Exhibit 4.5
FORM OF INDENTURE
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WEIRTON STEEL CORPORATION
AND
▇.▇. ▇▇▇▇▇▇ TRUST COMPANY, NATIONAL ASSOCIATION, Trustee
Indenture
Dated as of ________ __, 2002
$134,200,000
10% Senior Secured Notes Due 2008
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THIS INDENTURE, dated as of _______ __, 2002 between WEIRTON
STEEL CORPORATION, a Delaware corporation (the "Issuer"), and ▇.▇. ▇▇▇▇▇▇ TRUST
COMPANY, NATIONAL ASSOCIATION, a national banking association (the "Trustee"),
W I T N E S S E T H :
WHEREAS, the Issuer has duly authorized the issue of its 10%
Senior Secured Notes Due 2008 (the "Securities") and, to provide, among other
things, for the authentication, delivery and administration thereof, the Issuer
has duly authorized the execution and delivery of this Indenture;
WHEREAS, the Securities will be secured by second priority
security interests in the Collateral (as defined hereinafter) for the benefit of
the holders of the Securities; and
WHEREAS, a Collateral Agency Agreement and an Intercreditor
Agreement (each as defined hereinafter) shall provide for the relative rights
and obligations of the secured parties with respect to the Collateral; and
WHEREAS, all things necessary to make the Securities, when
executed by the Issuer and authenticated and delivered by the Trustee as in this
Indenture provided, the valid, binding and legal obligations of the Issuer, and
to constitute these presents a valid indenture and agreement according to its
terms, have been done.
NOW, THEREFORE: In consideration of the premises and the
purchases of the Securities by the holders thereof, the Issuer and the Trustee
mutually covenant and agree for the equal and proportionate benefit of the
respective holders from time to time of the Securities as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Certain Terms Defined. The following terms (except as otherwise
expressly provided or unless the context otherwise clearly requires) for all
purposes of this Indenture and of any indenture supplemental hereto shall have
the respective meanings specified in this Section. All other terms used in this
Indenture which are defined in the Trust Indenture Act of 1939 or the
definitions of which in the Securities Act of 1933, as amended (the "Securities
Act"), are referred to in the Trust Indenture Act of 1939 (except as herein
otherwise expressly provided or unless the context otherwise clearly requires),
shall have the meanings assigned to such terms in said Trust Indenture Act of
1939 and in said Securities Act as in force at the date of this Indenture. All
accounting terms used herein and not expressly defined shall have the meanings
given to them in accordance with generally accepted accounting principles, and
the term "GAAP" shall mean such accounting principles which are generally
accepted at the date or time of any computation or at the date hereof. The words
"herein", "hereof" and "hereunder" and other words of similar import refer to
this Indenture as a whole and not to any particular Article,
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Section or other subdivision. The terms defined in this Article include the
plural as well as the singular.
"Acquired Indebtedness" means Indebtedness or Preferred Stock
of any Person existing at the time such Person became a Subsidiary of the Issuer
(or such Person is merged into the Issuer or one of the Issuer's Subsidiaries)
or assumed in connection with the acquisition of assets from any such Person
(other than assets acquired in the ordinary course of business), excluding
Indebtedness or Preferred Stock incurred in connection with, or in contemplation
of, such Person becoming a Subsidiary of the Issuer.
"Additional Credit Facility Liens" has the meaning set forth
in the definition of "Permitted Liens".
"Affiliate" means, when used with reference to a specified
Person, any Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Person specified. 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.
"Agent Members" has the meaning set forth in Section 2.7
hereof.
"Asset Disposition" means, (a) the sale, lease, conveyance or
other disposition of any assets or rights, other than sales of inventory in the
ordinary course of business consistent with past practices; provided, however,
that the sale, conveyance or other disposition of all or substantially all of
the assets of the Issuer and its Subsidiaries taken as a whole will be governed
by Section 3.16 and/or Section 8.1 and not by Section 3.12 and (b) the issuance
of Capital Stock by any of the Issuer's Subsidiaries or the sale of Capital
Stock in any of its Subsidiaries.
Notwithstanding the preceding, the following items shall not
be deemed to be Asset Dispositions:
(a) any single transaction or series of related
transactions that: (i) involves assets having a fair
market value of less than $1.0 million; or (ii)
results in net proceeds to the Issuer and its
Subsidiaries of less than $1.0 million;
(b) a transfer of assets between or among the Issuer and
its Wholly Owned Subsidiaries and in connection with
the Vendor Financing Programs;
(c) an issuance of Capital Stock by a Wholly Owned
Subsidiary to the Issuer or to another Wholly Owned
Subsidiary;
(d) the sale or lease of equipment, inventory, accounts
receivable or other assets in the ordinary course of
business;
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(e) the sale or other disposition of assets if additional
assets were acquired within 270 days prior to such
disposition for the purpose of replacing the assets
disposed of which are obsolete or no longer necessary
to the operations of the Issuer;
(f) the sale or other disposition of cash or Cash
Equivalents;
(g) the sale or other disposition of assets in exchange
for similar assets or for cash where the proceeds are
deposited in a trust and employed to acquire similar
property in a transaction qualifying as a like-kind
exchange pursuant to Section 1031 of the Internal
Revenue Code of 1986 or any successor provision;
(h) the sale or other disposition of (i) the ▇▇▇▇▇'▇
Island property or (ii) real property adjacent to the
Issuer's headquarters at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇ in connection with the Vendor
Financing Programs;
(i) a Restricted Payment that is permitted by Section
3.10, including Permitted Payments;
(j) the sale or other disposition of the Tandem Mill
Collateral in connection with a financing or sale and
leaseback transaction; and
(k) an Asset Swap.
"Asset Disposition Offer" has the meaning set forth in Section
3.12(c) hereof.
"Asset Swap" means the execution of a definitive agreement,
subject only to customary closing conditions that the Issuer in good faith
believes will be satisfied, for a substantially concurrent purchase and sale, or
exchange, of assets used or usable in the business or businesses of the Issuer
as of the Issue Date or any related business between the Issuer or any of its
Subsidiaries and another Person or group of affiliated Persons; provided,
however, that any amendment to or waiver of any closing condition that
individually or in the aggregate is material to the Asset Swap shall be deemed
to be a new Asset Swap; and provided, further that no Asset Swap will involve
any of the Collateral.
