolidated Interest Coverage Ratio."
"Discharge" or "Discharged" means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by, and
obligations under the Notes and to have satisfied all the obligations under the
Indenture relating to the Notes (and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging the same and satisfaction of and
discharging this Supplemental Indenture No. 2).
"Eligible Receivables" means, as of any date, trade
receivables (less allowance for doubtful accounts) of the Company and its
Restricted Subsidiaries that would be shown on a consolidated balance sheet of
the Company and its Restricted Subsidiaries as of that date prepared in
accordance with GAAP.
"Equity Offering" means a registered public offering of common
stock of the Company resulting in net proceeds to the Company in excess of $25.0
million.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and the rules and regulations promulgated thereunder.
"Expiration Date" has the meaning specified in Section 309.
"Fair Market Value" means, with respect to the total
consideration received pursuant to any Asset Sale or any non-cash consideration
received by any Person, the fair market value of such consideration as
determined in good faith by the Board of Directors as evidenced by a Certified
Resolution.
"fiscal year" means, with respect to the Company, the twelve
consecutive months ending December 31.
"GAAP" or "generally accepted accounting principles," with
respect to any computation required or permitted hereunder shall, except as
otherwise specifically provided, mean such accounting principles as are
generally accepted in the United States of America at the date of such
computation.
"Guarantee" by an Person means any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, and including, without limitation, any
obligation of such Person, (i) to purchase or pay (or advance or supply
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funds for the purchase or payment of) such Indebtedness or to purchase (or to
advance or supply funds for the purchase of) any security for the payment of
such Indebtedness, (ii) to purchase Property, securities or services for the
purpose of assuring the holder of such Indebtedness of the payment of such
Indebtedness, or (iii) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness (and "Guaranteed,"
"Guaranteeing" and "Guarantor" shall have meanings correlative to the
foregoing); PROVIDED, HOWEVER, that a Guarantee by any Person shall not include
endorsements by such Person for collection or deposit, in either case, in the
ordinary course of business.
"Incur" means, with respect to any Indebtedness or other
obligation of any Person, to create, issue, incur (by conversion, exchange or
otherwise), extend, assume, Guarantee or otherwise become liable in respect of
such Indebtedness or other obligation or the recording, as required pursuant to
GAAP or otherwise, of any such Indebtedness or obligation on the balance sheet
of such Person (and "Incurrence," "Incurred," "Incurrable" and "Incurring" shall
have meanings correlative to the foregoing); PROVIDED, HOWEVER, that a change in
GAAP that results in an obligation of such Person that exists at such time
becoming Indebtedness shall not be deemed an Incurrence of such Indebtedness.
"Indebtedness" means at any time (without duplication), with
respect to any Person, whether recourse is to all or a portion of the assets of
such Person, and whether or not contingent, (i) any obligation of such Person
for borrowed money, (ii) any obligation of such Person evidenced by bonds,
debentures, notes, Guarantees or other similar instruments, including, without
limitation, any such obligations Incurred in connection with acquisition of
Property or businesses, (iii) any reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person, (iv) any obligation of such Person issued or
assumed as the deferred purchase price of Property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business), (v) any Capital Lease Obligation of such Person, (vi) the maximum
fixed redemption or repurchase price of Redeemable Stock of such Person at the
time of determination, (vii) any payment obligation of such Person under
Interest Rate Protection Agreements at the time of determination, (viii) any
obligation to pay rent or other payment amounts of such Person with respect to
any Sale and Leaseback Transaction to which such Person is a party and (ix) any
obligation of the type referred to in clauses (i) through (viii) of another
Person and all dividends of another Person the payment of which, in either case,
such Person has Guaranteed or is responsible or liable, directly or indirectly,
as obligor, Guarantor or otherwise. For purposes of the preceding sentence, the
maximum fixed repurchase price of any Redeemable Stock that does not have a
fixed repurchase price shall be calculated in accordance with the terms of such
Redeemable Stock as if such Redeemable Stock were repurchased on any date on
which Indebtedness shall be required to be determined pursuant to this
Supplemental Indenture No. 2; PROVIDED, HOWEVER, that if such Redeemable Stock
is not then permitted to be repurchased, the repurchase price shall be the book
value of such Redeemable Stock. 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 the maximum liability of any contingent
obligations in respect thereof at such date.
10
"Independent Investment Banker" means one of the Reference
Treasury Dealers appointed by the Trustee after consultation with the Company.
"Initial Issue Date" means December 15, 1998.
"Interest Rate Protection Agreement" means, with respect to
any Person, any interest rate swap agreement, interest rate cap agreement,
currency swap agreement or other financial agreement or arrangement designed to
protect such Person or its Restricted Subsidiaries against fluctuations in
interest rates or currency exchange rates, as in effect from time to time.
"Investment" means, with respect to any Person, any direct,
indirect or contingent (i) payment or transfer (including, without limitation,
by means of any payment for Property or services for the account or use of
another Person) of cash, Capital Stock or other Property, or assumption of
Indebtedness, made by such Person in exchange for Capital Stock, notes or bonds
of, or as a capital contribution to, any other Person or (ii) loan, advance or
other extension of credit (including, without limitation, by means of a
Guarantee, letter of credit or similar arrangement other than advances or loans
to customers in the ordinary course of business that are recorded as accounts
receivable of such Person or its Restricted Subsidiaries in accordance with
GAAP) made by such Person to or on behalf of any other Person.
"Lien" means, with respect to any Property, any mortgage or
deed of trust, pledge, hypothecation, assignment, deposit arrangement, security
interest, lien (statutory or other), charge, easement, encumbrance, preference,
priority or other security or similar agreement or preferential arrangement of
any kind or nature whatsoever on or with respect to such Property (including,
without limitation, any conditional sale or other title retention agreement
having substantially the same economic effect as any of the foregoing).
"Make-Whole Premium" means, with respect to a Note, an amount
equal to the greater of (i) 1.0% of the outstanding principal amount of such
Note and (ii) the excess of (a) the present value of the remaining interest,
premium and principal payments due on such Note as if such Note were redeemed on
December 1, 2003, computed using a discount rate equal to the Treasury Rate plus
75 basis points, over (b) the outstanding principal amount of such Note.
"Net Cash Proceeds" from any Asset Sale by any Person or its
Restricted Subsidiaries means cash, cash equivalents or readily marketable
securities received (including by way of sale or discounting of a note,
installment receivable or other receivable, but excluding any other
consideration received in the form of assumption of Indebtedness or other
obligations relating to the Properties sold or otherwise conveyed or received in
any other non-cash form unless such non-cash consideration is immediately
converted into cash therefrom by such Person or its Restricted Subsidiaries),
net of (i) all reasonable out-of-pocket expenses of such Person or such
Restricted Subsidiary Incurred in connection with an Asset Sale of such type,
including, without limitation, all legal, title and recording tax expenses,
commissions and other fees and expenses Incurred (but excluding any finder's fee
or broker's fee payable to any Affiliate of such Person) and all federal, state,
provincial, foreign and local taxes arising in connection with such Asset Sale
that are paid or required to be accrued as a liability under GAAP by such Person
or its Restricted Subsidiaries, (ii) all payments made by such Person or its
Restricted Subsidiaries on
11
any Indebtedness which is secured by such Properties in accordance with the
terms of any Lien upon or with respect to such Properties or which must, by the
terms of such Lien, or in order to obtain a necessary consent to such Asset Sale
or by applicable law, be repaid out of the proceeds from such Asset Sale, and
(iii) all distributions and other payments made to minority interest holders in
Restricted Subsidiaries of such Person as a result of such Asset Sale; PROVIDED
that, in the event that any consideration for an Asset Sale (which would
otherwise constitute Net Cash Proceeds) is required to be held in escrow pending
determination of whether a purchase price adjustment will be made, such
consideration (or any portion thereof) shall become Net Cash Proceeds only at
such time as it is released to such Person or its Restricted Subsidiaries from
escrow, and PROVIDED that any non-cash consideration received in connection with
an Asset Sale, which is subsequently converted to cash, shall be deemed to be
Net Cash Proceeds at such time and shall thereafter be applied in accordance
with Section 309.
"Non-Core Businesses" means the following businesses of the
Company, including any tangible and intangible Property assets (excluding cash,
Indebtedness and Capital Stock of any other Person (other than Capital Stock of
Subsidiaries of AFSC that do not, directly or indirectly, hold Property or
assets of the Core Business) held by such businesses), substantially as
conducted and reported on September 30, 1998, (i) the Company's ▇▇▇▇▇▇▇ Tubular
division, (ii) ▇▇▇▇▇▇▇ Dynamics, L.L.C., (iii) Greens Port Industrial Park, (iv)
the Company's steelmaking facilities in Dover, Ohio, (v) AFSC and Subsidiaries
of AFSC that do not, directly or indirectly, hold Property or assets of the Core
Business and (vi) any other business other than the Core Business.
"Paying Agent" means any Person authorized by the Company to
pay the principal of or interest on any Notes on behalf of the Company.
"Permitted Refinancing Indebtedness" means Indebtedness of the
Company, the proceeds of which are used to Refinance outstanding Indebtedness of
the Company or any Restricted Subsidiary, PROVIDED that (i) if the Indebtedness
being Refinanced is PARI PASSU with or subordinated in right of payment to the
Notes, then such Indebtedness is PARI PASSU with or subordinated in right of
payment to, as the case may be, the Notes at least to the same extent as the
Indebtedness being Refinanced, (ii) such Indebtedness is scheduled to mature no
earlier than the Indebtedness being Refinanced and (iii) such Indebtedness has
an Average Life at the time such Indebtedness is Incurred that is equal to or
greater than the Average Life of the Indebtedness being Refinanced; PROVIDED
FURTHER that such Indebtedness is in an aggregate principal amount (or, if such
Indebtedness is issued at a price less than the principal amount thereof, has an
aggregate original issue price) not in excess of the aggregate principal amount
then outstanding of the Indebtedness being Refinanced (or if the Indebtedness
being Refinanced was issued at a price less than the principal amount thereof,
then not in excess of the amount of liability in respect thereof determined in
accordance with GAAP) plus (A) prepayment premium and accrued interest on and
defeasance costs associated with such Indebtedness being Refinanced and (B) plus
fees and expenses associated with the Incurrence of such refinancing
Indebtedness.
"Preferred Stock," as applied to the Capital Stock of any
Person, means Capital Stock of such Person of any class or classes (however
designated) that ranks prior, as to the
12
payment of dividends or as to the distribution of assets upon any voluntary or
involuntary liquidation, dissolution or winding up of such Person, to shares of
Capital Stock of any other class of such Person.
"Prepayment Offer" has the meaning given such term in Section
309(a).
"Prepayment Offer Notice" has the meaning given such term in
Section 309(b).
"Primary Treasury Dealer" has the meaning given such term in
this Section 203 as set forth in the definition of Reference Treasury Dealer.
"Property" means, with respect to any Person, any interest of
such Person in any kind of property or asset, whether real, personal or mixed,
or tangible or intangible, including, without limitation, Capital Stock in any
other Person.
"Purchase Date" has the meaning specified in Section 309(b).
"Qualified Capital Stock" means Capital Stock of the Company
or any of its Restricted Subsidiaries that does not by its terms require any
dividends, distributions, mandatory prepayment or redemption prior to the first
anniversary following the Stated Maturity of the Notes.
"Redeemable Stock" of any Person means any equity security of
such Person that by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or otherwise (including, on the
happening of an event), is required to be redeemed or is redeemable at the
option of the holder thereof, in whole or part, prior to the Stated Maturity of
the Notes, or is exchangeable for debt at any time, in whole or part, prior to
the Stated Maturity of the Notes.
"Redemption Date" means, when used with respect to any Note to
be redeemed, the date fixed for redemption of such Note pursuant to Article IV
of this Supplemental Indenture No. 2 and the Notes.
"Redemption Price" means, when used with respect to any Note
to be redeemed, the price fixed for redemption of such Note pursuant to Article
IV of this Supplemental Indenture No. 2 and the Notes, plus accrued and unpaid
interest thereon to the Redemption Date.
"Reference Treasury Dealer" means each of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Inc. and Chase Securities Inc. and their respective successors; PROVIDED,
HOWEVER, that if any of the foregoing shall cease to be a primary U.S.
Government securities dealer in New York City (a "Primary Treasury Dealer"), the
Company shall substitute therefor another nationally recognized investment
banking firm that is a Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to
each Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its
13
principal amount) quoted in writing to the Trustee by such Reference Treasury
Dealer as of 3:30 p.m., New York time, on the third business day preceding such
redemption date.
"Refinance" means, with respect to any Indebtedness, to renew,
extend, refinance, refund, replace or repurchase, or be substituted for, such
Indebtedness and "Refinancing" means the renewal, extension, refinancing,
refunding, replacement or repurchasing of, or substitution for, such
Indebtedness.
"Registration Agreement" means, the registration agreement
dated December 10, 1998 between the Company and the Initial Purchasers, for
themselves and as representatives of each subsequent Holder of the Notes.
"Repurchase Price" has the meaning given such term in Section
305.
"Restricted Payment" means (i) a dividend or other
distribution declared and paid on the Capital Stock of the Company or to the
Company's stockholders (in their capacity as such), or declared and paid to any
Person other than the Company or a Restricted Subsidiary of the Company on the
Capital Stock of any Restricted Subsidiary of the Company, in each case, other
than dividends, distributions or payments payable or made solely in Qualified
Capital Stock, (ii) a payment made by the Company or any of its Restricted
Subsidiaries (other than to the Company or any Restricted Subsidiary of the
Company) to purchase, redeem, acquire or retire any Capital Stock of the Company
or of a Restricted Subsidiary, (iii) a payment made by the Company or any of its
Restricted Subsidiaries to redeem, repurchase, defease (including, but not
limited to, in-substance or legal defeasance) or otherwise acquire or retire for
value, prior to any scheduled maturity, scheduled repayment or scheduled sinking
fund or mandatory redemption payment, Indebtedness of the Company which is
subordinate (whether pursuant to its terms or by operation of law) in right of
payment to the Notes and which was scheduled to mature (after giving effect to
any and all options to extend the maturity thereof) on or after the Stated
Maturity of the Notes or (iv) a payment made by the Company or any of its
Restricted Subsidiaries to purchase, acquire, retire or redeem any Indebtedness
of or equity interest in or otherwise to make any Investment in any Affiliate
thereof or in any Person that would become an Affiliate thereof in connection
with or as a result of such investment; PROVIDED, that Restricted Payments shall
not include any payment or transfer of any Capital Stock of any Person in
exchange for, or to purchase or otherwise acquire, Capital Stock of, or an
equity interest in, another Person that is, or other Persons that are, or will,
as part of such transaction, become, the successor or successors to
substantially all of the assets and business of such first Person.
