EXHIBIT 7.1
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GERDAU AMERISTEEL CORPORATION
GUSAP PARTNERS,
THE SUBSIDIARY GUARANTORS PARTIES HERETO,
AND
SOUTHTRUST BANK,
AS TRUSTEE
10 3/8% Senior Notes due 2011
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INDENTURE
Dated as of June 27, 2003
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. Definitions................................................................................1
SECTION 1.2. Other Definitions.........................................................................29
SECTION 1.3. Incorporation by Reference of Trust Indenture Act.........................................31
SECTION 1.4. Rules of Construction.....................................................................31
ARTICLE II
THE SECURITIES
SECTION 2.1. Form, Dating and Terms....................................................................32
SECTION 2.2. Execution and Authentication..............................................................40
SECTION 2.3. Registrar and Paying Agent................................................................41
SECTION 2.4. Paying Agent to Hold Money in Trust.......................................................42
SECTION 2.5. Securityholder Lists......................................................................42
SECTION 2.6. Transfer and Exchange.....................................................................42
SECTION 2.7. Form of Certificate to be Delivered in Connection with Transfers to Institutional
Accredited Investors.................................................................45
SECTION 2.8. Form of Certificate to be Delivered in Connection with Transfers Pursuant to
Regulation S.........................................................................48
SECTION 2.9. Mutilated, Destroyed, Lost or Stolen Securities...........................................49
SECTION 2.10. Outstanding Securities...................................................................50
SECTION 2.11. Temporary Securities.....................................................................50
SECTION 2.12. Cancellation.............................................................................50
SECTION 2.13. Payment of Interest; Defaulted Interest..................................................51
SECTION 2.14. Computation of Interest..................................................................52
SECTION 2.15. CUSIP and ISIN Numbers...................................................................52
ARTICLE III
COVENANTS
SECTION 3.1. Payment of Securities.....................................................................52
SECTION 3.2. Limitation on Indebtedness................................................................56
SECTION 3.3. Limitation on Restricted Payments.........................................................60
SECTION 3.4. Limitation on Restrictions on Distributions from Restricted Subsidiaries..................65
SECTION 3.5. Limitation on Sales of Assets and Subsidiary Stock........................................67
SECTION 3.6. Limitation on Liens.......................................................................70
SECTION 3.7. Limitation on Sale/Leaseback Transactions.................................................70
SECTION 3.8. Limitation on Affiliate Transactions......................................................71
SECTION 3.9. Limitation on Sale of Capital Stock of Restricted Subsidiaries............................72
SECTION 3.10. Change of Control........................................................................72
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SECTION 3.11. SEC Reports..............................................................................74
SECTION 3.12. Future Subsidiary Guarantors.............................................................75
SECTION 3.13. Maintenance of Office or Agency..........................................................75
SECTION 3.14. Corporate Existence......................................................................75
SECTION 3.15. Payment of Taxes and Other Claims........................................................76
SECTION 3.16. Payments for Consent.....................................................................76
SECTION 3.17. Compliance Certificate...................................................................76
SECTION 3.18. Further Instruments and Acts.............................................................76
SECTION 3.19. Statement by Officers as to Default......................................................76
SECTION 3.20. Effectiveness of Covenants...............................................................77
ARTICLE IV
SUCCESSOR COMPANY
SECTION 4.1. Merger and Consolidation..................................................................77
ARTICLE V
REDEMPTION OF SECURITIES
SECTION 5.1. Redemption................................................................................79
SECTION 5.2. Applicability of Article..................................................................79
SECTION 5.3. Election to Redeem; Notice to Trustee.....................................................79
SECTION 5.4. Selection by Trustee of Securities to Be Redeemed.........................................79
SECTION 5.5. Notice of Redemption......................................................................80
SECTION 5.6. Deposit of Redemption Price...............................................................81
SECTION 5.7. Securities Payable on Redemption Date.....................................................81
SECTION 5.8. Securities Redeemed in Part...............................................................81
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.1. Events of Default.........................................................................82
SECTION 6.2. Acceleration..............................................................................85
SECTION 6.3. Other Remedies............................................................................85
SECTION 6.4. Waiver of Past Defaults...................................................................85
SECTION 6.5. Control by Majority.......................................................................86
SECTION 6.6. Limitation on Suits.......................................................................86
SECTION 6.7. Rights of Holders to Receive Payment......................................................86
SECTION 6.8. Collection Suit by Trustee................................................................86
SECTION 6.9. Trustee May File Proofs of Claim..........................................................87
SECTION 6.10. Priorities...............................................................................87
SECTION 6.11. Undertaking for Costs....................................................................87
ARTICLE VII
TRUSTEE
SECTION 7.1. Duties of Trustee.........................................................................88
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SECTION 7.2. Rights of Trustee.........................................................................89
SECTION 7.3. Individual Rights of Trustee..............................................................90
SECTION 7.4. Trustee's Disclaimer......................................................................90
SECTION 7.5. Notice of Defaults........................................................................90
SECTION 7.6. Reports by Trustee to Holders.............................................................91
SECTION 7.7. Compensation and Indemnity................................................................91
SECTION 7.8. Replacement of Trustee....................................................................92
SECTION 7.9. Successor Trustee by Merger...............................................................93
SECTION 7.10. Eligibility; Disqualification............................................................93
SECTION 7.11. Preferential Collection of Claims Against Issuers........................................93
SECTION 7.12. Trustee's Application for Instruction from the Issuers...................................93
SECTION 7.13. Paying Agents............................................................................94
ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.1. Discharge of Liability on Securities; Defeasance..........................................94
SECTION 8.2. Conditions to Defeasance..................................................................95
SECTION 8.3. Application of Trust Money................................................................97
SECTION 8.4. Repayment to Issuers......................................................................97
SECTION 8.5. Indemnity for U.S. Government Obligations.................................................97
SECTION 8.6. Reinstatement.............................................................................97
ARTICLE IX
AMENDMENTS
SECTION 9.1. Without Consent of Holders................................................................98
SECTION 9.2. With Consent of Holders...................................................................99
SECTION 9.3. Compliance with Trust Indenture Act......................................................100
SECTION 9.4. Revocation and Effect of Consents and Waivers............................................100
SECTION 9.5. Notation on or Exchange of Securities....................................................100
SECTION 9.6. Trustee To Sign Amendments...............................................................100
ARTICLE X
SUBSIDIARY GUARANTEE
SECTION 10.1. Subsidiary Guarantee....................................................................101
SECTION 10.2. Limitation on Liability; Termination, Release and Discharge.............................103
SECTION 10.3. Right of Contribution...................................................................104
SECTION 10.4. No Subrogation..........................................................................104
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Trust Indenture Act Controls............................................................104
SECTION 11.2. Notices.................................................................................105
SECTION 11.3. Communication by Holders with other Holders.............................................106
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SECTION 11.4. Certificate and Opinion as to Conditions Precedent......................................107
SECTION 11.5. Statements Required in Certificate or Opinion...........................................107
SECTION 11.6. When Securities Disregarded.............................................................107
SECTION 11.7. Rules by Trustee, Paying Agent and Registrar............................................107
SECTION 11.8. Legal Holidays..........................................................................108
SECTION 11.9. GOVERNING LAW...........................................................................108
SECTION 11.10. Judgment Currency......................................................................108
SECTION 11.11. Agent for Service; Submission to Jurisdiction; Waiver of Immunities....................108
SECTION 11.12. Enforceability of Judgments............................................................109
SECTION 11.13. No Recourse Against Others.............................................................109
SECTION 11.14. Successors.............................................................................109
SECTION 11.15. Multiple Originals.....................................................................109
SECTION 11.16. Qualification of Indenture.............................................................109
SECTION 11.17. Table of Contents; Headings............................................................110
SCHEDULE 3.4
SCHEDULE 3.8
EXHIBIT A Form of the Series A Note
EXHIBIT B Form of the Series B Note
EXHIBIT C Form of Indenture Supplement to Add Subsidiary Guarantors
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
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310(a)(1) ............................................................. 7.10
(a)(2) ............................................................. 7.10
(a)(3) ............................................................. N.A.
(a)(4) ............................................................. N.A.
(a)(5) ............................................................. 7.10
(b) ............................................................. 7.8; 7.10
(c) ............................................................. N.A.
311(a) ............................................................. 7.11
(b) ............................................................. 7.11
(c) ............................................................. N.A.
312(a) ............................................................. 2.5
(b) ............................................................. 11.3
(c) ............................................................. 11.3
313(a) ............................................................. 7.6
(b)(1) ............................................................. N.A.
(b)(2) ............................................................. 7.6
(c) ............................................................. 7.6
(d) ............................................................. 7.6
314(a) ............................................................. 3.11; 3.17; 11.5
(b) ............................................................. N.A.
(c)(1) ............................................................. 11.4
(c)(2) ............................................................. 11.4
(c)(3) ............................................................. N.A.
(d) ............................................................. N.A.
(e) ............................................................. 11.5
315(a) ............................................................. 7.1
(b) ............................................................. 7.5; 11.2
(c) ............................................................. 7.1
(d) ............................................................. 7.1
(e) ............................................................. 6.11
316(a)(last sentence) ............................................................. 11.6
(a)(1)(A) ............................................................. 6.5
(a)(1)(B) ............................................................. 6.4
(a)(2) ............................................................. N.A.
(b) ............................................................. 6.7
(c) ............................................................. 6.5
317(a)(1) ............................................................. 6.8
(a)(2) ............................................................. 6.9
(b) ............................................................. 2.4
318(a) ............................................................. 11.1
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of this Indenture.
INDENTURE dated as of June 27, 2003, among GERDAU AMERISTEEL
CORPORATION, an Ontario corporation (the "Company"), and GUSAP Partners, a
Delaware Partnership (together with the Company, the "Issuers"), THE SUBSIDIARY
GUARANTORS (as defined herein) and SOUTHTRUST Bank, a banking corporation
chartered in the State of Alabama (the "Trustee"), as Trustee.
Each party agrees as follows for the benefit of the other
parties and for the equal and ratable benefit of the Holders of (i) the Issuers'
10 3/8% Senior Notes, Series A, due 2011, issued on the date hereof and the
guarantees thereof by certain of the Company's subsidiaries (the "Initial
Securities"), (ii) if and when issued, an unlimited principal amount of
additional 10 3/8% Senior Notes, Series A, due 2011 in a non-registered offering
or 10 3/8% Senior Notes, Series B, due 2011 in a registered offering of the
Issuers that may be offered from time to time subsequent to the Issue Date (the
"Additional Securities") and (iii) if and when issued, the Issuers' 10 3/8%
Senior Notes, Series B, due 2011 and the guarantees thereof by certain of the
Company's subsidiaries that may be issued from time to time in exchange for
Initial Securities or any Additional Securities in an offer registered under the
Securities Act as provided in the Registration Rights Agreement (as hereinafter
defined the "Exchange Securities," and together with the Initial Securities and
Additional Securities, the "Securities").
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. Definitions.
"Acquired Indebtedness" means Indebtedness (i) of a Person or
any of its Subsidiaries existing at the time such Person becomes a Restricted
Subsidiary or (ii) assumed in connection with the acquisition of assets from a
Person, in each case whether or not Incurred by such Person in connection with,
or in anticipation or contemplation of, such Person becoming a Restricted
Subsidiary or such acquisition. Acquired Indebtedness shall be deemed to have
been Incurred, with respect to clause (i) of the preceding sentence, on the date
such Person becomes a Restricted Subsidiary and, with respect to clause (ii) of
the preceding sentence, on the date of consummation of such acquisition of
assets.
"Additional Assets" means:
(1) any property or assets (other than Indebtedness and
Capital Stock) to be used by the Company or a Restricted Subsidiary in
a Related Business;
(2) the Capital Stock of a Person that becomes a Restricted
Subsidiary as a result of the acquisition of such Capital Stock by the
Company or a Restricted Subsidiary;
(3) Capital Stock constituting a minority interest in any
Person that at such time is a Restricted Subsidiary; or
(4) capital expenditures, or commitments to make capital
expenditures, by the Company or its Restricted Subsidiaries;
provided, however, that, in the case of clauses (2) and (3), such Restricted
Subsidiary is primarily engaged in a Related Business.
"Affiliate" of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing;
provided that beneficial ownership of 10% or more of the Voting Stock of a
Person shall be deemed to be control unless another Person (and any other Person
who directly or indirectly controls, is controlled by or is under direct or
indirect common control with such Person) has beneficial ownership of more than
50% of such Voting Stock.
"Asset Disposition" means any direct or indirect sale, lease
(other than an operating lease or sublease entered into in the ordinary course
of business), transfer, conveyance, issuance or other disposition, or a series
of related sales, leases, transfers, conveyances, issuances or dispositions that
are part of a common plan, of shares of Capital Stock of a Subsidiary (other
than directors' qualifying shares), property or other assets (each referred to
for the purposes of this definition as a "disposition") by the Company or any of
its Restricted Subsidiaries, including any disposition by means of a merger,
consolidation or similar transaction.
Notwithstanding the preceding, the following items shall not
be deemed to be Asset Dispositions:
(1) a disposition by a Restricted Subsidiary to the Company or
by the Company or a Restricted Subsidiary to a Wholly-Owned Subsidiary;
provided that in the case of a sale by a Restricted Subsidiary to
another Restricted Subsidiary, the Company directly or indirectly owns
an equal or greater percentage of the Common Stock of the transferee
than of the transferor;
(2) the sale of Cash Equivalents in the ordinary course of
business;
(3) a disposition of inventory in the ordinary course of
business;
(4) a disposition of obsolete, retired or worn out equipment
or equipment that is no longer useful in the conduct of the business of
the Company and its Restricted Subsidiaries and that is disposed of in
each case in the ordinary course of business;
(5) transactions permitted under Section 4.1;
(6) an issuance of Capital Stock by a Restricted Subsidiary to
the Company or to a Wholly-Owned Subsidiary;
(7) for purposes of Section 3.5 only, the making of a
Permitted Investment or a disposition subject to Section 3.3;
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(8) dispositions of assets with an aggregate fair market value
since the Issue Date of less than $10.0 million;
(9) dispositions in connection with Permitted Liens;
(10) dispositions of receivables in connection with the
compromise, settlement or collection thereof in the ordinary course of
business or in bankruptcy or similar proceedings and dispositions of
accounts receivable, chattel paper, intangibles, documents, or other
instruments pursuant to bona fide factoring arrangements;
(11) the licensing or sublicensing of intellectual property or
other general intangibles and licenses, leases or subleases of other
property in the ordinary course of business which do not materially
interfere with the business of the Company and its Restricted
Subsidiaries; and
(12) foreclosure on assets.
"Attributable Indebtedness" in respect of a Sale/Leaseback
Transaction means, as at the time of determination, the present value
(discounted at the interest rate borne by the Securities, compounded
semi-annually) of the total obligations of the lessee for rental payments during
the remaining term of the lease included in such Sale/Leaseback Transaction
(including any period for which such lease has been extended).
"Average Life" means, as of the date of determination, with
respect to any Indebtedness or Preferred Stock, the quotient obtained by
dividing (1) the sum of the products of the numbers of years from the date of
determination to the dates of each successive scheduled principal payment of
such Indebtedness or redemption or similar payment with respect to such
Preferred Stock multiplied by the amount of such payment by (2) the sum of all
such payments.
"Bankruptcy Law" means Title 11 of the United States Code or
any similar federal or state law for the relief of debtors.
"Board of Directors" means, as to any Person, the board of
directors of such Person (or if such Person is a partnership, the Board of
Directors or other governing body of the general partner of such partnership) or
any duly authorized committee thereof.
"Borrowing Base" means, as of the date of determination, an
amount equal to the sum, without duplication of (1) 85% of the net book value of
the Company's and its Restricted Subsidiaries' accounts receivable at such date
and (2) 65% of the net book value of the Company's and its Restricted
Subsidiaries' inventories at such date, until March 30, 2004, and thereafter the
lesser of (A) 65% of the net book value and (B) 85% of the appraised net
recovery value of the Company's and its Restricted Subsidiaries' inventories at
such date. Net book value shall be determined in accordance with GAAP and shall
be that reflected on the most recent available balance sheet (it being
understood that the accounts receivable and inventories of an acquired business
may be included if such acquisition has been completed on or prior to the date
of determination).
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"Business Day" means each day that is not a Saturday, Sunday
or other day on which banking institutions in New York, New York and Birmingham,
Alabama are authorized or required by law to close.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participation or other
equivalents of or interests in (however designated and whether voting or
non-voting) equity of such Person, including any Preferred Stock, but excluding
any debt securities convertible into such equity.
"Capitalized Lease Obligations" means an obligation that is
required to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation will be the capitalized amount of such obligation
at the time any determination thereof is to be made as determined in accordance
with GAAP, and the Stated Maturity thereof will be the date of the last payment
of rent or any other amount due under such lease prior to the first date such
lease may be terminated or prepaid by the lessee without penalty.
"Cash Equivalents" means:
(1) U.S. dollars, Canadian dollars, euros or such other local
currencies held by the Company or any of its Subsidiaries from time to
time in the ordinary course;
(2) securities issued or directly and fully guaranteed or
insured by the United States Government or the Canadian Government or
any agency or instrumentality of the United States or Canada (provided
that the full faith and credit of the United States or Canada is
pledged in support thereof), having maturities of not more than one
year from the date of acquisition;
(3) certificates of deposit, time deposits, eurodollar time
deposits, overnight bank deposits or bankers' acceptances having
maturities of not more than one year from the date of acquisition
thereof issued by any commercial bank the long-term debt of which is
rated at the time of acquisition thereof at least "A" or the equivalent
thereof by Standard & Poor's Ratings Services, or "A" or the equivalent
thereof by ▇▇▇▇▇'▇ Investors Service, Inc., and having combined capital
and surplus in excess of $500 million;
(4) repurchase obligations with a term of not more than 30
days for underlying securities of the types described in clauses (1),
(2) and (3) entered into with any bank meeting the qualifications
specified in clause (3) above;
(5) commercial paper rated at the time of acquisition thereof
at least "A-2" or the equivalent thereof by Standard & Poor's Ratings
Services or "P-2" or the equivalent thereof by ▇▇▇▇▇'▇ Investors
Service, Inc., or carrying an equivalent rating by a nationally
recognized rating agency, if both of the two named rating agencies
cease publishing ratings of investments, and in any case maturing
within one year after the date of acquisition thereof; and
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(6) interests in any investment company or money market fund
which invests 95% or more of its assets in instruments of the type
specified in clauses (1) through (6) above.
"Change of Control" means:
(1) (A) any "person" or "group" of related persons (as such
terms are used in Sections 13(d) and 14(d) of the Exchange Act), other
than one or more Permitted Holders, is or becomes the beneficial owner
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except
that for the purpose of this clause such person or group shall be
deemed to have "beneficial ownership" of all shares that any such
person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 35% of the total voting power of the Voting
Stock of the Company (or its successor by merger, consolidation or
purchase of all or substantially all of its assets) (for the purposes
of this clause, such person or group shall be deemed to beneficially
own any Voting Stock of the Company held by a parent entity, if such
person or group "beneficially owns" (as defined above), directly or
indirectly, more than 35% of the voting power of the Voting Stock of
such parent entity) and (B) the Permitted Holders "beneficially own"
(as defined in Rules 13d-3 and 13d-5 of the Exchange Act), directly or
indirectly, in the aggregate a lesser percentage of the total voting
power of the Voting Stock of the Company (or its successor by merger,
consolidation or purchase of all or substantially all of its assets)
than such other person or group and do not have the right or ability by
voting power, contract or otherwise to elect or designate for election
a majority of the board of directors of the Company or such successor
(for the purposes of this clause, such other person or group shall be
deemed to beneficially own any Voting Stock of a specified entity held
by a parent entity, if such other person or group "beneficially owns"
directly or indirectly, more than 35% of the voting power of the Voting
Stock of such parent entity and the Permitted Holders "beneficially
own" directly or indirectly, in the aggregate a lesser percentage of
the voting power of the Voting Stock of such parent entity and do not
have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the board of directors of
such parent entity); or
(2) during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of Directors
of the Company (together with any new directors whose election by such
Board of Directors of the Company or whose nomination for election by
the shareholders of the Company was approved by a vote of a majority of
the directors of the Company 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 Board of Directors of the
Company then in office;
(3) the sale, lease, transfer, conveyance or other disposition
(other than by way of merger, amalgamation or consolidation), in one or
a series of related transactions, of all or substantially all of the
assets of the Company and its Restricted Subsidiaries taken as a whole
to any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act) other than a Permitted Holder; or
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(4) the adoption by the stockholders of the Company of a plan
or proposal for the liquidation or dissolution of the Company.
"Clearstream" means Clearstream Banking, societe anonyme, or
any successor securities clearing agency.
"Code" means the Internal Revenue Code of 1986, as amended.
"Common Stock" means with respect to any Person, any and all
shares, interest or other participations in, and other equivalents (however
designated and whether voting or nonvoting) of such Person's common stock
whether or not outstanding on the Issue Date, and includes, without limitation,
all series and classes of such common stock.
"Company" means Gerdau Ameristeel Corporation or its
successors and assigns.
"Consolidated Coverage Ratio" means as of any date of
determination, with respect to any Person, the ratio of (x) the aggregate amount
of Consolidated EBITDA of such Person for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such determination for
which financial statements are in existence (the "Four-Quarter Period") to (y)
Consolidated Interest Expense for such Four-Quarter Period, provided, however,
that:
(1) if the Company or any Restricted Subsidiary:
(a) has Incurred any Indebtedness since the beginning of such
Four-Quarter Period that remains outstanding on such date of
determination or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio is an Incurrence of
Indebtedness, Consolidated EBITDA and Consolidated Interest
Expense for such period will be calculated after giving pro
forma effect to such Indebtedness as if such Indebtedness had
been Incurred on the first day of such Four-Quarter Period
(except that in making such computation, the amount of
Indebtedness under any revolving credit facility outstanding
on the date of such calculation will be deemed to be (i) the
average daily balance of such Indebtedness during such
Four-Quarter Period or such shorter period for which such
facility was outstanding or (ii) if such facility was created
after the end of such Four-Quarter Period, the average daily
balance of such Indebtedness during the period from the date
of creation of such facility to the date of such calculation)
and the discharge of any other Indebtedness repaid,
repurchased, defeased or otherwise discharged with the
proceeds of such new Indebtedness as if such discharge had
occurred on the first day of such Four-Quarter Period; or
(b) has repaid, repurchased, defeased or otherwise discharged any
Indebtedness since the beginning of the Four-Quarter Period
that is no longer outstanding on such date of determination or
if the transaction giving rise to the need to calculate the
Consolidated Coverage Ratio involves a discharge of
Indebtedness (in each case other than Indebtedness Incurred
under any revolving credit facility unless such Indebtedness
has
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been permanently repaid and the related commitment
terminated), Consolidated EBITDA and Consolidated Interest
Expense for such period will be calculated after giving pro
forma effect to such discharge of such Indebtedness, including
with the proceeds of such new Indebtedness, as if such
discharge had occurred on the first day of such Four-Quarter
Period;
(2) if since the beginning of such Four-Quarter Period the
Company or any Restricted Subsidiary will have made any Asset
Disposition or disposed of any company, division, operating unit,
segment, business, group of related assets or line of business or if
the transaction giving rise to the need to calculate the Consolidated
Coverage Ratio is such an Asset Disposition:
(a) the Consolidated EBITDA for such Four-Quarter Period will be
reduced by an amount equal to the Consolidated EBITDA (if
positive) directly attributable to the assets which are the
subject of such Asset Disposition for such period or increased
by an amount equal to the Consolidated EBITDA (if negative)
directly attributable thereto for such Four-Quarter Period;
and
(b) Consolidated Interest Expense for such Four-Quarter Period
will be reduced by an amount equal to the Consolidated
Interest Expense directly attributable to any Indebtedness of
the Company or any Restricted Subsidiary repaid, repurchased,
defeased or otherwise discharged with respect to the Company
and its continuing Restricted Subsidiaries in connection with
such Asset Disposition for such Four-Quarter Period (or, if
the Capital Stock of any Restricted Subsidiary is sold, the
Consolidated Interest Expense for such period directly
attributable to the Indebtedness of such Restricted Subsidiary
to the extent the Company and its continuing Restricted
Subsidiaries are no longer liable for such Indebtedness after
such sale);
(3) if since the beginning of such Four-Quarter Period the
Company or any Restricted Subsidiary (by merger or otherwise) will have
made an Investment in any Restricted Subsidiary (or any Person which
becomes a Restricted Subsidiary or is merged, consolidated or
amalgamated with or into the Company or a Restricted Subsidiary) or an
acquisition of assets, including any acquisition of assets occurring in
connection with a transaction causing a calculation to be made
hereunder, which constitutes all or substantially all of a company,
division, operating unit, segment, business, group of related assets or
line of business, Consolidated EBITDA and Consolidated Interest Expense
for such Four-Quarter Period will be calculated after giving pro forma
effect thereto (including the Incurrence of any Indebtedness) as if
such Investment or acquisition occurred on the first day of such
Four-Quarter Period; and
(4) if since the beginning of such Four-Quarter Period any
Person (that subsequently became a Restricted Subsidiary or was merged
with or into the Company or any Restricted Subsidiary since the
beginning of such Four-Quarter Period) will have Incurred any
Indebtedness or discharged any Indebtedness, made any Asset Disposition
7
or any Investment or acquisition of assets that would have required an
adjustment pursuant to clause (2) or (3) above if made by the Company
or a Restricted Subsidiary during such Four-Quarter Period,
Consolidated EBITDA and Consolidated Interest Expense for such period
will be calculated after giving pro forma effect thereto as if such
Asset Disposition or Investment or acquisition of assets occurred on
the first day of such Four Quarter Period.
For purposes of this definition, whenever pro forma effect is
to be given to any calculation under this definition, the pro forma calculations
will be determined in good faith by a responsible financial or accounting
officer of the Company (including pro forma expense and cost reductions
calculated on a basis consistent with Regulation S-X under the Securities Act).
If any Indebtedness bears a floating rate of interest and is being given pro
forma effect, the interest expense on such Indebtedness will be calculated as if
the rate in effect on the date of determination had been the applicable rate for
the entire Four-Quarter Period (taking into account any Interest Rate Agreement
applicable to such Indebtedness if such Interest Rate Agreement has a remaining
term in excess of 12 months). If any Indebtedness that is being given pro forma
effect bears an interest rate at the option of the Company, the interest rate
shall be calculated by applying such optional rate chosen by the Company.
"Consolidated EBITDA" for any period means, without
duplication, the Consolidated Net Income for such period, plus the following to
the extent deducted in calculating such Consolidated Net Income:
(1) Consolidated Interest Expense;
(2) Consolidated Income Taxes;
(3) consolidated depreciation expense;
(4) consolidated amortization expense or impairment charges
recorded in connection with the application of Financial Accounting
Standard No. 142 "Goodwill and Other Intangibles";
(5) other non-cash charges reducing Consolidated Net Income
(excluding any such non-cash charge to the extent it represents an
accrual of or reserve for cash charges in any future period or
amortization of a prepaid cash expense that was paid in a prior period
not included in the calculation); and
(6) any cash restructuring charges not to exceed $5.0 million
from the Issue Date, including any one-time costs incurred in
connection with acquisitions or restructurings consummated after the
Issue Date (which cash charges shall only be included in calculations
of Consolidated EBITDA for the quarter such charge is incurred and the
succeeding three fiscal quarters).
Notwithstanding the preceding sentence, clauses (2) through
(6) relating to amounts of a Restricted Subsidiary of a Person will be added to
Consolidated Net Income to compute Consolidated EBITDA of such Person only to
the extent (and in the same proportion) that the net income (loss) of such
Restricted Subsidiary was included in calculating the
8
Consolidated Net Income of such Person and, to the extent the amounts set forth
in clauses (2) through (6) are in excess of those necessary to offset a net loss
of such Restricted Subsidiary or if such Restricted Subsidiary has net income
for such period included in Consolidated Net Income, only if a corresponding
amount would be permitted at the date of determination to be dividended to the
Company by such Restricted Subsidiary without prior approval (that has not been
obtained), pursuant to the terms of its charter and all agreements, instruments,
judgments, decrees, orders, statutes, rules and governmental regulations
applicable to that Restricted Subsidiary or its stockholders.
"Consolidated Income Taxes" means, with respect to any Person
for any period, taxes imposed upon such Person or other payments required to be
made by such Person by any governmental authority which taxes or other payments
are calculated by reference to the income or profits of such Person or such
Person and its Restricted Subsidiaries (to the extent such income or profits
were included in computing Consolidated Net Income for such period), regardless
of whether such taxes or payments are required to be remitted to any
governmental authority.
"Consolidated Interest Expense" means, for any period, the
total interest expense of the Company and its consolidated Restricted
Subsidiaries, whether paid or accrued, plus, to the extent not included in such
interest expense:
(1) interest expense attributable to Capitalized Lease
Obligations and the interest portion of rent expense associated with
Attributable Indebtedness in respect of the relevant lease giving rise
thereto, determined as if such lease were a capitalized lease in
accordance with GAAP and the interest component of any deferred payment
obligations;
(2) amortization or write-offs of debt discount and debt
issuance cost (provided that any amortization of bond premium will be
credited to reduce Consolidated Interest Expense unless, pursuant to
GAAP, such amortization of bond premium has otherwise reduced
Consolidated Interest Expense);
(3) non-cash interest expense;
(4) commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing;
(5) the interest expense on Indebtedness of another Person
that is Guaranteed by such Person or one of its Restricted Subsidiaries
or secured by a Lien on assets of such Person or one of its Restricted
Subsidiaries;
(6) net costs associated with Hedging Obligations (including
amortization of fees) provided, however, that if Hedging Obligations
result in net benefits rather than net costs, such benefits shall be
credited to reduce Consolidated Interest Expense unless, pursuant to
GAAP, such net benefits are otherwise reflected in Consolidated Net
Income;
(7) the consolidated interest expense of such Person and its
Restricted Subsidiaries that was capitalized during such period;
9
(8) the product of (a) all dividends paid or payable, in cash,
Cash Equivalents or Indebtedness or accrued during such period on any
series of Disqualified Stock of such Person or on Preferred Stock of
its Restricted Subsidiaries payable to a party other than the Company
or a Wholly-Owned Subsidiary, times (b) a fraction, the numerator of
which is one and the denominator of which is one minus the then current
combined federal, state, provincial and local statutory tax rate of
such Person, expressed as a decimal, in each case, on a consolidated
basis and in accordance with GAAP;
(9) Receivables Fees; and
(10) the cash contributions to any employee stock ownership
plan or similar trust to the extent such contributions are used by such
plan or trust to pay interest or fees to any Person (other than the
Company) in connection with Indebtedness Incurred by such plan or
trust.
For the purpose of calculating Consolidated Interest Expense
with respect to the fiscal quarter in which the Issue Date occurs and the first
fiscal quarter after the Issue Date, any one-time expenses (including non-cash
charges) not to exceed $8.0 million relating to the termination of any Interest
Rate Agreement or the write-off of deferred financing costs in connection with
the Transactions shall be excluded, provided that such amounts will not be
included in the calculation of Consolidated EBITDA. Additionally, for the
purpose of calculating the Consolidated Coverage Ratio in connection with the
Incurrence of any Indebtedness described in the final paragraph of the
definition of "Indebtedness", the calculation of Consolidated Interest Expense
shall include all interest expense (including any amounts described in clauses
(1) through (10) above) relating to any Indebtedness of the Company or any
Restricted Subsidiary described in the final paragraph of the definition of
"Indebtedness".
For purposes of the foregoing, total interest expense will be
determined (i) after giving effect to any net payments made or received by the
Company and its Subsidiaries with respect to Interest Rate Agreements and (ii)
exclusive of amounts classified as other comprehensive income in the balance
sheet of the Company. Notwithstanding anything to the contrary contained herein,
commissions, discounts, yield and other fees and charges Incurred in connection
with any transaction pursuant to which the Company or its Restricted
Subsidiaries may sell, convey or otherwise transfer or grant a security interest
in any accounts receivable or related assets shall be included in Consolidated
Interest Expense.
"Consolidated Net Income" means, for any period, the net
income (loss) of the Company and its consolidated Restricted Subsidiaries
determined in accordance with GAAP; provided, however, that there will not be
included in such Consolidated Net Income:
(1) any net income (loss) of any Person (other than the
Company) if such Person is not a Restricted Subsidiary, except that:
(a) subject to the limitations contained in clauses (3),
(4) and (5) below, the Company's or a Restricted
Subsidiary's equity in the net income of any such
Person for such period will be included in such
Consolidated Net Income up to the aggregate amount of
cash actually distributed by such
10
Person to the Company or a Restricted Subsidiary as a
dividend or other distribution (subject, in the case
of a dividend or other distribution to a Restricted
Subsidiary, to the limitations contained in clause
(2) below); provided that such cash dividend or other
distribution relates to the net income of such Person
for such fiscal year or net income of such Person for
the fiscal year that commenced no earlier than 24
months prior to such cash dividend or distribution;
and
(b) the Company's equity in a net loss of any such Person
(other than an Unrestricted Subsidiary) for such
period will be included in determining such
Consolidated Net Income to the extent such loss has
been funded with cash from the Company or a
Restricted Subsidiary;
(2) any net income (but not loss) of any Restricted Subsidiary
if such Restricted Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of distributions
by such Restricted Subsidiary, directly or indirectly, to the Company,
except that:
(a) subject to the limitations contained in clauses (3),
(4) and (5) below, the Company's equity in the net
income of any such Restricted Subsidiary for such
period will be included in such Consolidated Net
Income up to the aggregate amount of cash that could
have been distributed by such Restricted Subsidiary
during such period to the Company or another
Restricted Subsidiary as a dividend (subject, in the
case of a dividend to another Restricted Subsidiary,
to the limitation contained in this clause); and
(b) the Company's equity in a net loss of any such
Restricted Subsidiary for such period will be
included in determining such Consolidated Net Income;
(3) any gain (loss) realized upon the sale or other
disposition of any property, plant or equipment of the Company or its
consolidated Restricted Subsidiaries (including pursuant to any
Sale/Leaseback Transaction) which is not sold or otherwise disposed of
in the ordinary course of business and any gain (loss) realized upon
the sale or other disposition of any Capital Stock of any Person;
(4) any extraordinary gain or loss; and
(5) the cumulative effect of a change in accounting
principles.
"Credit Facility" means, with respect to the Company or any
Subsidiary Guarantor, one or more debt facilities (including, without
limitation, the Senior Secured Credit Agreement) or commercial paper facilities
with banks or other institutional lenders providing for revolving credit loans,
term loans, receivables financing (including through the sale of receivables to
such lenders or to special purpose entities formed to borrow from such lenders
against such receivables) or letters of credit, in each case, as amended,
restated, modified, renewed, refunded, replaced or refinanced in whole or in
part from time to time (and whether or
11
not with the original administrative agent and lenders or another administrative
agent or agents or other lenders and whether provided under the original Senior
Secured Credit Agreement or any other credit or other agreement or indenture).
"Currency Agreement" means in respect of a Person any foreign
exchange contract, currency swap agreement, futures contract, option contract or
other similar agreement as to which such Person is a party or a beneficiary.
"Custodian" means any receiver, trustee, assignee, liquidator,
custodian or similar official under any Bankruptcy Law.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Definitive Securities" means certificated Securities.
"Disqualified Stock" means, with respect to any Person, any
Capital Stock of such Person which by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable) or upon the
happening of any event:
(1) matures or is mandatorily redeemable pursuant to a sinking
fund obligation or otherwise;
(2) is convertible or exchangeable for Indebtedness or
Disqualified Stock (excluding Capital Stock which is convertible or
exchangeable solely at the option of the Company or a Restricted
Subsidiary); or
(3) is redeemable at the option of the holder of the Capital
Stock in whole or in part,
in each case on or prior to the date that is 91 days after the earlier of the
date (a) of the Stated Maturity of the Securities or (b) on which there are no
Securities outstanding, provided that only the portion of Capital Stock which so
matures or is mandatorily redeemable, is so convertible or exchangeable or is so
redeemable at the option of the holder thereof prior to such date will be deemed
to be Disqualified Stock; provided, further that any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof have the right
to require the Company to repurchase such Capital Stock upon the occurrence of a
change of control or asset sale (each defined in a substantially identical
manner to the corresponding definitions in this Indenture) shall not constitute
Disqualified Stock if the terms of such Capital Stock (and all such securities
into which it is convertible or for which it is ratable or exchangeable) provide
that the Company may not repurchase or redeem any such Capital Stock (and all
such securities into which it is convertible or for which it is ratable or
exchangeable) pursuant to such provision prior to compliance by the Company with
the provisions of this Indenture described under Sections 3.10 and 3.5 and such
repurchase or redemption complies with Section 3.3.
"DTC" means The Depository Trust Company, its nominees and
their respective successors and assigns, or such other depository institution
hereinafter appointed by the Issuers.
12
"Earn-Out Payment" means any contingent consideration based on
future operating or other performance relating to an Investment of the type
described in clause (1) or (2) of the definition "Permitted Investment,"
following the consummation of such Investment, based on criteria set forth in
the documentation governing or relating to the Investment.
"Equity Offering" means an offering for cash by the Company of
its Common Stock, or options, warrants or rights with respect to its Common
Stock, other than public offerings with respect to the Company's Common Stock,
or options, warrants or rights, registered on Form F-4.
"Euroclear" means Euroclear Bank S.A./N.V. or any successor
securities clearing agency.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
"Exchange Securities" has the meaning ascribed to it in the
second introductory paragraph of this Indenture.
"Fiscal Year" means the fiscal year of the Company ending on
December 31 of each year.