"Attributable Debt" means, with respect to any sale and
leaseback transaction, at the date of determination, the present value
(discounted at the rate of interest implicit in the terms of the lease) of the
obligation of the lessee for net rental payments during the remaining term of
the lease (including any period for which such lease has been extended or may,
at the option of the lessor, be extended); provided, however, there shall not be
deemed to be any Attributable Debt in respect of any sale and leaseback
transaction if the Issuer or a Subsidiary would be entitled pursuant to the
provisions of clauses (a) through (c), (e), (g) and (q) under the
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definition of "Permitted Liens" to issue, assume or guarantee debt secured by a
mortgage upon the property involved in such transaction without equally and
ratably securing the Securities. "Net rental payments" under any lease for any
period means the sum of such rental and other payments required to be paid in
such period by the lessee thereunder, not including, however, any amount
required to be paid by such lessee (whether or not designated as rent or
additional rent) on account of maintenance and repairs, insurance, taxes,
assessments, water rates or similar charges required to be paid by such lessee
thereunder or any amounts required to be paid by such lessee thereunder
contingent upon the amount of sales, maintenance and repairs, insurance, taxes,
assessments, water rates or similar charges.
"Balance Sheet Date" has the meaning set forth in the
definition of "Excess Cash Flow".
"Board of Directors" means either the Board of Directors of
the Issuer or any committee of such Board duly authorized to act hereunder.
"Bond Indenture" mans that certain Indenture of Trust dated as
of ______________, 2002 between the City of Weirton, West Virginia and ▇.▇.
▇▇▇▇▇▇ Trust Company, National Association, as indenture trustee, as in effect
on the date hereof and as amended, supplemented or otherwise modified.
"Bond Trustee" means the trustee under the Bond Indenture.
"Business Day" means a day which, in the City of New York (or
in any of the cities, if more than one), where amounts are payable in respect of
the Securities, as specified on the face of the form of Securities set forth in
Exhibits A and B hereof, is neither a legal holiday nor a day on which banking
institutions are authorized or obligated by law or regulation to close.
"Capital Stock" means, with respect to any Person, any and all
shares, interests, rights to purchase, warrants, options, participations or
other equivalents of interest in (however designated) equity of such Person,
whether now outstanding or issued after the Issue Date, including, without
limitation, membership interests in limited liability companies and any
Preferred Stock.
"Cash Equivalents" means:
(a) United States dollars;
(b) securities issued or directly and fully guaranteed or
insured by the United States government or any agency
or instrumentality thereof (provided that the full
faith and credit of the United States is pledged in
support thereof) having maturities of not more than
six months from the date of acquisition;
(c) certificates of deposit and eurodollar time deposits
with maturities of six months or less from the date
of acquisition, bankers' acceptances with maturities
not
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exceeding six months and overnight bank deposits, in
each case, with any domestic commercial bank having
capital and surplus in excess of $500 million and a
▇▇▇▇▇▇▇▇ Bank Watch Rating of "B" or better;
(d) repurchase obligations with a term of not more than
seven days for underlying securities of the types
described in clauses (b) and (c) above entered into
with any financial institution meeting the
qualifications specified in clause (c) above;
(e) commercial paper having the highest rating obtainable
from ▇▇▇▇▇'▇ Investors Service, Inc. or Standard &
Poor's Corporation and in each case maturing within
six months after the date of acquisition; and
(f) money market funds at least 95% of the assets of
which constitute Cash Equivalents of the kinds
described in clauses (a) through (e) of this
definition.
(g) for purposes of Section 3.12, the following are also
deemed to be cash or Cash Equivalents:
(i) any liabilities (as shown on the Issuer's or on
any of its Subsidiaries' most recent balance sheet or
in the notes thereto) of the Issuer or any Subsidiary
(other than liabilities that are by their terms
subordinated to the Securities) that are assumed by
the transferee of such assets without recourse to the
Issuer or any of its Subsidiaries; and
(ii) any notes or other obligations received by the
Issuer or such Subsidiary from such transferee that
are converted by the Issuer or such Subsidiary into
cash (to the extent of the cash received) within 180
days following the closing of the relevant Asset
Disposition.
"Change of Control" has the meaning set forth in Section 3.16
hereof.
"Collateral" means, collectively, (a) the Tandem Mill
Collateral, (b) the Tin Mill Collateral, (c) the Hot Mill Collateral, (d) all
other real or personal property hereafter pledged to or mortgaged or conveyed by
deed of trust, mortgage, deed to secure debt or otherwise to the Issuer and/or
Trustee to secure all or any portion of the Securities, (e) all proceeds of any
of the foregoing, and (f) all other assets of the Issuer or any Subsidiary or
Affiliate thereof on which the Issuer and/or Trustee is granted a Lien to secure
all or any portion of the Securities or the payment of the principal of,
premium, if any, or interest on the Securities. Notwithstanding the foregoing,
the Collateral shall not include any assets or properties consisting of the
Project, as such term is defined in the Bond Indenture.
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"Collateral Agency Agreement" means the Collateral Agency and
Second Lien Intercreditor Agreement, dated as of ________, 2002, by and among
the Collateral Agent, the Trustee, and the Bond Trustee attached hereto in
substantially the form of Exhibit __, as the same may be amended from time to
time.
"Collateral Agent" means the collateral agent as set forth in
the Collateral Agency Agreement, until a successor replaces it in accordance
with the applicable provisions of Collateral Agency Agreement, and thereafter
means the successor, or, if the Collateral Agency Agreement is no longer in
effect, means the Trustee.
"Collateral Permitted Liens" means Liens of the type described
in clauses (a), (b), (e), (g), (h), (k), (l), (m) and (o) of the definition of
the term "Permitted Liens" and in clause (p) of such definition to the extent
that the Lien subject to the refinancing is included within any of the foregoing
clauses; provided, however, that the Liens with respect to the Tandem Mill
Collateral will be released under the conditions set forth in Section 3.14(b) in
connection with a sale and leaseback transaction; and provided further that the
dollar amount of Additional Credit Facility Liens permitted in clause (a) to be
secured by Collateral will be reduced dollar for dollar by the amount applied to
make a Permanent Reduction in accordance with Section 3.12 (b)(iii)(A) or the
amount applied to make a Credit Facility Repayment in accordance with Section
3.14(b).
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act of 1939,
then the body performing such duties at such time.
"Commodity Agreement" means any option or futures contract or
similar agreement or arrangement designed to protect the Issuer against
fluctuations in commodity prices.
"Common Stock" means, with respect to any Person, any and all
shares, interests, participations and other equivalents (however designated,
whether voting or non-voting) of such Person's common stock, whether now
outstanding or issued after the Issue Date, and includes, without limitation,
all series and classes of such common stock.