"Restricted Subsidiary" means, (i) with respect to the
Company, (A) any Subsidiary of the Company that exists on September 12, 1997
other than AFSC and its Subsidiaries, (B) any other Subsidiary of the Company
that the Company has not designated as an Unrestricted Subsidiary pursuant to
Section 311(a) and, (ii) with respect to a Person other than the Company and its
Subsidiaries, a Subsidiary of such other Person.
"Sale and Leaseback Transaction" means, with respect to any
Person, any direct or indirect arrangement pursuant to which Property is sold or
transferred by such Person or a
14
Restricted Subsidiary of such Person and is thereafter leased back from the
purchaser or transferee thereof by such Person or one of its Restricted
Subsidiaries.
"Senior Indebtedness" means, at any date, any outstanding
Indebtedness of the Company that is PARI PASSU in right of payment with the
Notes.
"Significant Restricted Subsidiary" means each Restricted
Subsidiary of the Company that (i) during the most recent four consecutive
fiscal quarters of the Company for which financial information in respect
thereof is available accounted for more than 10% of the Consolidated EBITDA of
the Company or (ii) is the owner, directly or indirectly, of more than 10% of
the Consolidated Net Tangible Assets of the Company, PROVIDED that clause (i)
shall be determined on a pro forma basis in the case of a Restricted Subsidiary
that became a Restricted Subsidiary during or subsequent to the end of such
four-consecutive-fiscal-quarter period as if the transaction in which it became
a Restricted Subsidiary occurred on the first day of such period.
"Stated Maturity" means, when used with respect to any
security, the date specified in such security as the fixed date on which the
principal or redemption price of such security is due and payable and, when used
with respect to any installment of interest on a security, the fixed date on
which such installment of interest is due and payable. The Stated Maturity of a
Capital Lease Obligation shall be the date of the last payment of rent or any
other amount due under such lease prior to the first date upon which such lease
may be terminated by the lessee without payment of a penalty.
"Subsidiary," with respect to any Person, means (i) a
corporation a majority of whose Capital Stock with voting power, under ordinary
circumstances, to elect directors is at the time, directly or indirectly, owned
by such Person, by such Person and one or more Subsidiaries of such Person or by
one or more Subsidiaries of such Person, or (ii) any other Person (other than a
corporation) in which such Person, one or more Subsidiaries of such Person, or
such Person and one or more Subsidiaries of such Person, directly or indirectly,
at the date of determination thereof has at least a majority ownership interest.
"Tangible Assets" of any Person means, at any date, the gross
book value as shown by the accounting books and records of such Person of all
its Property, less the net book value of all items that would be classified as
intangibles under GAAP, including, without limitation, (i) licenses, patents,
patent applications, copyrights, trademarks, trade names, goodwill, noncompete
agreements and organizational expenses, (ii) unamortized debt discount and
expense, (iii) all reserves for depreciation, obsolescence, depletion and
amortization of its Properties and (iv) all other proper reserves which in
accordance with GAAP should be provided in connection with the business
conducted by such Person.
"Transaction Date" means the date of any transaction giving
rise to the need to calculate the Consolidated Interest Coverage Ratio.
"Treasury Rate" means, with respect to any redemption date,
the rate per annum equal to the semiannual equivalent yield to maturity
(computed as of the second business day
15
immediately preceding such redemption date) of the Comparable Treasury Issue,
assuming a price for the Comparable Treasury Issue (expressed as a percentage of
its principal amount) equal to the Comparable Treasury Price for such redemption
date.
"Unrestricted Subsidiary" means (i) AFSC and its Subsidiaries
and, (ii) any Subsidiary of the Company that the Company has classified,
pursuant to Section 311(a) as an Unrestricted Subsidiary and that has not been
reclassified as a Restricted Subsidiary pursuant to Section 311(a).
"Voting Stock" of any Person means Capital Stock of such
Person which ordinarily has voting power for the election of directors (or
persons performing similar functions) of such Person, whether at all times or
only as long as no senior class of securities has such voting power by reason of
any contingency.
ARTICLE III.
COVENANTS
SECTION 301. TRANSACTIONS WITH AFFILIATES.
(a) The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, conduct any business or enter into any
transaction or series of transactions (including, but not limited to, the sale,
transfer, disposition, purchase, exchange or lease of assets or Property, the
making of any Investment, the giving of any Guarantee, or the rendering of any
service) with or for the benefit of any Affiliate of the Company (other than the
Company), unless (i) such transaction or series of transactions is on terms no
less favorable in the aggregate (including such factors as quality, delivery,
service and acceptance by customers of the Company or such Subsidiary) to the
Company or such Subsidiary than those that could be obtained in a comparable
arm's-length transaction with an entity that is not an Affiliate of the Company
or such Subsidiary, and (ii) with respect to a transaction or series of
transactions outside the ordinary course of business that has a Fair Market
Value equal to or greater than $5,000,000, the terms thereof are set forth in
writing and the Board of Directors (including a majority of the disinterested
directors thereof) approves such transaction or series of transactions and, in
its good faith judgment, believes that such transaction or series of
transactions complies with clause (i) of this Section 301(a), as evidenced by a
Certified Resolution.
(b) The limitations contained in Section 301(a) shall not
apply to (i) any transaction with an officer or director of the Company or any
Subsidiary of the Company entered into in the ordinary course of business
consistent with past practice (including compensation or employee benefit
arrangements with any officer or director of the Company or any Subsidiary of
the Company) and the cash-out of supplemental pension benefits, or (ii)
transactions between the Company and its Restricted Subsidiaries or among such
Restricted Subsidiaries.
16
SECTION 302. LIMITATION ON RESTRICTED PAYMENTS.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, make any Restricted Payment
if, at the time of and after giving effect to the proposed Restricted Payment:
(i) any Default or Event of Default has occurred and is
continuing;
(ii) the Company could not Incur at least $1.00 of additional
Indebtedness pursuant to Section 303(a); or
(iii) the aggregate amount expended or committed for all
Restricted Payments from September 12, 1997 (the amount so expended or
committed, if other than in cash, to be determined in good faith by the
Board of Directors and evidenced by a Certified Resolution) exceeds the
sum of (A) 50% of the aggregate Consolidated Net Income of the Company
and its Restricted Subsidiaries (or, if Consolidated Net Income shall
be a deficit, minus 100% of such deficit) subsequent to June 30, 1997
and ending on the last day of the fiscal quarter immediately preceding
the date of such Restricted Payment, (B) 100% of the aggregate net
proceeds, including cash and the Fair Market Value of Property other
than cash, received by the Company subsequent to September 12, 1997,
from capital contributions from its stockholders or from the issuance
or sale (other than to a Subsidiary) of Qualified Capital Stock of the
Company or of any convertible securities or debt obligations which have
been converted into, exchanged for or satisfied by the issuance of
Qualified Capital Stock, and (C) the amount of the net reduction in
Investments made as Restricted Payments in accordance with this
sentence in Unrestricted Subsidiaries resulting from (1) the payment of
cash dividends or the repayment in cash of the principal of loans or
the cash return on any Investment, in each case to the extent received
by the Company or any wholly owned Restricted Subsidiary of the Company
from Unrestricted Subsidiaries, (2) to the extent that any Investment
in an Unrestricted Subsidiary that was made after September 12, 1997 is
sold for cash or otherwise liquidated or repaid for cash, the after-tax
cash return of capital with respect to such Investment (less the cost
of disposition, if any) or (3) the redesignation of Unrestricted
Subsidiaries as Restricted Subsidiaries, such aggregate amount of the
net reduction in such Investments not to exceed, in the case of any
Unrestricted Subsidiary, the amount of such Investments made as
Restricted Payments previously made by the Company or any Restricted
Subsidiary in such Unrestricted Subsidiary, which amount was included
in the calculation of the amount of Restricted Payments.
(b) The limitations contained in Section 302(a) shall not
prevent the Company or its Restricted Subsidiaries from:
(i) paying a dividend on its Capital Stock within 60 days
after declaration thereof if, on the declaration date, the Company
could have paid such dividend in compliance with the Indenture;
17
(ii) repurchasing shares of its Capital Stock (A) solely in
exchange for other shares of its Capital Stock (other than Redeemable
Stock), (B) to eliminate fractional shares or odd lots for up to an
aggregate consideration in any fiscal year of the Company not to exceed
$2,000,000, (C) pursuant to an order of a court of competent
jurisdiction, or (D) in connection with repurchase provisions under
employee stock option and stock purchase agreements or other agreements
to compensate management employees of the Company;
(iii) making cash payments in respect of stock appreciation
rights granted to employees of the Company;
(iv) the purchase for value of shares of Capital Stock of the
Company (A) held by directors, officers or employees upon death,
disability, retirement, or termination of employment or (B) to fund
capital stock-based, long-term incentive programs, not to exceed
$10,000,000 in the aggregate;
(v) Restricted Payments for the redemption, repurchase or
other acquisition of shares of Capital Stock of the Company in
satisfaction of indemnification or other claims arising under any
merger, consolidation, asset purchase or investment or similar
acquisition agreement permitted under the Indenture, pursuant to which
such shares of Capital Stock were issued;
(vi) making payments to purchase or redeem Indebtedness made
by exchange for, or out of the proceeds of, the substantially
concurrent (A) sale or issuance of Capital Stock (other than Redeemable
Stock) of the Company, or (B) Incurrence of Indebtedness of the Company
that is contractually subordinated in right of payment to the Notes and
has a Stated Maturity later than the Stated Maturity of the Notes and
an Average Life greater than the remaining Average Life of any of the
Notes;
(vii) declaring and paying dividends on the Preferred Stock of
the Company outstanding on September 12, 1997;
(viii) making Investments in Affiliates up to an aggregate of
$15,000,000;
(ix) making an Investment in an Affiliate as a result of which
such Affiliate becomes a Restricted Subsidiary in compliance with the
provisions of Section 311;
(x) making an Investment by contributing or otherwise
transferring to any Person or Persons all or any part of the Non-Core
Businesses enumerated in clauses (i) through (v) of the definition of
"Non-Core Businesses"; and
(xi) making other Restricted Payments in an aggregate amount
not to exceed $25,000,000 (after giving effect to the amount of the net
reduction in any Investments made as Restricted Payments in reliance on
this clause (xi) resulting from (A) the payment of cash dividends or
the repayment in cash of the principal of loans or the cash return on
any such Investment, in each case to the extent received by the Company
or any
18
wholly owned Restricted Subsidiary of the Company from Unrestricted
Subsidiaries, (B) to the extent that any such Investment in an
Unrestricted Subsidiary is sold for cash or otherwise liquidated or
repaid for cash, the after-tax cash return of capital with respect to
such Investment (less the cost of disposition, if any) or (C) the
redesignation of Unrestricted Subsidiaries as Restricted Subsidiaries).
(c) The payments permitted to be made pursuant to clauses
(ii)(A), (iii) (but only to the extent any such payments are included in
determining Consolidated Net Income), (vi), (ix) and (x) of Section 302(b) shall
be excluded for purposes of any future calculations pursuant to Section 302(a)
of the aggregate amount of Restricted Payments outstanding. The payments
permitted to be made pursuant to clauses (i), (ii)(B), (ii)(C), (ii)(D), (iii)
(but only to the extent that any such payments are not included in determining
Consolidated Net Income), (iv), (v), (vii), (viii) and (xi) of Section 302(b)
shall be included for purposes of any future calculations pursuant to Section
302(a) of the aggregate amount of Restricted Payments outstanding.
SECTION 303. LIMITATION ON INDEBTEDNESS.
(a) The Company shall not, directly or indirectly, Incur any
Indebtedness unless, immediately after the date of the transaction giving rise
to such Indebtedness and after giving effect to the Incurrence of such
Indebtedness and the receipt and application of the proceeds thereof as if such
Indebtedness had been Incurred and the proceeds thereof applied on the first day
of the Determination Period, the Consolidated Interest Coverage Ratio of the
Company at such date exceeds the ratio of 2.0 to 1.0.
(b) The limitations contained in Section 303(a) shall not
prevent the Company from Incurring the following Indebtedness (although any
Indebtedness so Incurred shall be included, to the extent outstanding at the
Transaction Date, in any subsequent determination of the Consolidated Interest
Coverage Ratio):
(i) Indebtedness Incurred by the Company or by Armco Funding
Corporation under the Credit Facilities, PROVIDED that the aggregate
principal amount of all Indebtedness Incurred under this clause (i) at
any one time outstanding does not exceed the greater of (A)
$225,000,000 and (B) the sum of (1) 80% of the book value of the
accounts receivable of the Company and its Restricted Subsidiaries and
(2) 50% of the book value of the inventory of the Company and its
Restricted Subsidiaries, in the case of clauses (B)(1) and (B)(2) of
this proviso, as of the end of the most recent fiscal quarter for which
financial information in respect thereof is available immediately prior
to the date of such Incurrence, determined in accordance with GAAP;
(ii) Indebtedness evidenced by the Initial Notes issued on or
prior to December 15, 1998 and a like aggregate principal amount of
Exchange Notes;
(iii) (A) Indebtedness of the Company in respect of Capital
Lease Obligations or (B) Capital Expenditure Indebtedness directly
Incurred by the Company, PROVIDED that the aggregate principal amount
of all Indebtedness Incurred under subclauses (A) and (B)
19
of this clause (iii) and the Indebtedness Incurred under Section
304(a)(iv) does not exceed $100,000,000 at any one time outstanding;
(iv) Indebtedness under Interest Rate Protection Agreements,
PROVIDED that the obligations under such agreements are related to
payment obligations on Indebtedness otherwise permitted by the terms of
this covenant;
(v) Indebtedness of the Company to any wholly owned Restricted
Subsidiary of the Company (but only so long as such Indebtedness is
held by such wholly owned Restricted Subsidiary);
(vi) Indebtedness outstanding on September 12, 1997;
(vii) Permitted Refinancing Indebtedness;
(viii) surety obligations of the Company and its Restricted
Subsidiaries entered into in the ordinary course of business;
(ix) Indebtedness of the Company and its Restricted
Subsidiaries Incurred to finance the purchase of insurance in the
ordinary course of business;
(x) Indebtedness of the Company and its Restricted
Subsidiaries Incurred from the honoring by a bank or other financial
institution of a check or draft inadvertently drawn against
insufficient funds in the ordinary course of business, PROVIDED that
such Indebtedness is extinguished within two business days of notice of
any such Incurrence; and
(xi) Indebtedness not otherwise permitted to be Incurred under
clauses (i) through (x) of this Section 303(b), which, together with
any other outstanding Indebtedness Incurred under clause (xi) of this
Section 303(b), has an aggregate principal amount not in excess of
$40,000,000 at any one time outstanding.