"GAAP" means generally accepted accounting principles in the
United States of America as in effect as of the date of this Indenture,
including those set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as approved by a significant segment
of the accounting profession. All ratios and computations based on GAAP
contained in this Indenture will be computed in conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness of any other
Person and any obligation, direct or indirect, contingent or otherwise, of such
Person:
(1) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness of such other Person (whether
arising by virtue of partnership arrangements, or by agreement to
keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or
otherwise); or
(2) entered into for purposes of assuring in any other manner
the obligee of such Indebtedness of the payment thereof or to protect
such obligee against loss in respect thereof (in whole or in part);
provided, however, that the term "Guarantee" will not include
endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding
meaning.
"Guarantor Subordinated Obligation" means, with respect to a
Subsidiary Guarantor, any Indebtedness of such Subsidiary Guarantor (whether
outstanding on the Issue
13
Date or thereafter Incurred) which is expressly subordinate in right of payment
to the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee
pursuant to a written agreement.
"Hedging Obligations" of any Person means the obligations of
such Person pursuant to any Interest Rate Agreement or Currency Agreement.
"Holder" or "Securityholder" means the Person in whose name a
Security is registered in the Securities Register.
"IAI" means an institutional "accredited investor" as
described in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
"Incur" means issue, create, assume, Guarantee, incur or
otherwise become liable for; provided, however, that any Indebtedness or Capital
Stock of a Person existing at the time such Person becomes a Restricted
Subsidiary (whether by merger, consolidation, amalgamation, acquisition or
otherwise) will be deemed to be Incurred by such Person at the time it becomes a
Restricted Subsidiary; and the terms "Incurred" and "Incurrence" have meanings
correlative to the foregoing.
"Indebtedness" means, with respect to any Person on any date
of determination (without duplication):
(1) the principal of and premium (if any) in respect of
indebtedness of such Person for borrowed money;
(2) the principal of and premium (if any) in respect of
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;
(3) the principal component of all obligations of such Person
in respect of letters of credit, bankers' acceptances or other similar
instruments (including reimbursement obligations with respect thereto
except to the extent such reimbursement obligation relates to a trade
payable and such obligation is satisfied within 30 days of Incurrence);
(4) the principal component of all obligations of such Person
to pay the deferred and unpaid purchase price of property or services
(except trade payables and accrued expenses), which purchase price is
due more than six months after the date of placing such property in
service or taking delivery and title thereto;
(5) Capitalized Lease Obligations and all Attributable
Indebtedness of such Person;
(6) the principal component or liquidation preference of all
obligations of such Person with respect to the redemption, repayment or
other repurchase of any Disqualified Stock or, with respect to any
Subsidiary, other than Subsidiary Guarantors and GUSAP Partners, any
Preferred Stock;
14
(7) the principal component of all Indebtedness of other
Persons secured by a Lien on any asset of such Person, whether or not
such Indebtedness is assumed by such Person; provided, however, that
the amount of such Indebtedness will be the lesser of (a) the fair
market value of such asset at such date of determination and (b) the
amount of such Indebtedness of such other Persons;
(8) the principal component of Indebtedness of other Persons
to the extent Guaranteed by such Person; and
(9) to the extent not otherwise included in this definition,
net obligations of such Person under Currency Agreements and Interest
Rate Agreements (the amount of any such obligations to be equal at any
time to the termination value of such agreement or arrangement giving
rise to such obligation that would be payable by such Person at such
time).
The amount of Indebtedness of any Person at any date will be
the outstanding balance at such date of all unconditional obligations as
described above and the maximum liability, upon the occurrence of the
contingency giving rise to the obligation, of any contingent obligations at such
date. Notwithstanding the foregoing, money borrowed and set aside at the time of
the Incurrence of any Indebtedness in order to pre-fund the payment of interest
on such Indebtedness shall not be deemed to be "Indebtedness" provided that such
money is held to secure the payment of such interest.
In addition, "Indebtedness" of any Person shall include
Indebtedness described in the preceding paragraphs (other than Indebtedness
under the Amended and Restated Financing and Security Agreement, dated as of
December 31, 2002, by and among Gallatin Steel Company and the lenders parties
thereto, as such agreement may be amended, restated, modified, renewed, refunded
or replaced in whole or in part; provided that the principal amount of
Indebtedness under such agreement does not exceed $40.0 million) that would not
appear as a liability on the balance sheet of such Person if:
(1) such Indebtedness is the obligation of a partnership or
joint venture that is not a Restricted Subsidiary (a "Joint Venture");
(2) such Person or a Restricted Subsidiary of such Person is a
general partner of the Joint Venture (a "General Partner"); and
(3) there is recourse, by contract or operation of law, with
respect to the payment of such Indebtedness to property or assets of
such Person or a Restricted Subsidiary of such Person; and then such
Indebtedness shall be included in an amount not to exceed:
(a) the lesser of (i) the net assets of the General
Partner and (ii) the amount of such obligations to
the extent that there is recourse, by contract or
operation of law, to the property or assets of such
Person or a Restricted Subsidiary of such Person; or
15
(b) if less than the amount determined pursuant to clause
(a) immediately above, the actual amount of such
Indebtedness that is recourse to such Person or a
Restricted Subsidiary of such Person, if the
Indebtedness is evidenced by a writing and is for a
determinable amount..
"Indenture" means this Indenture as amended or supplemented
from time to time.
"Initial Purchasers" means, collectively, ▇.▇. ▇▇▇▇▇▇
Securities Inc., Banc of America LLC, CIBC World Markets Corp., TD Securities
(USA) Inc. and ABN AMRO Incorporated with respect to the Initial Securities.
"Initial Securities" has the meaning ascribed to it in the
second introductory paragraph of this Indenture.
"Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which such Person is party or a
beneficiary.
"Investment" means, with respect to any Person, all
investments by such Person in other Persons (including Affiliates) in the form
of any direct or indirect advance, loan (other than advances or extensions of
credit to customers in the ordinary course of business) or other extensions of
credit (including by way of Guarantee or similar arrangement, but excluding any
debt or extension of credit represented by a bank deposit other than a time
deposit) or capital contribution to (by means of any transfer of cash or other
property to others or any payment for property or services for the account or
use of others), or any purchase or acquisition of Capital Stock, Indebtedness or
other similar instruments issued by, such other Person and all other items that
are or would be classified as investments on a balance sheet prepared in
accordance with GAAP; provided that none of the following will be deemed to be
an Investment:
(1) Hedging Obligations entered into in the ordinary course of
business and in compliance with this Indenture;
(2) endorsements of negotiable instruments and documents in
the ordinary course of business; and
(3) an acquisition of assets, Capital Stock or other
securities by the Company or a Subsidiary for consideration to the
extent such consideration consists of Common Stock of the Company.
For purposes of Section 3.3,
(1) "Investment" will include the portion (proportionate to
the Company's equity interest in a Restricted Subsidiary to be
designated as an Unrestricted Subsidiary) of the fair market value of
the net assets of such Restricted Subsidiary at the time that such
Restricted Subsidiary is designated an Unrestricted Subsidiary;
provided, however, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Company
16
will be deemed to continue to have a permanent "Investment" in an
Unrestricted Subsidiary in an amount (if positive) equal to (a) the
Company's "Investment" in such Subsidiary at the time of such
redesignation less (b) the portion (proportionate to the Company's
equity interest in such Subsidiary) of the fair market value of the net
assets (as conclusively determined by the Board of Directors of the
Company in good faith) of such Subsidiary at the time that such
Subsidiary is so re-designated a Restricted Subsidiary; and
(2) any property transferred to or from an Unrestricted
Subsidiary will be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of
Directors of the Company.
"Investment Grade Rating" means a rating equal to or higher
than Baa3 (or the equivalent) by ▇▇▇▇▇'▇ Investors Service, Inc. and BBB- (or
the equivalent) by Standard & Poor's Ratings Services with at least a stable
outlook.
"Issue Date" means June 27, 2003.
"Legal Holiday" has the meaning ascribed to it in Section
11.8.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or other
title retention agreement or lease in the nature thereof).
"Net Available Cash" from an Asset Disposition means cash
payments received (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise
and net proceeds from the sale or other disposition of any securities received
as consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring person of
Indebtedness or other obligations relating to the properties or assets that are
the subject of such Asset Disposition or received in any other non-cash form)
therefrom, in each case net of:
(1) all legal, accounting, investment banking, title and
recording tax expenses, commissions and other fees and expenses
Incurred, and all Federal, state, provincial, foreign and local taxes
required to be paid or accrued as a liability under GAAP (after taking
into account any available tax credits or deductions and any tax
sharing agreements), as a consequence of such Asset Disposition;
(2) all payments made on any Indebtedness which is secured by
any assets subject to such Asset Disposition, in accordance with the
terms of any Lien upon such assets, or which must by its terms, or in
order to obtain a necessary consent to such Asset Disposition, or by
applicable law be repaid out of the proceeds from such Asset
Disposition;
(3) all distributions and other payments required to be made
to minority interest holders in Subsidiaries or joint ventures as a
result of such Asset Disposition; and
17
(4) the deduction of appropriate amounts to be provided by the
seller as a reserve, in accordance with GAAP, against any liabilities
associated with the assets disposed of in such Asset Disposition and
retained by the Company or any Restricted Subsidiary after such Asset
Disposition.
"Net Cash Proceeds," with respect to any issuance or sale of
Capital Stock, means the cash proceeds of such issuance or sale net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
listing fees, discounts or commissions and brokerage, consultant and other fees
and charges actually Incurred in connection with such issuance or sale and net
of taxes paid or payable as a result of such issuance or sale (after taking into
account any available tax credit or deductions and any tax sharing
arrangements).
"Non-Recourse Debt" means Indebtedness of a Person:
(1) as to which neither the Company nor any Restricted
Subsidiary (a) provides any Guarantee or credit support of any kind
(including any undertaking, guarantee, indemnity, agreement or
instrument that would constitute Indebtedness) or (b) is directly or
indirectly liable (as a guarantor or otherwise);
(2) no default with respect to which (including any rights
that the holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit (upon notice, lapse of time or
both) any holder of any other Indebtedness of the Company or any
Restricted Subsidiary to declare a default under such other
Indebtedness or cause the payment thereof to be accelerated or payable
prior to its stated maturity; and
(3) the terms of which provide there is no recourse against
any of the assets of the Company or its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person (as
defined in Regulation S).
"Offering Memorandum" means the offering memorandum, dated
June 23, 2003, relating to the offering by the Issuers of $405.0 million of the
10?% Senior Notes due 2011 and any future offering memoranda relating to
Additional Securities.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Financial Officer, any Vice President, the
Treasurer or the Secretary of the Company. Officer of GUSAP Partners and any
Subsidiary Guarantor has a correlative meaning.
"Officers' Certificate" means a certificate signed by two
Officers or by an Officer and either an Assistant Treasurer or an Assistant
Secretary of each of the Issuers.
"Opinion of Counsel" means a written opinion from legal
counsel who is not unacceptable to the Trustee. The counsel may be an employee
of or counsel to the Issuers or the Trustee.
"Pari Passu Indebtedness" means Indebtedness of the Company
that ranks equally in right of payment to the Securities.
18
"Permitted Holder" means ▇▇▇▇▇▇ ▇.▇. and any of its
wholly-owned Subsidiaries.
"Permitted Investment" means an Investment by the Company or
any Restricted Subsidiary in:
(1) the Company or a Restricted Subsidiary or a Person which
will, upon the making of such Investment, become a Restricted
Subsidiary; provided, that any Earn-Out Payment made after the date
such Person becomes a Restricted Subsidiary shall also be deemed to be
a Permitted Investment made pursuant to this clause (1); provided,
further, that the primary business of such Restricted Subsidiary is a
Related Business;
(2) another Person if as a result of such Investment such
other Person is merged, consolidated or amalgamated with or into, or
transfers or conveys all or substantially all its assets to or is
liquidated into, the Company or a Restricted Subsidiary; provided, that
any Earn-Out Payment made after the date of such transaction shall also
be deemed to be a Permitted Investment made pursuant to this clause
(2); provided, further, that such Person's primary business is a
Related Business;
(3) cash and Cash Equivalents;
(4) receivables owing to the Company or any Restricted
Subsidiary created or acquired in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
provided, however, that such trade terms may include such concessionary
trade terms as the Company or any such Restricted Subsidiary deems
reasonable under the circumstances;
(5) payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as
expenses in accordance with GAAP and that are made in the ordinary
course of business;
(6) loans or advances to employees (other than executive
officers) made in the ordinary course of business consistent with past
practices of the Company or such Restricted Subsidiary;
(7) Capital Stock, obligations or securities received in
settlement of debts created in the ordinary course of business and
owing to the Company or any Restricted Subsidiary or in satisfaction of
judgments or pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of a debtor;
(8) Investments made as a result of the receipt of non-cash
consideration from an Asset Disposition that was made pursuant to and
in compliance with Section 3.5;
(9) Investments in existence on the Issue Date;
(10) Currency Agreements, Interest Rate Agreements and related
Hedging Obligations, which transactions or obligations are Incurred in
compliance with Section 3.2;
19
(11) Investments by the Company or any of its Restricted
Subsidiaries, together with all other Investments pursuant to this
clause (11), in an aggregate amount at the time of such Investment not
to exceed $15.0 million outstanding at any one time (with the fair
market value of such Investment being measured at the time made and
without giving effect to subsequent changes in value); and
(12) Guarantees of Indebtedness Incurred by the Company or a
Restricted Subsidiary that are issued in accordance with Section 3.2.
"Permitted Liens" means, with respect to any Person:
(1) Liens existing on the Issue Date securing Indebtedness and
other obligations under or in connection with the Senior Secured Credit
Agreement, including Liens on all of the Company's and any Subsidiary's
accounts receivable, accounts (including inter-company loans),
inventory (including "rolls inventory") and other goods held for sale
or lease, chattel paper, documents of title, instruments (including
letters of credit, cheques and bills of exchange), general intangibles
(including intellectual property rights), bank accounts (including
collateral proceeds accounts and investment accounts), books and
records, money, Capital Stock in all Subsidiaries of the Company,
products and proceeds therefrom and from any of the foregoing, and
related property or rights, but excluding Liens on real estate,
improvements thereon, fixtures and equipment of the Company and its
Restricted Subsidiaries;
(2) Liens imposed, and pledges or deposits made by such
Person, under workmen's compensation laws, unemployment insurance laws,
Canadian Pension Plan laws or similar legislation, or good faith
deposits made in connection with bids, tenders, contracts (other than
for the payment of Indebtedness) or leases to which such Person is a
party, or deposits made to secure public or statutory or regulatory
obligations of such Person or deposits of cash or United States
government bonds to secure surety or appeal bonds to which such Person
is a party, or deposits as security for contested taxes or import or
customs duties or for the payment of rent, in each case Incurred in the
ordinary course of business;
(3) Liens imposed by law, including carriers', warehousemen's,
suppliers', materialmen's, repairmen's and mechanics' Liens, in each
case for sums not yet due or being contested in good faith by
appropriate proceedings if a reserve or other appropriate provisions,
if any, as shall be required by GAAP shall have been made in respect
thereof;
(4) Liens for taxes, assessments or other governmental charges
not yet due or payable subject to penalties for non-payment or which
are being contested in good faith by appropriate proceedings provided
appropriate reserves required pursuant to GAAP have been made in
respect thereof;
(5) Liens in favor of issuers of surety or performance bonds
or letters of credit or bankers' acceptances issued pursuant to the
request of and for the account of such Person in the ordinary course of
its business; provided, however, that such letters of credit do not
constitute Indebtedness;
20
(6) encumbrances, ground leases, easements or reservations of,
or rights of others for, licenses, rights of way, sewers, electric
lines, telegraph and telephone lines and other similar purposes, or
zoning, building codes or other restrictions (including, without
limitation, minor defects or irregularities in title and similar
encumbrances) as to the use of real properties or Liens incidental to
the conduct of the business of such Person or to the ownership of its
properties which do not in the aggregate materially adversely affect
the value of said properties or materially impair their use in the
ordinary course operation of the business of such Person;
(7) Liens securing Hedging Obligations so long as the related
Indebtedness is, and is permitted to be under this Indenture, secured
by a Lien on the same property securing such Hedging Obligation;
(8) leases, licenses, subleases and sublicenses of assets
(including, without limitation, real property and intellectual property
rights) which do not materially interfere with the ordinary conduct of
the business of the Company or any of its Restricted Subsidiaries;
(9) judgment Liens not giving rise to an Event of Default so
long as such Lien is adequately bonded or adequate cash reserves have
been set aside to cover such obligations in respect of such Lien and
any appropriate legal proceedings which may have been duly initiated
for the review of such judgment have not been finally terminated or the
period within which such proceedings may be initiated has not expired;
(10) Liens for the purpose of securing the payment of all or a
part of the purchase price of, or Capitalized Lease Obligations,
purchase money obligations or other payments Incurred to finance the
acquisition, improvement, repair or construction of, assets or property
improved, repaired, acquired or constructed in the ordinary course of
business; provided that:
(a) the aggregate principal amount of Indebtedness
secured by such Liens is otherwise permitted to be
Incurred under this Indenture and does not exceed the
cost of the assets or property so acquired, improved,
repaired or constructed; and
(b) such Liens are created within 180 days of
construction or acquisition of such assets or
property and do not encumber any other assets or
property of the Company or any Restricted Subsidiary
other than such assets or property and assets affixed
or appurtenant thereto;
(11) Liens arising solely by virtue of any statutory or common
law provisions relating to banker's Liens, rights of set-off or similar
rights and remedies as to deposit accounts or other funds maintained
with a depositary institution; provided that:
(a) such deposit account is not a dedicated cash
collateral account and is not subject to restrictions
against access by the Company in excess of those set
forth by regulations promulgated by the Federal
Reserve Board; and
21
(b) such deposit account is not intended by the Company
or any Restricted Subsidiary to provide collateral to
the depository institution;
(12) Liens arising from Uniform Commercial Code financing
statement filings regarding operating leases or subleases entered into
by the Company and its Restricted Subsidiaries in the ordinary course
of business;
(13) Liens existing on the Issue Date (other than Liens
relating to the Senior Secured Credit Agreement);
(14) Liens on property, assets or shares of Capital Stock of a
Person at the time such Person becomes a Restricted Subsidiary or
becomes part of the Company or a Restricted Subsidiary; provided,
however, that such Liens are not created, Incurred or assumed in
connection with, or in contemplation of, such other Person becoming a
Restricted Subsidiary; provided further, however, that any such Lien
may not extend to any other property owned by the Company or any
Restricted Subsidiary;
(15) Liens on property at the time the Company or a Restricted
Subsidiary acquired the property, including any acquisition by means of
a merger, liquidation, consolidation or amalgamation with or into the
Company or any Restricted Subsidiary; provided, however, that such
Liens are not created, Incurred or assumed in connection with, or in
contemplation of, such acquisition; provided further, however, that
such Liens may not extend to any other property owned by the Company or
any Restricted Subsidiary;
(16) Liens securing Indebtedness or other obligations of a
Restricted Subsidiary owing to the Company or a Wholly-Owned
Subsidiary;
(17) Liens securing the Securities and Subsidiary Guarantees;
(18) Liens securing Refinancing Indebtedness Incurred to
refinance Indebtedness that was previously so secured, provided that
any such Lien is limited to all or part of the same property or assets
(plus improvements, accessions, proceeds or dividends or distributions
in respect thereof) that secured (or, under the written arrangements
under which the original Lien arose, could secure) the Indebtedness
being refinanced or is in respect of property that is the security for
a Permitted Lien hereunder;
(19) any interest or title of a lessor under any Capitalized
Lease Obligation or operating lease;
(20) Liens in favor of customs and revenue authorities to
secure the payment of custom duties in connection with the exporting or
importing of goods;
(21) Liens on the Capital Stock of an Unrestricted Subsidiary
in order to secure Indebtedness of such Unrestricted Subsidiary; and
22
(22) Liens securing Indebtedness (other than Subordinated
Obligations and Guarantor Subordinated Obligations) in an aggregate
principal amount outstanding at any one time not to exceed $25.0
million.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company, government or any agency or political subdivision
hereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends or distributions, or as to the
distribution of assets upon any voluntary or involuntary liquidation or
dissolution of such corporation, over shares of Capital Stock of any other class
of such corporation.
"QIB" means any "qualified institutional buyer" as such term
is defined in Rule 144A.
"Rating Agency" means Standard & Poor's Ratings Group, Inc.
and ▇▇▇▇▇'▇ Investors Service, Inc. or if Standard & Poor's Ratings Group, Inc.
or ▇▇▇▇▇'▇ Investors Service, Inc. or both shall not make a rating on the
Securities publicly available, a nationally recognized statistical rating agency
or agencies, as the case may be, selected by the Company (as certified by a
resolution of the Board of Directors) which shall be substituted for Standard &
Poor's Ratings Group, Inc. or ▇▇▇▇▇'▇ Investors Service, Inc. or both, as the
case may be.
"Receivable" means a right to receive payment arising from a
sale or lease of goods or the performance of services by a Person pursuant to an
arrangement with another Person pursuant to which such other Person is obligated
to pay for goods or services under terms that permit the purchase of such goods
and services on credit and shall include, in any event, any items of property
that would be classified as an "account," "chattel paper," "payment intangible"
or "instrument" under the Uniform Commercial Code as in effect in the State of
New York and any "supporting obligations" as so defined.
"Receivables Fees" means any fees or interest paid to
purchasers or lenders providing the financing in connection with a factoring
agreement or other similar agreement, including any such amounts paid by
discounting the face amount of Receivables or participations therein transferred
in connection with a factoring agreement or other similar arrangement,
regardless of whether any such transaction is structured as on-balance sheet or
off--balance sheet or through a Restricted Subsidiary or an Unrestricted
Subsidiary.
"Redemption Date" means, with respect to any redemption of
Securities, the date of redemption with respect thereto.
"Refinancing Indebtedness" means Indebtedness that is Incurred
to refund, refinance, replace, exchange, renew, repay, prepay, redeem, retire or
extend (including pursuant to any defeasance or discharge mechanism)
(collectively, "refinance," "refinances," and "refinanced" shall have a
correlative meaning) any Indebtedness existing on the Issue Date or Incurred in
compliance with this Indenture (including Indebtedness of the Company that
refinances Indebtedness of any Restricted Subsidiary and Indebtedness of any
Restricted
23
Subsidiary that refinances Indebtedness of another Restricted Subsidiary)
including Indebtedness that refinances Refinancing Indebtedness, provided,
however, that:
(1) (a) if the Stated Maturity of the Indebtedness being
refinanced is earlier than the Stated Maturity of the Securities, the
Refinancing Indebtedness has a Stated Maturity no earlier than the
Stated Maturity of the Indebtedness being refinanced or (b) if the
Stated Maturity of the Indebtedness being refinanced is later than the
Stated Maturity of the Securities, the Refinancing Indebtedness has a
Stated Maturity at least 91 days later than the Stated Maturity of the
Securities;
(2) the Refinancing Indebtedness has an Average Life at the
time such Refinancing Indebtedness is Incurred that is equal to or
greater than the Average Life of the Indebtedness being refinanced;
(3) such Refinancing Indebtedness is Incurred in an aggregate
principal amount (or if issued with original issue discount, an
aggregate issue price) that is equal to or less than the sum of the
aggregate principal amount (or if issued with original issue discount,
the aggregate accreted value) then outstanding or, if greater, the
committed amount of the Indebtedness being refinanced (plus, without
duplication, any additional Indebtedness Incurred to pay interest or
premiums required by the instruments governing such existing
Indebtedness and fees Incurred in connection therewith); and
(4) if the Indebtedness being refinanced is subordinated in
right of payment to the Securities or the Subsidiary Guarantee, such
Refinancing Indebtedness is subordinated in right of payment to the
Securities or the Subsidiary Guarantee on terms at least as favorable
to the Holders as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"Registered Exchange Offer" shall have the meaning set forth
in the Registration Rights Agreement.
"Registration Rights Agreement" means that certain
registration rights agreement dated as of the Issue Date by and among the
Issuers, the Subsidiary Guarantors and the Initial Purchasers and future
registration rights agreements with respect to Additional Securities.
"Regulation S" means Regulation S under the Securities Act.
"Related Business" means any business which is the same as or
related, ancillary or complementary to any of the businesses of the Company and
its Restricted Subsidiaries on the date of this Indenture.
"Restricted Investment" means any Investment other than a
Permitted Investment.
"Restricted Period", with respect to any Securities, means the
period of 40 consecutive days beginning on and including the later of (A) the
day on which the Securities are first offered to Persons other than distributors
(as defined in Regulation S), notice of which day shall be promptly given by the
Issuers to the Trustee, and (B) the issue date with respect to such Securities.
24
"Restricted Securities Legend" means the Private Placement
Legend set forth in clause (1) of Section 2.1(d)(A) or the Regulation S Legend
set forth in clause (2) of Section 2.1(d)(B), as applicable.
"Restricted Subsidiary" means any Subsidiary of the Company
other than an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
"Sale/Leaseback Transaction" means an arrangement relating to
property now owned or hereafter acquired by the Company or a Restricted
Subsidiary whereby the Company or a Restricted Subsidiary transfers such
property to a Person (other than the Company or a Restricted Subsidiary) and the
Company or a Restricted Subsidiary leases it from such Person.
"SEC" means the United States Securities and Exchange
Commission.
"Securities" has the meaning ascribed to it in the second
introductory paragraph of this Indenture.
"Securities Act" means the Securities Act of 1933 (15 U.S.C.
Sections 77a-77aa), as amended, and the rules and regulations of the SEC
promulgated thereunder.
"Securities Custodian" means the custodian with respect to the
Global Security (as appointed by DTC), or any successor Person thereto and shall
initially be the Trustee.
"Securities Register" means the register of Securities,
maintained by the Registrar, pursuant to Section 2.3.
"Senior Secured Credit Agreement" means the Credit Facility
dated as of June 20, 2003 among the Issuers, The CIT Group/Business Credit,
Inc., as Administrative Agent, and CIT Business Credit Canada Inc., as Canadian
Administrative Agent, and the lenders parties thereto from time to time, as the
same may be amended, restated, modified, renewed, refunded, replaced or
refinanced in whole or part from time to time (including increasing the amount
loaned thereunder provided that such additional Indebtedness is Incurred in
accordance with Section 3.2); provided that a Senior Secured Credit Agreement
shall not include Indebtedness issued, created or Incurred pursuant to a
registered offering of securities under the Securities Act or a private
placement of securities (including under Rule 144A or Regulation S) pursuant to
an exemption from the registration requirements of the Securities Act.
"Shelf Registration Statement" shall have the meaning set
forth in the Registration Rights Agreement.
"Significant Subsidiary" means any Restricted Subsidiary that
would be a "Significant Subsidiary" of the Company within the meaning of Rule
1-02 under Regulation S-X promulgated by the SEC.
"Stated Maturity" means, with respect to any security, the
date specified in such security as the fixed date on which the payment of
principal of such security is due and payable,
25
including pursuant to any mandatory redemption provision, but shall not include
any contingent obligations to repay, redeem or repurchase any such principal
prior to the date originally scheduled for the payment thereof.
"Subordinated Obligation" means any Indebtedness of the
Issuers (whether outstanding on the Issue Date or thereafter Incurred) which is
subordinate or junior in right of payment to the Securities pursuant to a
written agreement.
"Subsidiary" of any Person means (a) any corporation,
association or other business entity (other than a partnership, joint venture,
limited liability company or similar entity) of which more than 50% of the total
ordinary voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof (or persons performing similar functions) or (b) any
partnership, joint venture limited liability company or similar entity of which
more than 50% of the capital accounts, distribution rights, total equity and
voting interests or general or limited partnership interests, as applicable, is,
in the case of clauses (a) and (b), at the time owned or controlled, directly or
indirectly, by (1) such Person, (2) such Person and one or more Subsidiaries of
such Person or (3) one or more Subsidiaries of such Person. Unless otherwise
specified herein, each reference to a Subsidiary will refer to a Subsidiary of
the Company.
"Subsidiary Guarantee" means, individually, any Guarantee of
payment of the Securities by a Subsidiary Guarantor pursuant to the terms of
this Indenture and any supplemental indenture hereto (including pursuant to
Exhibit C), and, collectively, all such Guarantees. Each such Subsidiary
Guarantee will be in the form prescribed by this Indenture.
"Subsidiary Guarantor" means (i) all of the Restricted
Subsidiaries that will be guarantors under the Senior Secured Credit Agreement
as of the Issue Date, which includes Co-Steel Benefit Plans Inc., Co-Steel
Benefit Plans USA Inc., Co-Steel C.S.M. Corp., Co-Steel Finance Corp., Co-Steel
USA Holdings, Inc., Co-Steel (U.S.) Ltd., Gerdau Ameristeel Cambridge Inc.,
Gerdau Ameristeel Distribution Canada Ltd., Gerdau Ameristeel Distribution US
Inc., Gerdau Ameristeel Lake Ontario Inc., Gerdau Ameristeel MRM Special
Sections Inc., Gerdau Ameristeel Perth Amboy Inc., Gerdau Ameristeel Sayreville
Inc., Gerdau Ameristeel US Inc., Gerdau MRM America Holding Corp., Gerdau MRM
Holdings Inc., Gerdau Nova Scotia Holding Company, Gerdau USA Inc., MFT
Acquisition, Corp., N.J.S.C. Investment Co., Inc., PASUG LLC, ▇▇▇▇▇▇ Bros.
Corporation, Raritan River Urban Renewal Corporation, 1062316 Ontario Limited,
1102590 Ontario Limited, 1300554 Ontario Limited, 1551533 Ontario Limited,
2017387 Ontario Limited and 3038482 Nova Scotia Company, and (ii) any Restricted
Subsidiary created or acquired by the Company after the Issue Date, that is
required to issue a Subsidiary Guarantee or that elects to issue a Subsidiary
Guarantee.
"TIA" or "Trust Indenture Act" means the Trust Indenture Act
of 1939 (15 U.S.C. Sections 77aaa-77bbbb), as in effect on the date of this
Indenture.
"Total Tangible Assets" means the total consolidated assets of
the Company and its Restricted Subsidiaries, as shown on the most recent balance
sheet of the Company, less goodwill, patents, trademarks and other intangible
assets as determined in accordance with GAAP.
26
"Transactions" means the issuance of the Securities, borrowing
made under the Senior Secured Credit Agreement on the Issue Date, and the
repayment of a portion of the Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the Issue Date using the proceeds thereof.
"Trustee" means the party named as such in this Indenture
until a successor replaces it and, thereafter, means the successor.
"Trust Officer" shall mean, when used with respect to the
Trustee, any officer within the corporate trust department of the Trustee,
including any vice president, assistant vice president, assistant secretary,
assistant treasurer, trust officer or any other officer of the Trustee who
customarily performs functions similar to those performed by the Persons who at
the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such person's knowledge of and familiarity with
the particular subject and who shall have direct responsibility for the
administration of this Indenture.
"Unrestricted Subsidiary" means:
(1) any Subsidiary of the Company that at the time of
determination shall be designated an Unrestricted Subsidiary by the
Board of Directors of the Company in the manner provided below; and
(2) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors of the Company may designate any
Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary or a Person becoming a Subsidiary through merger or consolidation,
amalgamation or Investment therein) to be an Unrestricted Subsidiary only if:
(1) such Subsidiary or any of its Subsidiaries does not own
any Capital Stock or Indebtedness of or have any Investment in, or own
or hold any Lien on any property of, any other Subsidiary of the
Company which is not a Subsidiary of the Subsidiary to be so designated
or otherwise an Unrestricted Subsidiary;
(2) all the Indebtedness of such Subsidiary and its
Subsidiaries shall, at the date of designation, and will at all times
thereafter, consist of Non-Recourse Debt;
(3) such designation and the Investment of the Company in such
Subsidiary complies with Section 3.3;
(4) such Subsidiary, either alone or in the aggregate with all
other Unrestricted Subsidiaries, does not operate, directly or
indirectly, all or substantially all of the business of the Company and
its Subsidiaries;
(5) such Subsidiary is a Person with respect to which neither
the Company nor any of its Restricted Subsidiaries has any direct or
indirect obligation:
(a) to subscribe for additional Capital Stock of such
Person; or
27
(b) to maintain or preserve such Person's financial
condition or to cause such Person to achieve any
specified levels of operating results; and
(6) on the date such Subsidiary is designated an Unrestricted
Subsidiary, such Subsidiary is not a party to any agreement, contract,
arrangement or understanding with the Company or any Restricted
Subsidiary with terms substantially less favorable to the Company than
those that might have been obtained from Persons who are not Affiliates
of the Company.
Any such designation by the Board of Directors of the Company
shall be evidenced to the Trustee by filing with the Trustee a resolution of the
Board of Directors of the Company giving effect to such designation and an
Officers' Certificate certifying that such designation complies with the
foregoing conditions. If, at any time, any Unrestricted Subsidiary would fail to
meet the foregoing requirements as an Unrestricted Subsidiary, it shall
thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture
and any Indebtedness of such Subsidiary shall be deemed to be Incurred as of
such date.
The Board of Directors of the Company may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that immediately
after giving effect to such designation, no Default or Event of Default shall
have occurred and be continuing or would occur as a consequence thereof and the
Company could Incur at least $1.00 of additional Indebtedness under the first
paragraph of Section 3.2 on a pro forma basis taking into account such
designation.
"U.S. Government Obligations" means securities that are (a)
direct obligations of the United States of America for the timely payment of
which its full faith and credit is pledged or (b) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of the
United States of America the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation of the United States of
America, which, in either case, are not callable or redeemable at the option of
the issuer thereof, and shall also include a depositary receipt issued by a bank
(as defined in Section 3(a)(2) of the Securities Act), as custodian with respect
to any such U.S. Government Obligations or a specific payment of principal of or
interest on any such U.S. Government Obligations held by such custodian for the
account of the holder of such depositary receipt; provided that (except as
required by law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depositary receipt from any amount received
by the custodian in respect of the U.S. Government Obligations or the specific
payment of principal of or interest on the U.S. Government Obligations evidenced
by such depositary receipt.
"Voting Stock" of a Person means all classes of Capital Stock
or other interests of such Person then outstanding and normally entitled to vote
(without regard to the occurrence of any contingency) in the election of
directors, managers or trustees, as applicable.
"Wholly-Owned Subsidiary" means a Restricted Subsidiary, all
of the Capital Stock of which (other than directors' qualifying shares) is owned
by the Company or another Wholly-Owned Subsidiary.
28
SECTION 1.2. Other Definitions.
Defined in
Term Section
---- -------
"Additional Restricted Securities" ................................. 2.1(b)
"Affiliate Transaction"............................................. 3.8
"Agent"............................................................. 3.13
"Agent Member"...................................................... 2.1(e)
"Asset Disposition Offer"........................................... 3.5
"Asset Disposition Offer Amount".................................... 3.5
"Asset Disposition Offer Period".................................... 3.5
"Asset Disposition Purchase Date"................................... 3.5
"Authenticating Agent".............................................. 2.2
"Canadian Additional Amounts"....................................... 3.1(b)
"Canadian Taxes".................................................... 3.1(b)
"Certificate of Destruction"........................................ 2.12
"Change of Control Offer"........................................... 3.10
"Change of Control Payment"......................................... 3.10
"Change of Control Payment Date".................................... 3.10
"covenant defeasance option"........................................ 8.1(b)
"cross acceleration provision"...................................... 6.1(6)(b)
"Defaulted Interest"................................................ 2.13
"Event of Default".................................................. 6.1
"Exchange Global Note".............................................. 2.1(b)
"Excluded Holder"................................................... 3.1(b)
29
Defined in
Term Section
---- -------
"Four-Quarter Period"............................................... 1.1
"General Partner"................................................... 1.1
"Global Securities"................................................. 2.1(b)
"Institutional Accredited Investor Note"............................ 2.1(b)
"Institutional Accredited Investor Global Note"..................... 2.1(b)
"Issuer Order"...................................................... 2.2
"Joint Venture"..................................................... 1.1
"Judgment Currency"................................................. 11.10
"judgment default provision"........................................ 6.1(9)
"legal defeasance option"........................................... 8.1(b)
"Obligations"....................................................... 10.1
"Owner"............................................................. 3.1(c)
"Pari Passu Notes".................................................. 3.5
"Payment Default" .................................................. 6.1(6)(a)
"Paying Agent"...................................................... 2.3
"Permanent Regulation S Global Note"................................ 2.1(b)
"Private Placement Legend".......................................... 2.1(d)
"protected purchaser"............................................... 2.9
"Registrar"......................................................... 2.3
"Regulation S Global Note".......................................... 2.1(b)
"Regulation S Legend"............................................... 2.1(d)
"Regulation S Notes"................................................ 2.1(b)
"Resale Restriction Termination Date"............................... 2.6(a)
"Restricted Payment"................................................ 3.3
"Restricted Period"................................................. 2.1(b)
30
Defined in
Term Section
---- -------
"Restricted Securities"............................................. 2.1(a)
"Rule 144A Global Note"............................................. 2.1(b)
"Rule 144A Note".................................................... 2.1(b)
"Special Interest Payment Date"..................................... 2.13(a)
"Special Record Date"............................................... 2.13(a)
"Successor Company"................................................. 4.1
"Suspended Covenants"............................................... 3.20
"Temporary Regulation S Global Note"................................ 2.1(b)
"U.S. Additional Amounts"........................................... 3.1(c)
SECTION 1.3. Incorporation by Reference of Trust Indenture
Act. This Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company, GUSAP
Partners and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined in the TIA by reference to another statute or defined by SEC
rule have the meanings assigned to them by such definitions.