"Consolidated EBITDA" means, for any period, on a consolidated
basis for the Issuer and its Subsidiaries, the sum for such period (without
duplication) of: (a) Consolidated Net Income; (b) income taxes (other than
income taxes positive or negative attributable to extraordinary and
non-recurring gains or losses on asset sales) with respect to such period,
determined in accordance with GAAP; (c) net interest expense for such period,
determined in accordance with GAAP; (d) depreciation and amortization expenses
(including, without duplication, amortization of debt discount and debt issue
costs), determined in accordance with GAAP; (e) other non-cash items reducing
Net Income, minus non-cash items increasing Net Income, determined in accordance
with GAAP; and (f) expense in excess of cash payments made in connection with
the Issuer's pension and other post-retirement employee benefits ("OPEB")
requirements; minus (g) cash payments in excess of expense amounts recorded for
the Issuer's pension and OPEB requirements.
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"Consolidated Fixed Charges" means, for any period, the sum
of: (a) the net interest expense of the Issuer and its Subsidiaries for such
period whether paid or accrued (including, without limitation, amortization of
original issue discount, non-cash interest payments, the interest component of
any deferred payment obligations, the interest component of all payments
associated with capital lease obligations and imputed interest with respect to
Attributable Debt); (b) interest incurred during the period and capitalized by
the Issuer; (c) any interest expense on Indebtedness of another Person that is
guaranteed by the Issuer or one of its Subsidiaries or secured by a Lien on
assets of the Issuer or one of its Subsidiaries (whether or not such guarantee
or Lien is called upon); and (d) the product of (i) all cash dividend payments
on any series of Preferred Stock of any Subsidiary or Disqualified Stock of the
Issuer or any of its Subsidiaries, multiplied by (ii) a fraction, the numerator
of which is one and the denominator of which is one minus the then current
combined federal, state and local statutory tax rate of the Issuer and its
Subsidiaries, expressed as a decimal, in each case, on a consolidated basis in
accordance with GAAP. For the purposes of this calculation of net interest
expense in clause (c), interest on the Securities shall be calculated at the
rate of 10.0% per annum from the Issue Date and interest on the Secured Series
2002 Bonds shall be calculated at the rate of 9.0% per annum from the issue date
of such Bonds, in each case based on the outstanding principal amount of the
Securities and the Secured Series 2002 Bonds, notwithstanding the interest rate
terms of the Securities and the Secured Series 2002 Bonds.
"Consolidated Indebtedness" means, as of any determination
date, Indebtedness of the Issuer and its Subsidiaries on a consolidated basis
which is secured by a Lien on the assets and properties (including accounts
receivable and inventory), of the Issuer and its Subsidiaries, calculated in
accordance with GAAP without applying the Statement of Financial Accounting
Standards No. 15 "Accounting by Debtors and Creditors for Troubled Debt
Restructurings".
"Consolidated Net Income" of the Issuer for any period means
the Net Income (or loss) of the Issuer and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP; provided, however,
that there shall be excluded from Consolidated Net Income: (a) the Net Income of
any Person other than a Consolidated Subsidiary in which the Issuer or any of
its Consolidated Subsidiaries has a joint interest with a third party except to
the extent of the amount of dividends or distributions actually paid in cash to
the Issuer or a Consolidated Subsidiary during such period; (b) the Net Income
of any other Person accrued prior to the date it becomes a Subsidiary with
respect to which Consolidated Net Income is calculated, or is merged into or
consolidated with such Person or any of its Subsidiaries or that Person's assets
are acquired by such Person or any of its Subsidiaries; (c) the Net Income (but
only if positive) of any Subsidiary to the extent that the declaration or
payment of dividends or similar distributions by that Subsidiary to such Person
or to any other Subsidiary of such Net Income is not at the time permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary; and (d) without duplication, any gains or losses attributable to the
sale, lease, conveyance or other disposition of assets (including without
limitation Capital Stock of any Subsidiary of such Person), whether owned on the
date of issuance of the Securities or thereafter acquired, in one or more
related transactions outside the ordinary course of business.
"Consolidated Net Worth" means, with respect to any Person
engaged in a merger, consolidation or sale of assets, the consolidated
stockholder's equity of such Person and
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its Subsidiaries, as determined in accordance with GAAP but excluding any
restructuring charges taken by such Person in connection with such merger,
consolidation or sale of assets.
"Consolidated Subsidiary" of any Person means a Subsidiary
which for financial reporting purposes is or, in accordance with GAAP, should
be, accounted for by such Person as a consolidated subsidiary.
"Continuing Director" has the meaning set forth in Section
3.16 hereof.
"Corporate Trust Office" means the office of the Trustee at
which the corporate trust business of the Trustee shall, at any particular time,
be principally administered, which office is, at the date as of which this
Indenture is dated, located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, Attention: Institutional Trust Services.
"Credit Facility" means any senior credit facility to be
entered into by the Issuer and the lenders referred to therein, together with
the related documents thereto (including the notes thereunder, any guarantees
and security documents), as amended, extended, renewed, restated, supplemented
or otherwise modified (in whole or in part, and without limitation as to amount,
terms, conditions, covenants, and other provisions) from time to time, and any
agreement (and related document) governing Indebtedness incurred to refinance,
in whole or in part, the borrowings and commitments then outstanding or
permitted to be outstanding under such Credit Facility or a successor Credit
Facility, whether by the same or any other lender or group of lenders.
"Credit Facility Repayment" has the meaning set forth in
Section 3.14(b) hereof.
"Currency Agreement" means any foreign exchange contract,
currency swap agreement or other similar agreement or arrangement designed to
protect the Issuer against fluctuations in currency values.
"Deeds of Trust" means, collectively, (a) the Hot Mill Deed
of Trust, (b) the Tandem Mill Deed of Trust, (c) the Tin Mill Deed of Trust, and
(d) any other deed of trust, mortgage, deed to secure debt or other instrument
encumbering any Collateral constituting real property which is given or made by
the Issuer or any Subsidiary thereof to or for the benefit of the Trustee to
secure all or any portion of the Securities or to secure all or any portion of
the payment of the principal of, premium, if any, or interest or purchase price
of the Securities.
"Default" means any event which is, or after notice or passage
of time, or both, would be, an Event of Default.
"Depositary" shall mean The Depository Trust Company, its
nominees, and their respective successors.