SECTION 304. LIMITATION ON RESTRICTED SUBSIDIARY
INDEBTEDNESS AND PREFERRED STOCK.
(a) The Company shall not permit any of its Restricted
Subsidiaries to Incur, directly or indirectly, any Indebtedness or Preferred
Stock, except:
(i) (A) Indebtedness or Preferred Stock outstanding on
September 12, 1997 or (B) Indebtedness Incurred under the Credit
Facilities to the extent permitted by clause (i) of Section 303(b);
(ii) Indebtedness or Preferred Stock issued to and held by the
Company or a wholly owned Restricted Subsidiary of the Company (but
only so long as such Indebtedness or Preferred Stock is held or owned
by the Company or a wholly owned Restricted Subsidiary of the Company);
20
(iii) (A) Indebtedness of a Restricted Subsidiary in respect
of Capital Lease Obligations or (B) Capital Expenditure Indebtedness
directly Incurred by a Restricted Subsidiary, PROVIDED that after
giving effect to such Indebtedness the Company could Incur at least
$1.00 of additional Indebtedness pursuant to Section 303(a);
(iv) (A) Indebtedness of a Restricted Subsidiary in respect of
Capital Lease Obligations or (B) Capital Expenditure Indebtedness
directly Incurred by a Restricted Subsidiary, PROVIDED that the
aggregate principal amount of all Indebtedness Incurred under clauses
(iv)(A) and (iv)(B) of this Section 304(a) and the Indebtedness
Incurred under Section 303(b)(iii) does not exceed $100,000,000 at any
one time outstanding; and
(v) Indebtedness or Preferred Stock Incurred in exchange for,
or the proceeds of which are used to Refinance, Indebtedness or
Preferred Stock of equal or higher ranking referred to in clauses (i)
through (iv) of this Section 304(a), so long as (A) the principal
amount of such Indebtedness or the liquidation value of such Preferred
Stock so Incurred does not exceed the principal amount or liquidation
value of the Indebtedness or Preferred Stock so exchanged or Refinanced
and (B) the Indebtedness or Preferred Stock so Incurred has a Stated
Maturity or final redemption date later than the Stated Maturity or
final redemption date (if any) of, and an Average Life that is longer
than that of, the Indebtedness or Preferred Stock being exchanged or
Refinanced.
(b) Any Indebtedness or Preferred Stock Incurred pursuant to
clauses (i) through (v) of Section 304(a) will be included, to the extent
outstanding at the Transaction Date, in any subsequent determination of the
Consolidated Interest Coverage Ratio.
SECTION 305. CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, each Holder
shall have the right to require the Company to repurchase such Holder's Notes,
in whole or in part, in integral multiples of $1,000, pursuant to the offer
described in Section 305(b) (the "Change of Control Offer") at a price (the
"Repurchase Price") in cash equal to 101% of the aggregate principal amount
thereof, plus accrued and unpaid interest thereon, if any, to the Change of
Control Payment Date.
(b) Within 30 calendar days subsequent to the date of any
Change of Control, the Company shall mail a notice to each Holder and to the
Trustee stating:
(i) that a Change of Control has occurred and a Change of
Control Offer is being made pursuant to this Section 305, and that all
Notes that are timely tendered will be accepted for payment;
(ii) the Repurchase Price and the repurchase date, which shall
be a date occurring no earlier than 30 days and no later than 60 days
subsequent to the date on which such notice is mailed (the "Change of
Control Payment Date");
21
(iii) that any Note (or any portion thereof) not tendered will
continue to accrue interest;
(iv) that any Note (or any portion thereof) accepted for
payment pursuant to the Change of Control Offer (and duly paid on the
Change of Control Payment Date) will cease to accrue interest after the
Change of Control Payment Date;
(v) that any Holder electing to have a Note (or any portion
thereof) repurchased pursuant to a Change of Control Offer will be
required to surrender the Note, with the form entitled "Election of
Holder to Require Repurchase" on the reverse of the Note completed, to
the Paying Agent at the address specified in the notice on or prior to
the close of business on the Change of Control Payment Date;
(vi) that any Holder will be entitled to withdraw such
election if the Paying Agent receives, not later than the close of
business on the third Business Day preceding the Change of Control
Payment Date, a telegram, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of Notes the Holder
delivered for repurchase and a statement that such Holder is
withdrawing the Holder's election to have such Notes repurchased;
(vii) that any Holder that elects to have a portion of its
Notes repurchased must specify the principal amount that is being
tendered for repurchase, which principal amount must be in an integral
multiple of $1000; and
(viii) any other information regarding the Company and its
Subsidiaries as the Company in good faith believes will enable such
Holders to make an informed decision with respect to the decision to
tender their Notes (including, but not limited to, a description of the
circumstances and relevant facts regarding the events requiring the
Company to make the Change of Control Offer), or is necessary to enable
Holders to tender their Notes (or any portion thereof) and to have such
Notes repurchased pursuant to this Section 305.
At the Company's request, the Trustee shall give the notice required in this
clause (b) in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by clauses
(i) - (viii) above.
(c) On the Change of Control Payment Date, the Company shall
(i) accept for payment any Note (or portion thereof) tendered pursuant to the
Change of Control Offer, (ii) deposit with the Paying Agent money sufficient to
pay the Repurchase Price of any Note so tendered and (iii) deliver to the
Trustee each Note so accepted together with an Officers' Certificate that states
the aggregate principal amount of Notes tendered to the Company. The Paying
Agent shall promptly mail to each Holder of Notes so accepted payment in an
amount equal to the Repurchase Price therefor. The Company shall publicly
announce the results of the Change of Control Offer on or as soon as practicable
after the Change of Control Payment Date. For purposes of this Section 305, the
Trustee shall act as the Paying Agent.
22
(d) Notwithstanding the foregoing, if any Note (or any portion
thereof) accepted for payment shall not be so paid pursuant to the provisions of
this Section 305, then, from the Change of Control Payment Date until the
principal of (and premium) and interest on such Note is paid, interest shall be
paid on the unpaid principal (and premium) and, to the extent permitted by law,
on any accrued but unpaid interest thereon, in each case at the rate prescribed
therefor by such Note.
(e) Upon surrender pursuant to this Section 305 of any Note
tendered in part, the Company shall execute, and the Trustee shall authenticate
and deliver, a new Note of the same series, of any authorized denomination, in
an aggregate principal amount equal to the untendered portion of the surrendered
Note.
(f) Neither the Board of Directors nor the Trustee under the
Indenture may waive the Company's obligation to make a Change of Control Offer.
(g) The Company shall comply, to the extent applicable, with
the requirements of Rule 14e-1 under the Exchange Act and other securities laws
or regulations in connection with the repurchase of the Notes pursuant to this
Section 305. To the extent that the provisions of any securities laws or
regulations conflict with the Change of Control provisions of the Indenture, the
Company shall comply with the applicable securities laws and regulations and
shall not be deemed to have breached its obligations under the Indenture by
virtue thereof.
SECTION 306. LIMITATION ON SALE AND LEASEBACK TRANSACTIONS.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into, assume,
Guarantee or otherwise become liable with respect to any Sale and Leaseback
Transaction, except for a Sale and Leaseback Transaction not exceeding 360 days
unless:
(i) the Company or such Restricted Subsidiary is permitted to
Incur such Indebtedness under Section 303 or Section 304, respectively;
(ii) the Company or such Restricted Subsidiary would be
permitted to Incur a Lien to secure Indebtedness or enter into a Sale
and Leaseback Transaction pursuant to Section 307(b) or Incur a Lien on
such Property that is the subject of such Sale and Leaseback
Transaction pursuant to Section 307(a)(ii) without equally and ratably
securing the Notes;
(iii) the Company or such Restricted Subsidiary receives
consideration at least equal to the Fair Market Value of the Property
transferred; and
(iv) if the Sale and Leaseback Transaction is, directly or
indirectly, entered into, or assumed or Guaranteed by, the Company or
such Restricted Subsidiary, or the Company or such Restricted
Subsidiary otherwise becomes liable with respect thereto, more than 360
days after the Property subject to such Sale and Leaseback Transaction
is
23
acquired or constructed by the Company or such Restricted Subsidiary,
the Company applies the proceeds of such Sale and Leaseback
Transaction, net of all reasonable out-of-pocket expenses Incurred by
the Company or such Restricted Subsidiary in connection therewith,
which are customarily Incurred in connection with the Sale and
Leaseback Transactions of such kind, in accordance with the provisions
of Section 309 as if such Sale and Leaseback Transaction were an Asset
Sale.
SECTION 307. LIMITATION ON LIENS.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, Incur any Lien on or with
respect to any Property of the Company or such Restricted Subsidiary, or any
interest therein or any income or profits therefrom, unless the Notes are
secured equally and ratably with (or prior to) any and all other Indebtedness
secured by such Lien, except for:
(i) any Lien securing Indebtedness permitted under Section
303(b)(i);
(ii) any Lien (A) in respect of Capital Lease Obligations or
Capital Expenditure Indebtedness permitted to be Incurred by the terms
of Section 303(a), Section 303(b)(iii), Section 304(a)(iii) or Section
304(a)(iv), (B) existing on any Property of a Person at the time such
Person is merged or consolidated with or into the Company or any
Restricted Subsidiary or becomes a Restricted Subsidiary (and not
Incurred in anticipation of such transaction) or (C) existing on any
Property at the time of the acquisition thereof (and not Incurred in
anticipation of such transaction) whether or not assumed by the Company
or any Restricted Subsidiary; PROVIDED that in any such case such Lien
may extend only to the Property so acquired or constructed and
improvements thereon, and, in the case of any such Lien in respect of
Capital Lease Obligations and Capital Expenditure Indebtedness, the
real property on which such Property is located;
(iii) any Lien Incurred to secure the performance of statutory
obligations, bids, trade contracts, leases, surety or appeal bonds,
performance or return-of-money bonds or other obligations of a like
nature Incurred in the ordinary course of business;
(iv) any Lien to secure industrial revenue or development or
pollution control bonds;
(v) any Lien to secure any Refinancing (or successive
Refinancings), in whole or in part, of any Indebtedness secured by
Liens referred to in clauses (i) through (iv) of this Section 307(a) so
long as such Lien does not extend to any other Property and the
Indebtedness so secured is not increased;
(vi) any Lien securing only the Notes;
(vii) any Lien in favor of the Company or a wholly owned
Restricted Subsidiary;
(viii) any Lien for taxes or assessments by other governmental
charges or levies;
24
(ix) any Lien to secure obligations under worker's
compensation, unemployment insurance or other social security
legislation, including Liens with respect to judgments which are not
currently dischargeable;
(x) materialmen's, mechanics', worker's, warehousemen's,
landlord's and carriers' Liens or other like Liens created by law (or
in a lease agreement in the case of landlord's Liens) and arising in
the ordinary course of business;
(xi) any Lien existing on September 12, 1997;
(xii) easements, rights of way, zoning and other similar
restrictions or encumbrances Incurred in the ordinary course of
business; and
(xiii) attachment, judgment and other similar Liens arising in
connection with court proceedings, PROVIDED that the execution or other
enforcement of such Liens is effectively stayed and the claims secured
thereby are currently being contested in good faith by appropriate
proceedings.
(b) In addition to the foregoing, the Company and its
Restricted Subsidiaries may Incur a Lien to secure Indebtedness or enter into a
Sale and Leaseback Transaction, without equally and ratably securing the Notes,
if the sum of (i) the amount of Indebtedness secured by all Liens entered into
after September 12, 1997 and (ii) the Attributable Value of all Sale and
Leaseback Transactions or Capital Lease Obligations in respect thereof entered
into after September 12, 1997 and otherwise prohibited by the Base Indenture or
this Supplemental Indenture No. 2 does not exceed 10% of the Company's
Consolidated Net Tangible Assets.
SECTION 308. LIMITATION CONCERNING DISTRIBUTIONS OR
TRANSFERS BY RESTRICTED SUBSIDIARIES.
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, cause to exist or become
effective or enter into any encumbrance or restriction (other than pursuant to
law or regulation) on the ability of any Restricted Subsidiary: (i) to pay
dividends or make any other distributions in respect of its Capital Stock or pay
any Indebtedness or other obligation owed to the Company or any other Restricted
Subsidiary of the Company; (ii) to make loans or advances to the Company or any
Restricted Subsidiary of the Company; or (iii) to transfer any of its Property
to the Company or any other Restricted Subsidiary, except for any encumbrance or
restrictions pursuant to any agreement in effect on September 12, 1997 or any
Refinancing thereof containing encumbrances or restrictions no greater than in
the agreement so Refinanced.