SECTION 1.4. Rules of Construction. Unless the context
otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
31
(5) words in the singular include the plural and words in the
plural include the singular;
(6) the principal amount of any noninterest bearing or other
discount security at any date shall be the principal amount thereof
that would be shown on a balance sheet of the issuer dated such date
prepared in accordance with GAAP;
(7) the principal amount of any Preferred Stock shall be (i)
the maximum liquidation value of such Preferred Stock or (ii) the
maximum mandatory redemption or mandatory repurchase price with respect
to such Preferred Stock, whichever is greater; and
(8) all amounts expressed in this Indenture or in any of the
Securities in terms of money refer to the lawful currency of the United
States of America.
ARTICLE II
THE SECURITIES
SECTION 2.1. Form, Dating and Terms.
(a) The aggregate principal amount of Securities that may be
authenticated and delivered under this Indenture is unlimited. The Initial
Securities issued on the date hereof will be in an aggregate principal amount of
$400,000,000. In addition, the Issuers may issue, from time to time in
accordance with the provisions of this Indenture, Additional Securities and
Exchange Securities. Furthermore, Securities may be authenticated and delivered
upon registration or transfer, or in lieu of, other Securities pursuant to
Section 2.6, 2.9, 2.11 or 9.5 or in connection with a Change of Control Offer
pursuant to Section 3.10.
The Initial Securities shall be known and designated as
"10 3/8% Senior Notes, Series A, due 2011" of the Issuers. Additional Securities
issued as securities bearing one of the restrictive legends described in Section
2.1(d) ("Restricted Securities") shall be known and designated as "10 3/8%
Senior Notes, Series A, due 2011" of the Issuers. Additional Securities issued
other than as Restricted Securities shall be known and designated as "10 3/8%
Senior Notes, Series B, due 2011" of the Issuers, and Exchange Securities shall
be known and designated as "10 3/8% Senior Notes, Series B, due 2011" of the
Issuers.
With respect to any Additional Securities, the Issuers shall
set forth in (a) a Board Resolution and (b) (i) an Officers' Certificate or (ii)
one or more indentures supplemental hereto, the following information:
(1) the aggregate principal amount of such Additional
Securities to be authenticated and delivered pursuant to this
Indenture;
(2) the issue price and the issue date of such Additional
Securities, including the date from which interest shall accrue; and
32
(3) whether such Additional Securities shall be Restricted
Securities issued in the form of Exhibit A hereto and/or shall be
issued in the form of Exhibit B hereto.
The Initial Securities, the Additional Securities and the
Exchange Securities shall be considered collectively as a single class for all
purposes of this Indenture. Holders of the Initial Securities, the Additional
Securities and the Exchange Securities will vote and consent together on all
matters to which such Holders are entitled to vote or consent as one class, and
none of the Holders of the Initial Securities, the Additional Securities or the
Exchange Securities shall have the right to vote or consent as a separate class
on any matter to which such Holders are entitled to vote or consent.
If any of the terms of any Additional Securities are
established by action taken pursuant to resolutions of the Board of Directors of
each Issuer, a copy of an appropriate record of such action shall be certified
by the Secretary or any Assistant Secretary of each Issuer and delivered to the
Trustee at or prior to the delivery of the Officers' Certificate or the
indenture supplemental hereto setting forth the terms of the Additional
Securities.
(b) The Initial Securities are being offered and sold by the
Issuers pursuant to a Purchase Agreement, dated June 23, 2003, among the
Issuers, ▇▇▇▇▇▇ ▇.▇., the Subsidiary Guarantors, ▇.▇. ▇▇▇▇▇▇ Securities Inc. and
the other initial purchasers named therein. The Initial Securities and any
Additional Securities (if issued as Restricted Securities) (the "Additional
Restricted Securities") will be resold initially only to (A) QIBs in reliance on
Rule 144A and (B) Non-U.S. Persons in reliance on Regulation S. Such Initial
Securities and Additional Restricted Securities may thereafter be transferred
to, among others, QIBs, purchasers in reliance on Regulation S and IAIs in
accordance with Rule 501 of the Securities Act, in each case, in accordance with
the procedure described herein. Additional Securities offered after the date
hereof may be offered and sold by the Issuers from time to time pursuant to one
or more purchase agreements in accordance with applicable law.
Initial Securities and Additional Restricted Securities
offered and sold to QIBs in the United States of America in reliance on Rule
144A (the "Rule 144A Notes") shall be issued in the form of a permanent global
Security, without interest coupons, substantially in the form of Exhibit A,
which is hereby incorporated by reference and made a part of this Indenture,
including appropriate legends as set forth in Section 2.1(d) (the "Rule 144A
Global Note"), deposited with the Trustee, as custodian for DTC, duly executed
by the Issuers and authenticated by the Trustee as hereinafter provided. The
Rule 144A Global Note may be represented by more than one certificate, if so
required by DTC's rules regarding the maximum principal amount to be represented
by a single certificate. The aggregate principal amount of the Rule 144A Global
Note may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for DTC or its nominee, as hereinafter
provided.
Initial Securities and Additional Securities offered and sold
outside the United States of America (the "Regulation S Notes") in reliance on
Regulation S shall initially be issued in the form of a temporary global
Security (the "Temporary Regulation S Global Note"), without interest coupons.
Beneficial interest in the Temporary Regulation S Global Note will be exchanged
for beneficial interests in a corresponding permanent global Security, without
interest coupons, substantially in the form of Exhibit A including appropriate
legends as set forth in
33
Section 2.1(d) (the "Permanent Regulation S Global Note" and, together with the
Temporary Regulation S Global Note, each a "Regulation S Global Note") within a
reasonable period after the expiration of the Restricted Period (as defined
below) upon delivery of the certification contemplated by Section 2.7. Each
Regulation S Global Note will be deposited upon issuance with, or on behalf of,
the Trustee as custodian for DTC in the manner described in this Article II for
credit to the respective accounts of the purchasers (or to such other accounts
as they may direct) at Euroclear or Clearstream. Prior to the 40th day after the
later of the commencement of the offering of the Initial Securities and the
Issue Date (such period through and including such 40th day, the "Restricted
Period"), interests in the Temporary Regulation S Global Note may only be held
through Euroclear or Clearstream (as indirect participants in DTC) unless
exchanged for interests in a Global Security in accordance with the transfer and
certification requirements described herein.
Investors may hold their interests in the Regulation S Global
Note directly through Euroclear or Clearstream, if they are participants in such
systems, or indirectly through organizations which are participants in such
systems. After the expiration of the Restricted Period (but not earlier),
investors may also hold such interests through organizations other than
Euroclear or Clearstream that are participants in DTC's system. Euroclear and
Clearstream will hold such interests in the Regulation S Global Note on behalf
of their participants through customers' securities accounts in their respective
names on the books of their respective depositaries. Such depositaries, in turn,
will hold such interests in the applicable Regulation S Global Note in
customers' securities accounts in the depositaries' names on the books of DTC.
The Regulation S Global Note may be represented by more than
one certificate, if so required by DTC's rules regarding the maximum principal
amount to be represented by a single certificate. The aggregate principal amount
of the Regulation S Global Note may from time to time be increased or decreased
by adjustments made on the records of the Trustee, as custodian for DTC or its
nominee, as hereinafter provided.
Initial Securities and Additional Securities resold to IAIs
(the "Institutional Accredited Investor Notes") in the United States of America
shall be issued in the form of a permanent global Security, without interest
coupons, substantially in the form of Exhibit A including appropriate legends as
set forth in Section 2.1(d) (the "Institutional Accredited Investor Global
Note") deposited with the Trustee, as custodian for DTC, duly executed by the
Issuers and authenticated by the Trustee as hereinafter provided. The
Institutional Accredited Investor Global Note may be represented by more than
one certificate, if so required by DTC's rules regarding the maximum principal
amount to be represented by a single certificate. The aggregate principal amount
of the Institutional Accredited Investor Global Note may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for DTC or its nominee, as hereinafter provided.
Exchange Securities exchanged for interests in the Rule 144A
Notes, the Regulation S Notes and the Institutional Accredited Investor Notes
will be issued in the form of a permanent global Security, without interest
coupons, substantially in the form of Exhibit B, which is hereby incorporated by
reference and made a part of this Indenture, deposited with the Trustee as
hereinafter provided, including the appropriate legend set forth in Section
2.1(d) (the "Exchange Global Note"). The Exchange Global Note may be represented
by more than one
34
certificate, if so required by DTC's rules regarding the maximum principal
amount to be represented by a single certificate.
The Rule 144A Global Note, the Regulation S Global Note, the
Institutional Accredited Investor Global Note and the Exchange Global Note are
sometimes collectively herein referred to as the "Global Securities."
The principal of (and premium, if any) and interest on the
Securities shall be payable at the office or agency of the Issuers maintained
for such purpose in The City of New York, or at such other office or agency of
the Issuers as may be maintained for such purpose pursuant to Section 2.3;
provided, however, that, at the option of the Issuers, each installment of
interest may be paid by (i) check mailed to addresses of the Persons entitled
thereto as such addresses shall appear on the Securities Register or (ii) wire
transfer to an account located in the United States maintained by the payee.
Payments in respect of Securities represented by a Global Security (including
principal, premium, if any, and interest) will be made by wire transfer of
immediately available funds to the accounts specified by DTC. Payments in
respect of Securities represented by Definitive Securities (including principal,
premium, if any, and interest) held by a Holder of at least $1,000,000 aggregate
principal amount of Securities represented by Definitive Securities will be made
by wire transfer to a U.S. dollar account maintained by the payee with a bank in
the United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating
such account no later than 15 days immediately preceding the relevant due date
for payment (or such other date as the Trustee may accept in its discretion).
The Securities may have notations, legends or endorsements
required by law, stock exchange rule or usage, in addition to those set forth on
Exhibit A and Exhibit B and in Section 2.1(d). The Issuers and the Trustee shall
approve the forms of the Securities and any notation, endorsement or legend on
them. Each Security shall be dated the date of its authentication. The terms of
the Securities set forth in Exhibit A and Exhibit B are part of the terms of
this Indenture and, to the extent applicable, the Issuers, the Subsidiary
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to be bound by such terms.
(c) Denominations. The Securities shall be issuable only in
fully registered form, without coupons, and only in denominations of $1,000 and
any integral multiple thereof.
(d) Restrictive Legends. Unless and until (i) an Initial
Security is sold under an effective registration statement or (ii) an Initial
Security is exchanged for an Exchange Security in connection with an effective
registration statement, in each case pursuant to the Registration Rights
Agreement or a similar agreement,
(A) the Rule 144A Global Note and the Institutional Accredited
Investor Global Note shall bear the following legend (the "Private Placement
Legend") on the face thereof:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE
OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR
35
ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM,
OR NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY
ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY
INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL
OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") THAT IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY
SUBSIDIARY OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE ISSUER, (B) PURSUANT TO
A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D)
PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED
INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES
OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR
OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE
ISSUER'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATION AND/ OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE
REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
BY ITS ACQUISITION OF THIS SECURITY THE HOLDER HEREOF WILL BE DEEMED TO
HAVE REPRESENTED AND WARRANTED THAT EITHER (I) NO PORTION OF THE ASSETS
USED BY SUCH HOLDER TO ACQUIRE AND HOLD THIS SECURITY CONSTITUTES THE
ASSETS OF AN EMPLOYEE BENEFIT PLAN THAT IS SUBJECT TO TITLE I OF THE
U.S. EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OF PLANS, INDIVIDUAL RETIREMENT ACCOUNTS OR OTHER
ARRANGEMENTS THAT
36
ARE SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE"), OR PROVISIONS UNDER ANY FEDERAL, STATE, LOCAL,
NON-U.S. OR OTHER LAWS OR REGULATIONS THAT ARE SIMILAR TO SUCH
PROVISIONS OF ERISA OR THE CODE ("SIMILAR LAWS"), OR OF AN ENTITY WHOSE
UNDERLYING ASSETS ARE CONSIDERED TO INCLUDE "PLAN ASSETS" OF SUCH
PLANS, ACCOUNTS OR ARRANGEMENTS, OR (II) THE PURCHASE AND HOLDING OF
THIS SECURITY WILL NOT CONSTITUTE A NON-EXEMPT PROHIBITED TRANSACTION
UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR A SIMILAR
VIOLATION UNDER ANY APPLICABLE SIMILAR LAWS.
(B) the Regulation S Global Note shall bear the following
legend (the "Regulation S Legend") on the face thereof:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE
OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE
HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT
FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE
TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION
TERMINATION DATE") THAT IS 40 DAYS AFTER THE LATER OF THE ORIGINAL
ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY
SUBSIDIARY OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE ISSUER, (B) PURSUANT TO
A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D)
PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED
INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES
OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR
OFFER OR SALE IN CONNECTION WITH
37
ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE ISSUER'S AND THE TRUSTEE'S RIGHT PRIOR
TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F)
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/ OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE
REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE. BY ITS ACQUISITION HEREOF, THE HOLDER HEREOF
REPRESENTS THAT IT IS NOT A U.S. PERSON NOR IS IT PURCHASING FOR THE
ACCOUNT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT.
BY ITS ACQUISITION OF THIS SECURITY THE HOLDER HEREOF WILL BE DEEMED TO
HAVE REPRESENTED AND WARRANTED THAT EITHER (I) NO PORTION OF THE ASSETS
USED BY SUCH HOLDER TO ACQUIRE AND HOLD THIS SECURITY CONSTITUTES THE
ASSETS OF AN EMPLOYEE BENEFIT PLAN THAT IS SUBJECT TO TITLE I OF THE
U.S. EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OF PLANS, INDIVIDUAL RETIREMENT ACCOUNTS OR OTHER
ARRANGEMENTS THAT ARE SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR PROVISIONS UNDER ANY
FEDERAL, STATE, LOCAL, NON-U.S. OR OTHER LAWS OR REGULATIONS THAT ARE
SIMILAR TO SUCH PROVISIONS OF ERISA OR THE CODE ("SIMILAR LAWS"), OR OF
AN ENTITY WHOSE UNDERLYING ASSETS ARE CONSIDERED TO INCLUDE "PLAN
ASSETS" OF SUCH PLANS, ACCOUNTS OR ARRANGEMENTS, OR (II) THE PURCHASE
AND HOLDING OF THIS SECURITY WILL NOT CONSTITUTE A NON-EXEMPT
PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF
THE CODE OR A SIMILAR VIOLATION UNDER ANY APPLICABLE SIMILAR LAWS.
(C) Each Global Security, whether or not an Initial Security,
shall bear the following legend on the face thereof:
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 ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN 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.
38
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO DTC, 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.
(e) Book-Entry Provisions.
(i) This Section 2.1(e) shall apply only to Global Securities
deposited with the Trustee, as custodian for DTC.
(ii) Each Global Security initially shall (x) be registered in
the name of DTC for such Global Security or the nominee of DTC, (y) be delivered
to the Trustee as custodian for DTC and (z) bear legends as set forth in Section
2.1(d).
(iii) Members of, or participants in, DTC ("Agent Members")
shall have no rights under this Indenture with respect to any Global Security
held on their behalf by DTC or by the Trustee as the custodian of DTC or under
such Global Security, and DTC may be treated by the Issuers, the Trustee and any
agent of the Issuers or the Trustee as the absolute owner of such Global
Security for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Issuers, the Trustee or any agent of the Issuers or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by DTC or impair, as between DTC and its Agent Members,
the operation of customary practices of DTC governing the exercise of the rights
of a Holder of a beneficial interest in any Global Security.
(iv) In connection with any transfer of a portion of the
beneficial interest in a Global Security pursuant to subsection (f) of this
Section 2.1 to beneficial owners who are required to hold Definitive Securities,
the Securities Custodian shall reflect on its books and records the date and a
decrease in the principal amount of such Global Security in an amount equal to
the principal amount of the beneficial interest in the Global Security to be
transferred, and the Issuers shall execute, and the Trustee shall authenticate
and make available for delivery, one or more Definitive Securities of like tenor
and amount.
(v) In connection with the transfer of an entire Global
Security to beneficial owners pursuant to subsection (f) of this Section 2.1,
such Global Security shall be deemed to be surrendered to the Trustee for
cancellation, and the Issuers shall execute, and the Trustee shall authenticate
and make available for delivery, to each beneficial owner identified by DTC in
exchange for its beneficial interest in such Global Security, an equal aggregate
principal amount of Definitive Securities of authorized denominations.
(vi) The registered Holder of a Global Security may grant
proxies and otherwise authorize any person, including Agent Members and persons
that may hold interests through Agent Members, to take any action which a Holder
is entitled to take under this Indenture or the Securities.
(vii) Any Holder of a Global Security shall, by acceptance of
such Global Security, agree that transfers of beneficial interests in such
Global Security may be effected only
39
through a book-entry system maintained by (a) the Holder of such Global Security
(or its agent) or (b) any Holder of a beneficial interest in such Global
Security, and that ownership of a beneficial interest in such Global Security
shall be required to be reflected in a book entry.
(f) Definitive Securities. (i) Except as provided below,
owners of beneficial interests in Global Securities will not be entitled to
receive Definitive Securities. If required to do so pursuant to any applicable
law or regulation, beneficial owners may obtain Definitive Securities in
exchange for their beneficial interests in a Global Security upon written
request in accordance with DTC's and the Registrar's procedures. In addition,
Definitive Securities shall be transferred to all beneficial owners in exchange
for their beneficial interests in a Global Security if (A) DTC notifies the
Issuers that it is unwilling or unable to continue as depositary for such Global
Security or DTC ceases to be a clearing agency registered under the Exchange
Act, at a time when DTC is required to be so registered in order to act as
depositary, and in each case a successor depositary is not appointed by the
Issuers within 90 days of such notice or, (B) the Issuers in their sole
discretion execute and deliver to the Trustee and Registrar an Officers'
Certificate stating that such Global Security shall be so exchangeable or (C) an
Event of Default has occurred and is continuing and the Registrar has received a
request from DTC. In the event of the occurrence of any of the events specified
in clause (A), (B) or (C) of the preceding sentence, the Issuers shall promptly
make available to the Trustee a reasonable supply of Definitive Securities in
fully registered form without interest coupons.
(ii) Any Definitive Security delivered in exchange for an
interest in a Global Security pursuant to Section 2.1(e)(iv) or (v) shall,
except as otherwise provided by Section 2.6(c), bear the applicable legend
regarding transfer restrictions applicable to the Definitive Security set forth
in Section 2.1(d).
(iii) In connection with the exchange of a portion of a
Definitive Security for a beneficial interest in a Global Security, the Trustee
shall cancel such Definitive Security, and the Issuers shall execute, and the
Trustee shall authenticate and make available for delivery, to the transferring
Holder a new Definitive Security representing the principal amount not so
transferred.
SECTION 2.2. Execution and Authentication. One Officer shall
sign the Securities for the Company and one Officer shall sign the Securities
for GUSAP Partners, each by manual or facsimile signature. If an Officer whose
signature is on a Security no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless.
A Security shall not be valid until an authorized signatory of
the Trustee manually authenticates the Security. The signature of the Trustee on
a Security shall be conclusive evidence that such Security has been duly and
validly authenticated and issued under this Indenture. A Security shall be dated
the date of its authentication.
At any time and from time to time after the execution and
delivery of this Indenture, the Trustee shall authenticate and make available
for delivery: (1) Initial Securities for original issue on the Issue Date in an
aggregate principal amount of $405,000,000, (2) subject to the terms of this
Indenture, Additional Securities for original issue in an unlimited principal
40
amount and (3) Exchange Securities for issue only in a Registered Exchange Offer
pursuant to the Registration Rights Agreement or upon resale under an effective
Shelf Registration Statement, and only in exchange for Initial Securities or
Additional Securities of an equal principal amount, in each case upon a written
order of the Issuers signed by two Officers of each of the Issuers (the "Issuer
Order"). Such Issuer Order shall specify whether the Securities will be in the
form of Definitive Securities or Global Securities, the amount of the Securities
to be authenticated and the date on which the original issue of Securities is to
be authenticated and whether the Securities are to be Initial Securities,
Additional Securities or Exchange Securities.
The Trustee may appoint an agent (the "Authenticating Agent")
reasonably acceptable to the Issuers to authenticate the Securities. Any such
instrument shall be evidenced by an instrument signed by a Trust Officer, a copy
of which shall be furnished to the Issuers. Unless limited by the terms of such
appointment, any such Authenticating Agent may authenticate Securities whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by the Authenticating Agent. An Authenticating
Agent has the same rights as any Registrar, Paying Agent or agent for service of
notices and demands.
In case the Company, GUSAP Partners or any Subsidiary
Guarantor, pursuant to Article IV or Section 10.2, shall be consolidated or
merged with or into any other Person or shall convey, transfer, lease or
otherwise dispose of its properties and assets substantially as an entirety to
any Person, and the successor Person resulting from such consolidation, or
surviving such merger, or into which the Company, GUSAP Partners or any
Subsidiary Guarantor shall have been merged, or the Person which shall have
received a conveyance, transfer, lease or other disposition as aforesaid, shall
have executed an indenture supplemental hereto with the Trustee pursuant to
Article IV, any of the Securities authenticated or delivered prior to such
consolidation, merger, conveyance, transfer, lease or other disposition may,
from time to time, at the request of the successor Person, be exchanged for
other Securities executed in the name of the successor Person with such changes
in phraseology and form as may be appropriate, but otherwise in substance of
like tenor as the Securities surrendered for such exchange and of like principal
amount; and the Trustee, upon Issuer Order of the successor Person, shall
authenticate and make available for delivery Securities as specified in such
order for the purpose of such exchange. If Securities shall at any time be
authenticated and delivered in any new name of a successor Person pursuant to
this Section 2.2 in exchange or substitution for or upon registration of
transfer of any Securities, such successor Person, at the option of the Holders
but without expense to them, shall provide for the exchange of all Securities at
the time outstanding for Securities authenticated and delivered in such new
name.
SECTION 2.3. Registrar and Paying Agent. The Issuers shall
maintain an office or agency where Securities may be presented for registration
of transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Issuers shall
cause each of the Registrar and the Paying Agent to maintain an office or agency
in Birmingham, Alabama or New York, New York. The Registrar shall keep a
register of the Securities and of their transfer and exchange (the "Securities
Register"). The Issuers may have one or more co-registrars and one or more
additional paying agents. The term "Paying Agent" includes any additional paying
agent and the term "Registrar" includes any co-registrar.
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The Issuers shall enter into an appropriate agency agreement
with any Registrar or Paying Agent not a party to this Indenture, which shall
incorporate the terms of the TIA. The agreement shall implement the provisions
of this Indenture that relate to such agent. The Issuers shall notify the
Trustee of the name and address of each such agent. If the Issuers fail to
maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 7.7. Any of
the Company's wholly owned Subsidiaries organized in the United States may act
as Paying Agent, Registrar or transfer agent.
The Issuers initially appoint the Trustee as Registrar and
Paying Agent for the Securities. The Issuers may remove any Registrar or Paying
Agent upon written notice to such Registrar or Paying Agent and to the Trustee;
provided, however, that no such removal shall become effective until (i)
acceptance of any appointment by a successor as evidenced by an appropriate
agreement entered into by the Issuers and such successor Registrar or Paying
Agent, as the case may be, and delivered to the Trustee or (ii) notification to
the Trustee that the Trustee shall serve as Registrar or Paying Agent until the
appointment of a successor in accordance with clause (i) above. The Registrar or
Paying Agent may resign at any time upon written notice to the Issuers and the
Trustee.
SECTION 2.4. Paying Agent to Hold Money in Trust. By no later
than 10:00 a.m. (New York City time) on the date on which any principal of or
interest on any Security is due and payable, the Issuers shall deposit with the
Paying Agent a sum sufficient in immediately available funds to pay such
principal or interest when due. The Issuers shall require each Paying Agent
(other than the Trustee) to agree in writing that such Paying Agent shall hold
in trust for the benefit of Securityholders or the Trustee all money held by
such Paying Agent for the payment of principal of or interest on the Securities
(whether such assets have been distributed to it by the Issuers or other
obligors on the Securities) and shall notify the Trustee in writing of any
default by the Issuers or any Subsidiary Guarantor in making any such payment.
If a Subsidiary of the Company acts as Paying Agent, it shall segregate the
money held by them as Paying Agent and hold it as a separate trust fund. The
Issuers at any time may require a Paying Agent (other than the Trustee) to pay
all money held by it to the Trustee and to account for any funds or assets
disbursed by such Paying Agent. Upon complying with this Section, the Paying
Agent (if other than a Subsidiary of the Company) shall have no further
liability for the money delivered to the Trustee. Upon any bankruptcy,
reorganization or similar proceeding with respect to the Issuers, the Trustee
shall serve as Paying Agent for the Securities.
SECTION 2.5. Securityholder Lists. The Trustee shall preserve
in as current a form as is reasonably practicable the most recent list available
to it of the names and addresses of Securityholders and shall otherwise comply
with TIA Section 312(a). If the Trustee is not the Registrar, or to the extent
otherwise required under the TIA, the Issuers, on their own behalf and on behalf
of each of the Subsidiary Guarantors, shall furnish or cause the Registrar to
furnish to the Trustee, in writing at least five Business Days before each
interest payment date and at such other times as the Trustee may request in
writing, a list in such form and as of such date as the Trustee may reasonably
require of the names and addresses of Securityholders and the Issuers shall
otherwise comply with TIA Section 312(a).
SECTION 2.6. Transfer and Exchange.
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(a) The following provisions shall apply with respect to any
proposed transfer of a Rule 144A Note or an Institutional Accredited Investor
Note prior to the date which is two years after the later of the date of its
original issue and the last date on which the Issuers or any Affiliate of the
Issuers was the owner of such Securities (or any predecessor thereto) (the
"Resale Restriction Termination Date"):
(i) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to a QIB
shall be made upon the representation of the transferee in the form as
set forth on the reverse of the Security that it is purchasing 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, 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 Issuers 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 its foregoing representations in order to claim the
exemption from registration provided by Rule 144A;
(ii) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to an IAI
shall be made upon receipt by the Trustee or its agent of a certificate
substantially in the form set forth in Section 2.7 from the proposed
transferee and, if requested by the Issuers or the Trustee, the
delivery of an opinion of counsel, certification and/or other
information satisfactory to each of them; and
(iii) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to a Non-U.S.
Person shall be made upon receipt by the Trustee or its agent of a
certificate substantially in the form set forth in Section 2.8 from the
proposed transferee and, if requested by the Issuers or the Trustee,
the delivery of an opinion of counsel, certification and/or other
information satisfactory to each of them.
(b) The following provisions shall apply with respect to any
proposed transfer of a Regulation S Note prior to the expiration of the
Restricted Period:
(i) a transfer of a Regulation S Note or a beneficial interest
therein to a QIB shall be made upon the representation of the
transferee, in the form of assignment on the reverse of the
certificate, that it is purchasing the Security for its own account or
an account with respect to which it exercises sole investment
discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A, 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 Issuers 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 its foregoing representations in order to claim the
exemption from registration provided by Rule 144A;
(ii) a transfer of a Regulation S Note or a beneficial
interest therein to an IAI shall be made upon receipt by the Trustee or
its agent of a certificate substantially in the form set forth in
Section 2.7 from the proposed transferee and, if requested by the
Issuers
43
or the Trustee, the delivery of an opinion of counsel, certification
and/or other information satisfactory to each of them; and
(iii) a transfer of a Regulation S Note or a beneficial
interest therein to a Non-U.S. Person shall be made upon receipt by the
Trustee or its agent of a certificate substantially in the form set
forth in Section 2.8 hereof from the proposed transferee and, if
requested by the Issuers or the Trustee, receipt by the Trustee or its
agent of an opinion of counsel, certification and/or other information
satisfactory to each of them.
After the expiration of the Restricted Period, interests in
the Regulation S Note may be transferred in accordance with applicable law
without requiring the certification set forth in Section 2.7, Section 2.8 or any
additional certification.
(c) Restricted Securities Legend. Upon the transfer, exchange
or replacement of Securities not bearing a Restricted Securities Legend, the
Registrar shall deliver Securities that do not bear a Restricted Securities
Legend. Upon the transfer, exchange or replacement of Securities bearing a
Restricted Securities Legend, the Registrar shall deliver only Securities that
bear a Restricted Securities Legend unless (i) Initial Securities are being
exchanged for Exchange Securities in a Registered Exchange Offer in which case
the Exchange Securities shall not bear a Restricted Securities Legend, (ii) an
Initial Security is being transferred pursuant to the Shelf Registration
Statement or other effective registration statement or (iii) there is delivered
to the Registrar an Opinion of Counsel reasonably satisfactory to the Issuers
and the Trustee to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance with the
provisions of the Securities Act. Any Additional Securities sold in a registered
offering shall not be required to bear the Restricted Securities Legend.
(d) The Registrar shall retain copies of all letters, notices
and other written communications received pursuant to Section 2.1 or this
Section 2.6. The Issuers shall have the right to inspect and make copies of all
such letters, notices or other written communications at any reasonable time
upon the giving of reasonable prior written notice to the Registrar.
(e) Obligations with Respect to Transfers and Exchanges of
Securities.
(i) To permit registrations of transfers and exchanges, the
Issuers shall, subject to the other terms and conditions of this
Article II, execute and the Trustee shall authenticate Definitive
Securities and Global Securities at the Registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Issuers may require the
Holder to pay 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
charges payable upon exchange or transfer pursuant to Sections 2.6 or
9.5).
(iii) The Issuers (and the Registrar) shall not be required to
register the transfer of or exchange of any Security for a period
beginning (1) 15 days before the mailing of a notice of an offer to
repurchase or redeem Securities and ending at the close of business on
the day of such mailing or (2) 15 days before an interest payment date
and ending on such interest payment date.
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(iv) Prior to the due presentation for registration of
transfer of any Security, the Issuers, the Trustee, the Paying Agent or
the Registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of
receiving payment of principal of and interest on such Security and for
all other purposes whatsoever, including without limitation the
transfer or exchange of such Security, whether or not such Security is
overdue, and none of the Issuers, the Trustee, the Paying Agent or the
Registrar shall be affected by notice to the contrary.
(v) Any Definitive Security delivered in exchange for an
interest in a Global Security pursuant to Section 2.1(e) shall, except
as otherwise provided by Section 2.6(c), bear the applicable legend
regarding transfer restrictions applicable to the Definitive Security
set forth in Section 2.1(d).
(vi) All Securities issued upon any transfer or exchange
pursuant to the terms of this Indenture shall evidence the same debt
and shall be entitled to the same benefits under this Indenture as the
Securities surrendered upon such transfer or exchange.
(f) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or obligation to
any beneficial owner of a Global Security, a member of, or a participant in, DTC
or other Person with respect to the accuracy of the records of DTC or its
nominee or of any participant or member thereof, with respect to any ownership
interest in the Securities or with respect to the delivery to any participant,
member, beneficial owner or other Person (other than DTC) of any notice
(including any notice of redemption) or the payment of any amount or delivery of
any Securities (or other security or property) under or with respect to such
Securities. All notices and communications to be given to the Holders and all
payments to be made to Holders in respect of the Securities shall be given or
made only to or upon the order of the registered Holders (which shall be DTC or
its nominee in the case of a Global Security). The rights of beneficial owners
in any Global Security shall be exercised only through DTC subject to the
applicable rules and procedures of DTC. The Trustee may rely and shall be fully
protected in relying upon information furnished by DTC with respect to its
members, participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Indenture or under applicable law with respect to any transfer of any
interest in any Security (including any transfers between or among DTC
participants, members or beneficial owners in any Global Security) other than to
require delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by, the terms
of this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
SECTION 2.7. Form of Certificate to be Delivered in Connection
with Transfers to Institutional Accredited Investors.
[Date]
Gerdau Ameristeel Corporation and GUSAP Partners
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c/o SouthTrust Bank
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Mail Code: A-001-0B-0201
Dear Sirs:
This certificate is delivered to request a transfer of
$[_________] principal amount of the 10 3/8% Senior Notes due 2011 (the
"Securities") of Gerdau Ameristeel Corporation (the "Company") and GUSAP
Partners (together, the "Issuers").
Upon transfer, the Securities would be registered in the name
of the new beneficial owner as follows:
Name: ___________________________________
Address: ________________________________
Taxpayer ID Number: _____________________
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended
(the "Securities Act")) purchasing for our own account or for the account of
such an institutional "accredited investor" at least $250,000 principal amount
of the Securities, and we are acquiring the Securities not with a view to, or
for offer or sale in connection with, any distribution in violation of the
Securities Act. We have such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risk of our investment in
the Securities and we invest in or purchase securities similar to the Securities
in the normal course of our business. We and any accounts for which we are
acting are each able to bear the economic risk of our or its investment.
2. We understand that the Securities have not been registered
under the Securities Act and, unless so registered, may not be sold except as
permitted in the following sentence. We agree on our own behalf and on behalf of
any investor account for which we are purchasing Securities to offer, sell or
otherwise transfer such Securities prior to the date that is two years after the
later of the date of original issue and the last date on which the Issuers or
any affiliate of the Issuers was the owner of such Securities (or any
predecessor thereto) (the "Resale Restriction Termination Date") only (a) to the
Issuers, (b) pursuant to a registration statement which has been declared
effective under the Securities Act, (c) in a transaction complying with the
requirements of Rule 144A under the Securities Act, to a person we reasonably
believe is a "qualified institutional buyer" under Rule 144A of the Securities
Act (a "QIB") that is purchasing for its own account or for the account of a QIB
and to whom notice is given that the transfer is being made in reliance on Rule
144A, (d) pursuant to offers and sales that occur outside the United States
within the meaning of Regulation S under the Securities Act, (e) to an
institutional "accredited investor" within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act that is purchasing for its own account or
for the account of such an institutional
46
"accredited investor," in each case in a minimum principal amount of Securities
of $250,000 for investment purposes and not with a view to or for offer or sale
in connection with any distribution in violation of the Securities Act or (f)
pursuant to any other available exemption from the registration requirements of
the Securities Act, subject in each of the foregoing cases to any requirement of
law that the disposition of our property or the property of such investor
account or accounts be at all times within our or their control and in
compliance with any applicable state securities laws. The foregoing restrictions
on resale will not apply subsequent to the Resale Restriction Termination Date.
If any resale or other transfer of the Securities is proposed to be made
pursuant to clause (e) above prior to the Resale Restriction Termination Date,
the transferor shall deliver a letter from the transferee substantially in the
form of this letter to the Issuers and the Trustee, which shall provide, among
other things, that the transferee is an institutional "accredited investor"
(within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act)
and that it is acquiring such Securities for investment purposes and not for
distribution in violation of the Securities Act. Each purchaser acknowledges
that the Issuers and the Trustee reserve the right prior to any offer, sale or
other transfer prior to the Resale Termination Date of the Securities pursuant
to clauses (d), (e) or (f) above to require the delivery of an opinion of
counsel, certifications and/or other information satisfactory to the Issuers and
the Trustee.
TRANSFEREE:________________________
BY:________________________________
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SECTION 2.8. Form of Certificate to be Delivered in Connection
with Transfers Pursuant to Regulation S.
[Date]
Gerdau Ameristeel Corporation and GUSAP Partners
▇/▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Mail Code: A-001-0B-0201
Re: Gerdau Ameristeel Corporation and
GUSAP Partners
10 3/8% Senior Notes due 2011 (the "Securities")
Ladies and Gentlemen:
In connection with our proposed sale of $[________] aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the United States
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, we
represent that:
(a) the offer of the Securities was not made to a person in
the United States;
(b) either (i) at the time the buy order was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the
United States or (ii) the transaction was executed in, on or through
the facilities of a designated off-shore securities market and neither
we nor any person acting on our behalf knows that the transaction has
been pre-arranged with a buyer in the United States;
(c) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(a)(2) or Rule
904(a)(2) of Regulation S, as applicable; and
(d) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act.
In addition, if the sale is made during a restricted period
and the provisions of Rule 903(b)(2) or Rule 904(b)(1) of Regulation S are
applicable thereto, we confirm that such sale has been made in accordance with
the applicable provisions of Rule 903(b)(2) or Rule 904(b)(1), as the case may
be.
You and the Issuers are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Terms used in this certificate have
the meanings set forth in Regulation S.
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Very truly yours,
[Name of Transferor]
By:____________________________
____________________________
Authorized Signature
SECTION 2.9. Mutilated, Destroyed, Lost or Stolen Securities.
If a mutilated Security is surrendered to the Registrar or if the Holder of a
Security claims that the Security has been lost, destroyed or wrongfully taken,
the Issuers shall issue and the Trustee shall authenticate a replacement
Security if the requirements of Section 8-405 of the Uniform Commercial Code are
met, such that the Securityholder (a) satisfies the Issuers or the Trustee
within a reasonable time after such Securityholder has notice of such loss,
destruction or wrongful taking and the Registrar has not registered a transfer
prior to receiving such notification, (b) makes such request to the Issuers or
Trustee prior to the Security being acquired by a protected purchaser as defined
in Section 8-303 of the Uniform Commercial Code (a "protected purchaser") and
(c) satisfies any other reasonable requirements of the Trustee. If required by
the Trustee or the Issuers, such Holder shall furnish an indemnity bond
sufficient in the judgment of the Issuers and the Trustee to protect the
Issuers, the Trustee, the Paying Agent and the Registrar from any loss which any
of them may suffer if a Security is replaced, and, in the absence of notice to
the Issuers, any Subsidiary Guarantor or the Trustee that such Security has been
acquired by a bona fide purchaser, the Issuers shall execute and upon receipt of
an Issuer Order the Trustee shall authenticate and make available for delivery,
in exchange for any such mutilated Security or in lieu of any such destroyed,
lost or stolen Security, a new Security of like tenor and principal amount,
bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Issuers in their
discretion may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Issuers may require that such Holder pay a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of counsel and of the Trustee) in
connection therewith.