"Disqualified Stock" means any Capital Stock (a) that, 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, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof, in whole or in part, on or
prior to the final maturity date of the Securities or (b) upon which the Issuer
or any of its
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Subsidiaries has a contractual obligation to compensate the holder thereof for
losses incurred upon the sale or other disposition thereof; provided, however,
that any portion or series of such Capital Stock which by its terms, or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund or otherwise, no earlier than the day following the maturity date
of the Securities shall not constitute Disqualified Stock; and provided further,
that any Capital Stock which would not constitute Disqualified Stock but for
provisions thereof giving holders thereof the right to require the Issuer to
repurchase or redeem such Capital Stock upon the occurrence of a Change in
Control occurring on or prior to the maturity date of the Securities shall not
constitute Disqualified Stock if (i) the Change in Control provisions applicable
to such Capital Stock are no more favorable to the holders of such Capital Stock
than the provisions of Section 3.16 and (ii) such Capital Stock specifically
provides that the Issuer will not repurchase or redeem any such stock pursuant
to such provisions prior to the Issuer's repurchase of such Securities as are
required to be repurchased pursuant to the provisions of Section 3.16.
"Event of Default" means any event or condition specified as
such in Section 4.1 which shall have continued for the period of time or after
notice thereof, if any, therein designated.
"Excepted Sale" means a sale, lease, conveyance or other
disposition of any portion of the Collateral that is excepted from the
definition of the term "Asset Disposition" contained in this Indenture.
"Excess Cash Flow" means, as of each date such calculation
shall be made, the Consolidated EBITDA for the immediately preceding six month
period expiring on the last day of each December and June, respectively, prior
to such calculation date (such last day, the "Balance Sheet Date") plus (a)
decreases in working capital; minus the sum of (b) expenditures on capital
assets; (c) increases in working capital; and (d) interest and mandatory
principal payments on Indebtedness other than payments or pre-payments of
principal and fees or other amounts with respect to revolving credit
Indebtedness under the Credit Facility. For purposes of clause (b)(i) of Section
3.10, the initial Balance Sheet Date shall be designated as December 31, 2001
and for purposes of determining "Contingent Interest Rate" (as such term is
defined in the form of Security), the initial Balance Sheet Date shall be
designated as December 31, 2002.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Act Reports" means the Issuer's Annual Report on
Form 10-K for the year ended December 31, 2001 filed with the Commission
pursuant to the Exchange Act.
"GAAP" means generally accepted accounting principles 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 may be approved by a significant segment of
the accounting profession of the United States, as in effect on the Issue Date.
"Global Securities" has the meaning set forth in Section 2.4
hereof.
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"Holder", "holder of Securities", "Securityholder" or other
similar terms means the registered holder of any Security.
"Hot Mill Collateral" means the real property constituting the
Issuer's Hot Strip Mill located at Issuer's Weirton, West Virginia steel-making
facility, which converts slabs into flat rolled coils, together with all
equipment and fixtures now or hereafter located thereon (whether or not later
moved), as described with particularity in the Hot Mill Deed of Trust, together
with all other property, real or personal, conveyed by or pledged under or
pursuant to the Hot Mill Deed of Trust and/or Security Agreement and otherwise
described as "Property" or "Collateral", respectively therein; provided,
however, that only that portion of the "Collateral" described in the Security
Agreement which is located on, is used in connection with or is proceeds of the
Hot Strip Mill shall be included as part of the "Hot Mill Collateral."
"Hot Mill Deed of Trust" means that certain Deed of Trust,
dated as of ____________, 2002 made by the Issuer in favor of ▇▇▇▇▇ ▇▇▇▇, as
trustee, for the benefit of, the Trustee and the City of Weirton, as
beneficiaries, (with the City of Weirton's rights thereunder assigned to the
Bond Trustee) and encumbering the Hot Mill Collateral, which constitutes real
property, as amended, supplemented, restated or otherwise modified from time to
time.
"Indebtedness" means, without duplication, (i) any liability
of any entity (A) for borrowed money, or under any reimbursement obligation
relating to a letter of credit, (B) evidenced by a bond, note, debenture or
similar instrument (including a purchase money obligation) given in connection
with the acquisition of any businesses, properties or assets of any kind or with
services incurred in connection with capital expenditures, or (C) in respect of
capitalized lease obligations; (ii) any liability of others described in the
preceding clause (i) that the entity has guaranteed or that is otherwise its
legal liability; (iii) to the extent not otherwise included, obligations under
Currency Agreements, Commodity Agreements or Interest Protection Agreements;
(iv) all Disqualified Stock valued at the greatest amount payable in respect
thereof on a liquidation (whether voluntary or involuntary) plus accrued and
unpaid dividends; and (v) any amendment, supplement, modification, deferral,
renewal, extension or refunding of any liability of the types referred to in
clauses (i)-(iv) above; provided that Indebtedness shall not include accounts
payable (including, without limitation, accounts payable to the Issuer by any
Subsidiary or to any such Subsidiary by the Issuer or any other Subsidiary, in
each case, in accordance with customary industry practice) or liabilities to
trade creditors of any entity arising in the ordinary course of business.
"Indemnified Persons" has the meaning set forth in Section 5.6
hereof.
"Indenture" means this instrument as originally executed and
delivered or, if amended or supplemented as herein provided, as so amended or
supplemented.
"Intercreditor Agreement" means the Intercreditor Agreement,
dated as of ___________, 2002, by and among the Collateral Agent, the Trustee,
the Bond Trustee and Fleet Capital Corporation, as agent for the lenders under
the Credit Facility, in substantially the form of Exhibit __ attached hereto, as
the same may be amended or supplemented from time to time.
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"Interest Protection Agreement" of any Person means any
interest rate swap agreement, interest rate collar agreement, option or future
contract or other similar agreement or arrangement designed to protect such
Person or any of its Subsidiaries against fluctuations in interest rates.
"Investments" of any Person means (i) all investments by such
Person in any other Person in the form of loans, advances or capital
contributions; (ii) all guarantees of Indebtedness or other obligations of any
other Person by such Person; (iii) all purchases (or other acquisitions for
consideration) by such Person of Indebtedness, Capital Stock or other securities
of any other Person; and (iv) all other items that would be classified as
investments (including, without limitation, purchases of assets outside the
ordinary course of business) on a balance sheet of such Person prepared in
accordance with GAAP.
"Issue Date" means __________ __, 2002, the date on which the
Securities are originally issued under this Indenture.
"Issuer" means (except as otherwise provided in Article V)
Weirton Steel Corporation, a Delaware corporation, and, subject to Article VIII,
its successors and assigns.
"Lien" means, with respect to any Property, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such Property. For purposes of this definition, the Issuer shall be deemed to
own subject to a Lien any Property which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such Property.
"Losses" has the meaning set forth in Section 5.6 hereof.