SECTION 309. LIMITATION ON ASSET SALES.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, consummate any Asset Sale unless:
25
(i) the Company or such Restricted Subsidiary, as the case may
be, receives consideration at least equal to the Fair Market Value of
the Property disposed of; and
(ii) at least 75% of the consideration received by the Company
or such Restricted Subsidiary for such Property (other than Non-Core
Businesses enumerated in clauses (i) through (v) of the definition of
"Non-Core Businesses" set forth in Section 203) is in the form of cash,
cash equivalents, readily marketable securities or non-cash
consideration that is immediately converted to cash, or the assumption
by the purchaser of such Property of Senior Indebtedness (PROVIDED such
Senior Indebtedness was not Incurred in connection with or in
anticipation of such Asset Sale), PROVIDED that the Company must, at
the Company's option:
(A) (1) commit, or cause such Restricted Subsidiary to commit
(such commitments to include amounts anticipated to be expended
pursuant to the Company's capital investment plan (x) as adopted by the
Board of Directors and (y) evidenced by the filing of an officer's
certificate with the Trustee stating that the total amount of the Net
Cash Proceeds of such Asset Sale is less than the aggregate amount
contemplated to be expended pursuant to such capital investment plan
within 24 months of the consummation of such Asset Sale) within 270
days of the consummation of such Asset Sale, to apply the Net Cash
Proceeds of such Asset Sale to reinvest in Additional Core Assets or,
if the applicable Asset Sale was a sale of a Non-Core Business, in
Additional Assets and (2) apply, or cause such Restricted Subsidiary to
apply, pursuant to such commitment (which includes amounts actually
expended under the capital investment plan authorized by the Board of
Directors), such Net Cash Proceeds of such Asset Sale within 24 months
of the consummation of such Asset Sale; PROVIDED THAT if any commitment
under this clause (A) is terminated or rescinded after the 225th day
after the consummation of such Asset Sale, the Company or such
Restricted Subsidiary, as the case may be, shall have 45 days after
such termination or rescission to (x) apply such Net Cash Proceeds
pursuant to clause (B) or (C) below, or (y) to commit, or cause such
Restricted Subsidiary to commit, to apply the Net Cash Proceeds of such
Asset Sale to reinvest in Additional Core Assets or in Additional
Assets, as the case may be, and/or
(B) offer to apply an amount equal to such Net Cash Proceeds
(or remaining Net Cash Proceeds) to the repayment of any Senior
Indebtedness, or (to the extent of Net Cash Proceeds received from an
Asset Sale by such Restricted Subsidiary) debt of a Restricted
Subsidiary, and repay such Indebtedness of any lender or debt holder
who accepts such offer or, in the case of any Indebtedness under a
revolving credit facility, repay an amount outstanding thereunder equal
to such Net Cash Proceeds and concurrently therewith, effect a
permanent reduction in the committed availability thereunder, and/or
(C) offer to apply an amount equal to such Net Cash Proceeds
(or remaining Net Cash Proceeds) to the repayment of the Notes and
repurchase any Notes properly tendered in acceptance of such prepayment
offer (the "Prepayment Offer") on a pro rata basis at a purchase price
at least equal to 100% of their principal amount plus interest
26
accrued to the date of such repurchase; PROVIDED, that in the event the
Net Cash Proceeds resulting from any Asset Sale, after giving effect to
the purchase of Additional Core Assets or Additional Assets, as the
case may be, and/or the repayment of Senior Indebtedness, are less than
$10,000,000, the application of an amount equal to such Net Cash
Proceeds to a pro rata offer to repurchase the Notes may be deferred
until such time as such Net Cash Proceeds, together with Net Cash
Proceeds from any prior or subsequent Asset Sales not otherwise applied
in accordance with this Section 309(a), are at least equal to
$10,000,000. To the extent that any portion of the amount of Net Cash
Proceeds remains after compliance with the preceding sentence and
PROVIDED that all Holders have been given the opportunity to tender
their Notes for repurchase as provided in clause (C) of the immediately
preceding sentence, the Company or such Restricted Subsidiary may use
such remaining amount for general corporate purposes.
(b) Within 280 days from the date of an Asset Sale, the
Company shall, if it chooses (or is obligated) to apply an amount equal to any
remaining Net Cash Proceeds (or any portion thereof) to fund an offer to
repurchase the Notes, send a written Notice (a "Prepayment Offer Notice"), by
first-class mail, to the Holders of the Notes, accompanied by such information
regarding the Company and its Subsidiaries as the Company in good faith believes
will enable such Holders to make an informed decision with respect to the
Prepayment Offer (including, but not limited to, a description of the
circumstances and relevant facts regarding the events requiring the Company to
make the Prepayment Offer). The Prepayment Offer Notice will contain all
instructions and materials necessary to enable such Holder to tender pursuant to
the Prepayment Offer. The Prepayment Offer Notice will also state:
(i) that the Company is offering to purchase Notes pursuant to
the provisions of this Section 309;
(ii) that any Note (or any portion thereof) accepted for
payment (and duly paid on the Purchase Date) pursuant to the Prepayment
Offer will cease to accrue interest after the Purchase Date and that
any Note (or any portion thereof) not tendered or accepted for payment
shall continue to accrue interest at the rate prescribed therefor by
such Note;
(iii) the expiration date (the "Expiration Date") of the
Prepayment Offer, which will be, subject to any contrary requirements
of applicable law, not less than 30 days nor more than 60 days after
the date of such Prepayment Offer;
(iv) a settlement date (the "Purchase Date") for the purchase
of Notes which shall be within five Business Days after the Expiration
Date;
(v) the aggregate principal amount of Notes to be purchased
and the purchase price thereof; and
(vi) a description of the procedure that a Holder must follow
and any other information necessary to tender all or any portion of
such Holder's Notes.
27
At the Company's request, the Trustee shall give the
Prepayment Offer Notice required in this paragraph (b) in the Company's name and
at the Company's expense. In such event, the Company shall provide the Trustee
with the information required by this paragraph (b).
To tender any Note, a Holder must surrender such Note at the
place or places specified in the Prepayment Offer Notice prior to the close of
business on the Expiration Date (such securities being, if the Company or the
Trustee so requires, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Trustee duly executed by,
the Holder thereof or such Holder's attorney duly authorized in writing).
Holders will be entitled to withdraw all or any portion of Notes tendered if the
Company (or its Paying Agent) receives, not later than the close of business on
the Expiration Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of Notes the Holder tendered,
the certificate numbers of the Notes tendered and a statement that such Holder
is withdrawing all or a portion of such tender. Any portion of Notes so tendered
must be tendered or withdrawn in an integral multiple of $1,000 principal
amount.
(c) Notwithstanding the foregoing, if any Note (or any portion
thereof) accepted for payment shall not be so paid pursuant to the provisions of
Section 309(b), then, from the Purchase Date until the principal of (and
premium, if any) and interest on such Note is paid, interest shall be paid on
the unpaid principal (and premium, if any) and, to the extent permitted by law,
on any accrued but unpaid interest thereon, in each case, at the rate prescribed
therefor by such Note.
(d) Upon surrender pursuant to this Section 309 of any Note
tendered or accepted in part, the Company shall execute, and the Trustee shall
authenticate and deliver, a new Note of the same series, of any authorized
denomination, in an aggregate principal amount equal to the unpaid portion of
the surrendered Note.
SECTION 310. COMPANY MAY CONSOLIDATE, ETC.
(a) The Company shall not merge or consolidate with any other
corporation (other than a merger of a Restricted Subsidiary into the Company in
which the Company is the continuing corporation) or sell, transfer or convey its
Property or assets as an entirety or substantially as an entirety to any Person
other than a wholly owned Restricted Subsidiary, unless:
(i) the entity formed by or surviving any such consolidation
or merger (if other than the Company) or to which such sale, transfer
or conveyance is made shall be a corporation organized and existing
under the laws of the United States of America or a State or the
District of Columbia and such corporation expressly assumes, by
supplemental indenture satisfactory to the Trustee, executed and
delivered to the Trustee by such corporation, the due and punctual
payment of the principal of, premium, if any, and interest on all the
Notes, according to their tenor, and the due and punctual performance
and observance of all of the covenants and conditions of the Indenture
to be performed by the Company;
28
(ii) immediately before and after giving effect to such
transaction or series of transactions, no Default or Event of Default
shall have occurred and be continuing;
(iii) immediately after giving effect to such transaction or
series of transactions on a pro forma basis (including, without
limitation, any Indebtedness Incurred or anticipated to be Incurred in
connection with such transaction or series of transactions), the
Company (or the surviving entity if the Company is not continuing)
would be able to Incur at least $1.00 of additional Indebtedness
pursuant to Section 303(a), or, in the case of a merger or
consolidation of the Company into or with a wholly owned Restricted
Subsidiary, the Consolidated Interest Coverage Ratio of the surviving
entity would be no less than the Consolidated Interest Coverage Ratio
of the Company immediately prior to such merger or consolidation;
(iv) immediately after giving effect to such transaction or
series of transactions on a pro forma basis (including, without
limitation, any Indebtedness Incurred or anticipated to be Incurred in
connection with such transaction or series of transactions) as if such
transaction had occurred on the first day of the Determination Period,
the Company (or the surviving entity if the Company is not continuing)
shall have a Consolidated Net Worth equal to or greater than the
Consolidated Net Worth of the Company immediately prior to the
transaction or series of transactions;
(v) the Company has delivered to the Trustee an Officer's
Certificate stating that such consideration, merger, sale, conveyance
or transfer and such supplemental indenture comply with this Section
310 and that all conditions precedent herein provided for relating to
such transaction have been complied with; and
(vi) the Trustee shall have received an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, sale,
conveyance or acquisition, and any such assumption, complies with the
provisions of this Section 310.
(b) In case of any such consolidation or merger or such sale,
transfer or conveyance to a Person other than a Restricted Subsidiary
in accordance with Section 310(a) and upon any such assumption by the
successor corporation, such successor corporation shall succeed to and
be substituted for the Company, with the same effect as if it had been
named herein as the Company and the predecessor corporation shall
thereupon be released from all liability with respect to the Notes, the
Indenture and this Supplemental Indenture No. 2. Such successor
corporation thereupon may cause to be signed, and may issue either in
its own name or in the name of Armco Inc., any or all of the Notes
which theretofore shall not have been signed by the Company and
delivered to the Trustee; and, upon the order of such successor
corporation, instead of the Company, and subject to all the terms,
conditions and limitations in this Indenture prescribed, the Trustee
shall authenticate and shall deliver any which previously shall have
been signed and delivered by the officers of the Company to the Trustee
for authentication, and any Notes which such successor corporation
thereafter shall cause to be signed and delivered to the Trustee for
that purpose. All the Notes so issued shall in all respects have the
same
29
legal rank and benefit under the Indenture as the Notes theretofore or
thereafter issued in accordance with the terms of this Indenture as
though all of such Notes had been issued at the date of the execution
hereof.
In case of any such consolidation, merger, sale, transfer or
conveyance such changes in phraseology and form (but not in substance)
may be made in the Notes thereafter to be issued as may be appropriate.
(c) If, upon any such consolidation, merger, sale, transfer or
conveyance or upon any acquisition by the Company by purchase or
otherwise of all or any part of the Property of any other corporation,
any Property of the Company owned immediately prior thereto would
thereupon become subject to any mortgage, lien, pledge, charge or
encumbrance, the Company, prior to such consolidation, merger, sale,
conveyance or acquisition, the Company, (or the surviving entity if the
Company is not continuing) shall secure the Notes (equally and ratably
with any other Indebtedness of the Company then entitled thereto) by a
lien on all such Property of the Company prior to all liens charges and
encumbrances other than any theretofore existing thereon;
(d) The provisions of Article 11 of the Base Indenture are
superseded and of no force or effect with respect to the Notes.
SECTION 311. RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
(a) The Company may designate a Subsidiary (including a newly
formed or newly acquired Subsidiary) of the Company or any of its Restricted
Subsidiaries as an Unrestricted Subsidiary if (i) such Subsidiary has total
assets of $1,000 or less, or (ii) such designation is effective immediately upon
such Person becoming a Subsidiary of either the Company or any of its Restricted
Subsidiaries. Unless so designated as an Unrestricted Subsidiary, any Person
that becomes a Subsidiary of the Company or any of its Restricted Subsidiaries
shall be classified as a Restricted Subsidiary thereof. Except as provided in
clause (i) of the first sentence of this Section 311, no Restricted Subsidiary
may be redesignated as an Unrestricted Subsidiary. Subject to Section 311(b), an
Unrestricted Subsidiary may be redesignated as a Restricted Subsidiary. The
designation of an Unrestricted Subsidiary or the removal of such designation in
compliance with Section 311(b) shall be made by the Board of Directors pursuant
to a Certified Resolution delivered to the Trustee and shall be effective as of
the date specified in the applicable Certified Resolution, which shall not be
prior to the date such Certified Resolution is delivered to the Trustee.
(b) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, take any action or enter into any transaction or
series of transactions that would result in a Person becoming a Restricted
Subsidiary (whether through an acquisition, the redesignation of an Unrestricted
Subsidiary or otherwise) unless, after giving effect to such action, transaction
or series of transactions:
(i) on a pro forma basis, the Company could Incur at least
$1.00 of additional Indebtedness pursuant to Section 303(a);
30
(ii) such Subsidiary could then Incur, pursuant to clauses
(ii), (iii) or (iv) of Section 304(a), all Indebtedness as to which it
is obligated at such time;
(iii) no Default or Event of Default would occur or be
continuing; and
(iv) there exist no Liens with respect to the Property of such
Subsidiary other than Liens permitted to be Incurred under Section 307.
(c) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, take any action or enter into any transaction or
series of transactions that would result in any such Restricted Subsidiary
ceasing to be a Subsidiary (other than a merger or consolidation with the
Company or another Restricted Subsidiary) unless, after giving effect to such
action, transaction or series of transactions, either:
(i) (A) neither the Company nor any of its Affiliates (other
than a Person that is an Affiliate by virtue of its ownership of
Capital Stock or control of the Company) shall own any Capital Stock of
such former Restricted Subsidiary or any successor in interest to the
business thereof, and (B) there shall not exist any Indebtedness of the
former Restricted Subsidiary or any successor in interest to the
business thereof in favor of the Company or any of its Restricted
Subsidiaries; or
(ii) the Company and its Restricted Subsidiaries would be
permitted to make a Restricted Payment in the amount of the aggregate
Investment (excluding (A) any Investment to the extent of cash or the
Fair Market Value of Property other than cash received by the Company
or its Restricted Subsidiary, as the case may be, in respect of or as a
repayment of such Investment, and (B) the amount of Indebtedness of the
former Restricted Subsidiary received by the Company or its Restricted
Subsidiaries as part of the consideration for the acquisition of the
Capital Stock or assets of such former Restricted Subsidiary), if any,
made in the former Restricted Subsidiary after September 12, 1997.
ARTICLE IV.
REDEMPTION
SECTION 401. REDEMPTION OF THE NOTES. Except as provided in
this Article IV and in the Notes, the Notes are not subject to redemption by the
Company.
On or after December 1, 2003, the Notes may, from time to
time, be redeemed, in whole or in part, at the option of the Company upon not
less than 30 nor more than 60 days' prior notice to Holders, at the redemption
prices set forth below (expressed in percentages of the principal amount
thereof), plus accrued and unpaid interest thereon, to the Redemption Date.
31
REDEMPTION PERIOD PERCENTAGE
----------------- ----------
December 1, 2003 to November 30, 2004 104.438%
December 1, 2004 to November 30, 2005 102.958%
December 1, 2005 to November 30, 2006 101.479%
December 1, 2006 and thereafter 100.000%
At any time prior to December 1, 2001 the Company, at its
option, may redeem up to 33 1/3% of the aggregate principal amount of Initial
Notes originally issued and may redeem up to 33 1/3% of the aggregate principal
amount of Exchange Notes originally issued with the net proceeds of one or more
Equity Offerings of the Company at a redemption price equal to 108.875% of the
principal amount thereof, plus accrued and unpaid interest, if any, thereon to
the date of redemption PROVIDED, HOWEVER, that after any such redemption at
least 66 2/3% of the aggregate principal amount of the Initial or Exchange Notes
originally issued by the Company, whether or not on the date hereof or hereafter
(excluding, for purposes hereof, any Notes issued pursuant to Section 305, 309
or 407 of this Supplemental Indenture No. 2 or Section 2.08 or 3.03 of the
Indenture), respectively, remains outstanding. Any such redemption must occur on
or prior to 120 days after the receipt of such net proceeds.