Every new Security issued pursuant to this Section in lieu of
any mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Issuers, any Subsidiary Guarantor (if
applicable) and any other obligor upon the Securities, whether or not the
mutilated, destroyed, lost or stolen Security shall be at any time enforceable
by anyone, and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
49
SECTION 2.10. Outstanding Securities. Securities outstanding
at any time are all Securities authenticated by the Trustee except for those
cancelled by it, those delivered to it for cancellation and those described in
this Section as not outstanding. A Security does not cease to be outstanding in
the event either of the Issuers or an Affiliate of the Company holds the
Security, provided, however, that (i) for purposes of determining which are
outstanding for consent or voting purposes hereunder, the provisions of Section
11.6 shall apply and (ii) in determining whether the Trustee shall be protected
in making a determination whether the Holders of the requisite principal amount
of outstanding Securities are present at a meeting of Holders of Securities for
quorum purposes or have consented to or voted in favor of any request, demand,
authorization, direction, notice, consent, waiver, amendment or modification
hereunder, or relying upon any such quorum, consent or vote, only Securities
which a Trust Officer of the Trustee actually knows to be held by the Issuers or
an Affiliate of the Issuers shall not be considered outstanding.
If a Security is replaced pursuant to Section 2.9 (other than
a mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee and the Issuers receive proof satisfactory to them that the
replaced Security is held by a protected purchaser. A mutilated Security ceases
to be outstanding upon surrender of such Security and replacement pursuant to
Section 2.9.
If the Paying Agent segregates and holds in trust, in
accordance with this Indenture, on a Redemption Date or maturity date money
sufficient to pay all principal, premium, if any, and accrued interest payable
on that date with respect to the Securities (or portions thereof) to be redeemed
or maturing, as the case may be, and the Paying Agent is not prohibited from
paying such money to the Securityholders on that date pursuant to the terms of
this Indenture, then on and after that date such Securities (or portions
thereof) cease to be outstanding and interest on them ceases to accrue.
SECTION 2.11. Temporary Securities. In the event that
Definitive Securities are to be issued under the terms of this Indenture, until
such Definitive Securities are ready for delivery, the Issuers may prepare and
the Trustee shall authenticate temporary Securities. Temporary Securities shall
be substantially in the form, and shall carry all rights, of Definitive
Securities but may have variations that the Issuers consider appropriate for
temporary Securities. Without unreasonable delay, the Issuers shall prepare and
the Trustee shall authenticate Definitive Securities. After the preparation of
Definitive Securities, the temporary Securities shall be exchangeable for
Definitive Securities upon surrender of the temporary Securities at any office
or agency maintained by the Issuers for that purpose and such exchange shall be
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Issuers shall execute, and the Trustee shall
authenticate and make available for delivery in exchange therefor, one or more
Definitive Securities representing an equal principal amount of Securities.
Until so exchanged, the Holder of temporary Securities shall in all respects be
entitled to the same benefits under this Indenture as a Holder of Definitive
Securities.
SECTION 2.12. Cancellation. The Issuers at any time may
deliver Securities to the Trustee for cancellation. The Registrar and the Paying
Agent shall forward to the Trustee any Securities surrendered to them for
registration of transfer, exchange or payment. The Trustee and no one else shall
cancel all Securities surrendered for registration of transfer,
50
exchange, payment or cancellation and destroy such Securities in accordance with
its internal policies and customary procedures including delivery of a
certificate (a "Certificate of Destruction") describing such Securities disposed
(subject to the record retention requirements of the Exchange Act) or deliver
canceled Securities to the Issuers pursuant to written direction by an Officer
of each of the Issuers. If the Issuer or any Subsidiary Guarantor acquires any
of the Securities, such acquisition shall not operate as a redemption or
satisfaction of the Indebtedness represented by such Securities unless and until
the same are surrendered to the Trustee for cancellation pursuant to this
Section 2.12. The Issuers may not issue new Securities to replace Securities
they have paid or delivered to the Trustee for cancellation for any reason other
than in connection with a transfer or exchange.
At such time as all beneficial interests in a Global Security
have either been exchanged for Definitive Securities, transferred, redeemed,
repurchased or canceled, such Global Security shall be returned by DTC 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 Security is
exchanged for Definitive Securities, transferred in exchange for an interest in
another Global Security, redeemed, repurchased or canceled, the principal amount
of Securities represented by such Global Security shall be reduced and an
adjustment shall be made on the books and records of the Trustee (if it is then
the Securities Custodian for such Global Security) with respect to such Global
Security, by the Trustee or the Securities Custodian, to reflect such reduction.
SECTION 2.13. Payment of Interest; Defaulted Interest.
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any interest payment date shall be paid to the Person in whose
name such Security (or one or more predecessor Securities) is registered at the
close of business on the regular record date for such payment at the office or
agency of the Issuers maintained for such purpose pursuant to Section 2.3.
Any interest on any Security which is payable, but is not paid
when the same becomes due and payable and such nonpayment continues for a period
of 30 days shall forthwith cease to be payable to the Holder on the regular
record date, and such defaulted interest and (to the extent lawful) interest on
such defaulted interest at the rate borne by the Securities (such defaulted
interest and interest thereon herein collectively called "Defaulted Interest")
shall be paid by the Issuers, at their election in each case, as provided in
clause (a) or (b) below:
(a) The Issuers may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their
respective predecessor Securities) are registered at the close of
business on a Special Record Date (as defined below) for the payment of
such Defaulted Interest, which shall be fixed in the following manner.
The Issuers shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security and the date
(not less than 30 days after such notice) of the proposed payment (the
"Special Interest Payment Date"), and at the same time the Issuers
shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled
to such Defaulted Interest as in this clause provided. Thereupon the
Trustee shall fix a record date (the "Special Record Date") for the
payment of such Defaulted Interest,
51
which date shall be not more than 15 days and not less than 10 days
prior to the Special Interest Payment Date and not less than 10 days
after the receipt by the Trustee of the notice of the proposed payment.
The Trustee shall promptly notify the Issuers of such Special Record
Date, and in the name and at the expense of the Issuers, shall cause
notice of the proposed payment of such Defaulted Interest and the
Special Record Date and Special Interest Payment Date therefor to be
given in the manner provided for in Section 11.2, not less than 10 days
prior to such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date and Special
Interest Payment Date therefor having been so given, such Defaulted
Interest shall be paid on the Special Interest Payment Date to the
Persons in whose names the Securities (or their respective predecessor
Securities) are registered at the close of business on such Special
Record Date and shall no longer be payable pursuant to the following
clause (b).
(b) The Issuers may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon
such notice as may be required by such exchange, if, after notice given
by the Issuers to the Trustee of the proposed payment pursuant to this
clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of, transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 2.14. Computation of Interest. Interest on the
Securities shall be computed on the basis of a 360-day year of twelve 30-day
months.
SECTION 2.15. CUSIP and ISIN Numbers. The Issuers in issuing
the Securities may use "CUSIP" and "ISIN" numbers (if then generally in use)
and, if so, the Trustee shall use "CUSIP" and "ISIN" numbers in notices of
redemption as a convenience to Holders; provided, however, that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such CUSIP or ISIN numbers. The Issuers shall
promptly notify the Trustee in writing of any change in the CUSIP and ISIN
numbers.
ARTICLE III
COVENANTS
SECTION 3.1. Payment of Securities. (a) The Issuers shall
promptly pay the principal of and interest on the Securities on the dates and in
the manner provided in the Securities and in this Indenture. Principal and
interest shall be considered paid on the date due if on such date the Trustee or
the Paying Agent holds in accordance with this Indenture immediately available
funds sufficient to pay all principal and interest then due and the Trustee
52
or the Paying Agent, as the case may be, is not prohibited from paying such
money to the Securityholders on that date pursuant to the terms of this
Indenture.
The Issuers shall pay interest on overdue principal at the
rate specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
(b) All payments made by or on behalf of the Issuers under or
with respect to the Securities, or payments made by or on behalf of the
Subsidiary Guarantors in respect of the Subsidiary Guarantees, must be made free
and clear of, and without withholding or deduction for, or on account of, any
present or future tax, duty, levy, impost, assessment or other governmental
charge imposed by Canada, any province or municipality or local taxing authority
(including penalties, interest and other liabilities related thereto)
(hereinafter "Canadian Taxes"), unless an Issuer, or any Subsidiary Guarantor,
as the case may be, is required to withhold or deduct Canadian Taxes by law or
by the interpretation or administration thereof by the relevant government
authority or agency. If an Issuer, or a Subsidiary Guarantor, as the case may
be, is so required to withhold or deduct any amount for or on account of
Canadian Taxes from any payment made under or with respect to the Securities,
the Issuer, or the Subsidiary Guarantor, as the case may be, will be required to
pay such additional amounts ("Canadian Additional Amounts") as may be necessary
so that the net amount received by each holder (including Canadian Additional
Amounts) after such withholding or deduction will not be less than the amount
the holder would have received if such Canadian Taxes had not been withheld or
deducted; provided, however, that no Canadian Additional Amounts will be payable
with respect to a payment made to a holder (an "Excluded Holder") in respect of
a beneficial owner:
(1) with which the Issuers and the Subsidiary Guarantors do
not deal at arm's length (for the purposes of the Income Tax Act
(Canada)) at the time of the making of such payment; or
(2) which is subject to such Canadian Taxes by reason of its
being connected with the jurisdiction imposing such taxes other than by
the mere holding of Securities or the receipt of payments thereunder.
The Issuers, or the Subsidiary Guarantors, as the case may be,
will also make such withholding or deduction and remit the full amount deducted
or withheld to the relevant authority as and when required in accordance with
applicable law. The Issuers will furnish to the holders, within 30 days after
the date the payment of any Canadian Taxes is due pursuant to applicable law,
certified copies of tax receipts evidencing such payment by the Issuers, or the
Subsidiary Guarantors, as the case may be. The Issuers, or the Subsidiary
Guarantors, as the case may be, will upon written request of each holder (other
than an Excluded Holder), reimburse each such holder for the amount of
(1) any Canadian Taxes so levied or imposed and paid by such
holder as a result of payments made under or with respect to the
Securities and
(2) any Canadian Taxes so levied or imposed and paid by such
holder with respect to any reimbursement under the foregoing clause
(1), this clause (2) or so that the
53
net amount received by such holder after such reimbursement will not be
less than the net amount the holder would have received if Canadian
Taxes on such reimbursement had not been imposed.
Upon request, the Issuers will provide the Trustee with
official receipts or other documentation satisfactory to the Trustee evidencing
the payment of the Canadian Taxes with respect to which Canadian Additional
Amounts are paid.
(c) All payments of principal, premium, if any, and interest
with respect to the Securities will be made without withholding or deduction at
source for, or on account of, any present or future taxes, fees, duties,
assessments or governmental charges of whatever nature imposed or levied by the
United States or any political subdivision or taxing authority thereof or
therein, unless such withholding or deduction is required by (i) the laws (or
any regulations or rulings promulgated thereunder) of the United States or any
political subdivision or taxing authority thereof or therein or (ii) an official
position regarding the application, administration, interpretation or
enforcement of any such laws, regulations or rulings (including, without
limitation, a holding by a court of competent jurisdiction or by a taxing
authority in the United States or any political subdivision thereof). If a
withholding or deduction at source is required, the Issuer or Subsidiary
Guarantors, as the case may be, will, subject to certain limitations and
exceptions (set forth below), pay to a holder of Securities on behalf of an
owner of a beneficial interest therein (an "Owner") who is a United States Alien
(as defined herein) such additional amounts ("U.S. Additional Amounts") as may
be necessary so that every net payment of principal, premium, if any, or
interest with respect to such Securities after such withholding or deduction,
will not be less than the amount provided for in the Securities. However,
neither the Issuers nor the Subsidiary Guarantors shall be required to make any
payment of U.S. Additional Amounts for or on account of:
(1) any tax, fee, duty, assessment or other governmental charge
which would not have been imposed but for (i) the existence of
any present or former connection between such Owner (or
between a fiduciary, settlor, beneficiary, member or
shareholder of such Owner, if such Owner is an estate, trust,
partnership or corporation) and the United States, including,
without limitation, such Owner (or such fiduciary, settlor,
beneficiary, member or shareholder) being or having been a
citizen or resident thereof or being or having been present or
engaged in trade or business therein or having or having had a
permanent establishment therein, or (ii) the presentation of a
Security for payment on a date more than 15 days after the
date on which such payment became due and payable or the date
on which payment thereof is duly provided for, whichever
occurs later;
(2) any estate, inheritance, gift, sales, transfer, personal
property or similar tax, assessment or other governmental
charge;
(3) any tax, fee, duty, assessment or other governmental charge
imposed by reason of such Owner's past or present status as a
personal holding company, foreign personal holding company or
controlled foreign corporation with respect to the United
States or as a corporation which accumulates earnings to avoid
United States federal income tax;
54
(4) any tax, fee, duty, assessment or other governmental charge
which is payable otherwise than by withholding from payments
of principal or interest with respect to the Securities;
(5) any tax, fee, duty, assessment or other governmental charge
imposed on interest received by anyone who owns (actually or
constructively) 10% or more of the total combined voting power
of all classes of stock of either Issuer;
(6) any tax, fee, duty, assessment or other governmental charge
imposed on interest received by a bank on an extension of
credit made pursuant to a loan agreement entered into in the
ordinary course of its trade or business;
(7) any tax, fee, duty, assessment or other governmental charge
which would not have been imposed but for the failure to
comply with certification, information or other reporting
requirements concerning the nationality, residence, identity
or connection with the United States of the Owner of such
Security, if such compliance is required by statute or by
regulation of the United States Treasury Department as a
precondition to relief or exemption from such tax, assessment
or other governmental charge; or
(8) any combination of items (1), (2), (3), (4), (5), (6) and (7);
nor shall U.S. Additional Amounts be paid to any holder of a
Security on behalf of any Owner who is a fiduciary or
partnership or other than the sole Owner to the extent a
beneficiary or settlor with respect to such fiduciary or a
member of such partnership or Owner would not have been
entitled to payment of the U.S. Additional Amounts had such
beneficiary, settlor, member or Owner been the sole Owner of
the Security.
The term "United States Alien" means any corporation,
individual, fiduciary or partnership that for United States federal income tax
purposes is a foreign corporation, nonresident alien individual, nonresident
alien fiduciary of a foreign estate or trust, or foreign partnership one or more
members of which is a foreign corporation, nonresident alien individual or
nonresident alien fiduciary of a foreign estate or trust.
(d) Any reference in this Indenture, in any context, to the
payment of the principal of, or premium, if any, or interest on or in respect of
a Security, or any other amount payable on or in respect of a Security, such
mention shall be deemed to include mention of the payment of U.S. Additional
Amounts and Canadian Additional Amounts as described in this Section 3.1 to the
extent that, in such context, U.S. Additional Amounts or Canadian Additional
Amounts are, were or would be payable in respect thereof pursuant to the
provisions of such Security and express mention of the payment of U.S.
Additional Amounts or Canadian Additional Amounts (if applicable) in any
provisions hereof shall not be construed as excluding U.S. Additional Amounts or
Canadian Additional Amounts in those provisions hereof where such express
mention is not made.
(e) The Issuers, or the Subsidiary Guarantors, as the case may
be, will pay any present or future stamp, court or documentary taxes or any
other excise or property taxes,
55
charges or similar levies that arise in any jurisdiction from the execution,
delivery, enforcement or registration of the Securities, the Indenture or any
other document or instrument in relation thereof, or the receipt of any payments
with respect to the Securities, excluding such taxes, charges or similar levies
imposed by any jurisdiction outside of Canada, the jurisdiction of incorporation
of any successor of the Company or any Canadian Subsidiary Guarantor or any
jurisdiction in which a paying agent is located, and will agree to indemnify the
holders for any such taxes paid by such holders.
(f) The foregoing obligations will survive any termination,
defeasance or discharge of the Indenture and will apply mutatis mutandis to any
jurisdiction in which any successor Person to the Company or any Issuer is
organized or any political subdivision or taxing authority or agency thereof or
therein.
SECTION 3.2. Limitation on Indebtedness. The Company will not,
and will not permit any of its Restricted Subsidiaries to, Incur any
Indebtedness (including Acquired Indebtedness); provided, however, that the
Issuers or any of the Subsidiary Guarantors may Incur Indebtedness if on the
date thereof:
(1) the Consolidated Coverage Ratio for the Company and its
Restricted Subsidiaries is at least 2.00 to 1.00; and
(2) no Default or Event of Default will have occurred or be
continuing or would occur as a consequence of Incurring the
Indebtedness or transactions relating to such Incurrence.
The first paragraph of this covenant will not prohibit the Incurrence of the
following Indebtedness:
(1) Indebtedness of the Issuers or any of the Subsidiary
Guarantors Incurred pursuant to a Credit Facility in an aggregate
amount up to the greater of (a) the Borrowing Base and (b) $350.0
million less the aggregate principal amount of all principal repayments
with proceeds from Asset Dispositions utilized in accordance with
clause (3)(a) of Section 3.5 that permanently reduce the commitments
thereunder;
(2) Guarantees by the Issuers and Subsidiary Guarantors of
Indebtedness Incurred in accordance with the provisions of this
Indenture; provided that in the event such Indebtedness that is being
Guaranteed is a Subordinated Obligation or a Guarantor Subordinated
Obligation, then the related Guarantee shall be subordinated in right
of payment to the Subsidiary Guarantee;
(3) Indebtedness of the Company owing to and held by any
Restricted Subsidiary or Indebtedness of a Restricted Subsidiary owing
to and held by the Company or any other Restricted Subsidiary;
provided, however, (a) if the Company is the obligor on such
Indebtedness, such Indebtedness is expressly subordinated in right of
payment to the Securities, or (b) if a Subsidiary Guarantor is the
obligor on such Indebtedness and the Company or a Subsidiary Guarantor
is not the obligee, such Indebtedness is subordinated in right of
payment to the Subsidiary Guarantees of such Subsidiary Guarantor, then
(i) any subsequent issuance or transfer of Capital Stock or any other
56
event which results in any such Indebtedness being beneficially held by
a Person other than the Company or a Restricted Subsidiary, or (ii) any
sale or other transfer of any such Indebtedness to a Person other than
the Company or a Restricted Subsidiary shall be deemed, in each case,
to constitute an Incurrence of such Indebtedness by the Company or such
Restricted Subsidiary, as the case may be;
(4) Indebtedness represented by (a) the Securities and the
Subsidiary Guarantees issued on the Issue Date and the Exchange
Securities and exchange guarantees evidencing the same Indebtedness as
the Securities and the Subsidiary Guarantees issued in a registered
exchange offer pursuant to the Registration Rights Agreement, (b) any
Indebtedness (other than the Indebtedness described in clauses (1),
(2), (3), (6), (8), (9), (10), (11) and (12)) outstanding on the Issue
Date and (c) any Refinancing Indebtedness Incurred in respect of any
Indebtedness described in this clause (4) or clause (5) or Incurred
pursuant to the first paragraph of this covenant;
(5) Indebtedness of a Person Incurred and outstanding on the
date on which such Person was acquired by the Company or a Restricted
Subsidiary and became a Restricted Subsidiary or part of a Restricted
Subsidiary or the Company or merged, consolidated, amalgamated or
liquidated with or into a Restricted Subsidiary or the Company (other
than Indebtedness Incurred (a) to provide all or any portion of the
funds utilized to consummate the transaction or series of related
transactions pursuant to which such Person became a Restricted
Subsidiary or was otherwise acquired by the Company or a Restricted
Subsidiary or merged, consolidated, amalgamated or liquidated with or
into a Restricted Subsidiary or the Company or (b) otherwise in
connection with, or in contemplation of, such acquisition); provided,
however, that at the time such transactions or series of transactions
is consummated, the Company would have been able to Incur $1.00 of
additional Indebtedness pursuant to the first paragraph of this
covenant after giving effect to the Incurrence of such Indebtedness
pursuant to this clause (5);
(6) Indebtedness under Currency Agreements and Interest Rate
Agreements; provided, that such agreements are entered into for bona
fide hedging purposes of the Company or its Restricted Subsidiaries (as
determined in good faith by the Board of Directors or senior management
of the Company), and not for speculative purposes, in the ordinary
course of business;
(7) the Incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capitalized Lease
Obligations, mortgage financings, conditional sale obligations,
obligations under title retention agreements or purchase money
obligations with respect to assets other than Capital Stock or other
Investments, in each case Incurred for the purpose of financing all or
any part of the purchase price, leasing or cost of acquisition,
construction, development or improvements of property or assets used in
the business of the Company or such Restricted Subsidiary, in an
aggregate principal amount not to exceed $5.0 million outstanding at
the time of determination;
(8) Indebtedness Incurred in respect of workers' compensation
claims, self-insurance obligations, performance, surety, appeal and
similar bonds and completion
57
guarantees provided by the Company or a Restricted Subsidiary in the
ordinary course of business;
(9) Indebtedness arising from agreements of the Company or a
Restricted Subsidiary providing for indemnification, adjustment of
purchase price or similar obligations, in each case, Incurred or
assumed in connection with the disposition of any business, property,
assets or Capital Stock, provided that the maximum aggregate liability
in respect of all such Indebtedness shall at no time exceed the gross
proceeds actually received by the Company and its Restricted
Subsidiaries in connection with such disposition;
(10) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn
against insufficient funds in the ordinary course of business,
provided, however, that such Indebtedness is extinguished within five
Business Days of Incurrence;
(11) Indebtedness arising out of any Earn-Out Payment
obligation relating to any Investment made in accordance with clause
(1) or (2) of the definition "Permitted Investment";
(12) Indebtedness of the Issuers and the Subsidiary Guarantors
extended by ▇▇▇▇▇▇ ▇.▇. or any of its wholly-owned Subsidiaries in an
aggregate outstanding principal amount which, when taken together with
the principal amount of all other Indebtedness Incurred pursuant to
this clause (12) and then outstanding, will not exceed $25.0 million at
any time outstanding; and
(13) in addition to the items referred to in clauses (1)
through (12) above, Indebtedness of the Issuers and the Subsidiary
Guarantors in an aggregate outstanding principal amount which, when
taken together with the principal amount of all other Indebtedness
Incurred pursuant to this clause (13) and then outstanding, will not
exceed $25.0 million at any time outstanding.
The Issuers will not Incur any Indebtedness under the
preceding paragraph if the proceeds thereof are used, directly or indirectly, to
refinance any Subordinated Obligations of the Issuers unless such Indebtedness
will be subordinated to the Securities to at least the same extent as such
Subordinated Obligations. No Subsidiary Guarantor will Incur any indebtedness if
the proceeds thereof are used, directly or indirectly, to refinance any
Guarantor Subordinated Obligations of such Subsidiary Guarantor unless such
Indebtedness will be subordinated to the obligations of such Subsidiary
Guarantor under its Subsidiary Guarantee to at least the same extent as such
Guarantor Subordinated Obligations. No Restricted Subsidiary other than a
Subsidiary Guarantor or GUSAP Partners may Incur any Indebtedness if the
proceeds are used to refinance Indebtedness of the Company.
For purposes of determining compliance with, and the
outstanding principal amount of any particular Indebtedness Incurred pursuant to
and in compliance with, this covenant:
58
(1) in the event that Indebtedness meets the criteria of more
than one of the types of Indebtedness described in this covenant, the
Company, in its sole discretion, will classify such item of
Indebtedness on the date of Incurrence and only be required to include
the amount and type of such Indebtedness in one of such clauses;
(2) all Indebtedness outstanding on the date of this Indenture
under the Senior Secured Credit Agreement shall be deemed initially
Incurred on the Issue Date under clause (1) of the second paragraph of
this covenant and not the first paragraph or clause (4) of the second
paragraph of this covenant;
(3) Guarantees of, or obligations in respect of letters of
credit relating to, Indebtedness which is otherwise included in the
determination of a particular amount of Indebtedness shall not be
included;
(4) if obligations in respect of letters of credit are
incurred pursuant to a Credit Facility and are being treated as
Incurred pursuant to clause (1) of the second paragraph above and the
letters of credit relate to other Indebtedness, then such other
Indebtedness shall not be included;
(5) the principal amount of any Disqualified Stock of the
Company or a Restricted Subsidiary, or Preferred Stock of a Restricted
Subsidiary that is not a Subsidiary Guarantor, will be equal to the
greater of the maximum mandatory redemption or repurchase price (not
including, in either case, any redemption or repurchase premium) or the
liquidation preference thereof at the time of determination;
(6) Indebtedness permitted by this covenant need not be
permitted solely by reference to one provision permitting such
Indebtedness but may be permitted in part by one such provision and in
part by one or more other provisions of this covenant permitting such
Indebtedness; and
(7) the amount of Indebtedness issued at a price that is less
than the principal amount thereof will be equal to the amount of the
liability in respect thereof determined in accordance with GAAP.
Accrual of interest, accrual of dividends, the accretion of
accreted value, the payment of interest in the form of additional Indebtedness
and the payment of dividends in the form of additional shares of Preferred Stock
or Disqualified Stock will not be deemed to be an Incurrence of Indebtedness for
purposes of this covenant. The amount of any Indebtedness outstanding as of any
date shall be (i) the accreted value thereof in the case of any Indebtedness
issued with original issue discount and (ii) the principal amount or liquidation
preference thereof, together with any interest thereon that is more than 30 days
past due, in the case of any other Indebtedness.
In addition, the Company will not permit any of its
Unrestricted Subsidiaries to Incur any Indebtedness or issue any shares of
Disqualified Stock, other than Non-Recourse Debt. If at any time an Unrestricted
Subsidiary becomes a Restricted Subsidiary, any Indebtedness of such Subsidiary
shall be deemed to be Incurred by a Restricted Subsidiary as of such date (and,
if
59
such Indebtedness is not permitted to be Incurred as of such date under this
Section 3.2, the Company shall be in Default of this covenant).
For purposes of determining compliance with any U.S.
dollar-denominated restriction on the Incurrence of Indebtedness, the U.S.
dollar-equivalent principal amount of Indebtedness denominated in a foreign
currency shall be calculated based on the relevant currency exchange rate in
effect on the date such Indebtedness was Incurred, in the case of term
Indebtedness, or first committed, in the case of revolving credit Indebtedness;
provided that if such Indebtedness is Incurred to refinance other Indebtedness
denominated in a foreign currency, and such refinancing would cause the
applicable U.S. dollar-dominated restriction to be exceeded if calculated at the
relevant currency exchange rate in effect on the date of such refinancing, such
U.S. dollar-dominated restriction shall be deemed not to have been exceeded so
long as the principal amount of such refinancing Indebtedness does not exceed
the principal amount of such Indebtedness being refinanced. Notwithstanding any
other provision of this covenant, the maximum amount of Indebtedness that the
Company may Incur pursuant to this covenant shall not be deemed to be exceeded
solely as a result of fluctuations in the exchange rate of currencies. The
principal amount of any Indebtedness Incurred to refinance other Indebtedness,
if Incurred in a different currency from the Indebtedness being refinanced,
shall be calculated based on the currency exchange rate applicable to the
currencies in which such Refinancing Indebtedness is denominated that is in
effect on the date of such refinancing.
SECTION 3.3. Limitation on Restricted Payments. The Company
will not, and will not permit any of its Restricted Subsidiaries, directly or
indirectly, to:
(1) declare or pay any dividend or make any distribution on or
in respect of its Capital Stock (including any payment in connection
with any merger or consolidation involving the Company or any of its
Restricted Subsidiaries) except:
(a) dividends or distributions payable in Capital Stock
of the Company (other than Disqualified Stock) or in
options, warrants or other rights to purchase such
Capital Stock of the Company; and
(b) any dividends or distributions payable to the Company
or a Restricted Subsidiary (and if such Restricted
Subsidiary is not a Wholly-Owned Subsidiary, to its
other holders of common Capital Stock on a pro rata
basis);
(2) purchase, redeem, retire or otherwise acquire for value
any Capital Stock of the Company or any direct or indirect parent of
the Company held by Persons other than the Company or a Restricted
Subsidiary (other than in exchange for Capital Stock of the Company
(other than Disqualified Stock));
(3) purchase, repurchase, redeem, defease or otherwise acquire
or retire for value, prior to scheduled maturity, scheduled repayment
or scheduled sinking fund payment, any Subordinated Obligations or
Guarantor Subordinated Obligations (other than the purchase,
repurchase, redemption, defeasance or other acquisition or retirement
of Subordinated Obligations or Guarantor Subordinated Obligations
purchased in
60
anticipation of satisfying a sinking fund obligation, principal
installment or final maturity, in each case due within one year of the
date of purchase, repurchase, redemption, defeasance or other
acquisition or retirement); or
(4) make any Restricted Investment in any Person;
(any such dividend, distribution, purchase, redemption, repurchase, defeasance,
other acquisition, retirement or Restricted Investment referred to in clauses
(1) through (4) shall be referred to herein as a "Restricted Payment"), if at
the time the Company or such Restricted Subsidiary makes such Restricted
Payment:
(a) a Default shall have occurred and be continuing (or
would result therefrom); or
(b) the Company is not able to Incur an additional $1.00
of Indebtedness pursuant to the first paragraph under
Section 3.2 after giving effect, on a pro forma
basis, to such Restricted Payment; or
(c) the aggregate amount of such Restricted Payment and
all other Restricted Payments declared or made
subsequent to the Issue Date would exceed the sum of:
(i) 50% of Consolidated Net Income for the period
(treated as one accounting period) from the beginning
of the first fiscal quarter commencing after the
Issue Date occurs to the end of the most recent
fiscal quarter ending prior to the date of such
Restricted Payment for which financial statements are
available (or, in case such Consolidated Net Income
is a deficit, minus 100% of such deficit);
(ii) 100% of the aggregate Net Cash Proceeds received
by the Company from the issue or sale of its Capital
Stock (other than Disqualified Stock) or other
capital contributions subsequent to the Issue Date
(other than Net Cash Proceeds received from an
issuance or sale of such Capital Stock to a
Subsidiary of the Company or an employee stock
ownership plan, option plan or similar trust to the
extent such sale to an employee stock ownership plan
or similar trust is financed by loans from or
Guaranteed by the Company or any Restricted
Subsidiary unless such loans have been repaid with
cash on or prior to the date of determination);
(iii) the amount by which Indebtedness of the Company
or its Restricted Subsidiaries is reduced on the
Company's balance sheet upon the conversion or
exchange (other than by a Subsidiary of the Company)
subsequent to the Issue Date of any Indebtedness of
the Company or its Restricted Subsidiaries
convertible or exchangeable for Capital Stock (other
than Disqualified Stock) of the Company (less the
amount of any cash, or the fair market value of any
other property, distributed by the Company upon such
conversion or exchange); and
61
(iv) the amount equal to the net reduction in
Restricted Investments made by the Company or any of
its Restricted Subsidiaries in any Person resulting
from:
(A) repurchases, redemptions or liquidations of
such Restricted Investments by such Person,
proceeds realized upon the sale or other
transfer of such Restricted Investment to an
unaffiliated purchaser, repayments of loans
or advances or other transfers of assets
(including by way of dividend or
distribution) by such Person to the Company
or any Restricted Subsidiary; or
(B) the redesignation of Unrestricted
Subsidiaries as Restricted Subsidiaries
(valued in each case as provided in the
definition of "Investment") not to exceed,
in the case of any Unrestricted Subsidiary,
the amount of Investments previously made by
the Company or any Restricted Subsidiary in
such Unrestricted Subsidiary,
which amount in each case under this clause (iv) was
included in the calculation of the amount of
Restricted Payments; provided, however, that no
amount will be included under this clause (iv) to the
extent it is already included in Consolidated Net
Income.
The provisions of the preceding paragraph will not prohibit:
(1) any purchase, repurchase, redemption, defeasance or other
acquisition, cancellation or retirement of Capital Stock, Disqualified
Stock or Subordinated Obligations of the Issuers or Guarantor
Subordinated Obligation of any Subsidiary Guarantor made by exchange
for, or out of the proceeds of the substantially concurrent sale of,
Capital Stock of the Company (other than Disqualified Stock and other
than Capital Stock issued or sold to a Subsidiary or an employee stock
ownership plan or similar trust to the extent such sale to an employee
stock ownership plan or similar trust is financed by loans from or
Guaranteed by the Company or any Restricted Subsidiary unless such
loans have been repaid with cash on or prior to the date of
determination); provided, however, that (a) such purchase, repurchase,
redemption, defeasance, acquisition, cancellation or retirement will be
excluded in subsequent calculations of the amount of Restricted
Payments and (b) the Net Cash Proceeds from such sale of Capital Stock
will be excluded from clause (c)(ii) of the preceding paragraph;
(2) any prepayment, repayment, purchase, repurchase,
redemption, defeasance or other acquisition or retirement of
Subordinated Obligations of the Issuers or any Guarantor Subordinated
Obligation of any Subsidiary Guarantor made by exchange for, or out of
the proceeds of the substantially concurrent sale of, Subordinated
Obligations of the Company or any prepayment, repayment, purchase,
repurchase, redemption, defeasance or other acquisition or retirement
of Guarantor Subordinated Obligations made by exchange for or out of
the proceeds of the substantially concurrent sale of Guarantor
Subordinated Obligations that, in each case, is permitted to be
Incurred
62
pursuant to Section 3.2 and that in each case constitutes Refinancing
Indebtedness; provided, however, that such prepayment, repayment,
purchase, repurchase, redemption, defeasance, acquisition or retirement
will be excluded in subsequent calculations of the amount of Restricted
Payments;
(3) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement of Disqualified Stock of the Company or a
Restricted Subsidiary made by exchange for or out of the proceeds of
the substantially concurrent sale of Disqualified Stock of the Company
or such Restricted Subsidiary, as the case may be, that, in each case,
is permitted to be Incurred pursuant to Section 3.2 and that in each
case constitutes Refinancing Indebtedness; provided, however, that such
purchase, repurchase, redemption, defeasance, acquisition or retirement
will be excluded in subsequent calculations of the amount of Restricted
Payments;
(4) so long as no Default or Event of Default has occurred and
is continuing, any purchase, prepayment, repayment, repurchase,
retirement, defeasance or other acquisition or redemption of
Subordinated Obligations or Guarantor Subordinated Obligations of a
Subsidiary Guarantor from Net Available Cash to the extent permitted
under Section 3.5 below; provided, however, that such purchase,
prepayment, repayment, repurchase, retirement, defeasance or other
acquisition or redemption will be excluded in subsequent calculations
of the amount of Restricted Payments;
(5) dividends paid within 60 days after the date of
declaration if at such date of declaration such dividend would have
complied with this provision; provided, however, that such dividends
will be included in subsequent calculations of the amount of Restricted
Payments;
(6) so long as no Default or Event of Default has occurred and
is continuing,
(a) the purchase, repurchase, redemption or other
acquisition, cancellation or retirement for value of
Capital Stock, or options, warrants, equity
appreciation rights or other rights to purchase or
acquire Capital Stock of the Company or any
Restricted Subsidiary or any parent of the Company
held by any existing or former directors, employees
or management of the Company or any Subsidiary of the
Company or their assigns, transferees, estates or
heirs, in each case in connection with the repurchase
provisions under employee stock option or stock
purchase agreements or other agreements to compensate
management employees; provided that such redemptions
or repurchases pursuant to this clause will not
exceed $1.0 million in the aggregate during any
calendar year and $5.0 million in the aggregate for
all such purchases, repurchases, redemptions or other
acquisitions, cancellations and retirements;
provided, however, that the amount of any such
purchase, repurchase, redemption or other
acquisition, cancellation or retirement will be
included in subsequent calculations of the amount of
Restricted Payments; and
63
(b) loans or advances to employees or directors of the
Company or any Subsidiary of the Company the proceeds
of which are used to purchase Capital Stock of the
Company, in an aggregate amount not in excess of $2.0
million at any one time outstanding; provided,
however, that the amount of such loans and advances
will be included in subsequent calculations of the
amount of Restricted Payments;
(7) so long as no Default or Event of Default has occurred and
is continuing, the declaration and payment of dividends to holders of
any class or series of Disqualified Stock of the Company and Preferred
Stock of any Restricted Subsidiary (other than Subsidiary Guarantors
and GUSAP Partners), issued in accordance with the terms of this
Indenture to the extent such dividends are included in the definition
of "Consolidated Interest Expense"; provided that the payment of such
dividends will be excluded from the calculation of Restricted Payments;
(8) repurchases of Capital Stock deemed to occur upon the
exercise of stock options, warrants or other convertible securities if
such Capital Stock represents a portion of the exercise price thereof;
provided, however, that such repurchases will be excluded from
subsequent calculations of the amount of Restricted Payments;
(9) the distribution, as a dividend or otherwise, of shares of
Capital Stock and/or assets of any Unrestricted Subsidiary; provided,
however, that such distribution shall be excluded in subsequent
calculations of the amount of Restricted Payments;
(10) the repurchase, redemption or other acquisition or
retirement for value of any Subordinated Obligation (i) at a purchase
price not greater than 101% of the principal amount of such
Subordinated Obligation in the event of a Change of Control in
accordance with provisions similar to Section 3.10 or (ii) at a
purchase price not greater than 100% of the principal amount thereof in
accordance with provisions similar to Section 3.5; provided that, prior
to or simultaneously with such repurchase, the Company has made the
Change of Control Offer or Asset Disposition Offer, as applicable, as
provided in such covenant with respect to the Securities and has
repurchased all Securities validly tendered for payment in connection
with such Change of Control Offer or Asset Disposition Offer; and
(11) Restricted Payments in an amount not to exceed $15.0
million; provided that the amount of such Restricted Payments will be
included in the calculation of the amount of Restricted Payments.
The amount of all Restricted Payments (other than cash) shall
be the fair market value on the date of such Restricted Payment of the asset(s)
or securities proposed to be paid, transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to such Restricted Payment.