"Net Cash Proceeds" 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
(including any cash received upon sale or disposition of such note or
receivable), but only as and when received), excluding any other consideration
received in the form of assumption by the acquiring Person of Indebtedness or
other obligations relating to the Property disposed of in such Asset Disposition
or received in any other non-cash form unless and until such non-cash
consideration is converted into cash therefrom, in each case, net of all legal,
title and recording tax expenses, commissions and other fees and expenses
incurred, and all federal, state, provincial, foreign and local taxes required
to be accrued as a liability under GAAP as a consequence of such Asset
Disposition, and in each case net of a reasonable reserve for the after-tax cost
of any indemnification payments (fixed and contingent) attributable to seller's
indemnities to the purchaser undertaken by the Issuer or any of its Subsidiaries
in connection with such Asset Disposition (but excluding any payments, which by
the terms of the indemnities will not, under any circumstances, be made during
the term of the Securities), and net of all payments made on any Indebtedness
which is secured by such Property, in accordance with the terms of any Lien upon
or with respect to such Property or which must by its terms or by applicable law
be repaid out of the proceeds from such Asset Disposition, and net of all
distributions and other payment made to minority interest holders in
Subsidiaries or joint ventures as a result of such Asset Disposition.
12
"Net Income" of any Person for any period means the
consolidated net income or loss, as the case may be, of such Person and its
Subsidiaries for such period determined in accordance with GAAP; provided that
there shall be excluded all extraordinary gains or losses net of respective tax
effects (less, without duplication, all fees and expenses relating thereto).
"Notes Documents" means, collectively, the Securities, this
Indenture, the Security Documents, and all other documents, instruments and
agreements now or hereafter evidencing, governing, securing or otherwise
pertaining to the Securities or otherwise executed and delivered by or on behalf
of the Issuer or any other party in connection with the Securities or any of the
foregoing documents, together with all amendments, modifications, renewals,
substitutions and replacements of or to any of the foregoing.
"Offer Amount" has the meaning set forth in Section 3.12
hereof.
"Offer Period" has the meaning set forth in Section 3.12
hereof.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board of Directors or the President or any Vice President
(whether or not designated by a number or numbers or a word or words added
before or after the title "Vice President") and by the Treasurer or the
Secretary or any Assistant Secretary of the Issuer and delivered to the Trustee.
Each such certificate shall comply with Section 314 of the Trust Indenture Act
of 1939 and include the statements provided for in Section 11.5.
"Opinion of Counsel" means an opinion in writing signed by
legal counsel who may be an employee of or counsel to the Issuer or who may be
other counsel satisfactory to the Trustee and delivered to the Trustee. Each
such opinion shall comply with Section 314 of the Trust Indenture Act and
include the statements provided for in Section 11.5, if and to the extent
required hereby.
"OPEB" has the meaning set forth in the definition of
"Consolidated EBITDA".
"Original issue date" of any Security (or portion thereof)
means the earlier of (a) the date of such Security or (b) the date of any
Security (or portion thereof) for which such Security was issued (directly or
indirectly) on registration of transfer, exchange or substitution.
"Outstanding", when used with reference to Securities, shall,
subject to the provisions of Section 6.4, mean, as of any particular time, all
Securities authenticated and delivered by the Trustee under this Indenture,
except
(a) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or
redemption of which moneys in the necessary amount shall have been deposited in
trust with the Trustee or with any Paying Agent (other than the Issuer) or shall
have been set aside, segregated and held in trust by the Issuer (if the Issuer
shall act as its own Paying Agent); provided that if such Securities are to be
redeemed prior to the maturity thereof, notice of such redemption shall have
been given as
13
herein provided, or provision satisfactory to the Trustee shall have been made
for giving such notice; and
(c) Securities in substitution for which other Securities
shall have been authenticated and delivered, or which shall have been paid,
pursuant to the terms of Section 2.6 (unless proof satisfactory to the Trustee
is presented that any of such Securities is held by a person in whose hands such
Security is a legal, valid and binding obligation of the Issuer).
"Paying Agent" has the meaning set forth in Section 3.2
hereof.
"Permanent Reduction" has the meaning set forth in Section
3.12(b) hereof.
"Permitted Acquisition" means any one or more transactions or
series of transactions by the Issuer or a Subsidiary after the Issue Date,
whether effected by merger, consolidation, purchase, lease or other transfer of
assets, Permitted Joint Venture or otherwise, to acquire the properties and
related business (whether through the direct purchase of assets or of the
Capital Stock of the Person owning such assets) of any other Person (a) where
the Person to be acquired has been engaged, or the assets involved have been
deployed, in the business of making, processing or distributing steel products,
including without limitation tin mill products or other coated steel products;
and (b) the consummation of any such transaction would not otherwise result in
any Event of Default immediately thereafter.
"Permitted Indebtedness" means:
(i) Indebtedness of the Issuer and its Subsidiaries
outstanding immediately following the issuance of the
Securities, including any outstanding Senior Notes
due 2004 and Senior Notes due 2005, the Secured
Series 2002 Bonds, any outstanding Series 1989 Bonds,
Indebtedness of the Issuer's 1989 ESOP guaranteed by
the Issuer even if acquired by the Issuer, and any
put obligation imposed on the Issuer by the plan or
by law (including Section 409 of the Internal Revenue
Code of 1986, as amended, and any successor
provision), relating to shares of the Issuer's
Capital Stock, authorized and issued on or before the
Issue Date and initially issued to the Issuer's 1989
ESOP or 1984 ESOP;
(ii) the Securities;
(iii) Indebtedness in respect of obligations of the Issuer
to the Trustee under this Indenture;
(iv) Indebtedness incurred by the Issuer pursuant to the
Credit Facility; provided, however, that immediately