In addition, upon the occurrence of a Change of Control prior
to December 1, 2003, the Company, at its option, may redeem all, but not less
than all, of the outstanding Notes at a redemption price equal to 100% of the
principal amount thereof plus the applicable Make-Whole Premium. The Company
shall give not less than 30 nor more than 60 days' prior notice to Holders of
such redemption within 30 days following the applicable Change of Control.
If less than all of the Notes are to be redeemed, the
selection of the Notes to be redeemed shall be made by the Trustee in accordance
with Section 403. Notice of redemption will be mailed to the Holders, by
first-class mail, at the addresses of such Holders as they appear on the Note
Register.
SECTION 402. NOTICE TO TRUSTEE.
In order to effect any redemption, the Company shall notify
the Trustee of the Redemption Date and the principal amount of Notes to be
redeemed and shall deliver to the Trustee an Officers' Certificate certifying
resolutions of the Board of Directors authorizing the redemption and an Opinion
of Counsel with respect to the due authorization of such redemption and that
such redemption is being made in accordance with the Indenture and the Notes.
The Company shall give the notice provided for in this Section
402 at least 60 days but not more than 90 days before each Redemption Date
(unless a shorter notice period shall be satisfactory to the Trustee).
SECTION 403. SELECTION OF NOTES TO BE REDEEMED.
If less than all the Notes are to be redeemed, the Trustee
shall allocate the total principal amount of Notes to be redeemed on a pro rata
basis, by lot or by such other method as the Trustee deems fair and appropriate
to the Holders.
32
The Trustee shall make the selection not more than 60 days but
not less than 30 days before each Redemption Date from outstanding Notes not
previously called for redemption or submitted for repurchase pursuant to Section
305, 306, or 309.
The Trustee may select for redemption portions (equal to
$1,000 or any integral multiple thereof) of the principal of Notes that have
denominations larger than $1,000. Provisions of this Supplemental Indenture No.
2 that apply to Notes called for redemption shall also apply to portions of
Notes called for redemption. The Trustee shall notify the Company promptly of
the Notes or portions of Notes to be called for redemption.
SECTION 404. NOTICE OF REDEMPTION.
At least 30 but not more than 60 days before a Redemption
Date, the Company shall give 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:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the name and address of the Paying Agent;
(4) that the Notes called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price;
(5) that, unless the Company defaults in making the redemption
payment, interest on the Notes called for redemption ceases to accrue
on and after the specified Redemption Date and the only remaining right
of the Holders is to receive payment of the Redemption Price upon
surrender to the Trustee or the Paying Agent of the Notes; and
(6) if any Note is being redeemed in part, the portion of the
principal amount (equal to $1,000 or any integral multiple thereof) of
such Note to be redeemed and that, on or 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 issued.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by clauses
(1), (2) and (3) above.
SECTION 405. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed (after the Trustee has
received the notice provided for in Section 402), the Notes called for
redemption become due and payable on the Redemption Date and at the Redemption
Price and shall cease to bear interest from and after the Redemption Date
(unless the Company shall fail to make payment of the Redemption Price on
33
the Redemption Date). Upon surrender to the Paying Agent such Notes shall be
paid at the Redemption Price; PROVIDED, HOWEVER, 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 Record
Dates therefor in accordance with the terms of the Notes and the provisions of
Section 2.04 of the Indenture.
SECTION 406. DEPOSIT OF REDEMPTION PRICE.
On or prior to 10:00 a.m., New York City time, on each
Redemption Date, the Company shall deposit with the Trustee or Paying Agent (or
if the Company acts as its own Paying Agent, shall segregate and hold in a
separate trust fund for the sole benefit of the Holders) money, in federal or
other immediately available funds, sufficient to pay the Redemption Price of all
Notes to be redeemed on the Redemption Date other than Notes or portions thereof
called for redemption on that date which have been delivered by the Company to
the Trustee for cancellation.
So long as the Company complies with the preceding paragraph
and the other provisions of this Article, interest on the Notes to be redeemed
on the applicable Redemption Date shall cease to accrue from and after such date
and such Notes or portions thereof shall be deemed not to be entitled to any
benefit under the Indenture except to receive payment of the Redemption Price on
the Redemption Date. If any Note called for redemption shall not be so paid upon
surrender for redemption, then, from the Redemption Date until such principal is
paid, interest shall be paid on the unpaid principal and, to the extent
permitted by law, on any accrued but unpaid interest thereon, in each case at
the rate prescribed therefor by such Notes.
The provisions of Section 12.06 of the Indenture shall apply
to any money held by the Trustee or any Paying Agent under this Article that
remains unclaimed for two years after the Redemption Date for any Notes called
for redemption pursuant to the provisions of this Article.
SECTION 407. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company
shall execute, and the Trustee shall authenticate and deliver, at the expense of
the Company, a new Note equal in principal amount to the unredeemed portion of
the Note surrendered.
SECTION 408. DEFEASANCE.
The defeasance provisions of Article XII of the Indenture
shall be applicable to the Notes.
ARTICLE V.
ADDITIONAL EVENTS OF DEFAULT
SECTION 501. (a) In addition to the Events of Default
specified in clauses (a) - (f) of Section 6.01 of the Indenture, the following
events are Events of Default with respect to the
34
Notes and shall be subject to the procedures and other provisions applicable to
the Events of Default contained in clauses (a) - (f) of such Section 6.01:
(a) a default by the Company or any of its Significant
Restricted Subsidiaries under, any bonds, debentures, mortgages,
indentures, agreements or instruments, under which there may be issued,
or by which there may be secured or evidenced, any indebtedness for
borrowed money of the Company or any Significant Restricted Subsidiary,
whether such indebtedness now exists or shall hereafter be created, and
such indebtedness shall have been accelerated (or shall have matured)
and such indebtedness remains unpaid, PROVIDED that the principal
amount of such indebtedness with respect to which any such default and
acceleration (or maturity) has occurred and is continuing, together
with the principal amount of all other such indebtedness with respect
to which such a default and acceleration (or maturity) has occurred and
is continuing, aggregates $5,000,000 or more; or
(b) the entry by a court of competent jurisdiction of one or
more judgments or orders against the Company or any of its Significant
Restricted Subsidiaries in an uninsured aggregate amount in excess of
$5,000,000 is not discharged, waived, stayed or satisfied for a period
of 60 consecutive days.
ARTICLE VI.
MISCELLANEOUS
SECTION 601. The recitals of fact herein and in the Notes
shall be taken as statements of the Company and shall not be construed as made
by the Trustee.
SECTION 602. THIS SUPPLEMENTAL INDENTURE NO. 2 AND THE NOTES
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.
SECTION 603. In case any one or more of the provisions
contained in this Supplemental Indenture No. 2 or in the Notes should be
invalid, illegal, or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected, impaired, prejudiced or disturbed thereby.
SECTION 604. Wherever in this Supplemental Indenture No. 2 any
of the parties hereto is named or referred to, such reference shall be deemed to
include the successors or assigns of such party, and all the covenants and
agreements in this Supplemental Indenture No. 2 contained by or on behalf of the
Company or the Trustee shall bind and inure to the benefit of the respective
successors and assigns of such parties, whether so expressed or not.
SECTION 604a. For purposes of the Notes and this Supplemental
Indenture No. 2, Section 2.02(a) of the Indenture is amended to read as follows:
"(a) a Certified Resolution, or a Certified Resolution and
Officers' Certificate, setting forth"
35
SECTION 605. (a) This Supplemental Indenture No. 2 may be
simultaneously executed in several counterparts, and all such counterparts
executed and delivered, each as an original, shall constitute but one and the
same instrument.
(b) The descriptive headings of the several Articles of this
Supplemental Indenture No. 2 were formulated, used and inserted in this
Supplemental Indenture No. 2 for convenience only and shall not be deemed to
affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture No. 2 to be duly executed, all as of the day and year
first above written.
STAR BANK, N.A.,
as Trustee
By
----------------------------------------
Name:
Title:
ARMCO INC.
By
-----------------------------------------
Name:
Title:
36
STATE OF )
-------------
: ss:
COUNTY OF )
-----------
On the ____ day of __________, 1998, before me personally came
_____________, to me known, who, being by me duly sworn, did depose and say that
he resides at ___________ ____________________; that he is a __________ of
___________, one of the parties described in and which executed the above
instrument; that he knows the corporate seal of said corporation; that the seal
affixed to the said instrument is such corporate seal; that it was so affixed by
authority of the board of directors of said corporation; and that he signed his
name thereto by like authority.
[NOTARIAL SEAL]
--------------------------------------
NOTARY PUBLIC
37
STATE OF )
-------------
: ss:
COUNTY OF )
-----------
On the ____ day of __________, 1998, before me personally came
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, to me known, who, being by me duly sworn, did depose and say
that he resides at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇; that he is a Vice
President of Armco Inc., one of the parties described in and which executed the
above instrument; that he knows the corporate seal of said corporation; that the
seal affixed to the said instrument is such corporate seal; that it was so
affixed by authority of the board of directors of said corporation; and that he
signed his name thereto by like authority.
[NOTARIAL SEAL]
---------------------------------
NOTARY PUBLIC
38
APPENDIX A
FOR OFFERINGS TO QUALIFIED INSTITUTIONAL BUYERS
PURSUANT TO RULE 144A AND TO CERTAIN PERSONS IN OFFSHORE TRANSACTIONS IN
RELIANCE ON REGULATION S.
PROVISIONS RELATING TO INITIAL NOTES AND EXCHANGE NOTES
1. DEFINITIONS
1.1 DEFINITIONS
Capitalized terms used but not defined herein that are defined
in the Supplemental Indenture to which this Appendix is attached shall have the
meaning ascribed therein to such terms. For the purposes of this Appendix A the
following terms shall have the meanings indicated below:
"Definitive Note" means a certificated Note.
"Depositary" means The Depository Trust Company, its nominees
and their respective successors.
"Initial Purchasers" means ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., ▇▇▇▇▇
Securities Inc. and PNC Capital Markets, Inc.
"Purchase Agreement" means the Purchase Agreement dated
December 10, 1998 among the Company and the Initial Purchasers.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Registered Exchange Offer" means the offer by the Company,
pursuant to the Registration Agreement, to certain Holders of Initial Notes, to
issue and deliver to such Holders, in exchange for the Initial Notes, a like
aggregate principal amount of Exchange Notes registered under the Securities
Act.
"Registration Agreement" means the Registration Agreement
dated December 10, 1998 among the Company and the Initial Purchasers.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Custodian" means the custodian with respect to a
Global Note (as appointed by the Depositary), or any successor person thereto
and shall initially be the Trustee.
"Shelf Registration Statement" means the registration
statement issued by the Company in connection with the offer and sale of Initial
Notes pursuant to the Registration Agreement.
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"Transfer Restricted Notes" means Definitive Notes and Notes
that bear or are required to bear the legend set forth in Section 2.3(e) hereto.
1.2 OTHER DEFINITIONS
TERM DEFINED IN
---- SECTION:
--------
"Agent Members"............................................................................... 2.1(b)
"Cedel Bank".................................................................................. 2.1(a)
"Euroclear"................................................................................... 2.1(a)
"Global Note" ................................................................................ 2.1(a)
"Regulation S"................................................................................ 2.1(a)
"Rule 144A"................................................................................... 2.1(a)
2. THE NOTES
2.1 FORM AND DATING
Initial Notes having an aggregate prinicpal amount of
$75,000,000 (the "Basic Initial Notes") are being offered and sold by the
Company pursuant to the Purchase Agreement. Additional Initial Notes having an
aggregate principal amount of up to $50,000,000 (the "Add-On Additional Notes")
may be offered and sold by the Company pursuant to one or more purchase
agreements ("Add-On Purchase Agreements") having terms substantially similar to
the Purchase Agreement.
(a) GLOBAL NOTES. Initial Notes offered and sold to a QIB in
reliance on Rule 144A under the Securities Act ("Rule 144A") or in reliance on
Regulation S under the Securities Act ("Regulation S"), in each case as provided
in the Purchase Agreement or Add-On Purchase Agreement, shall be issued
initially in the form of one or more permanent global notes in definitive, fully
registered form without interest coupons with the global securities legend and
restricted notes legend set forth in Exhibit 1 hereto (each, a "Global Note"),
which shall be deposited on behalf of the purchasers of the Initial Notes
represented thereby with the Trustee, as custodian for the Depositary (or with
such other custodian as the Depositary may direct) (and, in the case of
Regulation S, for the accounts of designated agents holding on behalf of the
Euroclear System ("Euroclear") or Cedel Bank, societe anonyme ("Cedel Bank")),
and registered in the name of the Depositary or a nominee of the Depositary,
duly executed by the Company and authenticated by the Trustee as provided in the
Indenture. The aggregate principal amount of the Global Notes may from time to
time be increased or decreased by adjustments made on the records of the Trustee
and the Depositary or its nominee as hereinafter provided.
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(b) BOOK-ENTRY PROVISIONS. This Section 2.1(b) shall apply
only to a Global Note deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance
with this Section 2.1(b) and pursuant to an order of the Company, authenticate
and deliver initially one or more Global Notes that (i) shall be registered in
the name of the Depositary for such Global Note or Global Notes or the nominee
of such Depositary and (ii) shall be delivered by the Trustee to such Depositary
or pursuant to such Depositary's instructions or held by the Trustee as
custodian for the Depositary pursuant to a FAST Balance Certificate Agreement
between the Depositary and the Trustee.
Members of, or participants in, the Depositary ("Agent
Members") shall have no rights under this Supplemental Indenture No. 2 with
respect to any Global Note held on their behalf by the Depositary or by the
Trustee as the custodian of the Depositary or under such 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 of such Depositary governing the exercise of
the rights of a holder of a beneficial interest in any Global Note.
(c) DEFINITIVE NOTES. Except as provided in this Section 2.1
or Sections 2.3 or 2.4, owners of beneficial interests in Global Notes will not
be entitled to receive physical delivery of certificated Notes. Upon transfer of
a Definitive Note to a QIB, such Definitive Note will, unless the Global Note
has previously been exchanged, be exchanged for an interest in a Global Note
pursuant to the provisions of Section 2.3.
2.2 AUTHENTICATION. The Trustee shall authenticate and deliver
from time to time: (a) Initial Notes for original issue in an aggregate
principal amount of up to $125,000,000 and (b) Exchange Notes for issue only in
a Registered Exchange Offer pursuant to the Registration Agreement, for a like
principal amount of Initial Notes, in either case, upon a written order of the
Company. Such order shall specify the amount of the Notes to be authenticated
and the date on which the original issue of such amount of Notes is to be
authenticated and whether the Notes are to be Initial Notes or Exchange Notes.