The fair market value of any cash Restricted Payment shall be its face amount
and any non-cash Restricted Payment shall be determined conclusively by the
Board of Directors of the Company acting in good faith whose resolution with
respect thereto shall be delivered to the Trustee, such determination to be
based upon an opinion or appraisal issued by an accounting, appraisal or
investment banking firm of national standing if such fair
64
market value is estimated in good faith by the Board of Directors of the Company
to exceed $5.0 million. Not later than the date of making any Restricted Payment
pursuant to the first paragraph of this covenant, the Company shall deliver to
the Trustee an Officers' Certificate stating that such Restricted Payment is
permitted and setting forth the basis upon which the calculations required by
the covenant "Restricted Payments" were computed, together with a copy of any
fairness opinion or appraisal required by this Indenture.
SECTION 3.4. Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or consensual restriction on the ability of
any Restricted Subsidiary to:
(1) pay dividends or make any other distributions on its
Capital Stock or pay any indebtedness or other obligations owed to the
Company or any Restricted Subsidiary (it being understood that the
priority of any Preferred Stock in receiving dividends or liquidating
distributions prior to dividends or liquidating distributions being
paid on Common Stock shall not be deemed a restriction on the ability
to make distributions on Capital Stock);
(2) make any loans or advances to the Company or any
Restricted Subsidiary (it being understood that the subordination of
loans or advances made to the Company or any Restricted Subsidiary to
other Indebtedness Incurred by the Company or any Restricted Subsidiary
shall not be deemed a restriction on the ability to make loans or
advances); or
(3) transfer any of its property or assets to the Company or
any Restricted Subsidiary.
The preceding provisions will not prohibit:
(i) any encumbrance or restriction pursuant to an agreement or
other instrument in effect at or entered into on the date of
this Indenture, including under, this Indenture and the Senior
Secured Credit Agreement or identified in Schedule 3.4 to this
Indenture.
(ii) any encumbrance or restriction with respect to a Person
pursuant to an agreement relating to any Capital Stock or
Indebtedness Incurred by such Person on or before the date on
which such Person was acquired by the Company and became a
Restricted Subsidiary or part thereof or of the Company (other
than Capital Stock or Indebtedness Incurred as consideration
in, or to provide all or any portion of the funds utilized to
consummate, the transaction or series of related transactions
pursuant to which such Person became a Restricted Subsidiary
or was acquired by the Company or a Restricted Subsidiary or
in contemplation of the transaction) and outstanding on such
date; provided, that any such encumbrance or restriction may
not extend to any assets or property of the
65
Company or any other Restricted Subsidiary other than the
assets and property of the Person so acquired;
(iii) any encumbrance or restriction with respect to the
Company or a Restricted Subsidiary pursuant to an agreement or
other instrument relating to Refinancing Indebtedness that
refinanced Indebtedness Incurred pursuant to an agreement or
other instrument referred to in clause (i) or (ii) of this
paragraph or this clause (iii) or contained in any amendment
to an agreement or other instrument referred to in clause (i)
or (ii) of this paragraph or this clause (iii); provided,
however, that the encumbrances and restrictions with respect
to the Company or such Restricted Subsidiary contained in any
such agreement or other instrument or amendment are no less
favorable in any material respect to the Holders of the
Securities than the encumbrances and restrictions contained in
such agreement or other instrument or amendment referred to in
clauses (i) or (ii) of this paragraph on the Issue Date or the
date such Person became a Restricted Subsidiary, whichever is
applicable;
(iv) in the case of clause (3) of the first paragraph of this
covenant, any encumbrance or restriction:
(a) that restricts in a customary manner the subletting,
assignment or transfer of any property or asset that
is subject to a lease, sublease, license or similar
contract, or the assignment or transfer of any such
lease, sublease, license or other contract;
(b) contained in mortgages, pledges or other security
agreements permitted under this Indenture securing
Indebtedness of the Company or a Restricted
Subsidiary to the extent such encumbrances or
restrictions restrict the transfer of the property
subject to such mortgages, pledges or other security
agreements; or
(c) pursuant to customary provisions restricting
dispositions of real property interests set forth in
any reciprocal easement agreements of the Company or
any Restricted Subsidiary;
(v) (a) purchase money obligations for assets or property
acquired in the ordinary course of business and (b)
Capitalized Lease Obligations permitted under this Indenture,
in each case, that impose encumbrances or restrictions of the
nature described in clause (3) of the first paragraph of this
covenant on the property so acquired;
(vi) any restriction with respect to a Restricted Subsidiary
(or any of its property or assets) imposed pursuant to an
agreement entered into for the direct or indirect sale or
disposition of all or substantially all the Capital Stock or
assets of such Restricted Subsidiary (or the property or
assets that
66
are subject to such restriction) pending the closing of such
sale or disposition;
(vii) customary provisions in joint venture agreements
relating to joint ventures that are not Restricted
Subsidiaries and other similar agreements entered into in the
ordinary course of business;
(viii) net worth provisions in leases and other agreements
entered into by the Company or any Restricted Subsidiary in
the ordinary course of business;
(ix) encumbrances or restrictions arising or existing by
reason of applicable law or any applicable rule, regulation or
order; and
(x) Permitted Liens.
SECTION 3.5. Limitation on Sales of Assets and Subsidiary
Stock. The Company will not, and will not permit any of its Restricted
Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may
be, receives consideration at least equal to the fair market value
(such fair market value to be determined on the date of contractually
agreeing to such Asset Disposition), as determined with respect to
transactions in excess of $2.0 million in good faith by the chief
executive officer or chief financial officer of the Company (including
as to the value of all non-cash consideration), of the shares and
assets subject to such Asset Disposition;
(2) at least 75% of the consideration from such Asset
Disposition received by the Company or such Restricted Subsidiary, as
the case may be, is in the form of cash or Cash Equivalents; provided,
that this clause (2) shall not apply to dispositions of assets with a
fair market value of $1.0 million or less; provided further that the
aggregate of the fair market value of the transactions so excluded from
this clause (2) shall not exceed $5.0 million in any calendar year; and
(3) an amount equal to 100% of the Net Available Cash from
such Asset Disposition is applied by the Company or such Restricted
Subsidiary, as the case may be:
(a) first, to the extent the Company or any Restricted
Subsidiary, as the case may be, elects (or is
required by the terms of any Indebtedness), to
prepay, repay or purchase, repurchase, redeem,
retire, defease or otherwise acquire amounts payable
under or in respect of a Credit Facility or other
Indebtedness of the Company (other than any
Disqualified Stock or Subordinated Obligations) or
Indebtedness of a Wholly-Owned Subsidiary (other than
any Disqualified Stock or Guarantor Subordinated
Obligation) (in each case other than Indebtedness
owed to the Company or an Affiliate of the Company)
within 360 days from the later of the date of such
Asset Disposition or the receipt of such Net
Available Cash; provided, however,
67
that, in connection with any prepayment, repayment,
repurchase, redemption, retirement, defeasance or
other acquisition or purchase of Indebtedness
pursuant to this clause (a), the Company or such
Restricted Subsidiary will retire such Indebtedness
and will cause the related commitment (if any) to be
permanently reduced in an amount equal to the
principal amount so prepaid, repaid, purchased,
repurchased, redeemed, retired, defeased or otherwise
acquired; and
(b) second, to the extent of the balance of such Net
Available Cash after application in accordance with
clause (a), to the extent the Company or such
Restricted Subsidiary elects, to invest (or enter
into a binding agreement to invest within 90 days of
the date of such agreement) in Additional Assets
within 360 days from the later of the date of such
Asset Disposition or the receipt of such Net
Available Cash;
provided that pending the final application of any such Net Available
Cash in accordance with clause (a) or clause (b) above, the Company and
its Restricted Subsidiaries may temporarily reduce Indebtedness or
otherwise invest such Net Available Cash in Cash Equivalents or any
other manner not prohibited by this Indenture.
Any Net Available Cash from Asset Dispositions that are not
applied or invested as provided in the preceding paragraph will be deemed to
constitute "Excess Proceeds." On the 361st day after an Asset Disposition, if
the aggregate amount of Excess Proceeds exceeds $5.0 million, a triggering event
shall be deemed to have occurred, which will trigger the obligation of the
Company to make an offer ("Asset Disposition Offer") to all Holders of
Securities and to the extent required by the terms of other Pari Passu
Indebtedness, to all holders of other Pari Passu Indebtedness outstanding with
similar provisions requiring the Company to make an offer to purchase such Pari
Passu Indebtedness with the proceeds from any Asset Disposition ("Pari Passu
Notes"), to purchase the maximum principal amount of Securities and any such
Pari Passu Notes to which the Asset Disposition Offer applies that may be
purchased out of the Excess Proceeds, at an offer price in cash in an amount
equal to 100% of the principal amount of the Securities and Pari Passu Notes
plus accrued and unpaid interest to the date of purchase, in accordance with the
procedures set forth in this Indenture or the agreements governing the Pari
Passu Notes, as applicable, in each case in integral multiples of $1,000. To the
extent that the aggregate amount of Securities and Pari Passu Notes so validly
tendered and not properly withdrawn pursuant to an Asset Disposition Offer is
less than the Excess Proceeds, the Company may use any remaining Excess Proceeds
for any purpose not otherwise prohibited by this Indenture. If the aggregate
principal amount of Securities surrendered by Holders thereof and other Pari
Passu Notes surrendered by holders or lenders, collectively, exceeds the amount
of Excess Proceeds, the Trustee shall select the Securities and Pari Passu Notes
to be purchased on a pro rata basis on the basis of the aggregate principal
amount of tendered Securities and Pari Passu Notes. Upon completion of such
Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
The Asset Disposition Offer will remain open for a period of
20 Business Days following its commencement, except to the extent that a longer
period is required by applicable
68
law (the "Asset Disposition Offer Period"). No later than five Business Days
after the termination of the Asset Disposition Offer Period (the "Asset
Disposition Purchase Date"), the Company will purchase the principal amount of
Securities and Pari Passu Notes required to be purchased pursuant to this
covenant (the "Asset Disposition Offer Amount") or, if less than the Asset
Disposition Offer Amount has been so validly tendered, all Securities and Pari
Passu Notes validly tendered in response to the Asset Disposition Offer.
If the Asset Disposition Purchase Date is on or after an
interest record date and on or before the related interest payment date, any
accrued and unpaid interest will be paid to the Person in whose name a Security
is registered at the close of business on such record date, and no additional
interest will be payable to Holders who tender Securities pursuant to the Asset
Disposition Offer.
On or before the Asset Disposition Purchase Date, the Company
will, to the extent lawful, accept for payment, on a pro rata basis to the
extent necessary, the Asset Disposition Offer Amount of Securities and Pari
Passu Notes or portions of Securities and Pari Passu Notes so validly tendered
and not properly withdrawn pursuant to the Asset Disposition Offer, or if less
than the Asset Disposition Offer Amount has been validly tendered and not
properly withdrawn, all Securities and Pari Passu Notes so validly tendered and
not properly withdrawn, in each case in integral multiples of $1,000. The
Company will deliver to the Trustee an Officers' Certificate stating that such
Securities or portions thereof were accepted for payment by the Company in
accordance with the terms of this covenant and, in addition, the Company will
deliver all certificates and notes required, if any, by the agreements governing
the Pari Passu Notes. The Company or the Paying Agent, as the case may be, will
promptly (but in any case not later than five Business Days after termination of
the Asset Disposition Offer Period) mail or deliver to each tendering Holder of
Securities or holder or lender of Pari Passu Notes, as the case may be, an
amount equal to the purchase price of the Securities or Pari Passu Notes so
validly tendered and not properly withdrawn by such holder or lender, as the
case may be, and accepted by the Company for purchase, and the Company will
promptly issue a new Security, and the Trustee, upon delivery of an Officers'
Certificate from the Company, will authenticate and mail or deliver such new
Security to such Holder, in a principal amount equal to any unpurchased portion
of the Security surrendered; provided that each such new Security will be in a
principal amount of $1,000 or an integral multiple of $1,000. In addition, the
Company will take any and all other actions required by the agreements governing
the Pari Passu Notes. Any Security not so accepted will be promptly mailed or
delivered by the Company to the Holder thereof. The Company will publicly
announce the results of the Asset Disposition Offer on the Asset Disposition
Purchase Date.
For the purposes of this covenant, the following will be
deemed to be cash:
(1) the assumption by the transferee of Indebtedness (other
than Subordinated Obligations or Disqualified Stock) of the Company or
Indebtedness of a Wholly-Owned Subsidiary (other than Subordinated
Obligations of GUSAP Partners, Guarantor Subordinated Obligations or
Disqualified Stock of any Wholly-Owned Subsidiary that is a Subsidiary
Guarantor) and the release of the Company or such Restricted Subsidiary
from all liability on such Indebtedness in connection with such Asset
Disposition (in
69
which case the Company will, without further action, be deemed to have
applied such deemed cash to Indebtedness in accordance with clause (a)
above); and
(2) securities, notes or other obligations received by the
Company or any Restricted Subsidiary from the transferee that are
promptly converted by the Company or such Restricted Subsidiary into
cash.
The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to the
Asset Disposition Offer. To the extent that the provisions of any securities
laws or regulations conflict with provisions of this covenant, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this Indenture by virtue of any
conflict.
SECTION 3.6. Limitation on Liens. The Company will not, and
will not permit any of its Restricted Subsidiaries to, directly or indirectly,
create, Incur or suffer to exist any Lien (other than Permitted Liens) upon any
of its property or assets (including Capital Stock of Restricted Subsidiaries),
whether owned on the date of this Indenture or acquired after that date, which
Lien is securing any Indebtedness, unless contemporaneously with the Incurrence
of such Liens, effective provision is made to secure the Indebtedness due under
this Indenture and the Securities or, in respect of Liens on any Restricted
Subsidiary's property or assets, any Subsidiary Guarantee of such Restricted
Subsidiary, equally and ratably with (or prior to in the case of Liens with
respect to Subordinated Obligations or Guarantor Subordinated Obligations, as
the case may be) the Indebtedness secured by such Lien for so long as such
Indebtedness is so secured.
SECTION 3.7. Limitation on Sale/Leaseback Transactions. The
Company will not, and will not permit any of its Restricted Subsidiaries to,
enter into any Sale/Leaseback Transaction with respect to any property unless:
(1) the Company or such Restricted Subsidiary, as the case may
be, receives consideration at the time of such Sale/Leaseback
Transaction at least equal to the fair market value (as evidenced by a
resolution of the Board of Directors of the Company) of the property
subject to such transaction;
(2) the Company or such Restricted Subsidiary could have
Incurred Indebtedness in an amount equal to the Attributable
Indebtedness in respect of such Sale/Leaseback Transaction pursuant to
the covenant described under Section 3.2;
(3) the Company or such Restricted Subsidiary would be
permitted to create a Lien on the property subject to such
Sale/Leaseback Transaction without securing the Securities by the
covenant described under Section 3.6; and
(4) the Sale/Leaseback Transaction is treated as an Asset
Disposition and all of the conditions of this Indenture described under
Section 3.5 (including the provisions concerning the application of Net
Available Cash) are satisfied with respect to such Sale/Leaseback
Transaction, treating all of the consideration received in such
Sale/Leaseback Transaction as Net Available Cash for purposes of such
covenant.
70
SECTION 3.8. Limitation on Affiliate Transactions. The Company
will not, and will not permit any of its Restricted Subsidiaries to, directly or
indirectly, enter into or conduct any transaction (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
Affiliate of the Company (an "Affiliate Transaction") unless:
(1) the terms of such Affiliate Transaction are no less
favorable, taken as a whole, to the Company or such Restricted
Subsidiary, as the case may be, than those that could be obtained in a
comparable transaction at the time of such transaction in arm's-length
dealings with a Person who is not such an Affiliate;
(2) in the event such Affiliate Transaction involves an
aggregate consideration in excess of $5.0 million, the terms of such
transaction have been approved by a majority of the members of the
Board of Directors of the Company and by a majority of the members of
such Board having no personal stake in such transaction, if any (and
such majority or majorities, as the case may be, determines that such
Affiliate Transaction satisfies the criteria in clause (1) above); and
(3) in the event such Affiliate Transaction involves an
aggregate consideration in excess of $10.0 million, the Company has
received a written opinion from an independent investment banking,
accounting or appraisal firm of nationally recognized standing that
such Affiliate Transaction is not materially less favorable than those
that might reasonably have been obtained in a comparable transaction at
such time on an arm's-length basis from a Person that is not an
Affiliate.
The preceding paragraph will not apply to:
(1) any Restricted Payment permitted to be made pursuant to
the covenant described under Section 3.3;
(2) any issuance of securities, or other payments, awards or
grants in cash, securities or otherwise pursuant to, or the funding of,
employment arrangements and other compensation arrangements, options to
purchase Capital Stock of the Company, restricted stock plans,
long-term incentive plans, stock appreciation rights plans,
participation plans or similar employee benefits plans and/or indemnity
provided on behalf of directors, officers and employees approved by the
Board of Directors;
(3) loans or advances to employees or officers in the ordinary
course of business of the Company or any of its Restricted Subsidiaries
but in any event not to exceed $2.0 million in the aggregate
outstanding at any one time with respect to all loans or advances made
since the Issue Date;
(4) any transaction between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries;
(5) Guarantees issued by the Company or a Restricted
Subsidiary for the benefit of the Company or a Restricted Subsidiary,
as the case may be, in accordance with Section 3.2;
71
(6) the payment of reasonable and customary compensation and
fees paid to, and indemnity provided on behalf of, directors, officers
or employees of the Company or any Restricted Subsidiary providing
services to the Company or any Restricted Subsidiary; and
(7) the performance of obligations of the Company or any of
its Restricted Subsidiaries under the terms of any agreement to which
the Company or any of its Restricted Subsidiaries is a party as of or
on the Issue Date and identified on Schedule 3.8 to this Indenture on
the Issue Date, as these agreements may be amended, modified,
supplemented, extended or renewed from time to time; provided, however,
that any future amendment, modification, supplement, extension or
renewal entered into after the Issue Date will be permitted to the
extent that its terms are not more disadvantageous to the Holders of
the Securities than the terms of the agreements in effect on the Issue
Date.
Notwithstanding the foregoing, the Company shall not be
required to comply with clause (3) of the first paragraph of this Section 3.8
with respect to (i) any Indebtedness of the Company or any Restricted Subsidiary
to ▇▇▇▇▇▇ ▇.▇. or any of its Subsidiaries Incurred in accordance with clauses
(12) or (13) of the second paragraph of Section 3.2 and (ii) any commercial
supply arrangements between ▇▇▇▇▇▇ ▇.▇. and/or any of its Subsidiaries, on the
one hand, and the Company and/or any Restricted Subsidiary, on the other hand.
SECTION 3.9. Limitation on Sale of Capital Stock of Restricted
Subsidiaries. The Company will not, and will not permit any Restricted
Subsidiary to, transfer, convey, sell, lease or otherwise dispose of any Voting
Stock of any Restricted Subsidiary or to issue any of the Voting Stock of a
Restricted Subsidiary (other than, if necessary, shares of its Voting Stock
constituting directors' qualifying shares) to any Person except:
(1) to the Company or a Wholly-Owned Subsidiary; or
(2) in compliance with Section 3.5 and immediately after
giving effect to such issuance or sale, such Restricted Subsidiary
would continue to be a Restricted Subsidiary.
Notwithstanding the preceding paragraph, the Company or any Restricted
Subsidiary may sell all the Voting Stock of a Restricted Subsidiary as long as
the Company complies with the terms of Section 3.5.
SECTION 3.10. Change of Control. If a Change of Control
occurs, unless the Issuers have exercised their right to redeem all of the
Securities as described under "Optional redemption", then such Change of Control
shall constitute a triggering event which shall trigger the obligation of the
Issuers to offer to repurchase from each Holder all or any part (equal to $1,000
or an integral multiple thereof) of such Holder's Securities at a purchase price
in cash equal to 101% of the principal amount of the Securities plus accrued and
unpaid interest, if any, to the date of purchase (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date).
Within 30 days following any Change of Control, unless the
Issuers have exercised their right to redeem all outstanding Securities pursuant
to Section 5.1, the Issuers will mail a notice (the "Change of Control Offer")
to each Holder, with a copy to the Trustee, stating:
72
(1) that a Change of Control has occurred and that such Holder
has the right to require the Issuers to purchase such Holder's
Securities at a purchase price in cash equal to 101% of the principal
amount of such Securities plus accrued and unpaid interest, if any, to
the date of purchase (subject to the right of Holders of record on a
record date to receive interest on the relevant interest payment date)
(the "Change of Control Payment");
(2) the repurchase date (which shall be no earlier than 30
days nor later than 60 days from the date such notice is mailed) (the
"Change of Control Payment Date"); and
(3) the procedures determined by the Issuers, consistent with
this Indenture, that a Holder must follow in order to have its
Securities repurchased.
On the Change of Control Payment Date, the issuers will, to
the extent lawful:
(1) accept for payment all Securities or portions of
Securities (in integral multiples of $1,000) properly tendered pursuant
to the Change of Control Offer;
(2) deposit with the paying agent an amount equal to the
Change of Control Payment in respect of all Securities or portions of
Securities so tendered; and
(3) deliver or cause to be delivered to the Trustee the
Securities so accepted together with an Officers' Certificate stating
the aggregate principal amount of Securities or portions of Securities
being purchased by the Issuers.
The Paying Agent will promptly mail to each Holder of
Securities so tendered the Change of Control Payment for such Securities, and
the Trustee will promptly authenticate and mail (or cause to be transferred by
book entry) to each Holder a new Security equal in principal amount to any
unpurchased portion of the Securities surrendered, if any; provided that each
such new Security will be in a principal amount of $1,000 or an integral
multiple thereof.
If the Change of Control Payment Date is on or after an
interest record date and on or before the related interest payment date, any
accrued and unpaid interest, if any, will be paid to the Person in whose name a
Security is registered at the close of business on such record date, and no
additional interest will be payable to Holders who tender pursuant to the Change
of Control Offer.
Prior to mailing a Change of Control Offer, and as a condition
to such mailing (i) the requisite holders of each issue of Indebtedness issued
under an indenture or other agreement that may be violated by such payment shall
have consented to such Change of Control Offer being made and waived the event
of default, if any, caused under such indenture or other agreement by the Change
of Control or (ii) the Issuers will repay all outstanding Indebtedness issued
under an indenture or other agreement that may be violated by a payment to the
Holders of Securities under a Change of Control Offer or (iii) the Issuers must
offer to repay all such Indebtedness, and make payment to the holders of such
Indebtedness that accept such offer, and obtain waivers of any event of default
from the remaining holders of such Indebtedness. The Issuers covenant to effect
such repayment or obtain such consent and/or waiver within 30 days
73
following any Change of Control, it being a default of the Change of Control
provisions of this Indenture if the Issuers fail to comply with such covenant. A
default under this Indenture will result in a cross-default under the Senior
Secured Credit Agreement.
The Issuers will not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Indenture applicable to a Change of Control Offer
made by the Issuers and purchases all Securities validly tendered and not
withdrawn under such Change of Control Offer.
The Issuers will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Indenture, the Issuers will comply
with the applicable securities laws and regulations and will not be deemed to
have breached their obligations described in this Indenture by virtue of the
conflict.
SECTION 3.11. SEC Reports. Notwithstanding that the Issuers
may not be subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, to the extent permitted by the Exchange Act, the Issuers will file
with the SEC, and make available to the Trustee and the registered Holders of
the Securities, the annual reports and the information, documents and other
reports (or copies of such portions of any of the foregoing as the SEC may by
rules and regulations prescribe) that are specified in Sections 13 and 15(d) of
the Exchange Act within the time periods specified therein. In the event that
the Issuers are not permitted to file such reports, documents and information
with the SEC pursuant to the Exchange Act, the Issuers will nevertheless make
available such Exchange Act information to the Trustee and the Holders of the
Securities as if the Issuers were subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act within the time periods specified
therein.
If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by the preceding paragraph shall include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes
to the financial statements and in Management's Discussion and Analysis of
Results of Operations and Financial Condition, of the financial condition and
results of operations of the Company and its Restricted Subsidiaries.
Notwithstanding the foregoing, in the event that the Company
qualifies to report under the U.S./Canadian multijurisdictional disclosure
system, such annual reports and such information, documents and other reports
will be deemed to refer to those reports required of a Canadian company eligible
to use Canadian continuous disclosure filings to satisfy its reporting
requirements under such system; provided further, however, that notwithstanding
anything to the contrary permitted by such U.S./Canadian multijurisdictional
disclosure system, now or in the future, the reports required of a Canadian
company under such system will be deemed to include (1) a reconciliation of such
annual reports and such information, documents and other reports to accounting
principles generally accepted in the United States, (2) a quarterly balance
sheet and (3) a quarterly or annual, as the case may be, management's discussion
and analysis of financial
74
condition and results of operations substantially in the form that would be
required by a U.S. Person subject to such Sections.
SECTION 3.12. Future Subsidiary Guarantors. After the Issue
Date, the Company will cause each Restricted Subsidiary that is not at that time
a Subsidiary Guarantor and that is required to Guarantee either any Indebtedness
of either of the Issuers or Indebtedness under a Credit Facility to execute and
deliver to the Trustee a Subsidiary Guarantee pursuant to which such Restricted
Subsidiary will unconditionally Guarantee, on a joint and several basis, the
full and prompt payment of the principal of, premium, if any, and interest on
the Securities on a senior basis and all other obligations under this Indenture.
SECTION 3.13. Maintenance of Office or Agency. The Issuers
will maintain an office or agency where the Securities may be presented or
surrendered for payment, where, if applicable, the Securities may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Issuers in respect of the Securities and this Indenture may be served.
The agency of SouthTrust Bank (the "Agent") currently located at SouthTrust
Bank, 110 Office Park Drive, 2nd Floor, Corporate Trust Department, Mail Code
A-001-0B-0201, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ shall be such office or agency of the
Issuers, unless the Issuers shall designate and maintain some other office or
agency for one or more of such purposes. The Issuers will give prompt written
notice to the Trustee of any change in the location of any such office or
agency. If at any time the Issuers shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Agent of the Trustee, and the Issuers hereby appoint the Trustee as their agent
to receive all such presentations, surrenders, notices and demands.
The Issuers may also from time to time designate one or more
other offices or agencies where the Securities may be presented or surrendered
for any or all such purposes and may from time to time rescind any such
designation. The Issuers will give prompt written notice to the Trustee of any
such designation or rescission and any change in the location of any such other
office or agency.
SECTION 3.14. Corporate Existence. Except as otherwise
provided in this Article III, Article IV and Section 10.2(b), the Company will
do or cause to be done all things necessary to preserve and keep in full force
and effect its corporate existence and the corporate, partnership, limited
liability company or other existence of GUSAP Partners and each Significant
Subsidiary or the respective corporate, partnership, limited liability company
or other existences of each member of any group of Restricted Subsidiaries that
taken together would constitute a Significant Subsidiary of the Company in
accordance with their respective organizational documents (as the same may be
amended from time to time) and the rights (charter and statutory) licenses and
franchises of the Company and each Significant Subsidiary or each member of any
group of Restricted Subsidiaries that taken together would constitute a
Significant Subsidiary of the Company; provided, however, that the Company shall
not be required to preserve any such right, license or franchise or the
corporate, partnership, limited liability company or other existence of any
Significant Subsidiary or the respective corporate, partnership, limited
liability company or other existences of each member of any group of Restricted
Subsidiaries that taken together would constitute a Significant Subsidiary of
the
75
Company if the Board of Directors of the Company shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and each of its Restricted Subsidiaries, taken as a whole, and that
the loss thereof is not, and will not be, disadvantageous in any material
respect to the Holders; provided, further, that the Company shall not be
required to preserve any such right, license or franchise or the corporate,
partnership, limited liability company or other existence of a Restricted
Subsidiary that is neither a Significant Subsidiary nor a member of any group of
Restricted Subsidiaries that taken together would constitute a Significant
Subsidiary of the Company and provided further, however, that the foregoing
shall not prohibit a sale, transfer, or conveyance of a Restricted Subsidiary or
any of its assets in compliance with the terms of this Indenture.
SECTION 3.15. Payment of Taxes and Other Claims. The Issuers
shall pay or discharge or cause to be paid or discharged, before the same shall
become delinquent, (i) all material taxes, assessments and governmental charges
levied or imposed upon the Company, GUSAP Partners or any Subsidiary or upon the
income, profits or property of the Company, GUSAP Partners or any Subsidiary and
(ii) all lawful claims for labor, materials and supplies, which, if unpaid,
might by law become a material liability or lien upon the property of the
Company, GUSAP Partners or any Subsidiary; provided, however, that the Issuers
shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge or claim the amount, applicability or validity of
which is being contested in good faith by appropriate proceedings and for which
appropriate reserves, if necessary (in the good faith judgment of management of
the Issuers), are being maintained in accordance with GAAP or where the failure
to effect such payment will not be disadvantageous to the Holders.
SECTION 3.16. Payments for Consent. Neither the Company nor
any of its Restricted Subsidiaries will, directly or indirectly, pay or cause to
be paid any consideration, whether by way of interest, fees or otherwise, to any
Holder of any Securities for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Securities
unless such consideration is offered to be paid or is paid to all Holders of the
Securities that consent, waive or agree to amend in the time frame set forth in
the solicitation documents relating to such consent, waiver or amendment.
SECTION 3.17. Compliance Certificate. The Issuers shall
deliver to the Trustee within 120 days after the end of each Fiscal Year of the
Company an Officers' Certificate stating that in the course of the performance
by the signers of their duties as Officers of the Company and of GUSAP Partners
they would normally have knowledge of any Default or Event of Default and
whether or not the signers know of any Default or Event of Default that occurred
during the previous Fiscal Year. If they do, the certificate shall describe the
Default or Event of Default, its status and the action the Company or GUSAP
Partners is taking or proposes to take with respect thereto. The Issuers also
shall comply with TIA Section 314(a)(4).
SECTION 3.18. Further Instruments and Acts. Upon request of
the Trustee, the Issuers will execute and deliver such further instruments and
do such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 3.19. Statement by Officers as to Default. The Issuers
shall deliver to the Trustee, as soon as possible and in any event within 10
days after the Issuers become aware
76
of the occurrence of any Event of Default or an event which, with notice or the
lapse of time or both, would constitute an Event of Default, an Officers'
Certificate setting forth the details of such Event of Default or default, its
status and the actions which the Issuers are taking or propose to take with
respect thereto.
SECTION 3.20. Effectiveness of Covenants. Following the first
day:
(a) the Securities have an Investment Grade Rating from both
of the Ratings Agencies, and
(b) no Default has occurred and is continuing under the
Indenture;
the Company and its Restricted Subsidiaries will not be subject to Sections 3.2,
3.3, 3.4, 3.5, 3.8, 3.9 and clause (3) of Section 4.1 of this Indenture
(collectively, the "Suspended Covenants"). If at any time the Securities' credit
rating is downgraded from Investment Grade Rating, then the Suspended Covenants
will thereafter be reinstated as if such covenants had never been suspended and
be applicable pursuant to the terms of the Indenture (including in connection
with performing any calculation or assessment to determine compliance with the
terms of the Indenture), unless and until the Securities subsequently attain
Investment Grade Rating (in which event the Suspended Covenants shall no longer
be in effect for such time that the Securities maintain Investment Grade
Rating); provided, however, that no Default, Event of Default or breach of any
kind shall be deemed to exist under the Indenture, the Securities or the
Subsidiary Guarantees with respect to the Suspended Covenants based on, and none
of the Company or any of its Subsidiaries shall bear any liability for, any
actions taken or events occurring after the Securities attain Investment Grade
Rating and before any reinstatement of such Suspended Covenants as provided
above, or any actions taken at any time pursuant to any contractual obligation
arising prior to such reinstatement, regardless of whether such actions or
events would have been permitted if the applicable Suspended Covenants remained
in effect during such period. The Issuers will notify the Trustee by delivery of
an Officers' Certificate of the suspension of the Suspended Covenants.
ARTICLE IV
SUCCESSOR COMPANY
SECTION 4.1. Merger and Consolidation. The Company will not
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person, unless:
(1) the resulting, surviving or transferee Person (the
"Successor Company") will be a corporation, organized and existing
under the federal laws of Canada, any province or territory thereof,
the laws of the United States of America, any State of the United
States or the District of Columbia and the Successor Company (if not
the Company) will expressly assume, by supplemental indenture, executed
and delivered to the Trustee, in form satisfactory to the Trustee, all
the obligations of the Company under the Securities and this Indenture;
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(2) immediately after giving effect to such transaction (and
treating any Indebtedness that becomes an obligation of the Successor
Company or any Subsidiary of the Successor Company as a result of such
transaction as having been Incurred by the Successor Company or such
Subsidiary at the time of such transaction), no Default or Event of
Default shall have occurred and be continuing;
(3) immediately after giving pro forma effect to such
transaction, the Successor Company would be able to Incur at least an
additional $1.00 of Indebtedness pursuant to the first paragraph of
Section 3.2;
(4) each Subsidiary Guarantor (unless it is the other party to
the transactions above, in which case clause (1) shall apply) shall
have by supplemental indenture confirmed that its Subsidiary Guarantee
shall apply to the Successor Company's obligations in respect of this
Indenture and the Securities and its obligations under the Registration
Rights Agreement shall continue to be in effect; and
(5) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if
any) comply with this Indenture.
For purposes of this covenant, the sale, lease, conveyance,
assignment, transfer, or other disposition of all or substantially all of the
properties and assets of one or more Subsidiaries of the Company, which
properties and assets, if held by the Company instead of such Subsidiaries,
would constitute all or substantially all of the properties and assets of the
Company on a consolidated basis, shall be deemed to be the transfer of all or
substantially all of the properties and assets of the Company.
The Successor Company will succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture,
but, in the case of a lease of all or substantially all of its assets, the
predecessor Company will not be released from the obligation to pay the
principal of and interest on the Securities.
Notwithstanding the preceding clause (3), (x) any Restricted
Subsidiary may amalgamate, consolidate or merge with, or liquidate into or
transfer all or part of its properties and assets to the Company or a
Wholly-Owned Subsidiary and (y) the Company may amalgamate, consolidate or merge
with or liquidate into an Affiliate incorporated for the purpose of
reincorporating the Company in another jurisdiction so long as the amount of
Indebtedness of the Company and its Restricted Subsidiaries is not increased
thereby; provided that, in the case of the foregoing clause (x), the Company
will not be required to comply with the preceding clause (5).
Furthermore, the Company will not permit GUSAP Partners to
consolidate with or merge with or into any Person (other than the Company or a
Wholly-Owned Subsidiary), and will not convey, transfer or lease all or
substantially all of the assets of GUSAP Partners (other than to the Company or
a Wholly-Owned Subsidiary), unless (a) the resulting, surviving or transferee
Person will be a corporation, partnership, trust or limited liability company
organized or formed and existing under the laws of the United States of America,
any State of the United
78
States or the District of Columbia, Canada or any province or territory of
Canada and such Person (if not the Company or GUSAP Partners) will expressly
assume, by supplemental indenture, executed and delivered to the Trustee, all
the obligations of GUSAP Partners under the Securities and this Indenture; (b)
immediately after giving effect to such transaction (and treating any
Indebtedness that becomes an obligation of the resulting, surviving or
transferee Person as a result of such transaction as having been Incurred by
such Person at the time of such transaction), no Default or Event of Default
shall have occurred and be continuing; and (c) the Company will have delivered
to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation, merger or transfer and such supplemental indenture (if
any) comply with this Indenture.
ARTICLE V
REDEMPTION OF SECURITIES
SECTION 5.1. Redemption. The Securities may be redeemed, as a
whole or from time to time in part, subject to the conditions and at the
redemption prices specified in paragraph 5 of the form of Securities set forth
in Exhibit A and Exhibit B hereto, which are hereby incorporated by reference
and made a part of this Indenture, together with accrued and unpaid interest to
the Redemption Date.
SECTION 5.2. Applicability of Article. Redemption of
Securities at the election of the Issuers or otherwise, as permitted or required
by any provision of this Indenture, shall be made in accordance with such
provision and this Article.
SECTION 5.3. Election to Redeem; Notice to Trustee. The
election of the Issuers to redeem any Securities pursuant to Section 5.1 shall
be evidenced by a Board Resolution of each Issuer. In case of any redemption at
the election of the Issuers, the Issuers shall, upon not later than the earlier
of the date that is 45 days prior to the Redemption Date fixed by the Issuers or
the date on which notice is given to the Holders (except as provided in Section
5.5 or unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee of such Redemption Date and of the principal amount of Securities to be
redeemed and shall deliver to the Trustee such documentation and records as
shall enable the Trustee to select the Securities to be redeemed pursuant to
Section 5.4. Any such notice may be cancelled at any time prior to notice of
such redemption being mailed to any Holder and shall thereby be void and of no
effect.
SECTION 5.4. Selection by Trustee of Securities to Be
Redeemed. If less than all the Securities are to be redeemed at any time
pursuant to an optional redemption, the particular Securities to be redeemed
shall be selected not more than 60 days prior to the Redemption Date by the
Trustee, from the outstanding Securities not previously called for redemption,
in compliance with the requirements of the principal securities exchange, if
any, on which such Securities are listed, or, if such Securities are not so
listed, on a pro rata basis among the classes of Securities, by lot or by such
other method as the Trustee shall deem fair and appropriate (and in such manner
as complies with applicable legal requirements) and which may provide for the
selection for redemption of portions of the principal of the Securities;
provided,
79
however, that no such partial redemption shall reduce the portion of the
principal amount of a Security not redeemed to less than $1,000.
The Trustee shall promptly notify the Issuers in writing of
the Securities selected for redemption and, in the case of any Securities
selected for partial redemption, the method it has chosen for the selection of
Securities and the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to redemption of Securities shall
relate, in the case of any Security redeemed or to be redeemed only in part, to
the portion of the principal amount of such Security which has been or is to be
redeemed.