after giving effect to any such incurrence, the
aggregate principal amount of all Indebtedness
incurred under this clause (iv) and then outstanding
does not exceed (1) the sum of (x)
14
65% of the inventory of the Issuer and its
Subsidiaries and (y) 85% of the accounts receivable
of the Issuer and its Subsidiaries (in each case as
such amounts are reflected on the consolidated
financial statements of the Issuer) ("Permitted
Working Capital Indebtedness"), plus (2) $50,000,000;
(v) intercompany obligations (including intercompany debt
or Disqualified Stock of a Subsidiary which is held
by the Issuer or a Subsidiary of the Issuer) of the
Issuer and each of its Subsidiaries; provided,
however, that the obligations of the Issuer to any of
its Subsidiaries with respect to such Indebtedness
shall be subject to a subordination agreement between
the Issuer and its Subsidiaries providing for the
subordination of such obligations in right of payment
from and after such time as all Securities issued and
outstanding shall become due and payable (whether at
stated maturity, by acceleration or otherwise) to the
payment and performance of the Issuer's obligations
under this Indenture and the Securities; provided,
further, that any Indebtedness or Disqualified Stock
of the Issuer or any Subsidiary owed to any other
Subsidiary that ceases to be a Subsidiary shall be
deemed to be incurred and shall be treated as an
incurrence for purposes of Section 3.9 at the time
the Subsidiary in question ceased to be a Subsidiary;
(vi) Indebtedness of the Issuer under any Currency
Agreements, Commodity Agreements or Interest
Protection Agreements;
(vii) the guarantee by the Issuer or any of its
Subsidiaries of Indebtedness of the Issuer or a
Subsidiary of the Issuer that was permitted to be
incurred by another provision of this definition or
Section 3.9;
(viii) the accrual of interest, accretion or amortization of
original issue discount, the payment of interest on
any Indebtedness in the form of additional
Indebtedness with the same terms, and the payment of
dividends on Disqualified Stock in the form of
additional shares of the same class of Disqualified
Stock in the form of additional shares of the same
class of Disqualified Stock;
(ix) Indebtedness (including Acquired Indebtedness)
incurred by Issuer or any Subsidiary in connection
with a Permitted Acquisition so long as (a) at the
time of such transaction and giving effect thereto,
on a pro forma basis, the Issuer or its Subsidiaries
may incur $1.00 in additional Indebtedness
15
(other than Permitted Indebtedness) pursuant to
clause (a) of Section 3.9 or (b) at the time of such
transaction and giving effect thereto, on a pro forma
basis, the ratio of Consolidated Indebtedness to
Consolidated EBITDA for the four fiscal quarters
immediately preceding such event for which financial
information is available consistent with the Issuer's
prior practice, taken as one period and calculated on
the assumption that all Indebtedness had been
incurred on the first day of such period and that the
related Permitted Acquisition and all its adjustments
being included in such pro forma calculation had also
occurred on such date, would be reduced;
(x) Indebtedness arising from a financing transaction
involving the Tandem Mill Collateral including
without limitation a sale and leaseback transaction;
(xi) Indebtedness of the Issuer and its Subsidiaries in
connection with the Vendor Financing Programs;
(xii) obligations in respect of performance bonds, bankers'
acceptances, letters of credit and surety or appeal
bonds provided by the Issuer or any of its
Subsidiaries in the ordinary course of business in an
amount not to exceed $10,000,000 in the aggregate;
(xiii) additional Indebtedness incurred by Issuer or any of
its Subsidiaries the aggregate principal amount at
maturity of which does not exceed $100,000,000; and
(xiv) any Refinancing Indebtedness; provided that (A) the
original issue amount of the Refinancing Indebtedness
shall not exceed the maximum principal amount at
maturity and accrued interest of the Indebtedness to
be repaid (or if such Indebtedness was issued at an
original issue discount, the original issue price
plus amortization of the original issue discount at
the time of the incurrence of the Refinancing
Indebtedness less the amount of any prepayments on or
prior to the date of the Indenture, plus the
reasonable fees and expenses directly incurred in
connection with such Refinancing Indebtedness), (B)
Refinancing Indebtedness incurred by any Subsidiary
shall not be used to repay or refund outstanding
Indebtedness of the Issuer or any other Subsidiary,
and (C) with respect to any Refinancing Indebtedness
that refinances Indebtedness ranking junior in right
of payment to the Securities, (1) the Refinancing
Indebtedness does not require any principal payments
prior
16
to the maturity of the Securities and has an average
weighted life that is equal to or greater than the
average weighted life of the Securities and (2) the
Refinancing Indebtedness is subordinated to the
Securities to the same or greater extent and on
substantially the same terms or terms more favorable
to the holders of the Securities.
For purposes of determining compliance with Section 3.9, in
the event that an item of proposed Indebtedness meets the criteria of more than
one of the categories of Permitted Indebtedness described in clauses (i) through
(xiii) above, or is entitled to be incurred pursuant to Section 3.9, the Issuer
will be permitted to classify such item of Indebtedness on the date of its
incurrence in any manner that complies with Section 3.9.
"Permitted Joint Venture" means the interest of the Issuer in
any corporation, association or other business entity of which 50% or less, but
not less than 10%, of the total Voting Stock or other interest is at the time
owned or controlled, directly or indirectly, by the Issuer or one or more of its
Subsidiaries or a combination thereof; provided that (a) such corporation,
association or entity is engaged in the business or businesses of the Issuer or
any related business and (b) that any interest paid by Issuer or any Subsidiary
of Issuer on any Indebtedness incurred by the Issuer or any Subsidiary of the
Issuer in connection with such ownership interest shall not exceed the sum of
(x) any dividends, other distributions of earnings and returns of capital
received by the Issuer and any Subsidiaries on account of such ownership
interest and (y) demonstrable operating benefits derived by the Issuer and any
Subsidiaries, including cost savings and margin improvements, calculated on a
pro forma basis as determined in good faith by management of the Issuer and
adopted by resolution of the majority of the independent members of the Issuer's
Board of Directors and delivered to the Trustee in an Officers' Certificate.