Notes authenticated for original issue on any date and pursuant to any written
order of the Company shall nonetheless have identical terms as, and shall be
fungible with, all other Notes. The aggregate principal amount of Notes
outstanding at any time may not exceed $125,000,000, except as provided in
Section 2.08 of the Indenture. It is understood that as of the date hereof the
Board of Directors has not authorized the issuance of Add-On Initial Notes and
that evidence of appropriate action by the Board of Directors shall be provided
to the Trustee prior to any issuance thereof.
2.3 TRANSFER AND EXCHANGE. (a) TRANSFER AND EXCHANGE OF
DEFINITIVE NOTES. When Definitive Notes are presented to the Debt Security
Registrar with a request to register the transfer of such Definitive Notes or to
exchange such Definitive Notes for an equal principal
A-3
amount of Definitive Notes of other authorized denominations, the Debt Security
Registrar shall register the transfer or make the exchange as requested if the
requirements set forth in the Indenture for such transaction are met; PROVIDED,
HOWEVER, that the Definitive Notes presented or surrendered for registration of
transfer or exchange:
(i) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Company
and the Registrar duly executed by the Holder thereof or his attorney
duly authorized in writing; and
(ii) in the case of Transfer Restricted Notes that are
Definitive Notes, such Notes shall be (A) transferred or exchanged
pursuant to an effective registration statement under the Securities
Act or (B) shall be accompanied by the following additional information
and documents, as applicable:
(1) if such Transfer Restricted Notes are being
delivered to the Debt Security Registrar by a Holder for
registration in the name of such Holder, without transfer, a
certification from such Holder to that effect (in the form set
forth on the reverse of the Notes), (2) if such Transfer
Restricted Notes are being transferred to the Company, a
certification to that effect (in the form set forth on the
reverse of the Notes) or (3) if such Transfer Restricted Notes
are being delivered to the Debt Security Registrar by a Holder
for transfer pursuant to an exemption from registration in
accordance with Rule 144 under the Securities Act, (x) a
certification to that effect (in the form set forth on the
reverse of the Notes) and (y) if the Company so requests,
evidence reasonably satisfactory to it as to the compliance
therewith.
(b) RESTRICTIONS ON TRANSFER OF A DEFINITIVE NOTE FOR A
BENEFICIAL INTEREST IN A GLOBAL NOTE. A Definitive Note may not be exchanged for
a beneficial interest in a Global Note except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive Note,
duly endorsed or accompanied by appropriate instruments or transfer, in form
satisfactory to the Trustee, together with:
(i) in the case of Transfer Restricted Notes that are
Definitive Notes, certification, (in the form set forth on the reverse
of the Note), that such Definitive Note is being transferred (A) to a
QIB in accordance with Rule 144A, or (B) outside the United States in
an offshore transaction within the meaning of Regulation S and in
compliance with Rule 904 under the Securities Act; and
(ii) whether or not such Definitive Security is a Transfer
Restricted Security, written instructions directing the Trustee to
make, or to direct the Securities Custodian to make, an adjustment on
its books and records with respect to such Global Note to reflect an
increase in the aggregate principal amount of the Notes represented by
the Global Note, such instructions to contain information regarding the
Depositary account to be credited with such increase,
A-4
then the Trustee shall cancel such Definitive Note and cause, or direct the
Securities Custodian to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Securities Custodian, the
aggregate principal amount of Notes represented by the Global Note to be
increased by the aggregate principal amount of the Definitive Note to be
exchanged and shall credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in the Global Note equal to
the principal amount of the Definitive Note so canceled. If no Global Notes are
then outstanding and the Global Note has not been previously exchanged pursuant
to Section 2.4, the Company shall issue and the Trustee shall authenticate, upon
written order of the Company in the form of an Officers' Certificate, a new
Global Note in the appropriate principal amount.
(c) TRANSFER AND EXCHANGE OF GLOBAL NOTES. (i) The transfer
and exchange of Global Notes or beneficial interests therein shall be effected
through the Depositary, in accordance with Supplemental Indenture No. 2
(including applicable restrictions on transfer set forth herein, if any) and the
procedures of the Depositary (and Euroclear or Cedel Bank, if applicable)
therefor. A transferor of a beneficial interest in a Global Note shall deliver
to the Debt Security Registrar a written order given in accordance with the
Depositary's procedures (and the procedures of Euroclear or Cedel Bank, if
applicable) containing information regarding the participant account of the
Depositary to be credited with a beneficial interest in the Global Note. The
Debt Security Registrar or Euroclear or Cedel Bank, if applicable, shall, in
accordance with such instructions instruct the Depositary to credit to the
account of the Person specified in such instructions a beneficial interest in
the Global Note and to debit the account of the Person making the transfer the
beneficial interest in the Global Note being transferred.
(ii) Notwithstanding any other provisions of this Appendix A
(other than the provisions set forth in Section 2.4), a Global Note may
not be transferred as a whole except by the Depositary to a nominee of
the Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or any such
nominee to a successor Depositary or a nominee of such successor
Depositary.
(iii) In the event that a Global Note is exchanged for Notes
in definitive registered form pursuant to Section 2.4 prior to the
consummation of a Registered Exchange Offer or the effectiveness of a
Shelf Registration Statement with respect to such Notes, such Notes may
be exchanged only in accordance with such procedures as are
substantially consistent with the provisions of this Section 2.3
(including the certification requirements set forth on the reverse of
the Initial Notes intended to ensure that such transfers comply with
Rule 144A or Regulation S, as the case may be) and such other
procedures as may from time to time be adopted by the Company.
(d) TRANSFER OF A BENEFICIAL INTEREST IN A GLOBAL SECURITY
FOR A DEFINITIVE SECURITY. Subject to Section 2.4 of this Supplemental
Indenture No. 2, any person having a beneficial interest in a Global Security
may upon request exchange such beneficial interest for a Definitive Security.
Upon receipt by the Trustee of written instructions from the Depositary or
its nominee, pursuant to instructions from its direct or indirect
participants or otherwise, and upon receipt by the
A-5
Trustee of a written order of the person designated by the Depositary as
having such a beneficial interest containing registration instructions and,
in the case of a beneficial interest in a Transfer Restricted Security only,
the following additional information and documents:
(i) if such beneficial interest is being transferred to the
person designated by the Depositary as being the beneficial owner, a
certification from such person to that effect (in the form set forth on
the reverse of the Note); or
(ii) if such beneficial interest is being transferred to a QIB
in accordance with Rule 144A or pursuant to an exemption from
registration in accordance with Regulation S or pursuant to an
effective registration statement under the Securities Act, a
certification to that effect from the holder of such beneficial
interest (in the form set forth on the reverse of the Note); or
(iii) if such beneficial interest is being transferred
pursuant to an exemption from registration in accordance with Rule 144
under the Securities Act, a certification to that effect (in the form
set forth on the reverse of the Note) and if the Company so requests,
evidence reasonably satisfactory to it as to compliance with such Rule,
then the Trustee will cause the aggregate principal amount of the Global
Security to be reduced, the Trustee shall promptly notify the Depositary of such
action and, following such reduction, the Company will execute and, upon receipt
of an authentication order in the form of an Officers' Certificate, the Trustee
will authenticate and deliver to the transferee, a Definitive Note.
(e) LEGEND.
(i) Except as permitted by the following paragraphs (ii),
(iii) and (iv), each Note certificate evidencing the Global Notes and
the Notes in certificated form (and all Notes issued in exchange
therefor or in substitution thereof) shall bear a legend in
substantially the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT
THIS SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X)
PRIOR TO THE SECOND ANNIVERSARY OF THE ISSUANCE HEREOF (OR A
PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT WAS AN AFFILIATE
OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE
OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO
LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
RESALE,
A-6
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A
(AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE
OF TRANSFER ON THE REVERSE OF THIS SECURITY), (3) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT
("REGULATION S") (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON
THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (4)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, OR (5)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT
IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
OR (2) A NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING
OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k) (2) OF
RULE 902 UNDER) REGULATION S. THE HOLDER HEREOF BY ITS ACCEPTANCE
HEREOF AGREES TO BE BOUND BY THE PROVISIONS OF THE REGISTRATION
AGREEMENT DATED DECEMBER 10, 1998 RELATING TO THE NOTES."
Each Definitive Note will also bear the following additional
legend:
"IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER
INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO
CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS."
(ii) Upon any sale or transfer of a Transfer Restricted Note
(including any Transfer Restricted Note represented by a Global Note)
pursuant to clause (3), (4) or (5) of the foregoing legend:
(A) in the case of any Transfer Restricted Note that
is a Definitive Note, the Registrar shall permit the Holder
thereof to exchange such Transfer Restricted Note for a
Definitive Note that does not bear the legend set forth above
and rescind any restriction on the transfer of such Transfer
Restricted Note; and
(B) in the case of any Transfer Restricted Note that
is represented by a Global Note, the Registrar shall permit
the Holder thereof to exchange such Transfer Restricted Note
for a Definitive Note that does not bear the legend set forth
above and rescind any restriction on the transfer of such
Transfer Restricted Note,
A-7
in either case, if the Holder certifies in writing to the Registrar
that its request for such exchange was made in reliance on Rule 144 or
Regulation S, if applicable (such certification to be in the form set
forth on the reverse of the Initial Note).
(iii) After a transfer of any Initial Notes during the period
of the effectiveness of a Shelf Registration Statement with respect to
such Initial Notes, all requirements pertaining to legends on such
Initial Note will cease to apply, the requirements requiring any such
Initial Note issued to certain Holders be issued in global form will
cease to apply, and an Initial Note in certificated or global form
without legends will be available to the transferee of the Holder of
such Initial Notes upon exchange of such transferring Holder's
certificated Initial Note. Upon the occurrence of any of the
circumstances described in this paragraph, the Company will deliver an
Officers' Certificate to the Trustee instructing the Trustee to issue
Notes without legends.
(iv) Upon the consummation of a Registered Exchange Offer with
respect to the Initial Notes pursuant to which certain Holders of such
Initial Notes are offered Exchange Notes in exchange for their Initial
Notes, all requirements pertaining to such Initial Notes that Initial
Notes issued to certain Holders be issued in global form will cease to
apply and certificated Initial Notes with the restricted notes legend
set forth in Exhibit 1 hereto will be available to Holders of such
Initial Notes that do not exchange their Initial Notes, and Exchange
Notes in certificated or global form will be available to Holders that
exchange such Initial Notes in such Registered Exchange Offer. Upon the
occurrence of any of the circumstances described in this paragraph, the
Company will deliver an Officers' Certificate to the Trustee
instructing the Trustee to issue Notes without legends.
(e) CANCELLATION OR ADJUSTMENT OF GLOBAL NOTE. At such time as
all beneficial interests in a Global Note have either been exchanged for
certificated or Definitive Notes, redeemed, repurchased or canceled, such Global
Note shall be returned to the Trustee for cancellation or retained and canceled
by the Trustee. At any time prior to such cancellation, if any beneficial
interest in a Global Note is exchanged for certificated or Definitive Notes,
repurchased or canceled, the principal amount of Notes represented by such
Global Note shall be reduced and an adjustment shall be made on the books and
records of the Trustee (if it is then the Securities Custodian for such Global
Note) with respect to such Global Note, by the Trustee or the Securities
Custodian, to reflect such reduction.
(f) OBLIGATIONS WITH RESPECT TO TRANSFERS AND EXCHANGES OF
NOTES.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Notes in
certificated form and Global Notes at the Debt Security Registrar's
request.
(ii) No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any transfer tax, assessments, or similar
governmental charge payable in connection therewith (other than any
such transfer taxes, assessments or similar governmental charge payable
upon exchange or transfer pursuant to Section 3.08).
A-8
(iii) The Debt Security Registrar shall not be required to
register the transfer of or exchange of any Note for a period beginning
15 days before the mailing of a notice of an offer to repurchase Notes
or 15 days before an interest payment date.
(iv) Prior to the due presentation for registration of
transfer of any Note, the Company, the Trustee, the Paying Agent, the
Debt Security Registrar may deem and treat the person in whose name a
Note is registered as the absolute owner of such Note for the purpose
of receiving payment of principal of and interest on such Note and for
all other purposes whatsoever, whether or not such Note is overdue, and
none of the Company, the Trustee, the Paying Agent, the Registrar or
any co-registrar shall be affected by notice to the contrary.
(v) All Notes issued upon any transfer or exchange pursuant to
the terms of this Supplemental Indenture No. 2 shall evidence the same
debt and shall be entitled to the same benefits under this Supplemental
Indenture No. 2 as the Notes surrendered upon such transfer or
exchange.
(g) NO OBLIGATION OF THE TRUSTEE.
(i) The Trustee shall have no responsibility or obligation to
any beneficial owner of a Global Note, a member of, or a participant in
the Depositary or other Person with respect to the accuracy of the
records of the Depositary or its nominee or of any participant or
member thereof, with respect to any ownership interest in the Notes or
with respect to the delivery to any participant, member, beneficial
owner or other Person (other than the Depositary) of any notice
(including any notice of redemption) or the payment of any amount,
under or with respect to such Notes. All notices and communications to
be given to the Holders and all payments to be made to Holders under
the Notes shall be given or made only to the registered Holders (which
shall be the Depositary or its nominee in the case of a Global Note).
The rights of beneficial owners in any Global Note shall be exercised
only through the Depositary subject to the applicable rules and
procedures of the Depositary. The Trustee may rely and shall be fully
protected in relying upon information furnished by the Depositary with
respect to its members, participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under this Supplemental Indenture No. 2 or under applicable law
with respect to any transfer of any interest in any Note (including any
transfers between or among Depositary participants, members or
beneficial owners in any Global Note) other than to require delivery of
such certificates and other documentation or evidence as are expressly
required by, and to do so if and when expressly required by, the terms
of this Supplemental Indenture No. 2, and to examine the same to
determine substantial compliance as to form with the express
requirements hereof.
2.4 CERTIFICATED NOTES
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(a) A Global Note deposited with the Depositary or with the
Trustee as custodian for the Depositary pursuant to Section 2.1 shall be
transferred to the beneficial owners thereof in the form of Notes in
certificated form in an aggregate principal amount equal to the principal amount
of such Global Note, in exchange for such Global Note, only if such transfer
complies with Section 2.3 and (i) the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary for such Global Note or if at any
time such Depositary ceases to be a "clearing agency" registered under the
Exchange Act 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 or (iii) the Company, in its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of Notes in certificated form under
this Supplemental Indenture No. 2.