SECTION 5.5. Notice of Redemption. Notice of redemption shall
be given in the manner provided for in Section 11.2 not less than 30 nor more
than 60 days prior to the Redemption Date, to each Holder of Securities to be
redeemed. At the Issuers' request, the Trustee shall give notice of redemption
in the Issuers' name and at the Issuers' expense; provided, however, that the
Issuers shall deliver to the Trustee, at least 45 days prior to the Redemption
Date, an Officers' Certificate requesting that the Trustee give such notice at
the Issuers' expense and setting forth the information to be stated in such
notice as provided in the following items.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the redemption price and the amount of accrued interest to
the Redemption Date payable as provided in Section 5.7, if any,
(3) if less than all outstanding Securities are to be
redeemed, the identification of the particular Securities (or portion
thereof) to be redeemed, as well as the aggregate principal amount of
Securities to be redeemed and the aggregate principal amount of
Securities to be outstanding after such partial redemption,
(4) in case any Security is to be redeemed in part only, the
notice which relates to such Security shall state that on and after the
Redemption Date, upon surrender of such Security, the Holder will
receive, without charge, a new Security or Securities of authorized
denominations for the principal amount thereof remaining unredeemed,
(5) that on the Redemption Date the redemption price (and
accrued interest, if any, to the Redemption Date payable as provided in
Section 5.7) will become due and payable upon each such Security, or
the portion thereof, to be redeemed, and, unless the Issuers default in
making the redemption payment, that interest on Securities called for
redemption (or the portion thereof) will cease to accrue on and after
said date,
(6) the place or places where such Securities are to be
surrendered for payment of the redemption price and accrued interest,
if any,
(7) the name and address of the Paying Agent,
80
(8) that Securities called for redemption must be surrendered
to the Paying Agent to collect the redemption price,
(9) the CUSIP number, and that no representation is made as to
the accuracy or correctness of the CUSIP number, if any, listed in such
notice or printed on the Securities, and
(10) the paragraph of the Securities pursuant to which the
Securities are to be redeemed.
SECTION 5.6. Deposit of Redemption Price. Prior to 10:00 a.m.,
New York City time, on any Redemption Date, the Issuers shall deposit with the
Trustee or with a Paying Agent (or, if any of the Company's Subsidiaries is
acting as its own Paying Agent, segregate and hold in trust as provided in
Section 2.4) an amount of money sufficient to pay the redemption price of, and
accrued interest on, all the Securities which are to be redeemed on that date,
other than Securities or portions of Securities called for redemption that are
beneficially owned by the Issuers and have been delivered by the Issuers to the
Trustee for cancellation.
SECTION 5.7. Securities Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Securities or portions of
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the redemption price therein specified (together with accrued
interest, if any, to the Redemption Date), and from and after such date (unless
the Issuers shall default in the payment of the redemption price and accrued
interest) such Securities shall cease to bear interest and the only right of the
Holders thereof will be to receive payment of the redemption price and, subject
to the next sentence, unpaid interest on such Securities to the Redemption Date.
Upon surrender of any such Security for redemption in accordance with said
notice, such Security shall be paid by the Issuers at the redemption price,
together with accrued interest, if any, to the Redemption Date (subject to the
rights of Holders of record on the relevant record date to receive interest due
on the relevant interest payment date).
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the unpaid principal (and premium, if
any) shall, until paid, bear interest from the Redemption Date at the rate borne
by the Securities.
SECTION 5.8. Securities Redeemed in Part. Any Security which
is to be redeemed only in part (pursuant to the provisions of this Article)
shall be surrendered at the office or agency of the Issuers maintained for such
purpose pursuant to Section 3.13 (with, if the Issuers or the Trustee so
require, due endorsement by, or a written instrument of transfer in form
satisfactory to the Issuers and the Trustee duly executed by, the Holder thereof
or such Holder's attorney duly authorized in writing), and the Issuers shall
execute, and the Trustee shall authenticate and make available for delivery to
the Holder of such Security at the expense of the Issuers, a new Security or
Securities, of any authorized denomination as requested by such Holder, in an
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered, provided, that each such new
Security will be in a principal amount of $1,000 or integral multiple thereof.
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ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.1. Events of Default. Each of the following is an
"Event of Default":
(1) default in any payment of interest or additional interest,
if any, (as required by the Registration Rights Agreement) on any
Security when the same becomes due and payable, and such default
continues for a period of 30 days;
(2) default in the payment of principal of or premium, if any,
on any Security when the same becomes due and payable at its Stated
Maturity, upon optional redemption, upon required repurchase, upon
declaration or otherwise;
(3) failure by the Issuers or any Subsidiary Guarantor to
comply with its obligations under Article IV or Section 10.2;
(4) failure by the Issuers to comply with any of their
obligations under Section 3.2, Section 3.3, Section 3.4, Section 3.5,
Section 3.6, Section 3.7, Section 3.8, Section 3.9, Section 3.10,
Section 3.11, Section 3.12 or Section 3.16, (in each case, other than a
failure to purchase Securities when required under this Indenture,
which failure shall constitute an Event of Default under Section
6.1(2)) and such failure continues for 30 days after the notice
specified below;
(5) the Issuers default in the performance of or a breach by
the Issuers of any other covenant or agreement in this Indenture or
under the Securities (other than those referred to in (1), (2), (3) or
(4) above) and such default continues for 60 days after the notice
specified below;
(6) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by the Company or any of its
Restricted Subsidiaries (or the payment of which is guaranteed by the
Company or any of its Restricted Subsidiaries or is recourse to the
Company or its Restricted Subsidiaries, by contract or operation of
law), other than Indebtedness owed to the Company or a Restricted
Subsidiary, whether such Indebtedness or guarantee now exists, or is
created after the date of this Indenture, which default:
(a) is caused by a failure to pay any Indebtedness at
maturity prior to the expiration of the grace period
provided in such Indebtedness ("Payment Default") or
(b) results in the acceleration of such Indebtedness
prior to its final maturity (the "cross acceleration
provision");
and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness
under which there has been a payment
82
default or the maturity of which has been so accelerated, aggregates
$10.0 million or more;
(7) the Company, GUSAP Partners or a Significant Subsidiary or
group of Restricted Subsidiaries that, taken together (as of the latest
audited consolidated financial statements for the Company and its
Restricted Subsidiaries), would constitute a Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case or proceeding;
(b) consents to the entry of judgment, decree or order
for relief against it in an involuntary case or
proceeding;
(c) consents to the appointment of a Custodian of it or
for any substantial part of its property;
(d) makes a general assignment for the benefit of its
creditors;
(e) consents to or acquiesces in the institution of a
bankruptcy or an insolvency proceeding against it;
(f) takes any corporate action to authorize or effect any
of the foregoing; or
(g) takes any comparable action under any foreign laws
relating to insolvency; or
(8) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(a) is for relief in an involuntary case against the
Company, GUSAP Partners or a Significant Subsidiary
or group of Restricted Subsidiaries that, taken
together (as of the latest audited consolidated
financial statements for the Company and its
Restricted Subsidiaries), would constitute a
Significant Subsidiary pursuant to or within the
meaning of any Bankruptcy Law;
(b) appoints a Custodian for all or substantially all of
the property of the Company, GUSAP Partners or a
Significant Subsidiary or group of Restricted
Subsidiaries that, taken together (as of the latest
audited consolidated financial statements for the
Company and its Restricted Subsidiaries), would
constitute a Significant Subsidiary pursuant to or
within the meaning of any Bankruptcy Law; or
(c) orders the winding up or liquidation of the Company,
GUSAP Partners or a Significant Subsidiary or group
of Restricted Subsidiaries that, taken together (as
of the latest audited consolidated financial
statements for the Company and its Restricted
Subsidiaries), would constitute a Significant
Subsidiary pursuant to or within the meaning of any
Bankruptcy Law; and
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(d) in each case the order, decree or relief remains
unstayed and in effect for 90 days;
(9) failure by the Company or any Significant Subsidiary or
group of Restricted Subsidiaries that, taken together (as of the latest
audited consolidated financial statements for the Company and its
Restricted Subsidiaries), would constitute a Significant Subsidiary to
pay final judgments aggregating in excess of $10.0 million (net of any
amounts that a reputable and creditworthy insurance company has
acknowledged liability for in writing), which judgments are not paid,
discharged, waived or stayed for a period of 60 days (the "judgment
default provision"); or
(10) any Subsidiary Guarantee ceases to be in full force and
effect (except as contemplated by the terms of this Indenture) or is
declared null and void in a judicial proceeding or any Subsidiary
Guarantor denies or disaffirms its obligations under this Indenture or
its Subsidiary Guarantee.
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body.
Notwithstanding the foregoing, a Default under clauses (4) or
(5) of this Section 6.1 will not constitute an Event of Default until the
Trustee or the Holders of 25% or more in principal amount of the outstanding
Securities notify the Issuers of the Default in writing, which notice shall
specify that it constitutes a notice of Default, and the Issuers do not cure
such Default within the time specified in clauses (4) or (5) of this Section 6.1
after receipt of such notice.
The Issuers shall deliver to the Trustee, within 10 days after
the occurrence thereof, written notice in the form of an Officers' Certificate
of any Default or Event of Default under clauses (3), (4), (5), (6), (7), (8),
(9) or (10) of this Section 6.1, which such notice shall contain the status
thereof and a description of the action being taken or proposed to be taken by
the Issuers in respect thereof.
In the case of any Event of Default occurring by reason of any
willful action (or inaction) taken (or not taken) by or on behalf of the Issuers
with the intention of avoiding payment of the premium that the Issuers would
have had to pay if the Issuers then had elected to redeem the Securities
pursuant to the optional redemption provisions of this Indenture or were
required to repurchase the Securities, an equivalent premium shall also become
and be immediately due and payable to the extent permitted by law upon the
acceleration of the Securities. If an Event of Default occurs prior to July 15,
2007 by reason of any willful action (or inaction) taken (or not taken) by or on
behalf of the Issuers with the intention of avoiding the prohibition on
redemption of the Securities prior to July 15, 2007, the premium specified in
this Indenture shall also become immediately due and payable to the extent
permitted by law upon the acceleration of the Securities.
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SECTION 6.2. Acceleration. If an Event of Default (other than
an Event of Default described in clause (7) or (8) of Section 6.1) occurs and is
continuing, the Trustee by notice to the Issuers, or the Holders of at least 25%
in principal amount of the outstanding Securities by notice to the Issuers and
the Trustee, may, and the Trustee at the request of such Holders shall, declare
the principal of, premium, if any, and accrued and unpaid interest, if any, on
all the Securities to be due and payable. Upon such a declaration, such
principal, premium and accrued and unpaid interest shall be due and payable
immediately.
In the event of a declaration of acceleration of the
Securities because an Event of Default described in clause (6) of Section 6.1
has occurred and is continuing, the declaration of acceleration of the
Securities shall be automatically annulled if the event of default or payment
default triggering such Event of Default pursuant to clause (6) shall be
remedied or cured by the Company or a Restricted Subsidiary or waived by the
holders of the relevant Indebtedness within 20 days after the declaration of
acceleration with respect thereto and if (1) the annulment of the acceleration
of the Securities would not conflict with any judgment or decree of a court of
competent jurisdiction and (2) all existing Events of Default, except nonpayment
of principal, premium or interest on the Securities that became due solely
because of the acceleration of the Securities, have been cured or waived.
If an Event of Default described in clause (7) or (8) of
Section 6.1 occurs and is continuing, the principal of, premium, if any, and
accrued and unpaid interest on all the Securities will become and be immediately
due and payable without any declaration or other act on the part of the Trustee
or any Holders.
SECTION 6.3. Other Remedies. If an Event of Default occurs and
is continuing, the Trustee may pursue any available remedy by proceeding at law
or in equity to collect the payment of principal of (or premium, if any) or
interest on the Securities or to enforce the performance of any provision of the
Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Securityholder in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.4. Waiver of Past Defaults. The Holders of a
majority in principal amount of the outstanding Securities by notice to the
Trustee may (a) waive, by their consent (including, without limitation consents
obtained in connection with a purchase of, or tender offer or exchange offer
for, Securities), an existing Default or Event of Default and its consequences
except (i) a Default or Event of Default in the payment of the principal of, or
premium, if any, or interest on a Security or (ii) a Default or Event of Default
in respect of a provision that under Section 9.2 cannot be amended without the
consent of each Securityholder affected and (b) rescind any such acceleration
with respect to the Securities and its consequences if (1) rescission would not
conflict with any judgment or decree of a court of competent jurisdiction and
(2) all existing Events of Default, other than the nonpayment of the principal
of, premium, if any, and interest on the Securities that have become due solely
by such declaration
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of acceleration, have been cured or waived. When a Default or Event of Default
is waived, it is deemed cured, but no such waiver shall extend to any subsequent
or other Default or Event of Default or impair any consequent right.
SECTION 6.5. Control by Majority. The Holders of a majority in
principal amount of the outstanding Securities may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Sections 7.1 and 7.2, that the Trustee determines is unduly
prejudicial to the rights of other Securityholders or would involve the Trustee
in personal liability; provided, however, that the Trustee may take any other
action deemed proper by the Trustee that is not inconsistent with such
direction. Prior to taking any action hereunder, the Trustee shall be entitled
to indemnification satisfactory to it in its sole discretion against all losses
and expenses caused by taking or not taking such action.
SECTION 6.6. Limitation on Suits. Subject to Section 6.7, a
Securityholder may not pursue any remedy with respect to this Indenture or the
Securities unless:
(1) such Holder has previously given to the Trustee written
notice stating that an Event of Default is continuing;
(2) Holders of at least 25% in principal amount of the
outstanding Securities have requested that the Trustee to pursue the
remedy;
(3) such Holders have offered to the Trustee reasonable
security or indemnity against any loss, liability or expense;
(4) the Trustee has not complied with such request within 60
days after receipt of the request and the offer of security or
indemnity; and
(5) the Holders of a majority in principal amount of the
outstanding Securities have not given the Trustee a direction that, in
the opinion of the Trustee, is inconsistent with such request during
such 60-day period.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
another Securityholder.
SECTION 6.7. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture (including, without
limitation, Section 6.6), the right of any Holder to receive payment of
principal of, premium (if any) or interest on the Securities held by such
Holder, on or after the respective due dates expressed in the Securities, or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
SECTION 6.8. Collection Suit by Trustee. If an Event of
Default specified in clauses (1) or (2) of Section 6.1 occurs and is continuing,
the Trustee may recover judgment in its own name and as trustee of an express
trust against the Issuers for the whole amount then due
86
and owing (together with interest on any unpaid interest to the extent lawful)
and the amounts provided for in Section 7.7.
SECTION 6.9. Trustee May File Proofs of Claim. The Trustee may
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel) and the Securityholders allowed in any judicial
proceedings relative to the Company, its Subsidiaries or its or their respective
creditors or properties and, unless prohibited by law or applicable regulations,
may be entitled and empowered to participate as a member of any official
committee of creditors appointed in such matter and may vote on behalf of the
Holders in any election of a trustee in bankruptcy or other Person performing
similar functions, and any Custodian in any such judicial proceeding is hereby
authorized by each Holder to make payments to the Trustee and, in the event that
the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel, and any other amounts due the Trustee under Section 7.7.
SECTION 6.10. Priorities. If the Trustee collects any money or
property pursuant to this Article VI, it shall pay out the money or property in
the following order:
FIRST: to the Trustee for amounts due under Section 7.7;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for principal, premium, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts
due and payable on the Securities for principal and interest,
respectively; and
THIRD: to the Issuers or, to the extent the Trustee collects
any amount for any Subsidiary Guarantor, to such Subsidiary Guarantor.
The Trustee may fix a record date and payment date for any
payment to Securityholders pursuant to this Section. At least 15 days before
such record date, the Company shall mail to each Securityholder and the Trustee
a notice that states the record date, the payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by the Issuers, a suit by a Holder pursuant to
Section 6.7 or a suit by Holders of more than 10% in outstanding principal
amount of the Securities.
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ARTICLE VII
TRUSTEE
SECTION 7.1. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Person's own affairs; provided that if an Event of
Default occurs and is continuing, the Trustee will be under no obligation to
exercise any of the rights or powers under this Indenture at the request or
direction of any of the Holders unless such Holders have offered the Trustee
reasonable indemnity or security against loss, liability or expense.
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates,
opinions or orders furnished to the Trustee and conforming to the
requirements of this Indenture. However, in the case of any such
certificates or opinions which by any provisions hereof are
specifically required to be furnished to the Trustee, the Trustee shall
examine such certificates and opinions to determine whether or not they
conform to the requirements of this Indenture (but need not confirm or
investigate the accuracy of mathematical calculations or other facts
stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b)
of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.5.
(d) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b) and (c) of this
Section.
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the
Issuers.
(f) Money held in trust by the Trustee need not be segregated
from other funds except to the extent required by law.
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(g) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder or in the exercise of
any of its rights or powers, if it shall have reasonable grounds to
believe that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee
shall be subject to the provisions of this Section and to the
provisions of the TIA.
(i) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Issuers shall be
sufficient if signed by an Officer of each of the Company and GUSAP
Partners.
(j) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request
or direction of any of the Holders unless such Holders shall have
offered to the Trustee reasonable security or indemnity satisfactory to
it against the costs, expenses (including reasonable attorneys' fees
and expenses) and liabilities that might be incurred by it in
compliance with such request or direction.
SECTION 7.2. Rights of Trustee. Subject to Section 7.1:
(a) The Trustee may conclusively rely on any document (whether
in its original or facsimile form) reasonably believed by it to be genuine and
to have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document. The Trustee shall receive
and retain financial reports and statements of the Issuers as provided herein,
but shall have no duty to review or analyze such reports or statements to
determine compliance under covenants or other obligations of the Issuers.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate and/or an Opinion of Counsel. The Trustee shall
not be liable for any action it takes or omits to take in good faith in reliance
on an Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers, unless the Trustee's conduct constitutes willful misconduct or
negligence.
(e) The Trustee may consult with counsel of its selection, and
the advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Securities shall be full and complete authorization and
protection from liability in respect of any action taken, omitted or suffered by
it hereunder in good faith and in accordance with the advice or opinion of such
counsel.
(f) The Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Trust Officer of the Trustee has actual
knowledge thereof or unless written
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notice of any event which is in fact such a default is received by the Trustee
at the corporate trust office of the Trustee specified in Section 11.2, and such
notice references the Securities and this Indenture.
(g) The rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and to each agent, custodian and other Person
employed to act hereunder.
(h) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
(i) The Trustee shall not be deemed to have knowledge of any
fact or matter unless such fact or matter is known to a Trust Officer of the
Trustee.
(j) Whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may request, and in the absence of
bad faith or willful misconduct on its part, rely upon an Officers' Certificate.
SECTION 7.3. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Issuers, Subsidiary Guarantors or their
Affiliates with the same rights it would have if it were not Trustee. Any Paying
Agent, Registrar, co-registrar or co-paying agent may do the same with like
rights. However, the Trustee must comply with Sections 7.10 and 7.11. In
addition, the Trustee shall be permitted to engage in transactions with the
Issuers; provided, however, that if the Trustee acquires any conflicting
interest the Trustee must (i) eliminate such conflict within 90 days of
acquiring such conflicting interest, (ii) apply to the SEC for permission to
continue acting as Trustee or (iii) resign.
SECTION 7.4. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, shall not be accountable for the Issuers' use
of the proceeds from the sale of the Securities, shall not be responsible for
the use or application of any money received by any Paying Agent other than the
Trustee or any money paid to the Issuers pursuant to the terms of this Indenture
and shall not be responsible for any statement of the Issuers in this Indenture
or in any document issued in connection with the sale of the Securities or in
the Securities other than the Trustee's certificate of authentication.
SECTION 7.5. Notice of Defaults. If a Default or Event of
Default occurs and is continuing and if a Trust Officer has actual knowledge
thereof, the Trustee shall mail by first class mail to each Securityholder at
the address set forth in the Securities Register notice of the Default or Event
of Default within the earlier of 90 days after it occurs or 30 days after it is
actually known to a Trust Officer or written notice of it is received by the
Trustee. Except in the
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case of a Default or Event of Default in payment of principal of, premium (if
any), or interest on any Security (including payments pursuant to the optional
redemption or required repurchase provisions of such Security, if any), the
Trustee may withhold the notice if and so long as its board of directors, a
committee of its board of directors or a committee of its Trust Officers in good
faith determines that withholding the notice is in the interests of
Securityholders.
SECTION 7.6. Reports by Trustee to Holders. As promptly as
practicable after each May 15 beginning the May 15, 2004 following the date of
this Indenture, and in any event prior to July 15 in each year, the Trustee
shall mail to each Securityholder a brief report dated as of such July 15 that
complies with TIA Section 313(a) if and to the extent required thereby. The
Trustee also shall comply with TIA Section 313(b) and TIA Section 313(c).
A copy of each report at the time of its mailing to
Securityholders shall be filed with the SEC and each stock exchange (if any) on
which the Securities are listed. The Issuers agree to notify promptly the
Trustee whenever the Securities become listed on any stock exchange and of any
delisting thereof and the Trustee shall comply with TIA Section 313(d).
SECTION 7.7. Compensation and Indemnity. The Issuers shall pay
to the Trustee from time to time reasonable compensation for its acceptance of
this Indenture and services hereunder as the Issuers and the Trustee shall from
time to time agree in writing. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Issuers shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred or made by it, including costs of collection, costs of preparing and
reviewing reports, certificates and other documents, costs of preparation and
mailing of notices to Securityholders and reasonable costs of counsel retained
by the Trustee in connection with the delivery of an Opinion of Counsel or
otherwise, in addition to the compensation for its services. Such expenses shall
include the reasonable compensation and expenses, disbursements and advances of
the Trustee's agents, counsel, accountants and experts. The Issuers shall
indemnify the Trustee against any and all loss, liability, damages, claims or
expense (including reasonable attorneys' fees and expenses) incurred by it
without negligence or bad faith on its part in connection with the
administration of this trust and the performance of its duties hereunder,
including the costs and expenses of enforcing this Indenture (including this
Section 7.7) and of defending itself against any claims (whether asserted by any
Securityholder, the Issuers or otherwise). The Trustee shall notify the Issuers
promptly of any claim for which it may seek indemnity. Failure by the Trustee to
so notify the Issuers shall not relieve the Issuers of their obligations
hereunder. The Issuers shall defend the claim and the Trustee shall provide
reasonable cooperation at the Issuers' expense in the defense. The Trustee may
have separate counsel and the Issuers shall pay the fees and expenses of such
counsel, provided that the Issuers shall not be required to pay such fees and
expenses if they assume the Trustee's defense, and, in the reasonable judgment
of outside counsel to the Trustee, there is no conflict of interest between the
Issuers and the Trustee in connection with such defense. Notwithstanding the
foregoing, the Issuers and the Subsidiary Guarantors need not reimburse any
expense or indemnify against any loss, liability or expense which is finally
determined by a court of competent jurisdiction to have been incurred by the
Trustee through the Trustee's own willful misconduct, negligence or bad faith.
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To secure the Issuers' payment obligations in this Section,
the Trustee shall have a lien prior to the Securities on all money or property
held or collected by the Trustee other than money or property held in trust to
pay principal of and interest on particular Securities. Such lien shall survive
the satisfaction and discharge of this Indenture. The Trustee's right to receive
payment of any amounts due under this Section 7.7 shall not be subordinate to
any other liability or Indebtedness of the Issuers.
The Issuers' payment obligations pursuant to this Section
shall survive the discharge of this Indenture. When the Trustee incurs expenses
after the occurrence of a Default specified in clause (7) or clause (8) of
Section 6.1 with respect to the Issuers, the expenses are intended to constitute
expenses of administration under any Bankruptcy Law.
SECTION 7.8. Replacement of Trustee. The Trustee may resign at
any time by so notifying the Issuers in writing. The Holders of a majority in
principal amount of the Securities may remove the Trustee by so notifying the
removed Trustee in writing and may appoint a successor Trustee with the
Company's written consent, which consent will not be unreasonably withheld. The
Issuers shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of
the Trustee or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed by the Issuers or by the
Holders of a majority in principal amount of the Securities and such Holders do
not reasonably promptly appoint a successor Trustee as described in the
preceding paragraph, or if a vacancy exists in the office of the Trustee for any
reason (the Trustee in such event being referred to herein as the retiring
Trustee), the Issuers shall promptly appoint a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 7.7.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee or the
Holders of at least 10% in principal amount of the Securities may petition, at
the Issuers' expense, any court of competent jurisdiction for the appointment of
a successor Trustee.
If the Trustee fails to comply with Section 7.10, unless the
Trustee's duty to resign is stayed as provided in TIA Section 310(b), any
Securityholder, who has been a bona fide
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holder of a Security for at least six months, may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to
this Section, the Issuers' obligations under Section 7.7 shall continue for the
benefit of the retiring Trustee.
SECTION 7.9. Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture, any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; provided that the right to adopt the certificate of
authentication of any predecessor Trustee or authenticate Securities in the name
of any predecessor Trustee shall only apply to its successor or successors by
merger, consolidation or conversion.
SECTION 7.10. Eligibility; Disqualification. This Indenture
shall always have a Trustee that satisfies the requirements of TIA Section
310(a)(1), (2) and (5) in every respect. The Trustee shall have a combined
capital and surplus of at least $100 million as set forth in its most recent
published annual report of condition. The Trustee shall comply with TIA Section
310(b); provided, however, that there shall be excluded from the operation of
TIA Section 310(b)(1) any indenture or indentures under which other securities
or certificates of interest or participation in other securities of the Issuers
are outstanding if the requirements for such exclusion set forth in TIA Section
310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against
Issuers. The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.
SECTION 7.12. Trustee's Application for Instruction from the
Issuers. Any application by the Trustee for written instructions from the
Issuers may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable for any action taken by, or omission
of, the Trustee in accordance with a proposal included in such application on or
after the date specified in such application (which date shall not be less than
three Business Days after the date any officer of the Company or GUSAP Partners
actually receives such application, unless any such officer shall have consented
in writing to any earlier date) unless prior to taking any such action (or the
effective date in the case of an omission), the Trustee shall have received
written instructions in response to such application specifying the action to be
taken or omitted.
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SECTION 7.13. Paying Agents. The Company shall cause each
Paying Agent other than the Trustee to execute and deliver to it and the Trustee
an instrument in which such agent shall agree with the Trustee, subject to the
provisions of this Section 7.13:
(1) that it will hold all sums held by it as agent for the
payment of principal of, or premium, if any, or interest on, the
Securities (whether such sums have been paid to it by the Company or by
any obligor on the Securities) in trust for the benefit of Holders of
the Securities or the Trustee;
(2) that it will at any time during the continuance of any
Event of Default, upon written request from the Trustee, deliver to the
Trustee all sums so held in trust by it together with a full accounting
thereof; and
(3) that it will give the Trustee written notice within three
Business Days of any failure of the Company (or by any obligor on the
Securities) in the payment of any installment of the principal of,
premium, if any, or interest on, the Securities when the same shall be
due and payable.
ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.1. Discharge of Liability on Securities; Defeasance.
(a) Subject to Section 8.1(c), when (i)(x) the Issuers deliver to the Trustee
all outstanding Securities (other than Securities replaced pursuant to Section
2.9) for cancellation or (y) all outstanding Securities not theretofore
delivered for cancellation have /become due and payable, whether at maturity or
upon redemption or will become due and payable within one year or are to be
called for redemption within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption pursuant to Article V hereof and
the Issuers or any Subsidiary Guarantor irrevocably deposit or cause to be
deposited with the Trustee as trust funds in trust solely for the benefit of the
Holders money in U.S. dollars, non-callable U.S. Government Obligations, or a
combination thereof, in such amounts as will be sufficient without consideration
of any reinvestment of interest to pay and discharge the entire indebtedness on
such Securities not theretofore delivered to the Trustee for cancellation for
principal, premium, if any, and accrued interest to the date of maturity or
redemption; (ii) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or shall occur as a result of such
deposit and such deposit will not result in a breach or violation of, or
constitute a default under, any other instrument to which the Company, GUSAP
Partners or any Subsidiary Guarantor is a party or by which the Company, GUSAP
Partners or any Subsidiary Guarantor is bound; (iii) the Issuers or any
Subsidiary Guarantor have paid or caused to be paid all sums payable under this
Indenture and the Securities; and (iv) the Issuers have delivered irrevocable
instructions to the Trustee under this Indenture to apply the deposited money
toward the payment of such Securities at maturity or the Redemption Date, as the
case may be, then the Trustee shall acknowledge satisfaction and discharge of
this Indenture on demand of the Issuers (accompanied by an Officers' Certificate
and an Opinion of Counsel stating that all conditions precedent specified
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herein relating to the satisfaction and discharge of this Indenture have been
complied with) and at the cost and expense of the Issuers.
(b) Subject to Sections 8.1(c) and 8.2, the Issuers at any
time may terminate (i) all their obligations under the Securities and this
Indenture ("legal defeasance option"), and after giving effect to such legal
defeasance, any omission to comply with such obligations shall no longer
constitute a Default or Event of Default or (ii) their obligations under Section
3.2, Section 3.3, Section 3.4, Section 3.5, Section 3.6, Section 3.7, Section
3.8, Section 3.9, Section 3.10, Section 3.11, Section 3.12, Section 3.16 and
Section 4.1(3), and the Issuers may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document and such omission to
comply with such covenants shall no longer constitute a Default or an Event of
Default under Section 6.1(4) and the operation of Section 6.1(5), Section
6.1(6), Section 6.1(7) (with respect to Significant Subsidiaries), Section
6.1(8) (with respect to Significant Subsidiaries), Section 6.1(9) and Section
6.1(10), and the events specified in such Sections shall no longer constitute an
Event of Default (clause (ii) being referred to as the "covenant defeasance
option"), but except as specified above, the remainder of this Indenture and the
Securities shall be unaffected thereby. The Issuers may exercise their legal
defeasance option notwithstanding their prior exercise of their covenant
defeasance option. If the Issuers exercise their covenant defeasance option, the
Issuers may elect to have any Subsidiary Guarantees in effect at such time
terminate.
If the Issuers exercise their legal defeasance option, payment
of the Securities may not be accelerated because of an Event of Default, and the
Subsidiary Guarantees in effect at such time shall terminate. If the Issuers
exercise their covenant defeasance option, payment of the Securities may not be
accelerated because of an Event of Default specified in Section 6.1(4) (as such
Section relates to Section 3.2, Section 3.3, Section 3.4, Section 3.5, Section
3.6, Section 3.7, Section 3.8, Section 3.9, Section 3.10, Section 3.11, Section
3.12 and Section 3.16), Section 6.1(5), Section 6.1(6), Section 6.1(7) (with
respect only to Significant Subsidiaries), Section 6.1(8) (with respect only to
Significant Subsidiaries), Section 6.1(9) or Section 6.1(10), or because of the
failure of the Company to comply with Section 4.1(3).
Upon satisfaction of the conditions set forth herein and upon
request of the Issuers, the Trustee shall acknowledge in writing the discharge
of those obligations that the Issuers terminate.
(c) Notwithstanding the provisions of Sections 8.1(a) and (b),
the Issuers' obligations in Sections 2.2, 2.3, 2.4, 2.5, 2.6, 2.9, 2.10, 2.11,
2.12, 3.1, 3.13, 3.14, 3.15, 3.17, 3.18, 3.19, 6.7, 7.7 and 7.8 and in this
Article VIII shall survive until the Securities have been paid in full.
Thereafter, the Issuers' obligations in Sections 7.7, 8.4 and 8.5 shall survive.
SECTION 8.2. Conditions to Defeasance. The Issuers may
exercise their legal defeasance option or its covenant defeasance option only
if:
(1) the Issuers irrevocably deposit in trust with the Trustee
for the benefit of the Holders money in U.S. dollars or U.S. Government
Obligations or a combination
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thereof, the principal of and interest (without reinvestment) on which
will be sufficient, or a combination thereof sufficient, for the
payment of principal, premium, if any, and interest on the Securities
to maturity or redemption, as the case may be;
(2) the Issuers deliver to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their
opinion that the payments of principal and interest when due and
without reinvestment on the deposited U.S. Government Obligations plus
any deposited money without investment will provide cash at such times
and in such amounts as will be sufficient to pay principal and interest
when due on all the Securities to maturity or redemption, as the case
may be;
(3) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or, with respect to certain
bankruptcy or insolvency Events of Default, on the later of (i) the
91st day after such date of deposit or (ii) the day ending on the day
following the expiration of the longest preference period under any
bankruptcy law applicable to the Issuers in respect of such deposit;
(4) such legal defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a Default under, this
Indenture or any other material agreement or instrument to which the
Company or any of its Subsidiaries, or GUSAP Partners is a party or by
which the Company or any of its Subsidiaries, or GUSAP Partners is
bound;
(5) the Issuers shall have delivered to the Trustee an Opinion
of Counsel (subject to customary assumptions and exclusions) to the
effect that (A) the Securities and (B) assuming no intervening
bankruptcy of the Company or GUSAP Partners between the date of deposit
and the 91st day following the deposit and that no Holder of the
Securities is an insider of the Company or GUSAP Partners, after the
91st day following the deposit, the trust funds will not be subject to
the effect of any applicable bankruptcy, insolvency, reorganization or
similar laws affecting creditors' right generally;
(6) the deposit does not constitute a default under any other
agreement binding on the Issuers;
(7) the Issuers deliver to the Trustee an Opinion of Counsel
(subject to customary assumptions and exclusions) to the effect that
the trust resulting from the deposit does not constitute, or is
qualified as, a regulated investment company under the Investment
Company Act of 1940;
(8) the Issuers shall have delivered to the Trustee an Opinion
of Counsel (subject to customary assumptions and exclusions) in the
jurisdictions of organization of each of the Issuers stating that (i)
the Securityholders will not recognize income, gain or loss for U.S.
Federal income tax purposes as a result of such deposit and defeasance
and will be subject to U.S. Federal income tax on the same amounts, in
the same manner and at the same times as would have been the case if
such deposit and defeasance had not occurred and (ii) in the case of
the legal defeasance option, such Opinion of Counsel must
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be based on a ruling by the Internal Revenue Service or other change in
the applicable U.S. or Canadian tax law;
(9) the Issuers shall have delivered to the Trustee an Opinion
of Counsel (subject to customary assumptions and exclusions) in the
jurisdictions of organization of each of the Issuers to the effect that
the Securityholders will not recognize income, gain or loss for income
tax purposes of such jurisdiction as a result of such deposit and
covenant defeasance and will be subject to income tax of such
jurisdiction on the same amount, in the same manner and at the same
times as would have been the case if such deposit and covenant
defeasance had not occurred; and
(10) the Issuers deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the legal defeasance or
covenant defeasance, as the case may be, as contemplated by this
Article VIII have been complied with.
SECTION 8.3. Application of Trust Money. The Trustee shall
hold in trust all money or U.S. Government Obligations (including proceeds
thereof) deposited with it pursuant to this Article VIII. It shall apply the
deposited money and the money from U.S. Government Obligations through the
Paying Agent and in accordance with this Indenture and the Securities to the
Holders of the Securities of all sums due in respect of the payment of principal
of, premium, if any, and accrued interest on the Securities.
SECTION 8.4. Repayment to Issuers. The Trustee and the Paying
Agent shall promptly turn over to the Issuers upon request any excess money,
U.S. Government Obligations or securities held by them upon payment of all the
obligations under this Indenture.
Subject to any applicable abandoned property law, the Trustee
and the Paying Agent shall pay to the Issuers upon request any money held by
them for the payment of principal of or premium, if any, or interest on the
Securities that remains unclaimed by the Holders thereof for two years, and,
thereafter, Securityholders entitled to the money must look to the Issuers for
payment as unsecured general creditors.
SECTION 8.5. Indemnity for U.S. Government Obligations. The
Issuers shall pay and shall indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against deposited U.S. Government Obligations or
the principal and interest received on such U.S. Government Obligations.
SECTION 8.6. Reinstatement. If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with this
Article VIII by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the obligations of the Issuers and each
Subsidiary Guarantor under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to this Article VIII
until such time as the Trustee or Paying Agent is permitted to apply all such
money or U.S. Government Obligations in accordance with this Article VIII;
provided, however, that, if the Issuers or the Subsidiary Guarantors have made
any payment of principal, premium, if any, interest on or
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principal of any Securities because of the reinstatement of their obligations,
the Issuers or Subsidiary Guarantors, as the case may be, shall be subrogated to
the rights of the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee or Paying Agent.
The Trustee's rights under this Article VIII shall survive
termination of this Indenture.
ARTICLE IX
AMENDMENTS
SECTION 9.1. Without Consent of Holders. The Issuers, the
Subsidiary Guarantors and the Trustee may amend or supplement this Indenture or
the Securities without notice to or consent of any Securityholder (provided that
such amendment does not adversely affect the tax treatment of the
Securityholders):
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article IV or Article X in respect of the
assumption by a Successor Company of an obligation of the Issuers or
any Subsidiary Guarantor under this Indenture;
(3) to provide for uncertificated Securities in addition to or
in place of certificated Securities; provided, however, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(4) to add Guarantees with respect to the Securities or
release a Subsidiary Guarantor upon its designation as an Unrestricted
Subsidiary or otherwise in accordance with this Indenture;
(5) to secure the Securities;
(6) to add to the covenants of the Issuers for the benefit of
the Holders or to surrender any right or power herein conferred upon
the Issuers;
(7) to comply with any requirement of the SEC in connection
with the qualification of this Indenture under the TIA;
(8) to make any change that does not materially adversely
affect the rights of any Securityholder; or
(9) to provide for the issuance of the Exchange Securities,
which will have terms substantially identical in all respects to the
Initial Securities or the Additional Securities, as the case may be
(except that the transfer restrictions contained in the Initial
Securities or the Additional Securities, if any, will be modified or
eliminated, as
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appropriate), and which will be treated, together with any outstanding
Initial Securities or Additional Securities, as a single class of
securities.