"Permitted Liens" means, without duplication:
(a) Liens on the assets of the Issuer and any Subsidiary
securing Indebtedness and other obligations under the
Credit Facility; provided that the aggregate amount
so secured does not exceed the amount of Permitted
Working Capital Indebtedness plus $75,000,000
("Additional Credit Facility Liens");
(b) Liens on the assets of the Issuer and any Subsidiary
securing Indebtedness and other obligations under the
Vendor Financing Programs, including, without
limitation, Liens on railroad locomotives and
railcars granted to secure Indebtedness incurred in
connection with sale and leaseback transaction(s)
involving the Issuer's general office building and
research and development building located in Weirton,
West Virginia;
(c) Liens in favor of the Issuer or its Subsidiaries;
17
(d) Liens on property or shares of Capital Stock of a
Person existing at the time such Person is acquired
by or merged with or into or consolidated with the
Issuer or any of its Subsidiaries; provided, however,
that such Liens were in existence prior to the
consummation of such acquisition, merger or
consolidation and do not extend to property other
that the property or shares of Capital Stock being
acquired by the Issuer or its Subsidiaries (other
than property affixed or appurtenant thereto);
(e) Liens to secure the performance of statutory
obligations;
(f) Liens existing on the Issue Date;
(g) Liens for taxes, assessments or governmental charges
or claims that are not yet delinquent or that are
being contested in good faith by appropriate
proceedings promptly instituted and diligently
concluded; provided, however, that any reserve or
other appropriate provision as shall be required in
conformity with GAAP shall have been made therefor;
(h) (i) Liens on assets subject to a sale and leaseback
transaction securing Attributable Debt permitted to
be incurred pursuant to Section 3.9, (ii) Liens in
connection with a financing or sale and leaseback
transaction involving or relating to the Tandem Mill
Collateral permitted to be incurred under clause (x)
of the definition of Permitted Indebtedness, and
(iii) Liens in connection with long-term tolling or
product supply agreements with respect to the use of
the Collateral; provided that the terms of such
agreement do not, in the good faith determination of
the Board of Directors and taking into account any
additional collateral pledged to secure the
Securities, impair the value of the Collateral;
(i) Liens securing industrial revenue or pollution
control bonds, for which the Issuer has payment
obligations; provided, however, that such Liens
relate solely to the project being financed;
(j) Liens (i) arising from or in connection with clause
(ix) of the definition of "Permitted Indebtedness" or
(ii) incurred to finance the acquisition of property
or assets acquired by the Issuer or any of its
Subsidiaries after the Issue Date so long as such
Lien is created within 90 days of such acquisition;
provided that in either clause (i) or (ii), such
18
Liens do not extend to any property or assets other
than the property or assets acquired by the Issuer or
its Subsidiaries;
(k) Minor survey exceptions, minor encumbrances,
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 or other restrictions as to the
use of real property or Liens incidental to the
conduct of the business of the Issuer or its
Subsidiaries or to the ownership of its properties
which were not incurred in connection with
Indebtedness and which do not individually or in the
aggregate materially adversely affect the value of
said properties or materially impair their use in the
operation of the business of the Issuer;
(l) Liens arising from judgments or similar awards in an
amount permitted by the Credit Facility;
(m) Liens on the Collateral effected (i) by the Deeds of
Trust or the Security Agreement or (ii) by the Issuer
for purposes of securing its obligations with respect
of the Secured Series 2002 Bonds;
(n) Liens on assets and properties of the Issuer and its
Subsidiaries other than Collateral to secure up to
$25,000,000 of Indebtedness;
(o) In connection with the financing of a Permitted
Acquisition secured in whole or in part by the
Collateral, Liens on assets and properties acquired
plus Liens on Collateral senior to Liens in favor of
the holders of the Securities; provided, however,
that the Issuer or its Subsidiaries shall ▇▇▇▇▇ ▇
▇▇▇▇ on such assets and properties acquired in the
Permitted Acquisition (excluding working capital
assets) in favor of the holders of the Securities
which Lien shall be junior only to the Liens securing
any senior secured financing incurred to purchase
such assets;
(p) Liens to secure any Refinancing Indebtedness as a
whole or in part secured by any Lien referred to in
the foregoing clauses (a), (b), (h), (i), (j), (m),
(n) and (o); provided, however, that:
i. such new Lien shall be limited to all or part of
the same property and assets that secured or, under
the written agreements pursuant to which the original
Lien arose, could secure the original Lien (plus
improvements and accessions to, such property or
proceeds or distributions thereof); and
ii. the Indebtedness secured by such Lien at such
time is not increased to any amount greater than the
sum of (A)
19
the outstanding principal amount or, if greater,
committed amount of the Indebtedness described under
the foregoing clauses (a), (b), (h), (i), (j), (m),
(n) and (o); at the time the original Lien became a
Permitted Lien and (B) an amount necessary to pay any
fees and expenses, including premiums, related to
such refinancing, refunding, extension, renewal or
replacement; and
(q) Liens to secure the performance of surety or appeal
bonds, performance bonds or other obligations of a
like nature incurred in the ordinary course of
business.
"Permitted Payments" means, with respect to the Issuer or any
of its Subsidiaries, (i) any dividend on shares of Capital Stock payable solely
in shares of Capital Stock (other than Disqualified Stock) or in options,
warrants or other rights to purchase Capital Stock (other than Disqualified
Stock); (ii) any dividend or other distribution with respect to Capital Stock
payable to the Issuer by any of its Subsidiaries or by a Subsidiary to another
Subsidiary; (iii) payments made by the Issuer in satisfaction of any put
obligation imposed on the Issuer by the plan or by law (including Section 409 of
the Internal Revenue Code of 1986, as amended, and any successor provision),
relating to shares of the Issuer's Capital Stock, authorized and issued on or
before the Issue Date and initially issued to the Issuer's 1989 ESOP or 1984
ESOP; and (iv) any redemption or other payments in respect of the Series C
Preferred Stock.
"Permitted Working Capital Indebtedness" has the meaning set
forth in the definition of "Permitted Indebtedness".
"Person" shall mean any individual, corporation, partnership,
joint venture, association, joint stock company, trust, trustee, estate, limited
liability company, unincorporated organization, real estate investment trust,
government or any agency or political subdivision thereof, or any other form of
entity.
"Pledged Account" means a cash collateral account in a
financial institution acceptable to Trustee that is pledged to the Trustee in
whole or in part as security for the benefit of the holders of the Securities.
"Preferred Stock" of any Person means all Capital Stock of
such Person which has a preference in liquidation or a preference with respect
to the payment of dividends.
"principal", wherever used with reference to the Securities or
any Security or any portion thereof, shall be deemed to include "and premium, if
any".
"Prohibited Investment" means, with respect to any Person, any
Investment by such Person in any Person that is not a Subsidiary of such first
Person, other than (i) an Investment in Cash Equivalents; (ii) to the extent not
included in clause (i), (a) negotiable instruments held for collection, (b)
outstanding travel, moving or other similar advances to officers, employees and
consultants of such Person, (c) lease or utility deposits or other similar
deposits or (d) Capital Stock, debt obligations or similar securities received
in settlement of debts owed to such Person or its Subsidiaries as a result of
the foreclosure, perfection or enforcement
20
of any Liens by such Person or any of its Subsidiaries, but, in each case, only
to the extent such Investments are made in the ordinary course of business;
(iii) sales of goods on trade credit terms consistent with the past practices of
such Person or otherwise consistent with trade credit terms in common use in the
industry; and (iv) Investments made in connection with Permitted Acquisitions.
"Property" of any Person means all types of real, personal,
tangible, intangible or mixed property owned by such Person whether or not
included in the most recent consolidated balance sheet of such Person and its
Subsidiaries under GAAP.
"Prospectus" means the prospectus dated ____________ __, 2002
relating to the Securities and the Series C Preferred Stock.
"Purchase Date" has the meaning set forth in Section 3.12
hereof.