(b) Any Global Note that is transferable to the beneficial
owners thereof pursuant to this Section 2.4 shall be surrendered by the
Depositary to the Trustee, to be so transferred, in whole or from time to time
in part, without charge, and the Trustee shall authenticate and deliver, upon
such transfer of each portion of such Global Note, an equal aggregate principal
amount of certificated Initial Notes of authorized denominations. Any portion of
a Global Note transferred pursuant to this Section 2.4 shall be executed,
authenticated and delivered only in denominations of $1,000 and any integral
multiple thereof and registered in such names as the Depositary shall direct.
Any certificated Initial Note delivered in exchange for an interest in the
Global Note shall, except as otherwise provided by Section 2.3(d), bear the
restricted notes legend set forth in Exhibit 1 hereto.
(c) Subject to the provisions of Section 2.4(b), 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
Supplemental Indenture No. 2 or the Notes.
(d) In the event of the occurrence of either of the events
specified in Section 2.4(a)(i), (ii) or (iii), the Company will promptly make
available to the Trustee a reasonable supply of Certificated Notes in
definitive, fully registered form without interest coupons.
A-10
EXHIBIT 1 TO APPENDIX A
FORM OF FACE OF INITIAL NOTE
[Global Notes Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Notes Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING
THIS SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT
BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY
OF THE ISSUANCE HEREOF (OR A PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER
THAT WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS
PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE
COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED
BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE
A-1-1
REVERSE OF THIS SECURITY), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
REGULATION S UNDER THE SECURITIES ACT ("REGULATION S") (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, OR (5)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND
AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A OR (2) A NON-U.S. PERSON OUTSIDE THE
UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS
OF PARAGRAPH (k) (2) OF RULE 902 UNDER) REGULATION S. THE HOLDER HEREOF BY ITS
ACCEPTANCE HEREOF AGREES TO BE BOUND BY THE PROVISIONS OF THE REGISTRATION
AGREEMENT DATED DECEMBER 10, 1998 RELATING TO THE NOTES.
A-1-2
REGISTERED REGISTERED
ARMCO INC.
No CUSIP
------ ------------
8 7/8% Senior Note Due 2008
ARMCO INC., a corporation duly organized and existing under
the laws of the State of Ohio (herein referred to as the "Company", which
term includes any successor corporation under the Indenture referred to on
the reverse hereof), for value received, hereby promises to pay to
or registered assigns, the principal sum of
[indicated on Schedule A hereof]* [________________________ Dollars]** on
December 1, 2008, and to pay interest thereon in arrears from the date of
original issuance hereof or from the most recent date to which interest has
been paid or duly provided for, semiannually on June 1 and December 1 (each
hereinafter called an "Interest Payment Date") in each year commencing June
1, 1999 at the rate of 8 7/8% per annum until the principal hereof is paid or
made available for payment.
The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in the Indenture referred to
on the reverse hereof, be paid to the person in whose name this Note is
registered at the close of business on the May 15 or November 15, as the case
may be, next preceding such Interest Payment Date, unless the Company shall
default in the payment of interest due on such Interest Payment Date, in which
case such defaulted interest shall be paid to the person in whose name this Note
is registered at the close of business on a special record date for the payment
of such defaulted interest established by notice to the registered holders of
the Notes not less than ten days preceding such special record date.
Payment of the principal of, premium, if any, and interest on
this Note will be made at the office or agency of the Company maintained for
that purpose in the Borough of Manhattan, City and State of New York, in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts; PROVIDED, HOWEVER, that at
the option of the Company payment of interest may be made by check mailed to the
address of the person entitled thereto as such address shall appear in the Debt
Security Register related to the Notes and PROVIDED, FURTHER, that at the option
of any Holder of Notes, payment of interest to such Holder will be made by wire
transfer to an account designated by such Holder. So long as payments of
interest are made by check or wire transfer, the
------------------------------
* Applicable to Global Notes only.
** Applicable to certificated notes only.
A-1-3
Company need not maintain an office or agency for the payment of interest in the
Borough of Manhattan, City and State of New York.
Reference is made to the further provisions of this Note set
forth on the reverse hereof. Such further provisions shall for all purposes have
the same effect as though fully set forth at this place.
This Note shall not be valid or become obligatory for any
purpose until the certificate of authentication hereon shall have been signed by
the Trustee under the Indenture referred to on the reverse hereof.
IN WITNESS WHEREOF, Armco Inc. has caused this Note to be
signed manually or by facsimile by its Chairman of the Board or its President or
one of its Corporate Vice Presidents and by its Treasurer or one of its
Assistant Treasurers or its Secretary or one of its Assistant Secretaries, and
has caused its corporate seal to be affixed hereunto or imprinted hereon.
Dated:
------------------------------
ARMCO INC.
[SEAL]
Attest: By:
----------------------------- ----------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This Note is one of the Debt Securities described in the
within-mentioned Indenture.
Star Bank, N.A.,
as Trustee
By:
----------------------------------
Authorized Officer
A-1-4
FORM OF REVERSE OF INITIAL NOTE
ARMCO INC.
8 7/8% Senior Note Due 2008
This Note is one of a duly authorized issue of debentures,
notes, bonds or other evidences of indebtedness of the Company (hereinafter
called the "Debt Securities"), of the series hereinafter specified, all issued
or to be issued under an indenture dated as of November 1, 1993, as supplemented
by Supplemental Indenture No. 1 dated as of November 1, 1993 and by Supplemental
Indenture No. 2 dated as of December 15, 1998 ("Supplemental Indenture No. 2")
(together, as so supplemented, the "Indenture"), duly executed and delivered by
the Company to Star Bank, N.A., as trustee (hereinafter called the "Trustee"),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a description of the respective rights and duties thereunder of the
Trustee, the Company and the Holders of the Debt Securities. The Debt Securities
may be issued in one or more series, which different series may be issued in
various aggregate principal amounts, may mature at different times, may bear
interest at different rates (if any) which interest may be payable at different
times, may be subject to different redemption, repurchase or purchase provisions
(if any), may be subject to different sinking or analogous funds, may be subject
to different covenants and Events of Default, may be subject to different
defeasance provisions, and may otherwise vary as in the Indenture provided. This
Note is one of an issue of Debt Securities designated as the "8 7/8%
Notes Due 2008" of the Company (herein called the "Notes") issued under the
Indenture, limited in aggregate principal amount to $125,000,000. Pursuant to a
Registration Agreement dated December 10, 1998, the Company has agreed to use
its best efforts to exchange its 8 7/8% Exchange Notes Due 2008 (the
"Exchange Notes") for a like principal amount of the Notes. The Notes and the
Exchange Notes will be treated for all purposes of the Indenture as one series
of Debt Securities.
On or after December 1, 2003, the Notes may, from time to
time, be redeemed, in whole or in part, at the option of the Company upon not
less than 30 nor more than 60 days' prior notice to Holders, at the redemption
prices set forth below (expressed in percentages of the principal amount
thereof), plus accrued and unpaid interest thereon, to the Redemption Date.
REDEMPTION PERIOD PERCENTAGE
----------------- ----------
December 1, 2003 to November 30, 2004 104.438%
December 1, 2004 to November 30, 2005 102.958%
December 1, 2005 to November 30, 2006 101.479%
December 1, 2006 and thereafter 100.000%
At any time prior to December 1, 2001 the Company, at its
option, may redeem up to 33 1/3% of the aggregate principal amount of Notes
originally issued with the net proceeds from one or more Equity Offerings of the
Company at a redemption price equal to 108.875% of the principal amount thereof,
plus accrued and unpaid interest, if any, thereon to the date of redemption
PROVIDED, HOWEVER, that after any such redemption at least 66 2/3 % of the
aggregate
A-1-5
principal amount of the original issue of the Notes remains outstanding. Any
such redemption must occur on or prior to 120 days after the receipt of such net
proceeds.
In addition, upon the occurrence of a Change of Control prior
to December 1, 2003, the Company, at its option, may redeem all, but not less
than all, of the outstanding Notes at a redemption price equal to 100% of the
principal amount thereof plus the applicable Make-Whole Premium. The Company
shall give not less than 30 nor more than 60 days' prior notice to Holders of
such redemption within 30 days following the applicable Change of Control.
Upon the occurrence of a Change of Control, each Holder shall
have the right to require the Company to repurchase such Holder's Notes, in
whole or in part, in integral multiples of $1,000, pursuant to the Change of
Control Offer described in Section 305 of Supplemental Indenture No. 2 at the
Repurchase Price in cash equal to 101% of the aggregate principal amount
thereof, plus accrued and unpaid interest thereon, if any, to the Change of
Control Payment Date. The Holder's right of repurchase referred to in this
paragraph is as provided in and subject to the terms of the Indenture.
The Indenture contains certain covenants which restrict (among
other things) the ability of the Company and certain of its Subsidiaries to
enter into or permit certain transactions with Affiliates, make certain
Investments, pay dividends, or make other Restricted Payments, Incur
Indebtedness, issue preferred stock of Restricted Subsidiaries, enter into Sale
and Leaseback Transactions, enter into certain Asset Sales, Incur Liens, impose
restrictions on distributions from Restricted Subsidiaries and consummate
mergers or sell, transfer or convey all or substantially all of the Company's
assets.
In case an Event of Default, as defined in the Indenture,
shall have occurred and be continuing, the principal hereof may be declared, and
upon such declaration shall become, due and payable, in the manner, with the
effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and
the Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of Debt Securities at the time outstanding of each
series to be affected, evidenced as in the Indenture provided, from time to time
and at any time to enter into supplemental indentures adding any provisions to
or changing in any manner or eliminating any of the provisions of the Indenture
or of any supplemental indenture or modifying in any manner the rights of the
Holders of the Debt Securities of such series to be affected; PROVIDED, HOWEVER,
that no such supplemental indenture shall (i) extend the fixed maturity of any
Debt Security, or reduce the rate or extend the time of payment of any interest
thereon, or reduce the principal amount thereof or any premium payable upon
redemption thereof, or make the principal thereof or any premium or interest
thereon payable in any coin or currency other than that initially provided for
in such Debt Security, without the consent of the Holder of each Debt Security
so affected, or (ii) reduce the aforesaid percentage of Debt Securities of a
series, the Holders of which are required to consent to any such supplemental
indenture, without the consent of the Holders of all Debt Securities of such
series then outstanding.
A-1-6
No reference herein to the Indenture and no provision of this
Note or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of, premium, if any,
and interest on this Note at the place, at the respective times, at the rate and
in the coin or currency herein prescribed.
The Notes are issuable in registered form without coupons in
denominations of $1,000 and any multiple of $1,000. Notes may be exchanged for a
like aggregate principal amount of Notes of other authorized denominations at
the office or agency of the Company in the Borough of Manhattan, City and State
of New York, and in the manner and subject to the limitations provided in the
Indenture, but without the payment of any service charge.
Upon due presentment for registration of transfer of this Note
at the office or agency of the Company in the Borough of Manhattan, City and
State of New York, the Company shall execute and the Trustee shall authenticate
and deliver a new Note or Notes of like tenor and authorized denominations for
an equal aggregate principal amount in exchange herefor, subject to the
limitations provided in the Indenture, without charge except for any tax or
other governmental charge imposed in connection therewith.
The Company has initially appointed the Trustee as Debt
Security Registrar, paying agent and agent for notice of service and demand in
respect of the Notes. So long as the Trustee continues to serve as the Debt
Security Registrar or a paying agent, payment of principal, premium, if any, and
interest, exchanges and registrations of transfer and tender of Notes for
redemption may be made at the principal corporate trust office of the Trustee in
addition to any other office or agency that the Company is required to maintain
pursuant to the terms of the Indenture or this Note.
The Company, the Trustee, any paying agent and any Debt
Security Registrar in respect of the Notes may deem and treat the registered
holder hereof as the absolute owner of this Note (whether or not this Note shall
be overdue and notwithstanding any notation of ownership or other writing hereon
made by anyone other than the Company or any Debt Security Registrar in respect
of the Notes), for the purpose of receiving payment as provided herein, and for
all other purposes, neither the Company nor the Trustee nor any paying agent nor
any Debt Security Registrar in respect of the Notes shall be affected by any
notice to the contrary. All payments made to or upon the order of such
registered holder shall, to the extent of the sum or sums paid, effectually
satisfy and discharge the liability for moneys payable on this Note.
No recourse for the payment of the principal of or interest on
this Note, or for any claim based hereon or otherwise in respect hereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
the Indenture or any indenture supplemental thereto or in any Note, or because
of the creation of any indebtedness represented thereby, shall be had against
any incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor corporation, either directly or
through the Company or any successor corporation, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issue hereof, expressly waived and released.
A-1-7
THIS NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS
OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF SAID STATE, WITHOUT REFERENCE TO PRINCIPLES OF CONFLICTS OF
LAW.
All terms used in this Note (and not otherwise defined in this
Note) that are defined in the Indenture shall have the meanings assigned to them
in the Indenture.
--------------------------------------------------------------------------------
Certificate of Transfer
(To be executed by the registered holder
if such holder desires to transfer this Note)
__________________
__________________
New York, New York______
FOR VALUE RECEIVED _________________________ hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER TAX
IDENTIFYING NUMBER OF TRANSFEREE
----------------------------------------------
| |
---------------------------------------------- ---------------------------------
--------------------------------------------------------------------------------
(Please print name and address of transferee)
--------------------------------------------------------------------------------
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ___________________________________________
Attorney to transfer this Note on the Debt Security Register relating to this
Note, with full power of substitution.
Dated:
---------------------------- -----------------------------------
Signature
-----------------------------------
Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
A-1-8
ELECTION OF HOLDER TO REQUIRE ▇▇▇▇▇▇▇▇▇▇
▇. Pursuant to Section 305 of Supplemental Indenture
No. 2,
/ / the undersigned hereby elects to have the entire principal amount of
this Note repurchased by the Company.
/ / the undersigned hereby elects to have $_________ of this Note
repurchased by the Company (such specified amount must be in an
integral multiple of $1000).
2. The undersigned hereby directs the Trustee or Paying Agent
to pay it or ___________________________ an amount in cash equal to 101% of the
principal amount specified in paragraph 1 above plus accrued and unpaid interest
hereon, if any, to the Change of Control Payment Date and to deliver to it a new
Note of this series in an aggregate principal amount equal to the untendered
portion, if any, this Note.