After an amendment or supplement under this Section becomes
effective, the Issuers shall mail to Securityholders a notice briefly describing
such amendment or supplement. The failure to give such notice to all
Securityholders, or any defect therein, shall not impair or affect the validity
of an amendment or supplement under this Section.
SECTION 9.2. With Consent of Holders. The Issuers, the
Subsidiary Guarantors and the Trustee may amend or supplement this Indenture or
the Securities without notice to any Securityholder but with the written consent
of the Holders of at least a majority in principal amount of the Securities then
outstanding (including, without limitation, consents obtained in connection with
a purchase of, or tender offer or exchange offer for, Securities). Any past
default or compliance with the provisions of this Indenture may be waived with
the written consent of the Holders of at least a majority in principal amount of
the Securities then outstanding (including, without limitation, consents
obtained in connection with a purchase of, or tender offer or exchange offer
for, Securities). However, without the consent of each Securityholder affected,
an amendment, supplement or waiver may not:
(1) reduce the principal amount of Securities outstanding
whose Holders must consent to an amendment;
(2) reduce the stated rate of or extend the stated time for
payment of interest or additional interest on any Security;
(3) reduce the principal of or extend the Stated Maturity of
any Security;
(4) reduce the premium payable upon the redemption or
repurchase of any Security or change the time at which any Security may
or shall be redeemed or repurchased as described under Section 3.10
(including an amendment to the definition of "Change of Control") or
Article V or any similar provision, whether through an amendment or
waiver of Section 3.10 or Article V, definitions or otherwise;
(5) make any Security payable in money other than that stated
in the Security;
(6) impair the right of any Holder to receive payment of,
premium, if any, principal of and interest on such Holder's Securities
on or after the due dates therefor or to institute suit for the
enforcement of any payment on or with respect to such Holder's
Securities;
(7) make any change to the amendment provisions which require
each Holder's consent or to the waiver provisions; or
(8) modify the Subsidiary Guarantees in any manner adverse to
the Holders.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof. A consent to any amendment,
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supplement or waiver under this Indenture by any Holder of the Securities given
in connection with a tender or exchange of such Holder's Securities will not be
rendered invalid by such tender or exchange.
After an amendment or supplement under this Section becomes
effective, the Issuers shall mail to Securityholders a notice briefly describing
such amendment. The failure to give such notice to all Securityholders, or any
defect therein, shall not impair or affect the validity of an amendment under
this Section.
SECTION 9.3. Compliance with Trust Indenture Act. Every
amendment or supplement to this Indenture or the Securities shall comply with
the TIA as then in effect.
SECTION 9.4. Revocation and Effect of Consents and Waivers. A
consent to an amendment, supplement or a waiver by a Holder of a Security shall
bind the Holder and every subsequent Holder of that Security or portion of the
Security that evidences the same debt as the consenting Holder's Security, even
if notation of the consent or waiver is not made on the Security. Any such
Holder or subsequent Holder may revoke the consent or waiver as to such Holder's
Security or portion of the Security if the Trustee receives the notice of
revocation before the date the amendment, supplement or waiver becomes effective
or otherwise in accordance with any related solicitation documents. After an
amendment, supplement or waiver becomes effective, it shall bind every
Securityholder unless it makes a change described in any of clauses (1) through
(8) of Section 9.2, in that case the amendment, supplement, waiver or other
action shall bind each Securityholder who has consented to it and every
subsequent Securityholder that evidences the same debt as the consenting
Holder's Securities. An amendment, supplement or waiver shall become effective
upon receipt by the Trustee of the requisite number of written consents under
Section 9.1 or 9.2 as applicable.
The Issuers may, but shall not be obligated to, fix a record
date for the purpose of determining the Securityholders entitled to give their
consent or take any other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were
Securityholders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to give such consent or to revoke any consent
previously given or to take any such action, whether or not such Persons
continue to be Holders after such record date. No such consent shall become
valid or effective more than 120 days after such record date.
SECTION 9.5. Notation on or Exchange of Securities. If an
amendment, supplement or waiver changes the terms of a Security, the Trustee may
require the Holder of the Security to deliver it to the Trustee. The Trustee may
place an appropriate notation on the Security regarding the changed terms and
return it to the Holder. Alternatively, if the Issuers or the Trustee so
determine, the Issuers in exchange for the Security shall issue and the Trustee
shall authenticate a new Security that reflects the changed terms. Failure to
make the appropriate notation or to issue a new Security shall not affect the
validity of such amendment.
SECTION 9.6. Trustee To Sign Amendments. The Trustee shall
sign any amendment, supplement or waiver authorized pursuant to this Article IX
if the amendment, supplement or waiver does not adversely affect the rights,
duties, liabilities or immunities of the
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Trustee. If it does, the Trustee may but need not sign it. In signing such
amendment, supplement or waiver the Trustee shall be entitled to receive
indemnity reasonably satisfactory to it and to receive, and (subject to Sections
7.1 and 7.2) shall be fully protected in relying upon an Officers' Certificate
and an Opinion of Counsel stating that such amendment, supplement or waiver is
authorized or permitted by this Indenture and that such amendment, supplement or
waiver is the legal, valid and binding obligation of the Issuers and any
Subsidiary Guarantors, enforceable against them in accordance with its terms,
subject to customary exceptions, and complies with the provisions hereof
(including Section 9.3).
ARTICLE X
SUBSIDIARY GUARANTEE
SECTION 10.1. Subsidiary Guarantee. Subject to the provisions
of this Article X, each Subsidiary Guarantor hereby fully, unconditionally and
irrevocably guarantees, as primary obligor and not merely as surety, jointly and
severally with each other Subsidiary Guarantor, to each Holder of the
Securities, to the extent lawful, and the Trustee the full and punctual payment
when due, whether at maturity, by acceleration, by redemption or otherwise, of
the principal of, premium, if any, and interest on the Securities and all other
obligations and liabilities of the Issuers under this Indenture (including
without limitation interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Company, GUSAP Partners or any Subsidiary Guarantor
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding and the obligations under Section 7.7) (all the foregoing being
hereinafter collectively called the "Obligations"). Each Subsidiary Guarantor
agrees that the Obligations will rank equally in right of payment with other
Indebtedness of such Subsidiary Guarantor, except to the extent such other
Indebtedness is subordinate to the Obligations. Each Subsidiary Guarantor
further agrees (to the extent permitted by law) that the Obligations may be
extended or renewed, in whole or in part, without notice or further assent from
it, and that it will remain bound under this Article X notwithstanding any
extension or renewal of any Obligation.
Each Subsidiary Guarantor waives presentation to, demand of
payment from and protest to the Issuers of any of the Obligations and also
waives notice of protest for nonpayment. Each Subsidiary Guarantor waives notice
of any default under the Securities or the Obligations.
Each Subsidiary Guarantor further agrees that its Subsidiary
Guarantee herein constitutes a Guarantee of payment when due (and not a
Guarantee of collection) and waives any right to require that any resort be had
by any Holder to any security held for payment of the Obligations.
Except as set forth in Section 10.2, the obligations of each
Subsidiary Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason (other than payment of the
Obligations in full), including any claim of waiver, release, surrender,
alteration or compromise, and shall not be subject to any defense of setoff,
counterclaim, recoupment or termination whatsoever or by reason of the
invalidity, illegality or unenforceability of the Obligations or otherwise.
Without limiting the generality of the
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foregoing, the obligations of each Subsidiary Guarantor herein shall not be
discharged or impaired or otherwise affected by (a) the failure of any Holder to
assert any claim or demand or to enforce any right or remedy against the Issuers
or any other person under this Indenture, the Securities or any other agreement
or otherwise; (b) any extension or renewal of any thereof; (c) any rescission,
waiver, amendment or modification of any of the terms or provisions of this
Indenture, the Securities or any other agreement; (d) the release of any
security held by any Holder or the Trustee for the Obligations or any of them;
(e) the failure of any Holder to exercise any right or remedy against any other
Subsidiary Guarantor, or (f) any change in the ownership of the Company or GUSAP
Partners; (g) by any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or (h) by any other act or thing or omission or
delay to do any other act or thing which may or might in any manner or to any
extent vary the risk of any Subsidiary Guarantor or would otherwise operate as a
discharge of such Subsidiary Guarantor as a matter of law or equity.
Subject to the provisions of Section 3.12, each Subsidiary
Guarantor agrees that its Subsidiary Guarantee herein shall remain in full force
and effect until payment in full of all the Obligations or such Subsidiary
Guarantor is released from its Subsidiary Guarantee upon the merger or the sale
of all the Capital Stock or assets of the Subsidiary Guarantor in compliance
with Section 10.2. Each Subsidiary Guarantor further agrees that its Subsidiary
Guarantee herein shall continue to be effective or be reinstated, as the case
may be, if at any time payment, or any part thereof, of principal of or interest
on any of the Obligations is rescinded or must otherwise be restored by any
Holder upon the bankruptcy or reorganization of the Company or GUSAP Partners or
otherwise.
In furtherance of the foregoing and not in limitation of any
other right which any Holder has at law or in equity against any Subsidiary
Guarantor by virtue hereof, upon the failure of the Issuers to pay any of the
Obligations when and as the same shall become due, whether at maturity, by
acceleration, by redemption or otherwise, each Subsidiary Guarantor hereby
promises to and will, upon receipt of written demand by the Trustee, forthwith
pay, or cause to be paid, in cash, to the Holders an amount equal to the sum of
(i) the unpaid amount of such Obligations then due and owing and (ii) accrued
and unpaid interest on such Obligations then due and owing (but only to the
extent not prohibited by law).
Each Subsidiary Guarantor further agrees that, as between such
Subsidiary Guarantor, on the one hand, and the Holders, on the other hand, (x)
the maturity of the Obligations guaranteed hereby may be accelerated as provided
in this Indenture for the purposes of its Subsidiary Guarantee herein,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Obligations guaranteed hereby and (y) in the
event of any such declaration of acceleration of such Obligations, such
Obligations (whether or not due and payable) shall forthwith become due and
payable by the Subsidiary Guarantor for the purposes of this Subsidiary
Guarantee.
Each Subsidiary Guarantor also agrees to pay any and all
reasonable costs and expenses (including reasonable attorneys' fees) incurred by
the Trustee or the Holders in enforcing any rights under this Section.
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SECTION 10.2. Limitation on Liability; Termination, Release
and Discharge.
(a) Any term or provision of this Indenture to the contrary
notwithstanding, the obligations of each Subsidiary Guarantor hereunder will be
limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such Subsidiary Guarantor (including,
without limitation, any guarantees under the Senior Secured Credit Agreement)
and after giving effect to any collections from or payments made by or on behalf
of any other Subsidiary Guarantor in respect of the obligations of such other
Subsidiary Guarantor under its Subsidiary Guarantee or pursuant to its
contribution obligations under this Indenture, result in the obligations of such
Subsidiary Guarantor under its Subsidiary Guarantee not constituting a
fraudulent conveyance or fraudulent transfer under federal or state law and not
otherwise being void or voidable under any similar laws affecting the rights of
creditors generally.
(b) The Company will not permit any Subsidiary Guarantor to
consolidate with or merge with or into any Person (other than the Company or
another Subsidiary Guarantor), and will not convey, transfer or lease all or
substantially all of the assets of any Subsidiary Guarantor (other than to the
Company or another Subsidiary Guarantor), unless:
(1) (a) the resulting, surviving or transferee Person will be
a corporation, partnership, trust or limited liability company
organized or formed and existing under the laws of the United States of
America, any State of the United States or the District of Columbia,
Canada or any province or territory of Canada and such Person (if not
the Company or such Subsidiary Guarantor) will expressly assume, by
supplemental indenture, executed and delivered to the Trustee, all the
obligations of such Subsidiary Guarantor under its Subsidiary
Guarantee; (b) immediately after giving effect to such transaction (and
treating any Indebtedness that becomes an obligation of the resulting,
surviving or transferee Person or any Restricted Subsidiary as a result
of such transaction as having been Incurred by such Person or such
Restricted Subsidiary at the time of such transaction), no Default of
Event of Default shall have occurred and be continuing; and (c) the
Company will have delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger or
transfer and such supplemental indenture (if any) comply with this
Indenture; or
(2) the transaction is made in compliance with Section 3.5.
Upon the sale or disposition of a Subsidiary Guarantor (by
merger, consolidation, the sale of its Capital Stock or the sale of all or
substantially all of its assets) and whether or not the Subsidiary Guarantor is
the surviving corporation in such transaction, to a Person which is not the
Company or a Restricted Subsidiary, which sale or disposition is otherwise in
compliance with this Indenture, such Subsidiary Guarantor will be automatically
released from all its obligations under this Indenture and its Subsidiary
Guarantee and the Registration Rights Agreement and such Subsidiary Guarantee
will terminate; provided, however, that any such termination will occur only to
the extent that each such Subsidiary Guarantor will be released from obligations
under its Subsidiary Guarantee if all the obligations of such Subsidiary
Guarantor under the Senior Secured Credit Agreement and related documentation
terminate upon consummation of such transaction.
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(c) Each Subsidiary Guarantor will be deemed released from all
its obligations under this Indenture, its Subsidiary Guarantee and the
Registration Rights Agreement and such Subsidiary Guarantee will terminate upon
the legal defeasance or covenant defeasance of the Securities pursuant to the
provisions of Article VIII hereof.
(d) Each Subsidiary Guarantor will be released from its
obligations under this Indenture, its Subsidiary Guarantee and the Registration
Rights Agreement if the Company designates such Subsidiary Guarantor as an
Unrestricted Subsidiary and such designation complies with the other applicable
provisions of this Indenture.
SECTION 10.3. Right of Contribution. Each Subsidiary Guarantor
hereby agrees that to the extent that any Subsidiary Guarantor shall have paid
more than its proportionate share of any payment made on the obligations under
the Subsidiary Guarantees, such Subsidiary Guarantor shall be entitled to seek
and receive contribution from and against the Company, GUSAP Partners or any
other Subsidiary Guarantor who has not paid its proportionate share of such
payment. The provisions of this Section 10.3 shall in no respect limit the
obligations and liabilities of each Subsidiary Guarantor to the Trustee and the
Holders and each Subsidiary Guarantor shall remain liable to the Trustee and the
Holders for the full amount guaranteed by such Subsidiary Guarantor hereunder.
SECTION 10.4. No Subrogation. Notwithstanding any payment or
payments made by each Subsidiary Guarantor hereunder, no Subsidiary Guarantor
shall be entitled to be subrogated to any of the rights of the Trustee or any
Holder against the Issuers or any other Subsidiary Guarantor or any collateral
security or guarantee or right of offset held by the Trustee or any Holder for
the payment of the Obligations, nor shall any Subsidiary Guarantor seek or be
entitled to seek any contribution or reimbursement from the Issuers or any other
Subsidiary Guarantor in respect of payments made by such Subsidiary Guarantor
hereunder, until all amounts owing to the Trustee and the Holders by the Issuers
on account of the Obligations are paid in full. If any amount shall be paid to
any Subsidiary Guarantor on account of such subrogation rights at any time when
all of the Obligations shall not have been paid in full, such amount shall be
held by such Subsidiary Guarantor in trust for the Trustee and the Holders,
segregated from other funds of such Subsidiary Guarantor, and shall, forthwith
upon receipt by such Subsidiary Guarantor, be turned over to the Trustee in the
exact form received by such Subsidiary Guarantor (duly indorsed by such
Subsidiary Guarantor to the Trustee, if required), to be applied against the
Obligations.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Trust Indenture Act Controls. If and to the
extent that any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the provision required by the TIA shall control. Each Subsidiary Guarantor in
addition to performing its obligations under its Subsidiary Guarantee shall
perform such other obligations as may be imposed upon it with respect to this
Indenture under the TIA.
104
SECTION 11.2. Notices. Any notice or communication shall be in
writing and delivered in person, sent by facsimile, delivered by commercial
courier service or mailed by first-class mail, postage prepaid, addressed as
follows:
if to the Company:
Gerdau Ameristeel Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇
if to GUSAP Partners:
GUSAP Partners
c/o Gerdau Ameristeel Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇
with a copy to:
Torys LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. Cost, Esq.
105
if to the Trustee:
SouthTrust Bank
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Mail Code: A-001-0B-0201
or street address:
SouthTrust Bank
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ Trust Department
Mail Code: A-001-0B-0201
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
With a copy to
Winston & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
The Issuers or the Trustee by written notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication to the Company or the Subsidiary
Guarantors shall be deemed to have been given or made as of the date so
delivered if personally delivered; when answered back, if telexed; when receipt
is acknowledged, if telecopied; and five calendar days after mailing if sent by
registered or certified mail, postage prepaid (except that a notice of change of
address shall not be deemed to have been given until actually received by the
addressee).
Any notice or communication mailed to a registered
Securityholder shall be mailed to the Securityholder at the Securityholder's
address as it appears on the registration books of the Registrar and shall be
sufficiently given if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it, except that
notices to the Trustee shall be effective only upon receipt.
SECTION 11.3. Communication by Holders with other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Issuers, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
106
SECTION 11.4. Certificate and Opinion as to Conditions
Precedent. Upon any request or application by the Issuers to the Trustee to take
or refrain from taking any action under this Indenture, the Issuers shall
furnish to the Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 11.5. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a covenant or
condition provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
In giving such Opinion of Counsel, counsel may rely as to
factual matters on an Officers' Certificate or on certificates of public
officials.
SECTION 11.6. When Securities Disregarded. In determining
whether the Holders of the required aggregate principal amount of Securities
have concurred in any direction, waiver or consent, Securities owned by the
Company, GUSAP Partners, any Subsidiary Guarantor or any Affiliate of them shall
be disregarded and deemed not to be outstanding, except that, for the purpose of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Securities which the Trustee actually knows
are so owned shall be so disregarded. Also, subject to the foregoing, only
Securities outstanding at the time shall be considered in any such
determination.
SECTION 11.7. Rules by Trustee, Paying Agent and Registrar.
The Trustee may make reasonable rules for action by, or at meetings of,
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.
107
SECTION 11.8. Legal Holidays. A "Legal Holiday" is a Saturday,
a Sunday or other day on which commercial banking institutions are authorized or
required to be closed in New York, New York or Birmingham, Alabama. If a payment
date is a Legal Holiday, payment shall be made on the next succeeding day that
is not a Legal Holiday, and no interest shall accrue for the intervening period.
If a regular record date is a Legal Holiday, the record date shall not be
affected.
SECTION 11.9. GOVERNING LAW. THIS INDENTURE AND THE SECURITIES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS INDENTURE, THE SECURITIES OR THE SUBSIDIARY GUARANTEES.
SECTION 11.10. Judgment Currency. The Issuers and the
Subsidiary Guarantors agree to fully indemnify the Trustee and each Holder
against any loss incurred by any of them as a result of any judgment or order
being given or made for any amount due under this Indenture or the Securities
and such judgment or order being expressed and paid in a currency (the "Judgment
Currency") other than U.S. dollars and as result of any variation as between (i)
the rate of exchange at which the U.S. dollar amount is converted into the
Judgment Currency for the purpose of such judgment or order and (ii) the spot
rate of exchange in The City of New York at which any such person on the date of
payment of such judgment or order is able to purchase U.S. dollars with the
amount of the Judgment Currency actually received by such Person. The foregoing
indemnity shall continue in full force and effect notwithstanding any such
judgment or order as aforesaid. The term "spot rate of exchange" shall include
any premiums and costs of exchange payable in connection with the purchase of,
or conversion into, U.S. dollars.
SECTION 11.11. Agent for Service; Submission to Jurisdiction;
Waiver of Immunities. Each of the Company and each Subsidiary Guarantor that is
not organized in the United States hereby agrees to maintain a Significant
Subsidiary as its authorized agent (the "Process Agent") upon which process may
be served in any suit, action or proceeding arising out of or relating to this
Indenture or the Securities that may be instituted in any Federal or State court
in the State of New York, The City of New York, the Borough of Manhattan, or
brought under Federal or State securities laws or brought by the Trustee
(whether in its individual capacity or in its capacity as Trustee hereunder),
and (i) acknowledges that the Process Agent has accepted such designation, (ii)
submits to the jurisdiction of any such court in any such suit, action or
proceeding and (iii) agrees that service of process upon the Process Agent and
written notice of said service to it (mailed or delivered to or care of the
Company at its principal office as specified in Section 11.2), shall be deemed
in every respect effective service of process upon it in any such suit or
proceeding. The Company and each Subsidiary Guarantor that is not organized in
the United States initially appoints Gerdau Ameristeel US Inc. to act as the
Process Agent. So long as the Company maintains its principal executive offices
in the United States, process may be served upon the Process Agent c/o the
Company at the address set forth in Section 11.2. In the event that the Company
no longer has a Significant Subsidiary organized in the United States which may
act as Process Agent, the Company shall designate such additional or alternative
agents for service of process under this Section 11.11 that (i) maintains an
office
108
located in the Borough of Manhattan, The City of New York in the State of New
York, (ii) are either (x) counsel for the Company or (y) a corporate service
company which acts as agent for service of process for other Persons in the
ordinary course of its business and (iii) agrees to act as agent for service of
process in accordance with this Section 11.11.
SECTION 11.12. Enforceability of Judgments. Each of the
Company and each Guarantor not organized in the United States agrees, to the
fullest extent that it lawfully may do so, that final judgment in any such suit,
action or proceeding brought in a court in the United States shall be conclusive
and binding upon it and may be enforced in the courts of Canada (or any other
courts to the jurisdiction of which the Guarantor is subject) by a suit upon
such judgment, provided that service of process is effected upon the Company or
such Guarantor, as applicable, in the manner specified in the foregoing
paragraph or as otherwise permitted by law; provided, however, that the Company
and such Guarantors do not waive, and the foregoing provisions of this sentence
shall not constitute or be deemed to constitute a waiver of, (i) any right to
appeal any such judgment, to seek any stay or otherwise to seek reconsideration
or review of any such judgment, (ii) any stay of execution or levy pending an
appeal from, or a suit, action or proceeding for reconsideration of, any such
judgment, or (iii) any other right or remedy of the Company or any such
Guarantor to the extent not expressly waived in accordance with this Section
11.12.
SECTION 11.13. No Recourse Against Others. An incorporator,
director, officer, employee, Affiliate or stockholder of the Company, GUSAP
Partners or any Subsidiary Guarantor, solely by reason of this status, shall not
have any liability for any obligations of the Issuers or any Subsidiary
Guarantor under the Securities, this Indenture or the Subsidiary Guarantees or
for any claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder shall waive and release
all such liability. The waiver and release shall be part of the consideration
for the issue of the Securities.
SECTION 11.14. Successors. All agreements of the Issuers and
each Subsidiary Guarantor in this Indenture and the Securities shall bind their
respective successors. All agreements of the Trustee in this Indenture shall
bind its successors.
SECTION 11.15. Multiple Originals. The parties may sign any
number of copies of this Indenture. Each signed copy shall be an original, but
all of them together represent the same agreement. One signed copy is enough to
prove this Indenture.
SECTION 11.16. Qualification of Indenture. The Issuers shall
qualify this Indenture under the TIA in accordance with the terms and conditions
of the Registration Rights Agreement and shall pay all reasonable costs and
expenses (including attorneys' fees and expenses for the Issuers, the Trustee
and the Holders) incurred in connection therewith, including, but not limited
to, costs and expenses of qualification of this Indenture and the Securities and
printing this Indenture and the Securities. The Trustee shall be entitled to
receive from the Issuers any such Officers' Certificates, Opinions of Counsel or
other documentation as it may reasonably request in connection with any such
qualification of this Indenture under the TIA.
109
SECTION 11.17. Table of Contents; Headings. The table of
contents, cross-reference sheet and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not
intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof.
110
IN WITNESS WHEREOF, the parties have caused this Indenture to
be duly executed all as of the date and year first written above.
GERDAU AMERISTEEL CORPORATION
By: /s/ ▇▇▇▇ ▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: VP Cambridge Mill, VP Administration
Canada & Assistant Secretary
GUSAP PARTNERS
By: GERDAU AMERISTEEL
CAMBRIDGE INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
----------------------------
Title: Secretary & Treasurer
By: GERDAU AMERISTEEL MRM
SPECIAL SECTIONS INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
----------------------------
Title: Secretary & Treasurer
SOUTHTRUST BANK, as Trustee
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------
Title: Vice President & Trust Officer
111
CO-STEEL BENEFIT PLANS INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: President
CO-STEEL BENEFIT PLANS USA INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Assistant Secretary
CO-STEEL C.S.M. CORP.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Assistant Secretary
CO-STEEL FINANCE CORP.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
CO-STEEL USA HOLDINGS, INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
CO-STEEL (U.S.) LTD.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
112
GERDAU AMERISTEEL CAMBRIDGE INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Secretary & Treasurer
GERDAU AMERISTEEL
DISTRIBUTION CANADA LTD.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Treasurer
GERDAU AMERISTEEL
DISTRIBUTION US INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
GERDAU AMERISTEEL LAKE
ONTARIO INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
GERDAU AMERISTEEL MRM
SPECIAL SECTIONS INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Secretary & Treasurer
113
GERDAU AMERISTEEL PERTH
AMBOY INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
GERDAU AMERISTEEL SAYREVILLE
INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
GERDAU AMERISTEEL US INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Assistant Secretary
GERDAU MRM AMERICA HOLDING
CORP.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Assistant Secretary
GERDAU MRM HOLDINGS INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ HOLDING
COMPANY
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: President
GERDAU USA INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Vice President & Secretary
MFT ACQUISITION, CORP.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Assistant Secretary
N.J.S.C. INVESTMENT CO., INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
PASUG LLC
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Assistant Secretary
115
▇▇▇▇▇▇ BROS. CORPORATION
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Secretary & Treasurer
RARITAN RIVER URBAN RENEWAL
CORPORATION
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: VP, Secretary, Treasurer & CFO
1062316 ONTARIO LIMITED
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: EVP, Finance & Administration
1102590 ONTARIO LIMITED
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: EVP, Finance & Administration
1300554 ONTARIO LIMITED
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: EVP, Finance & Administration
116
1551533 ONTARIO LIMITED
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Assistant Secretary
2017387 ONTARIO LIMITED
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Assistant Secretary
3038482 NOVA SCOTIA COMPANY
By /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: President
117
EXHIBIT A
[FORM OF FACE OF SERIES A NOTE]
[Applicable Restricted Securities Legend]
[Depository Legend, if applicable]
No. [___] Principal Amount $[___________], as
revised by the Schedule of Increases and
Decreases in Global Security attached hereto
CUSIP NO. __________________________
ISIN: _______________________________
GERDAU AMERISTEEL CORPORATION
GUSAP PARTNERS
10 3/8% Senior Note, Series A, due 2011
Gerdau Ameristeel Corporation, an Ontario corporation, and
GUSAP Partners, a Delaware partnership, promise to pay to Cede & Co., or its
registered assigns, the principal sum of [_______________] Dollars, as revised
by the Schedule of Increases and Decreases in Global Security attached hereto,
on July 15, 2011.
Interest Payment Dates: July 15 and January 15, commencing
January 15, 2004
Record Dates: December 31 and June 30
Additional provisions of this Security are set forth on the
other side of this Security.
GERDAU AMERISTEEL CORPORATION
By:______________________________________
GUSAP PARTNERS
By:______________________________________
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
A-1
SOUTHTRUST BANK
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
By________________________________
Authorized Signatory Date: __________, 20__
A-2
[FORM OF REVERSE SIDE OF SERIES A NOTE]
GERDAU AMERISTEEL CORPORATION
GUSAP PARTNERS
10 3/8% Senior Note, Series A, due 2011
1. Interest
Gerdau Ameristeel Corporation, an Ontario corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Company"), and GUSAP Partners, a Delaware
partnership (together, the "Issuers"), promise to pay interest on the principal
amount of this Security at the rate per annum shown above.
The Issuers will pay interest semiannually on January 15 and
July 15 of each year commencing January 15, 2004. Interest on the Securities
will accrue from the most recent date to which interest has been paid on the
Securities or, if no interest has been paid, from June 27, 2003. The Issuers
shall pay interest on overdue principal, and on overdue premium, if any (plus
interest on such interest to the extent lawful), at the rate borne by the
Securities to the extent lawful. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
If an exchange offer (the "Exchange Offer") registered under
the Securities Act is not consummated or a shelf registration statement (the
"Shelf Registration Statement") under the Securities Act with respect to resales
of the Notes is not declared effective by the SEC on or before the date that is
210 days after the Issue Date (the "Target Registration Date") in accordance
with the terms of the Registration Rights Agreement dated June 27 2003 among the
Issuers, the Subsidiary Guarantors and ▇.▇. ▇▇▇▇▇▇ Securities Inc., Banc of
America Securities LLC, CIBC World Markets Corp., TD Securities (USA) Inc. and
ABN AMRO Incorporated, the annual interest rate borne by the Notes shall be
increased from the rate shown above by (i) 0.25% per annum for the first 90-day
period immediately following the Target Registration Date and (ii) an additional
0.25% per annum with respect to each subsequent 90-day period, in each case
until the Exchange Offer is completed or the Shelf Registration Statement, if
required hereby, is declared effective by the Securities and Exchange Commission
or the Securities become freely tradable under the Securities Act, up to a
maximum of 1.00% per annum of additional interest. The Holder of this Note is
entitled to the benefits of such Registration Rights Agreement.
2. Method of Payment
By no later than 10:00 a.m. (New York City time) on the date
on which any principal of or interest on any Security is due and payable, the
Issuers shall irrevocably deposit with the Trustee or the Paying Agent money
sufficient to pay such principal, premium, if any, and/or interest. The Issuers
will pay interest (except Defaulted Interest) to the Persons who are registered
Holders of Securities at the close of business on the December 31 or June 30
next preceding the interest payment date even if Securities are cancelled,
repurchased or redeemed after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Issuers will pay principal, premium, if any, and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. Payments in respect of
Securities represented by
A-3
a Global Security (including principal, premium, if any, and interest) will be
made by the transfer of immediately available funds to the accounts specified by
The Depository Trust Company or any successor depository. The Issuers will make
all payments in respect of a Definitive Security (including principal, premium,
if any, and interest) by mailing a check to the registered address of each
Holder thereof; provided, however, that payments on the Securities may also be
made, in the case of a Holder of at least $1,000,000 aggregate principal amount
of Securities, by wire transfer to a U.S. dollar account maintained by the payee
with a bank in the United States if such Holder elects payment by wire transfer
by giving written notice to the Trustee or the Paying Agent to such effect
designating such account no later than 15 days immediately preceding the
relevant due date for payment (or such other date as the Trustee may accept in
its discretion).
3. Paying Agent and Registrar
Initially, SouthTrust Bank (the "Trustee") will act as
Trustee, Paying Agent and Registrar. The Issuers may appoint and change any
Paying Agent, Registrar or co-registrar without notice to any Securityholder.
The Company or any of its domestically organized, wholly owned Subsidiaries, or
GUSAP Partners may act as Paying Agent, Registrar or co-registrar.
4. Indenture
The Issuers issued the Securities under an Indenture dated as
of June 27, 2003 (as it may be amended or supplemented from time to time in
accordance with the terms thereof, the "Indenture"), among the Issuers, the
Subsidiary Guarantors and the Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) as in effect on
the date of the Indenture (the "Act"). Capitalized terms used herein and not
defined herein have the meanings ascribed thereto in the Indenture. The
Securities are subject to all terms and provisions of the Indenture, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.
The Securities are general unsecured senior obligations of the
Issuers. The aggregate principal amount of securities that may be authenticated
and delivered under the Indenture is unlimited. This Security is one of the
10 3/8% Senior Notes, Series A, due 2011 referred to in the Indenture. The
Securities include (i) $405,000,000 aggregate principal amount of the Issuers'
10 3/8% Senior Notes, Series A, due 2011 issued under the Indenture on June 27,
2003 (herein called "Initial Securities"), (ii) if and when issued, additional
10 3/8% Senior Notes, Series A, due 2011 or 10 3/8% Senior Notes, Series B, due
2011 of the Issuers that may be issued from time to time under the Indenture
subsequent to June 27, 2003 (herein called "Additional Securities") and (iii) if
and when issued, the Issuers' 10 3/8% Senior Notes, Series B, due 2011 that may
be issued from time to time under the Indenture in exchange for Initial
Securities or Additional Securities in an offer registered under the Securities
Act as provided in the Registration Rights Agreement (herein called "Exchange
Securities"). The Initial Securities, Additional Securities and Exchange
Securities are treated as a single class of securities under the Indenture. The
Indenture imposes certain limitations on the incurrence of indebtedness, the
making of restricted payments, the sale of assets and subsidiary stock, the
incurrence of certain liens, sale-leaseback transactions, the sale of capital
stock of restricted subsidiaries, the making of payments for consents, the
entering into of agreements that restrict distribution from restricted
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subsidiaries and the consummation of mergers and consolidations. The Indenture
also imposes requirements with respect to the provision of financial information
and the provision of guarantees of the Securities by certain subsidiaries.
To guarantee the due and punctual payment of the principal,
premium, if any, and interest (including post-filing or post-petition interest)
on the Securities and all other amounts payable by the Issuers under the
Indenture and the Securities when and as the same shall be due and payable,
whether at maturity, by acceleration or otherwise, according to the terms of the
Securities and the Indenture, the Subsidiary Guarantors have unconditionally
guaranteed (and future guarantors, together with the Subsidiary Guarantors, will
unconditionally Guarantee), jointly and severally, such obligations on a senior
basis pursuant to the terms of the Indenture.
5. Redemption
Except as set forth below, the Securities will not be
redeemable at the option of the Company prior to July 15, 2007. On and after
such date, the Securities will be redeemable, at the Issuers' option, in whole
or in part, at any time upon not less than 30 nor more than 60 days prior notice
mailed by first-class mail to each Holder's registered address, at the following
redemption prices (expressed in percentages of principal amount), plus accrued
and unpaid interest to the applicable redemption date (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date):
If redeemed during the 12-month period commencing on July 15
of the years set forth below:
PERIOD REDEMPTION PRICE
------ ----------------
2007 105.375%
2008 103.583%
2009 101.792%
2010 and thereafter 100.000%
In addition, at any time and from time to time prior to July
15, 2006, the Issuers may redeem in the aggregate up to 35% of the original
principal amount of the Securities with the Net Cash Proceeds of one or more
Equity Offerings at a redemption price (expressed as a percentage of principal
amount) of 110.75% plus accrued and unpaid interest, if any, to the redemption
date (subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date); provided, however,
that at least 65% of the original principal amount of the Securities must remain
outstanding after each such redemption; provided further, that each such
redemption occurs within 60 days of the date of closing of such Equity Offering.
If the optional redemption date is on or after an interest
record date and on or before the related interest payment date, the accrued and
unpaid interest, if any, will be paid to
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the Person in whose name the Security is registered at the close of business on
such record date, and no additional interest will be payable to Holders whose
Securities will be subject to redemption by the Issuers.
In the case of any partial redemption, selection of the
Securities for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Securities are listed or, if the Securities are not listed, then on a pro rata
basis, by lot or by such other method as the Trustee in its sole discretion
shall deem to be fair and appropriate, although no Securities of $1,000 in
original principal amount or less will be redeemed in part. Any such notice to
the Trustee may be cancelled at any time prior to notice of such redemption
being mailed to any Holder and shall thereby be void and of no effect. If any
Security is to be redeemed in part only, the notice of redemption relating to
such Security shall state the portion of the principal amount thereof to be
redeemed. A new Security in principal amount equal to the unredeemed portion
thereof will be issued in the name of the Holder thereof upon cancellation of
the original Security. On and after the redemption date, interest will cease to
accrue on Securities or portions thereof called for redemption as long as the
Issuers have deposited with the Paying Agent funds in satisfaction of the
applicable redemption price pursuant to the Indenture.
The Securities may also be redeemed at the option of either of
the Issuers, in whole but not in part, upon not less than 30 nor more than 60
days' notice, at any time, at a redemption price equal to the principal amount
of the Securities plus accrued and unpaid interest to the date fixed for
redemption only if, as a result of (i) any change in or amendment to the laws of
Canada or the United States (or of any political subdivision or taxing authority
therein or thereof) or any regulations or rulings promulgated thereunder or any
change in the official interpretation or official application of such laws,
regulations or rulings (including a judgment, holding or order by a court of
competent jurisdiction) which is publicly announced after the date of the
Indenture, or (ii) any change in the official application or interpretation
(including a judgment, holding or order by a court of competent jurisdiction)
of, or any execution of or amendment to, any treaty or treaties affecting
taxation to which Canada or the United States (or such political subdivision or
taxing authority) is a party, which change, amendment or treaty becomes publicly
available after the date of the Indenture, either of the Issuers is or would be
required on the next succeeding due date for a payment with respect to the
Securities to pay any Canadian Additional Amounts or U.S. Additional Amounts
with respect to the Securities as described in Section 3.1 of the Indenture.
It is not anticipated that the Guarantees will be called upon
and the mere fact that a Subsidiary Guarantor might have to pay withholding tax
if ever required to make a payment should not give rise to a right to redeem.
Prior to the publication of any notice of redemption of the
Securities, the Issuers shall deliver to the Trustee an Officers' Certificate
stating that the Issuers are entitled to effect such redemption, accompanied by
an opinion of tax counsel satisfactory to the Trustee, acting reasonably, that
the condition precedent to the right of redemption has occurred. The Issuers
will be bound to redeem the Securities on the date fixed for redemption.
▇-▇
▇. ▇▇▇▇▇▇▇▇▇▇ Provisions
If a Change of Control occurs, unless the Issuers have
exercised their right to redeem all of the Securities as described under
paragraph 5 of the Securities, then such Change of Control shall constitute a
triggering event which shall trigger the obligation of the Issuers to offer to
repurchase from each Holder all or any part (equal to $1,000 or an integral
multiple thereof) of such Holder's Securities at a purchase price in cash equal
to 101% of the principal amount thereof, plus accrued and unpaid interest, if
any, to the date of repurchase (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date) as provided in, and subject to the terms of, the Indenture.
7. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of principal amount of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay a sum sufficient to cover any
taxes and fees required by law or permitted by the Indenture. The Registrar need
not register the transfer of or exchange (i) any Securities selected for
redemption (except, in the case of a Security to be redeemed in part, the
portion of the Security not to be redeemed) for a period beginning 15 days
before the mailing of a notice of Securities to be redeemed and ending on the
date of such mailing or (ii) any Securities for a period beginning 15 days
before an interest payment date and ending on such interest payment date.
8. Persons Deemed Owners
The registered Holder of this Security may be treated as the
owner of it for all purposes.
9. Unclaimed Money
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Issuers at their request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Issuers for payment as general creditors unless an abandoned property law
designates another person and not to the Trustee for payment.
10. Defeasance
Subject to certain exceptions and conditions set forth in the
Indenture, the Issuers at any time may terminate some or all of its obligations
under the Securities and the Indenture if the Issuers deposit with the Trustee
money or U.S. Government Obligations for the payment of principal, premium, if
any, and interest on the Securities to redemption or maturity, as the case may
be.
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11. Amendment, Supplement, Waiver
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended or supplemented by the Issuers,
Subsidiary Guarantors and Trustee with the written consent of the Holders of at
least a majority in principal amount of the then outstanding Securities and (ii)
any default (other than with respect to nonpayment or in respect of a provision
that cannot be amended without the written consent of each Securityholder
affected) or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in principal amount of the then outstanding
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Securityholder, the Issuers, Subsidiary Guarantors and the
Trustee may amend or supplement the Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency, to comply with Article IV of the
Indenture, to provide for uncertificated Securities in addition to, or in place
of, certificated Securities, to add guarantees with respect to the Securities,
to release Subsidiary Guarantors upon their designation as Unrestricted
Subsidiaries or otherwise in accordance with the Indenture, to secure the
Securities, to add additional covenants of the Issuers, to surrender rights and
powers conferred on the Issuers, to comply with any requirement of the SEC in
connection with qualifying the Indenture under the Act, to make any change that
does not materially adversely affect the rights of any Securityholder, or to
provide for the issuance of Exchange Securities.
12. Defaults and Remedies
Under the Indenture, Events of Default include (each of which
are more specially described in the Indenture) (i) default for 30 days in
payment of interest when due on the Securities; (ii) default in payment of
principal or premium, if any, on the Securities at Stated Maturity, upon
required repurchase or upon optional redemption pursuant to paragraph 5 of the
Securities, upon declaration or otherwise; (iii) the failure by the Issuers or
any Subsidiary Guarantor to comply with its obligations under Article IV or
Section 10.2 of the Indenture; (iv) failure by the Issuers to comply for 30 days
after written notice with any of their obligations under the covenants described
under Sections 3.2 through 3.12 inclusive and Section 3.16 of the Indenture (in
each case, other than a failure to purchase Securities when required under the
Indenture, which failure shall constitute an Event of Default under clause (ii)
above); (v) the failure by the Issuers to comply for 60 days after written
notice with their other agreements contained in the Indenture or under the
Securities (other than those referred to in (i), (ii), (iii) or (iv) above);
(vi) default under any mortgage, indenture or instrument under which there may
be issued or by which there may be secured or evidenced any Indebtedness for
money borrowed by the Company or any of its Restricted Subsidiaries (or the
payment of which is guaranteed by the Company or any of its Restricted
Subsidiaries or is recourse to the Company or its Restricted Subsidiaries, by
contract or operation of law), other than Indebtedness owed to the Company or a
Restricted Subsidiary, whether such Indebtedness or guarantee now exists, or is
created after the date of the Indenture, which default (a) is caused by a
failure to pay any Indebtedness at maturity prior to the expiration of the grace
period provided in such Indebtedness ("payment default") or (b) results in the
acceleration of such Indebtedness prior to its final maturity (the "cross
acceleration provision") and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a payment default or the maturity of which has been
so accelerated, aggregates $10.0 million or more; (vii) certain events of
bankruptcy, insolvency or reorganization of the Company, GUSAP
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Partners or a Significant Subsidiary or group of Restricted Subsidiaries that,
taken together (as of the latest audited consolidated financial statements for
the Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary pursuant to or within the meaning of any Bankruptcy Law (the
"bankruptcy provisions"); (viii) failure by the Company or any Significant
Subsidiary or group of Restricted Subsidiaries that, taken together (as of the
latest audited consolidated financial statements for the Company and its
Restricted Subsidiaries), would constitute a Significant Subsidiary to pay final
judgments aggregating in excess of $10.0 million (net of any amounts that a
reputable and creditworthy insurance company has acknowledged liability for in
writing), which judgments are not paid, discharged, waived or stayed for a
period of 60 days (the "judgment default provision"); or (ix) any Subsidiary
Guarantee ceases to be in full force and effect (except as contemplated by the
terms of the Indenture) or is declared null and void in a judicial proceeding or
any Subsidiary Guarantor denies or disaffirms its obligations under the
Indenture or its Subsidiary Guarantee. However, a default under clauses (iv) and
(v) will not constitute an Event of Default until the Trustee or the Holders of
at least 25% in principal amount of the outstanding Securities notify the
Issuers of the default and the Issuers do not cure such default within the time
specified in clauses (iv) and (v) hereof after receipt of such notice.
If an Event of Default (other than an Event of Default
described in (vii) hereof) occurs and is continuing, the Trustee by notice to
the Issuers or the Holders of at least 25% in principal amount of the
outstanding Securities and the Trustee by notice to the Issuers may declare all
the Securities by notice to the Company to be due and payable immediately. If an
Event of Default described in (vii) hereof occurs and is continuing, the
principal of, premium, if any, and accrued and unpaid interest on all the
Securities will become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Holders.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives reasonable indemnity
or security. Subject to certain limitations, Holders of a majority in principal
amount of the Securities may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Securityholders notice of any continuing
Default or Event of Default (except a Default or Event of Default in payment of
principal or interest) if it determines that withholding notice is in their
interest.
13. Trustee Dealings with the Issuers
Subject to certain limitations set forth in the Indenture, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Issuers or their Affiliates and may otherwise deal
with the Issuers or their Affiliates with the same rights it would have if it
were not Trustee.
14. No Recourse Against Others
An incorporator, director, officer, employee, Affiliate or
stockholder, of each of the Company, GUSAP Partners or any Subsidiary Guarantor,
solely by reason of this status, shall not have any liability for any
obligations of the Issuers or any Subsidiary Guarantor under the
A-9
Securities, the Indenture or any Subsidiary Guarantees or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder waives and releases all
such liability. The waiver and release are part of the consideration for the
issue of the Securities.
15. Authentication
This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent acting on its behalf) manually signs
the certificate of authentication on the other side of this Security.
16. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (= tenants in common), TEN ENT (=
tenants by the entirety), JT TEN (= joint tenants with rights of survivorship
and not as tenants in common), CUST (= custodian) and U/G/M/A (= Uniform Gift to
Minors Act).
17. CUSIP Numbers
The Issuers have caused CUSIP numbers to be printed on the
Securities and have directed the Trustee to use CUSIP numbers in notices of
redemption as a convenience to Securityholders. No representation is made as to
the accuracy of such numbers either as printed on the Securities or as contained
in any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.
18. Governing Law
This Security shall be governed by, and construed in
accordance with, the laws of the State of New York.
The Issuers will furnish to any Securityholder upon written
request and without charge to the Securityholder a copy of the Indenture, which
has in it the text of this Security in larger type. Requests may be made to:
Gerdau Ameristeel Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇
A-10
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to:
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
--------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. No.)
and irrevocably appoint ___________ agent to transfer this Security on
the books of the Issuers. The agent may substitute another to act for
him.
--------------------------------------------------------------------------------
Date:____________________ Your Signature:___________________
Signature Guarantee:____________________________________________________________
(Signature must be guaranteed)
--------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
In connection with any transfer or exchange of any of the Securities
evidenced by this certificate occurring prior to the date that is two years
after the later of the date of original issuance of such Securities and the last
date, if any, on which such Securities were owned by the Company, GUSAP Partners
or any Affiliate of the Issuers, the undersigned confirms that such Securities
are being:
CHECK ONE BOX BELOW:
1|_| acquired for the undersigned's own account, without transfer;
or
2|_| transferred to the Issuers; or
3|_| transferred pursuant to and in compliance with Rule 144A under
the Securities Act of 1933, as amended (the "Securities Act");
or
4|_| transferred pursuant to an effective registration statement
under the Securities Act; or
5|_| transferred pursuant to and in compliance with Regulation S
under the Securities Act; or
A-11
6|_| transferred to an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act), that has furnished to the Trustee a signed
letter containing certain representations and agreements (the
form of which letter appears as Section 2.7 of the Indenture);
or
7|_| transferred pursuant to another available exemption from the
registration requirements of the Securities Act of 1933, as
amended.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered Holder thereof; provided, however, that if box (5), (6) or
(7) is checked, the Trustee or the Issuers may require, prior to registering any
such transfer of the Securities, in their sole discretion, such legal opinions,
certifications and other information as the Trustee or the Issuers may
reasonably request to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, as amended, such as the exemption
provided by Rule 144 under such Act.
------------------------------
Signature
Signature Guarantee:
------------------------- ------------------------------
(Signature must be guaranteed) Signature
--------------------------------------------------------------------------------
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
TO BE COMPLETED BY PURCHASER IF (1) OR (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Issuers 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:
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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have been made:
Principal Amount of Signature of
Amount of decrease in Amount of increase in this Global Security authorized signatory
Date of Principal Amount of Principal Amount of following such of Trustee or
Exchange this Global Security this Global Security decrease or increase Securities Custodian
------- -------------- --------------- --------------- --------------
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OPTION OF HOLDER TO ELECT PURCHASE
If you elect to have this Security purchased by the Issuers
Pursuant to Section 3.5 or 3.10 of the Indenture, check either box:
[ ] [ ]
3.5 3.10
If you want to elect to have only part of this Security
purchased by the Issuers pursuant to Section 3.5 or Section 3.10 of the
Indenture, state the amount in principal amount (must be integral multiple of
$1,000): $____________________________________________
Date: __________
Your Signature _________________________________________________________________
(Sign exactly as your name appears on the other side of the Security)
Signature Guarantee: ___________________________________________________________
(Signature must be guaranteed)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
A-14
EXHIBIT B
[FORM OF FACE OF SERIES B NOTE]
[Depository Legend, if applicable]
No. [___] Principal Amount $[___________], as revised by
the Schedule of Increases and Decreases in
Global Security attached hereto
CUSIP NO. __________________________
ISIN:_______________________________
GERDAU AMERISTEEL CORPORATION
GUSAP PARTNERS
10 3/8% Senior Note, Series B, due 2011
Gerdau Ameristeel Corporation, an Ontario corporation, and
GUSAP Partners, a Delaware partnership, promise to pay to Cede & Co., or its
registered assigns, the principal sum of [_______________] Dollars, as revised
by the Schedule of Increases and Decreases in Global Security attached hereto,
on July 15, 2011.
Interest Payment Dates: July 15 and January 15, commencing
January 15, 2004
Record Dates: December 31 and June 30
Additional provisions of this Security are set forth on the
other side of this Security.
GERDAU AMERISTEEL CORPORATION
By:______________________________________
GUSAP PARTNERS
By:______________________________________
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
B-1
SOUTHTRUST BANK
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
By________________________________
Authorized Signatory Date: __________, 20__
B-2
[FORM OF REVERSE SIDE OF SERIES B NOTE]
GERDAU AMERISTEEL CORPORATION
GUSAP PARTNERS
10 3/8% Senior Note, Series B, due 2011
1. Interest
Gerdau Ameristeel Corporation, an Ontario corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Company"), and GUSAP Partners, a Delaware
partnership (together, the "Issuers"), promise to pay interest on the principal
amount of this Security at the rate per annum shown above.
The Issuers will pay interest semiannually on January 15 and
July 15 of each year commencing January 15, 2004. Interest on the Securities
will accrue from the most recent date to which interest has been paid on the
Securities or, if no interest has been paid, from June 27, 2003. The Issuers
shall pay interest on overdue principal, and on overdue premium, if any (plus
interest on such interest to the extent lawful), at the rate borne by the
Securities to the extent lawful. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
2. Method of Payment
By no later than 10:00 a.m. (New York City time) on the date
on which any principal of or interest on any Security is due and payable, the
Issuers shall irrevocably deposit with the Trustee or the Paying Agent money
sufficient to pay such principal, premium, if any, and/or interest. The Issuers
will pay interest (except Defaulted Interest) to the Persons who are registered
Holders of Securities at the close of business on the December 31 or June 30
next preceding the interest payment date even if Securities are cancelled,
repurchased or redeemed after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Issuers will pay principal, premium, if any, and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. Payments in respect of
Securities represented by a Global Security (including principal, premium, if
any, and interest) will be made by the transfer of immediately available funds
to the accounts specified by The Depository Trust Company or any successor
depository. The Issuers will make all payments in respect of a Definitive
Security (including principal, premium, if any, and interest) by mailing a check
to the registered address of each Holder thereof; provided, however, that
payments on the Securities may also be made, in the case of a Holder of a least
$1,000,000 aggregate principal amount of Securities, by wire transfer to a U.S.
dollar account maintained by the payee with a bank in the United States if such
Holder elects payment by wire transfer by giving written notice to the Trustee
or the Paying Agent to such effect designating such account no later than 15
days immediately preceding the relevant due date for payment (or such other date
as the Trustee may accept in its discretion).
3. Paying Agent and Registrar
Initially, SouthTrust Bank (the "Trustee") will act as
Trustee, Paying Agent and Registrar. The Issuers may appoint and change any
Paying Agent, Registrar or co-registrar
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without notice to any Securityholder. The Company or any of its domestically
organized, wholly owned Subsidiaries, or GUSAP Partners may act as Paying Agent,
Registrar or co-registrar.
4. Indenture
The Issuers issued the Securities under an Indenture dated as
of June 27, 2003 (as it may be amended or supplemented from time to time in
accordance with the terms thereof, the "Indenture"), among the Issuers, the
Subsidiary Guarantors and the Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) as in effect on
the date of the Indenture (the "Act"). Capitalized terms used herein and not
defined herein have the meanings ascribed thereto in the Indenture. The
Securities are subject to all terms and provisions of the Indenture, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.
The Securities are general unsecured senior obligations of the
Issuers. The aggregate principal amount of securities that may be authenticated
and delivered under the Indenture is unlimited. This Security is one of the 10
3/8% Senior Notes, Series B, due 2011 referred to in the Indenture. The
Securities include (i) $400,000,000 aggregate principal amount of the Issuers'
10 3/8% Senior Notes, Series A, due 2011 issued under the Indenture on June 27,
2003 (herein called "Initial Securities"), (ii) if and when issued, additional
10 3/8% Senior Notes, Series A, due 2011 or 10 3/8% Senior Notes, Series B, due
2011 of the Issuers that may be issued from time to time under the Indenture
subsequent to June 27, 2003 (herein called "Additional Securities") and (iii) if
and when issued, the Issuers' 10 3/8% Senior Notes, Series B, due 2011 that may
be issued from time to time under the Indenture in exchange for Initial
Securities or Additional Securities in an offer registered under the Securities
Act as provided in the Registration Rights Agreement (herein called "Exchange
Securities"). The Initial Securities, Additional Securities and Exchange
Securities are treated as a single class of securities under the Indenture. The
Indenture imposes certain limitations on the incurrence of indebtedness, the
making of restricted payments, the sale of assets and subsidiary stock, the
incurrence of certain liens, sale-leaseback transactions, the sale of capital
stock of restricted subsidiaries, the making of payments for consents, the
entering into of agreements that restrict distribution from restricted
subsidiaries and the consummation of mergers and consolidations. The Indenture
also imposes requirements with respect to the provision of financial information
and the provision of guarantees of the Securities by certain subsidiaries.
To guarantee the due and punctual payment of the principal,
premium, if any, and interest (including post-filing or post-petition interest)
on the Securities and all other amounts payable by the Issuers under the
Indenture and the Securities when and as the same shall be due and payable,
whether at maturity, by acceleration or otherwise, according to the terms of the
Securities and the Indenture, the Subsidiary Guarantors have unconditionally
guaranteed (and future guarantors, together with the Subsidiary Guarantors, will
unconditionally Guarantee), jointly and severally, such obligations on a senior
basis pursuant to the terms of the Indenture.
B-4
5. Redemption
Except as set forth below, the Securities will not be
redeemable at the option of the Company prior to July 15, 2007. On and after
such date, the Securities will be redeemable, at the Issuers' option, in whole
or in part, at any time upon not less than 30 nor more than 60 days prior notice
mailed by first-class mail to each Holder's registered address, at the following
redemption prices (expressed in percentages of principal amount), plus accrued
and unpaid interest to the applicable redemption date (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date):
If redeemed during the 12-month period commencing on July 15
of the years set forth below:
PERIOD REDEMPTION PRICE
------ ----------------
2007 105.375%
2008 103.583%
2009 101.792%
2010 and thereafter 100.000%
In addition, at any time and from time to time prior to July
15, 2006, the Issuers may redeem in the aggregate up to 35% of the original
principal amount of the Securities with the Net Cash Proceeds of one or more
Equity Offerings at a redemption price (expressed as a percentage of principal
amount) of 110.75% plus accrued and unpaid interest, if any, to the redemption
date (subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date); provided, however,
that at least 65% of the original principal amount of the Securities must remain
outstanding after each such redemption; provided further, that each such
redemption occurs within 60 days of the date of closing of such Equity Offering.
If the optional redemption date is on or after an interest
record date and on or before the related interest payment date, the accrued and
unpaid interest, if any, will be paid to the Person in whose name the Security
is registered at the close of business on such record date, and no additional
interest will be payable to Holders whose Securities will be subject to
redemption by the Issuers.
In the case of any partial redemption, selection of the
Securities for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Securities are listed or, if the Securities are not listed, then on a pro rata
basis, by lot or by such other method as the Trustee in its sole discretion
shall deem to be fair and appropriate, although no Securities of $1,000 in
original principal amount or less will be redeemed in part. Any such notice to
the Trustee may be cancelled at any time prior to notice of such redemption
being mailed to any Holder and shall thereby be void and of no effect. If any
Security is to be redeemed in part only, the notice of redemption relating to
such
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Security shall state the portion of the principal amount thereof to be redeemed.
A new Security in principal amount equal to the unredeemed portion thereof will
be issued in the name of the Holder thereof upon cancellation of the original
Security. On and after the redemption date, interest will cease to accrue on
Securities or portions thereof called for redemption as long as the Issuers have
deposited with the Paying Agent funds in satisfaction of the applicable
redemption price pursuant to the Indenture.
The Securities may also be redeemed at the option of either of
the Issuers, in whole but not in part, upon not less than 30 nor more than 60
days' notice, at any time, at a redemption price equal to the principal amount
of the Securities plus accrued and unpaid interest to the date fixed for
redemption only if, as a result of (i) any change in or amendment to the laws of
Canada or the United States (or of any political subdivision or taxing authority
therein or thereof) or any regulations or rulings promulgated thereunder or any
change in the official interpretation or official application of such laws,
regulations or rulings (including a judgment, holding or order by a court of
competent jurisdiction) which is publicly announced after the date of the
Indenture, or (ii) any change in the official application or interpretation
(including a judgment, holding or order by a court of competent jurisdiction)
of, or any execution of or amendment to, any treaty or treaties affecting
taxation to which Canada or the United States (or such political subdivision or
taxing authority) is a party, which change, amendment or treaty becomes publicly
available after the date of the Indenture, either of the Issuers is or would be
required on the next succeeding due date for a payment with respect to the
Securities to pay any Canadian Additional Amounts or U.S. Additional Amounts
with respect to the Securities as described in Section 3.1 of the Indenture.
It is not anticipated that the Guarantees will be called upon
and the mere fact that a Subsidiary Guarantor might have to pay withholding tax
if ever required to make a payment should not give rise to a right to redeem.
Prior to the publication of any notice of redemption of the
Securities, the Issuers shall deliver to the Trustee an Officers' Certificate
stating that the Issuers are entitled to effect such redemption, accompanied by
an opinion of tax counsel satisfactory to the Trustee, acting reasonably, that
the condition precedent to the right of redemption has occurred. The Issuers
will be bound to redeem the Securities on the date fixed for redemption.
6. Repurchase Provisions
If a Change of Control occurs, unless the Issuers have
exercised their right to redeem all of the Securities as described under
paragraph 5 of the Securities, then such Change of Control shall constitute a
triggering event which shall trigger the obligation of the Issuers to offer to
repurchase from each Holder all or any part (equal to $1,000 or an integral
multiple thereof) of such Holder's Securities at a purchase price in cash equal
to 101% of the principal amount thereof, plus accrued and unpaid interest, if
any, to the date of repurchase (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date) as provided in, and subject to the terms of, the Indenture.
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7. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of principal amount of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay a sum sufficient to cover any
taxes and fees required by law or permitted by the Indenture. The Registrar need
not register the transfer of or exchange (i) any Securities selected for
redemption (except, in the case of a Security to be redeemed in part, the
portion of the Security not to be redeemed) for a period beginning 15 days
before the mailing of a notice of Securities to be redeemed and ending on the
date of such mailing or (ii) any Securities for a period beginning 15 days
before an interest payment date and ending on such interest payment date.
8. Persons Deemed Owners
The registered Holder of this Security may be treated as the
owner of it for all purposes.
9. Unclaimed Money
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Issuers at their request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Issuers for payment as general creditors unless an abandoned property law
designates another person and not to the Trustee for payment.
10. Defeasance
Subject to certain exceptions and conditions set forth in the
Indenture, the Issuers at any time may terminate some or all of its obligations
under the Securities and the Indenture if the Issuers deposit with the Trustee
money or U.S. Government Obligations for the payment of principal, premium, if
any, and interest on the Securities to redemption or maturity, as the case may
be.
11. Amendment, Supplement, Waiver
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended or supplemented by the Issuers,
Subsidiary Guarantors and Trustee with the written consent of the Holders of at
least a majority in principal amount of the then outstanding Securities and (ii)
any default (other than with respect to nonpayment or in respect of a provision
that cannot be amended without the written consent of each Securityholder
affected) or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in principal amount of the then outstanding
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Securityholder, the Issuers, Subsidiary Guarantors and the
Trustee may amend or supplement the Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency, to comply with Article IV of the
Indenture, to provide for uncertificated Securities in addition to, or in place
of, certificated Securities, to add guarantees with respect to the Securities,
to release Subsidiary Guarantors upon their designation
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as Unrestricted Subsidiaries or otherwise in accordance with the Indenture, to
secure the Securities, to add additional covenants of the Issuers, to surrender
rights and powers conferred on the Issuers, to comply with any requirement of
the SEC in connection with qualifying the Indenture under the Act, to make any
change that does not materially adversely affect the rights of any
Securityholder, or to provide for the issuance of Exchange Securities.
12. Defaults and Remedies
Under the Indenture, Events of Default include (each of which
are more specifically described in the Indenture) (i) default for 30 days in
payment of interest when due on the Securities; (ii) default in payment of
principal or premium, if any, on the Securities at Stated Maturity, upon
required repurchase or upon optional redemption pursuant to paragraph 5 of the
Securities, upon declaration or otherwise; (iii) the failure by the Issuers or
any Subsidiary Guarantor to comply with its obligations under Article IV or
Section 10.2 of the Indenture; (iv) failure by the Issuers to comply for 30 days
after written notice with any of their obligations under the covenants described
under Sections 3.2 through 3.12 inclusive and Section 3.16 of the Indenture (in
each case, other than a failure to purchase Securities when required pursuant to
Section 3.6 under the Indenture, which failure shall constitute an Event of
Default under clause (ii) above); (v) the failure by the Issuers to comply for
60 days after written notice with their other agreements contained in the
Indenture or under the Securities (other than those referred to in (i), (ii),
(iii) or (iv) above); (vi) default under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or evidenced
any Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
Restricted Subsidiaries or is recourse to the Company or its Restricted
Subsidiaries, by contract or operation of law), other than Indebtedness owed to
the Company or a Restricted Subsidiary, whether such Indebtedness or guarantee
now exists, or is created after the date of the Indenture, which default (a) is
caused by a failure to pay any Indebtedness at maturity prior to the expiration
of the grace period provided in such Indebtedness ("payment default") or (b)
results in the acceleration of such Indebtedness prior to its final maturity
(the "cross acceleration provision") and, in each case, the principal amount of
any such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a payment default or the maturity of
which has been so accelerated, aggregates $10.0 million or more; (vii) certain
events of bankruptcy, insolvency or reorganization of the Company, GUSAP
Partners or a Significant Subsidiary or group of Restricted Subsidiaries that,
taken together (as of the latest audited consolidated financial statements for
the Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary pursuant to or within the meaning of any Bankruptcy Law (the
"bankruptcy provisions"); (viii) failure by the Company or any Significant
Subsidiary or group of Restricted Subsidiaries that, taken together (as of the
latest audited consolidated financial statements for the Company and its
Restricted Subsidiaries), would constitute a Significant Subsidiary to pay final
judgments aggregating in excess of $10.0 million (net of any amounts that a
reputable and creditworthy insurance company has acknowledged liability for in
writing), which judgments are not paid, discharged, waived or stayed for a
period of 60 days (the "judgment default provision"); or (ix) any Subsidiary
Guarantee ceases to be in full force and effect (except as contemplated by the
terms of the Indenture) or is declared null and void in a judicial proceeding or
any Subsidiary Guarantor denies or disaffirms its obligations under the
Indenture or its Subsidiary Guarantee. However, a default under clauses (iv) and
(v) will not constitute an Event
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of Default until the Trustee or the Holders of at least 25% in principal amount
of the outstanding Securities notify the Issuers of the default and the Issuers
do not cure such default within the time specified in clauses (iv) and (v)
hereof after receipt of such notice.
If an Event of Default (other than an Event of Default
described in (vii) hereof) occurs and is continuing, the Trustee by notice to
the Issuers or the Holders of at least 25% in principal amount of the
outstanding Securities and the Trustee by notice to the Issuers may declare all
the Securities by notice to the Company to be due and payable immediately. If an
Event of Default described in (vii) hereof occurs and is continuing, the
principal of, premium, if any, and accrued and unpaid interest on all the
Securities will become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Holders.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives reasonable indemnity
or security. Subject to certain limitations, Holders of a majority in principal
amount of the Securities may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Securityholders notice of any continuing
Default or Event of Default (except a Default or Event of Default in payment of
principal or interest) if it determines that withholding notice is in their
interest.
13. Trustee Dealings with the Issuers
Subject to certain limitations set forth in the Indenture, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Issuers or their Affiliates and may otherwise deal
with the Issuers or their Affiliates with the same rights it would have if it
were not Trustee.
14. No Recourse Against Others
An incorporator, director, officer, employee, Affiliate or
stockholder, of each of the Company, GUSAP Partners or any Subsidiary Guarantor,
solely by reason of this status, shall not have any liability for any
obligations of the Issuers or any Subsidiary Guarantor under the Securities, the
Indenture or any Subsidiary Guarantees or for any claim based on, in respect of
or by reason of such obligations or their creation. By accepting a Security,
each Securityholder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
15. Authentication
This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent acting on its behalf) manually signs
the certificate of authentication on the other side of this Security.
16. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (= tenants in common), TEN ENT (=
tenants by the entirety), JT
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TEN (= joint tenants with rights of survivorship and not as tenants in common),
CUST (= custodian) and U/G/M/A (= Uniform Gift to Minors Act).
17. CUSIP Numbers
The Issuers have caused CUSIP numbers to be printed on the
Securities and have directed the Trustee to use CUSIP numbers in notices of
redemption as a convenience to Securityholders. No representation is made as to
the accuracy of such numbers either as printed on the Securities or as contained
in any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.
18. Governing Law
This Security shall be governed by, and construed in
accordance with, the laws of the State of New York.
The Issuers will furnish to any Securityholder upon written
request and without charge to the Securityholder a copy of the Indenture which
has in it the text of this Security in larger type. Requests may be made to:
Gerdau Ameristeel Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇
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ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to:
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
________________________________________________________________________________
(Insert assignee's social security or tax I.D. No.)
and irrevocably appoint ____________ agent to transfer this Security on the
books of the Issuers. The agent may substitute another to act for him.
________________________________________________________________________________
Date: _______________ Your Signature __________________________________________
Signature Guarantee: __________________________________________________________
(Signature must be guaranteed)
________________________________________________________________________________
Sign exactly as your name appears on the other side of this Security.
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have been made:
Principal Amount of Signature of
Amount of decrease in Amount of increase in this Global Security authorized signatory
Date of Principal Amount of Principal Amount of following such of Trustee or
Exchange this Global Security this Global Security decrease or increase Securities Custodian
------- -------------- --------------- --------------- --------------
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OPTION OF HOLDER TO ELECT PURCHASE
If you elect to have this Security purchased by the Issuers
Pursuant to Section 3.5 or 3.10 of the Indenture, check either box:
[ ] [ ]
3.5 3.10
If you want to elect to have only part of this Security
purchased by the Issuers pursuant to Section 3.5 or Section 3.10 of the
Indenture, state the amount in principal amount (must be integral multiple of
$1,000): $____________________________________________
Date: _______________
Your Signature: ________________________________________________________________
(Sign exactly as your name appears on the other side of the Security)
Signature Guarantee: ___________________________________________________________
(Signature must be guaranteed)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
B-13
EXHIBIT C
FORM OF INDENTURE SUPPLEMENT TO ADD SUBSIDIARY GUARANTORS
This Supplemental Indenture, dated as of [_______ __], 20__
(this "Supplemental Indenture" or "Guarantee"), among [name of future Subsidiary
Guarantor] (the "Guarantor"), Gerdau Ameristeel Corporation (together with its
successors and assigns, the "Company") and GUSAP Partners (together, the
"Issuers"), each other then existing Subsidiary Guarantor under the Indenture
referred to below, and SouthTrust Bank, as Trustee under the Indenture referred
to below.
W I T N E S S E T H:
WHEREAS, the Issuers, the Subsidiary Guarantors and the
Trustee have heretofore executed and delivered an Indenture, dated as of June
27, 2003 (as amended, supplemented, waived or otherwise modified, the
"Indenture"), providing for the issuance of an aggregate principal amount of
$405,000,000 of 10 3/8% Senior Notes due 2011 of the Issuers (the "Securities");
WHEREAS, Section 3.12 of the Indenture provides that the
Issuers are required to cause each Restricted Subsidiary (other than a
Subsidiary that does not Guarantee obligations under the Senior Secured Credit
Agreement) created or acquired by the Company and any Subsidiary that is
required to Guarantee either any Indebtedness of either of the Issuers or
Indebtedness under a Credit Facility to execute and deliver to the Trustee a
supplemental indenture pursuant to which such Subsidiary will unconditionally
Guarantee, on a joint and several basis with the other Subsidiary Guarantors,
the full and prompt payment of the principal of, premium, if any, and interest
on the Securities on a senior basis; and
WHEREAS, pursuant to Section 9.1 of the Indenture, the Trustee
and the Issuers are authorized to execute and deliver this Supplemental
Indenture to amend or supplement the Indenture, without the consent of any
Securityholder;
NOW, THEREFORE, in consideration of the foregoing and for
other good and valuable consideration, the receipt of which is hereby
acknowledged, the Guarantor, the Issuers, the other Subsidiary Guarantors and
the Trustee mutually covenant and agree for the equal and ratable benefit of the
Holders of the Securities as follows:
ARTICLE I
Definitions
SECTION 1.1 Defined Terms. As used in this Supplemental
Indenture, terms defined in the Indenture or in the preamble or recital hereto
are used herein as therein defined, except that the term "Holders" in this
Guarantee shall refer to the term "Holders" as defined in the Indenture and the
Trustee acting on behalf or for the benefit of such Holders. The words
"herein," "hereof" and "hereby" and other words of similar import used in this
Supplemental Indenture refer to this Supplemental Indenture as a whole and not
to any particular section hereof.
ARTICLE II
Agreement to be Bound; Guarantee
SECTION 2.1 Agreement to be Bound. The Guarantor hereby
becomes a party to the Indenture as a Subsidiary Guarantor and as such will have
all of the rights and be subject to all of the obligations and agreements of a
Subsidiary Guarantor under the Indenture. The Guarantor agrees to be bound by
all of the provisions of the Indenture applicable to a Subsidiary Guarantor and
to perform all of the obligations and agreements of a Subsidiary Guarantor under
the Indenture.
SECTION 2.2 Guarantee. The Guarantor agrees, on a joint and
several basis with all the existing Subsidiary Guarantors, to fully,
unconditionally and irrevocably Guarantee to each Holder of the Securities and
the Trustee the Obligations pursuant to Article X of the Indenture on a senior
basis.
ARTICLE III
Miscellaneous
SECTION 3.1 Notices. All notices and other communications to
the Guarantor shall be given as provided in the Indenture to the Guarantor, at
its address set forth below, with a copy to the Issuers as provided in the
Indenture for notices to the Issuers.
SECTION 3.2 Parties. Nothing expressed or mentioned herein is
intended or shall be construed to give any Person, firm or corporation, other
than the Holders and the Trustee, any legal or equitable right, remedy or claim
under or in respect of this Supplemental Indenture or the Indenture or any
provision herein or therein contained.
SECTION 3.3 Governing Law. This Supplemental Indenture shall
be governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 3.4 Severability Clause. In case any provision in this
Supplemental Indenture shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby and such provision shall be ineffective only to the
extent of such invalidity, illegality or unenforceability.
SECTION 3.5 Ratification of Indenture; Supplemental Indentures
Part of Indenture. Except as expressly amended hereby, the Indenture is in all
respects ratified and confirmed and all the terms, conditions and provisions
thereof shall remain in full force and effect. This Supplemental Indenture shall
form a part of the Indenture for all purposes, and every Holder of Securities
heretofore or hereafter authenticated and delivered shall be bound hereby.
C-2
The Trustee makes no representation or warranty as to the validity or
sufficiency of this Supplemental Indenture.
SECTION 3.6 Counterparts. The parties hereto may sign one or
more copies of this Supplemental Indenture in counterparts, all of which
together shall constitute one and the same agreement.
SECTION 3.7 Headings. The headings of the Articles and the
sections in this Guarantee are for convenience of reference only and shall not
be deemed to alter or affect the meaning or interpretation of any provisions
hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed as of the date first above written.
[SUBSIDIARY GUARANTOR],
as a Guarantor
By:_______________________________________
Name:
Title:
[Address]
SOUTHTRUST BANK, as Trustee
By:_______________________________________
Name:
Title:
GERDAU AMERISTEEL CORPORATION
By:_______________________________________
Name:
Title:
GUSAP PARTNERS
By: GERDAU AMERISTEEL
CAMBRIDGE INC.
By____________________
Title:
By: GERDAU AMERISTEEL MRM
SPECIAL SECTIONS INC.
By___________________
Title:
CO-STEEL BENEFIT PLANS INC.
By_______________________
Title:
CO-STEEL BENEFIT PLANS USA INC.
By_______________________
Title:
CO-STEEL C.S.M. CORP.
By_______________________
Title:
CO-STEEL FINANCE CORP.
By_______________________
Title:
CO-STEEL USA HOLDINGS, INC.
By_______________________
Title:
CO-STEEL (U.S.) LTD.
By_______________________
Title:
C-2
GERDAU AMERISTEEL CAMBRIDGE INC.
By_______________________
Title:
GERDAU AMERISTEEL
DISTRIBUTION CANADA LTD.
By_______________________
Title:
GERDAU AMERISTEEL
DISTRIBUTION US INC.
By_______________________
Title:
GERDAU AMERISTEEL LAKE
ONTARIO INC.
By_______________________
Title:
GERDAU AMERISTEEL MRM
SPECIAL SECTIONS INC.
By_______________________
Title:
C-3
GERDAU AMERISTEEL PERTH
AMBOY INC.
By_______________________
Title:
GERDAU AMERISTEEL SAYREVILLE INC.
By_______________________
Title:
GERDAU AMERISTEEL US INC.
By_______________________
Title:
GERDAU MRM AMERICA HOLDING
CORP.
By_______________________
Title:
GERDAU MRM HOLDINGS INC.
By_______________________
Title:
▇-▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ HOLDING
COMPANY
By_______________________
Title:
GERDAU USA INC.
By_______________________
Title:
MFT ACQUISITION, CORP.
By_______________________
Title:
N.J.S.C. INVESTMENT CO., INC.
By_______________________
Title:
PASUG LLC
By_______________________
Title:
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▇▇▇▇▇▇ BROS. CORPORATION
By_______________________
Title:
RARITAN RIVER URBAN RENEWAL
CORPORATION
By_______________________
Title:
1062316 ONTARIO LIMITED
By_______________________
Title:
1102590 ONTARIO LIMITED
By_______________________
Title:
1300554 ONTARIO LIMITED
By_______________________
Title:
C-6
1551533 ONTARIO LIMITED
By_______________________
Title:
2017387 ONTARIO LIMITED
By_______________________
Title:
3038482 NOVA SCOTIA COMPANY
By_______________________
Title:
C-7