Dated:
------------------------- ---------------------------------
Signature
---------------------------------
Signature Guaranteed:
NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
In connection with any transfer of any of the Notes evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act after the later of the date of original issuance
of such Notes and the last date, if any, on which such Notes were owned by the
Company or any Affiliate of the Company, the undersigned confirms that such
Notes are being transferred in accordance with its terms:
[CHECK ONE BOX BELOW]
(1) /_/ to the Company; or
(2) /_/ pursuant to an effective registration statement under the
Securities Act of 1933 (the "Securities Act"); or
(3) /_/ inside the United States to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act
("Rule 144A")) ("QIB") that purchases for its own account
or for the account of a qualified institutional buyer to
whom notice is given that such transfer is being made in
reliance on Rule 144A, in each case pursuant to and in
compliance with Rule 144A; or
A-1-9
(4) /_/ outside the United States in an offshore transaction
within the meaning of Regulation S under the Securities Act
in compliance with Rule 904 under the Securities Act; or
(5) /_/ pursuant to another available exemption from registration
provided by Rule 144 under the Securities Act ("Rule 144").
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Notes evidenced by this certificate in the name of any person other than the
registered holder thereof; PROVIDED, HOWEVER, that if box (5) is checked, the
Trustee may require, prior to registering any such transfer of the Notes, such
certifications and other information as the Company has reasonably requested to
confirm that such transfer is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act.
------------------------------------
Signature
Signature Guarantee:
-------------------------------------- ------------------------------------
Signature must be guaranteed Signature
------------------------------------------------------------ -------------------
A-1-10
TO BE COMPLETED BY PURCHASER IF (3) 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 ("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 the undersigned has requested pursuant to Rule 144A or has
determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Dated:
------------------------------ ------------------------------------
NOTICE: To be executed by an
executive officer
A-1-11
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE A
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE
The initial principal amount at maturity of this Global Note
shall be $ . The following increases or decreases in this Global
Note have been made:
Date of Amount of decrease in Amount of increase in Principal amount of this Signature of authorized
Exchange Principal Amount of this Principal Amount of this Global Note following signatory of Trustee or
Global Note Global Note such decrease or increase Securities Custodian
-------- ------------------------ ------------------------ ------------------------- -----------------------------
A-1-12
EXHIBIT 2 TO APPENDIX A
FORM OF FACE OF EXCHANGE NOTE
[Global Notes Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
REGISTERED REGISTERED
ARMCO INC.
No $
------ ------
8 7/8% Senior Exchange Note Due 2008
ARMCO INC., a corporation duly organized and existing under
the laws of the State of Ohio (herein referred to as the "Company", which
term includes any successor corporation under the Indenture referred to on
the reverse hereof), for value received, hereby promises to pay to________ or
registered assigns, the principal sum of [indicated on Schedule A hereof]*
[_____________________________Dollars]** on December 1, 2008, and to pay
interest thereon in arrears from the date of original issuance hereof or from
the most recent
-----------------------------
* Applicable to Global Notes only.
** Applicable to certificated notes only.
A-2-1
date to which interest has been paid or duly provided for, semiannually on June
1 and December 1 (each hereinafter called an "Interest Payment Date") in each
year commencing June 1, 1999 at the rate of 8 7/8% per annum until the principal
hereof is paid or made available for payment.
The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in the Indenture referred to
on the reverse hereof, be paid to the person in whose name this Note is
registered at the close of business on the May 15 or November 15, as the case
maybe, next preceding such Interest Payment Date, unless the Company shall
default in the payment of interest due on such Interest Payment Date, in which
case such defaulted interest shall be paid to the person in whose name this Note
is registered at the close of business on a special record date for the payment
of such defaulted interest established by notice to the registered holders of
the Notes not less than ten days preceding such special record date.
Payment of the principal of, premium, if any, and interest on
this Note will be made at the office or agency of the Company maintained for
that purpose in the Borough of Manhattan, City and State of New York, in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts; PROVIDED, HOWEVER, that at
the option of the Company payment of interest may be made by check mailed to the
address of the person entitled thereto as such address shall appear in the Debt
Security Register related to the Notes and PROVIDED, FURTHER, that at the option
of any Holder of Notes, payment of interest to such Holder will be made by wire
transfer to an account designated by such Holder. So long as payments of
interest are made by check or wire transfer, the Company need not maintain an
office or agency for the payment of interest in the Borough of Manhattan, City
and State of New York.
Reference is made to the further provisions of this Note set
forth on the reverse hereof. Such further provisions shall for all purposes have
the same effect as though fully set forth at this place.
This Note shall not be valid or become obligatory for any
purpose until the certificate of authentication hereon shall have been signed by
the Trustee under the Indenture referred to on the reverse hereof.
A-2-2
IN WITNESS WHEREOF, Armco Inc. has caused this Note to be
signed manually or by facsimile by its Chairman of the Board or its President or
one of its Corporate Vice Presidents and by its Treasurer or one of its
Assistant Treasurers or its Secretary or one of its Assistant Secretaries, and
has caused its corporate seal to be affixed hereunto or imprinted hereon.
Dated
ARMCO INC.
[SEAL]
Attest: By
--------------------------------
Name:
Title: [Chairman of the Board]
By
Name:
Title: [Treasurer]
FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This Note is one of the Debt Securities described in the
within-mentioned Indenture.
Star Bank, N.A.,
as Trustee
By
--------------------------------
Authorized Officer
A-2-3
FORM OF REVERSE OF EXCHANGE NOTE
ARMCO INC.
8 7/8% Senior Exchange Note Due 2008
This Note is one of a duly authorized issue of debentures,
notes, bonds or other evidences of indebtedness of the Company (hereinafter
called the "Debt Securities"), of the series hereinafter specified, all issued
or to be issued under an indenture dated as of November 1, 1993, as supplemented
by Supplemental Indenture No. 1 dated as of November 1, 1993 and by Supplemental
Indenture No. 2 dated as of December 15, 1998 ("Supplemental Indenture No. 2")
(together, as so supplemented, the "Indenture"), duly executed and delivered by
the Company to Star Bank, N.A., as trustee (hereinafter called the "Trustee"),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a description of the respective rights and duties thereunder of the
Trustee, the Company and the Holders of the Debt Securities. The Debt Securities
may be issued in one or more series, which different series may be issued in
various aggregate principal amounts, may mature at different times, may bear
interest at different rates (if any) which interest may be payable at different
times, may be subject to different redemption, repurchase or purchase provisions
(if any), may be subject to different sinking or analogous funds, may be subject
to different covenants and Events of Default, may be subject to different
defeasance provisions, and may otherwise vary as in the Indenture provided. This
Note is one of an issue of Debt Securities designated as the "8 7/8%
Exchange Notes Due 2008" of the Company (herein called the "Notes") issued under
the Indenture, limited in aggregate principal amount to $125,000,000. The Notes
were originally issued pursuant to an exchange offer for the Company's 8 7/8%,
Notes Due 2008 (the "Initial Notes"). The Notes and the Initial Notes will be
treated for all purposes of the Indenture as one series of Debt Securities.
On or after December 1, 2003, the Notes may, from time to
time, be redeemed, in whole or in part, at the option of the Company upon not
less than 30 nor more than 60 days' prior notice to Holders, at the redemption
prices set forth below (expressed in percentages of the principal amount
thereof), plus accrued and unpaid interest thereon, to the Redemption Date.
REDEMPTION PERIOD PERCENTAGE
----------------- ----------
December 1, 2003 to November 30, 2004 104.438%
December 1, 2004 to November 30, 2005 102.958%
December 1, 2005 to November 30, 2006 101.479%
December 1, 2006 and thereafter 100.000%
At any time prior to December 1, 2001, the Company, at its
option, may redeem up to 33 1/3% of the aggregate principal amount of Notes
originally issued with the net proceeds from one or more Equity Offerings of the
Company at a redemption price equal to 108.875% of the principal amount thereof,
plus accrued and unpaid interest, if any, thereon to the date of redemption
PROVIDED, HOWEVER, that after any such redemption at least 66 2/3% of the
aggregate
A-2-4
principal amount of the original issue of the Notes remains outstanding. Any
such redemption must occur on or prior to 120 days after the receipt of such net
proceeds.
In addition, upon the occurrence of a Change of Control prior
to December 1, 2003, the Company, at its option, may redeem all, but not less
than all, of the outstanding Notes at a redemption price equal to 100% of the
principal amount thereof plus the applicable Make-Whole Premium. The Company
shall give not less than 30 nor more than 60 days' prior notice to Holders of
such redemption within 30 days following the applicable Change of Control.
Upon the occurrence of a Change of Control, each Holder shall
have the right to require the Company to repurchase such Holder's Notes, in
whole or in part, in integral multiples of $1,000, pursuant to the Change of
Control Offer described in Section 305 of Supplemental Indenture No. 2 at the
Repurchase Price in cash equal to 101% of the aggregate principal amount
thereof, plus accrued and unpaid interest thereon, if any, to the Change of
Control Payment Date. The Holder's right of repurchase referred to in this
paragraph is as provided in and subject to the terms of the Indenture.
The Indenture contains certain covenants which restrict (among
other things) the ability of the Company and certain of its Subsidiaries to
enter into or permit certain transactions with Affiliates, make certain
Investments, pay dividends, or make other Restricted Payments, Incur
Indebtedness, issue preferred stock of Restricted Subsidiaries, enter into Sale
and Leaseback Transactions, enter into certain Asset Sales, Incur Liens, impose
restrictions on distributions from Restricted Subsidiaries and consummate
mergers or sell, transfer or convey all or substantially all of the Company's
assets.
In case an Event of Default, as defined in the Indenture,
shall have occurred and be continuing, the principal hereof may be declared, and
upon such declaration shall become, due and payable, in the manner, with the
effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and
the Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of Debt Securities at the time Outstanding of each
series to be affected, evidenced as in the Indenture provided, from time to time
and at any time to enter into supplemental indentures adding any provisions to
or changing in any manner or eliminating any of the provisions of the Indenture
or of any supplemental indenture or modifying in any manner the rights of the
Holders of the Debt Securities of such series to be affected; PROVIDED, HOWEVER,
that no such supplemental indenture shall (i) extend the fixed maturity of any
Debt Security, or reduce the rate or extend the time of payment of any interest
thereon, or reduce the principal amount thereof or any premium payable upon
redemption thereof, or make the principal thereof or any premium or interest
thereon payable in any coin or currency other than that initially provided for
in such Debt Security, without the consent of the Holder of each Debt Security
so affected, or (ii) reduce the aforesaid percentage of Debt Securities of a
series, the Holders of which are required to consent to any such supplemental
indenture, without the consent of the Holders of all Debt Securities of such
series then outstanding.
A-2-5
No reference herein to the Indenture and no provision of this
Note or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of, premium, if any,
and interest on this Note at the place, at the respective times, at the rate and
in the coin or currency herein prescribed.
The Notes are issuable in registered form without coupons in
denominations of $1,000 and any multiple of $1,000. Notes may be exchanged for a
like aggregate principal amount of Notes of other authorized denominations at
the office or agency of the Company in the Borough of Manhattan, City and State
of New York, and in the manner and subject to the limitations provided in the
Indenture, but without the payment of any service charge.
Upon due presentment for registration of transfer of this Note
at the office or agency of the Company in the Borough of Manhattan, City and
State of New York, the Company shall execute and the Trustee shall authenticate
and deliver a new Note or Notes of like tenor and authorized denominations for
an equal aggregate principal amount in exchange herefor, subject to the
limitations provided in the Indenture, without charge except for any tax or
other governmental charge imposed in connection therewith.
The Company has initially appointed the Trustee as Debt
Security Registrar, paying agent and agent for notice of service and demand in
respect of the Notes. So long as the Trustee continues to serve as the Debt
Security Registrar or a paying agent, payment of principal, premium, if any, and
interest, exchanges and registrations of transfer and tender of Notes for
redemption may be made at the principal corporate trust office of the Trustee in
addition to any other office or agency that the Company is required to maintain
pursuant to the terms of the Indenture or this Note.
The Company, the Trustee, any paying agent and any Debt
Security Registrar in respect of the Notes may deem and treat the registered
holder hereof as the absolute owner of this Note (whether or not this Note shall
be overdue and notwithstanding any notation of ownership or other writing hereon
made by anyone other than the Company or any Debt Security Registrar in respect
of the Notes), for the purpose of receiving payment as provided herein, and for
all other purposes neither the Company nor the Trustee nor any paying agent nor
any Debt Security Registrar in respect of the Notes shall be affected by any
notice to the contrary. All payments made to or upon the order of such
registered holder shall, to the extent of the sum or sums paid, effectually
satisfy and discharge the liability for moneys payable on this Note.
No recourse for the payment of the principal of or interest on
this Note, or for any claim based hereon or otherwise in respect hereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
the Indenture or any indenture supplemental thereto or in any Note, or because
of the creation of any indebtedness represented thereby, shall be had against
any incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor corporation, either directly or
through the Company or any successor corporation, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issue hereof, expressly waived and released.
A-2-6
THIS NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS
OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF SAID STATE, WITHOUT REFERENCE TO PRINCIPLES OF CONFLICTS OF
LAW.
All terms used in this Note (and not otherwise defined in this
Note) that are defined in the Indenture shall have the meanings assigned to them
in the Indenture.
--------------------------------------------------------------------------------
Certificate of Transfer
(To be executed by the registered holder
if such holder desires to transfer this Note)
__________________
__________________
New York, New York_____
FOR VALUE RECEIVED _________________________ hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER TAX
IDENTIFYING NUMBER OF TRANSFEREE
----------------------------------------------
| |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please print name and address of transferee)
--------------------------------------------------------------------------------
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ___________________________________________
Attorney to transfer this Note on the Debt Security Register relating to this
Note, with full power of substitution.
Dated:
-------------------------------- ----------------------------------
Signature
----------------------------------
Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
A-2-7
ELECTION OF HOLDER TO REQUIRE ▇▇▇▇▇▇▇▇▇▇
▇. Pursuant to Section 305 of Supplemental Indenture No. 2,
/ / the undersigned hereby elects to have the entire principal amount of
this Note repurchased by the Company.
/ / the undersigned hereby elects to have $_________ of this Note
repurchased by the Company (such specified amount must be in an
integral multiple of $1000).
2. The undersigned hereby directs the Trustee or Paying Agent
to pay it or ___________________________ an amount in cash equal to 101% of the
principal amount specified in paragraph 1 above plus accrued and unpaid interest
hereon, if any, to the Change of Control Payment Date and to deliver to it a new
Note of this series in an aggregate principal amount equal to the untendered
portion, if any, this Note.
Dated:
------------------------------ -----------------------------------
Signature
-----------------------------------
Signature Guaranteed:
NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
A-2-8
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE A
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE
The initial principal amount at maturity of this Global Note
shall be $ . The following increases or decreases in this Global
Note have been made:
Date of Amount of decrease in Amount of increase in Principal amount of this Signature of authorized
Exchange Principal Amount of this Principal Amount of this Global Note following signatory of Trustee or
Global Note Global Note such decrease or increase Securities Custodian
-------- ------------------------ ------------------------ ------------------------- -----------------------
A-2-9