"Refinancing Indebtedness" means Indebtedness that is incurred
to refund, refinance, replace, renew, repay, extend or substitute (including
pursuant to any defeasance or discharge mechanism) any Indebtedness of the
Issuer or its Subsidiaries on the Issue Date or incurred in compliance with the
Indenture (including Indebtedness that refinances Refinancing Indebtedness).
"Registrar" has the meaning set forth in Section 3.2 hereof.
"Repurchase Date" has the meaning set forth in Section 3.16
hereof.
"Responsible Officer" when used with respect to the Trustee
means any officer within the Institutional Trust Services (or any successor
group) of the Trustee, including, without limitation, any vice president
(whether or not designated by numbers or words added before or after the title
"vice president"), any assistant vice president, any assistant secretary, any
assistant treasurer or any other officer or assistant officer of the Trustee
customarily performing functions similar to those performed by any of the above-
designated officers who shall in any case, be responsible for the administration
of this document or have familiarity with it, and also means with respect to
particular corporate trust matters any other officer to whom any corporate trust
matter is referred because of his knowledge of and familiarity with the
particular subject.
"Restricted Payment" means any of the following: (i) the
declaration or payment of any dividend or any other distribution on Capital
Stock of the Issuer or any Subsidiary of the Issuer or any payment made to the
direct or indirect holders (in their capacities as such) of Capital Stock of the
Issuer or any Subsidiary of the Issuer (other than (x) dividends or
distributions payable solely in Capital Stock (other than Disqualified Stock)
and (y) in the case of Subsidiaries of the Issuer, dividends or distributions
payable to the Issuer or to a Subsidiary of the Issuer); (ii) the purchase,
redemption or other acquisition or retirement for value of any Capital Stock
(other than Series C Preferred Stock), or any option, warrant, or other right to
acquire shares of Capital Stock, of the Issuer or any of its Subsidiaries; (iii)
the making of any principal payment on, or the purchase, defeasance, repurchase,
redemption or other acquisition or retirement for value, prior to any scheduled
maturity, scheduled repayment or scheduled sinking fund payment, of any
Indebtedness which is subordinated in right of payment to the Securities; (iv)
the making of any Prohibited Investment or guarantee of any Prohibited
Investment in any
21
Person; and (v) the making of any payment to a holder of Capital Stock of the
Issuer to reimburse such holder for losses incurred by such holder upon the
disposition of such Capital Stock by such holder.
"Secured Series 2002 Bonds" means the 9.0% Secured Pollution
Control Revenue Refunding Bonds (Weirton Steel Corporation Project) Series 2002
in the aggregate principal amount of up to $33,800,000 to be issued by the City
of Weirton, West Virginia in exchange for the Series 1989 Bonds, pursuant to the
Bond Indenture.
"Securities" has the meaning set forth in the Recitals.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreement" means, collectively, (a) the Security
Agreement dated as of __________ __, 2002 made by the Company for the benefit of
the Trustee and the City of Weirton, West Virginia, as beneficiaries, (with the
City of Weirton's rights thereunder assigned to the Bond Trustee) and
encumbering a portion of the Hot Mill Collateral, Tandem Mill Collateral and Tin
Mill Collateral, which constitutes personal property, as amended or supplemented
from time to time and (b) any other security agreement or other instrument
encumbering any Collateral constituting personal property which is given or made
by the Company and any Subsidiary thereof to the Trustee to secure all or any
portion of the Securities or to secure all or any portion of the payment of the
principal of, premium, if any, or interest or purchase price of the Securities.
"Security Documents" means the Deeds of Trust, the Security
Agreement, any Uniform Commercial Code financing statements filed in connection
with the Securities, and all other documents, instruments and agreements now or
hereafter evidencing, governing, securing or otherwise pertaining to the
Securities or otherwise executed and delivered by or on behalf of the Issuer or
any other party in connection with the Securities or any of the foregoing
documents, together with all amendments, modifications, renewals, substitutions
and replacements of or to any of the foregoing.
"Senior Notes due 2004" means the 11 3/8% Senior Notes due
2004 in the aggregate original principal amount of $125,000,000 issued by the
Issuer pursuant to the Indenture dated as of July 3, 1996 between the Issuer, as
issuer, and Bankers Trust Company, as trustee.
"Senior Notes due 2005" means the 10 3/4% Senior Notes due
2005 in the aggregate original principal amount of $125,000,000 issued by the
Issuer pursuant to the Indenture dated as of June 12, 1995, as amended and/or
supplemented between the Issuer, as issuer, and Bankers Trust Company, as
trustee.
"Series ▇▇▇▇ ▇▇▇▇▇" means the 8 5/8% Pollution Control Revenue
Refunding Bonds (Weirton Steel Corporation Project) Series 1989 due 2014 in the
aggregate original principal amount of $56,300,000 issued by the City of
Weirton, West Virginia, pursuant to an Indenture of Trust dated as of November
1, 1989, between the City of Weirton, as issuer, and Pittsburgh National Bank,
as bond trustee.
22
"Series C Preferred Stock" means the new Series C Convertible
Redeemable Preferred Stock of the Issuer to be issued as contemplated by the
Prospectus.
"Subsidiary" means, with respect of any Person, any
corporation or other entity of which a majority of the Capital Stock or other
ownership interests having ordinary voting power to elect a majority of the
board of directors or other persons performing similar functions are at the time
directly or indirectly owned by such Person.
"Surviving Entity" has the meaning set forth in Section 8.1
hereof.
"Tandem Mill Collateral" means the real property constituting
the Issuer's No. 9 tin tandem mill located at Company's Weirton, West Virginia
steel-making facility, together with all equipment and fixtures now or hereafter
located thereon (whether or not later moved), as described with particularity in
the Tandem Mill Deed of Trust, together with all other property, real or
personal, conveyed by or pledged under or pursuant to the Tandem Mill Deed of
Trust and/or Security Agreement and otherwise described as "Property" or
"Collateral", respectively therein; provided, however, that only that portion of
the "Collateral" described in the Security Agreement which is located on, is
used in connection with or is proceeds of the Tandem Mill shall be included as
part of the "Tandem Mill Collateral."
"Tandem Mill Deed of Trust" means that certain Deed of Trust,
dated as of ____________, 2002 made by the Issuer in favor of ▇▇▇▇▇ ▇▇▇▇, as
trustee, for the benefit of the Trustee and the City of Weirton, West Virginia,
as beneficiaries, (with the City of Weirton's rights thereunder assigned to the
Bond Trustee) and encumbering the Tandem Mill Collateral which constitutes real
property, as amended, supplemented, restated or otherwise modified from time to
time.
"Tin Mill Collateral" means the real property constituting the
Issuer's tin mill located at the Company's Weirton, West Virginia steel-making
facility, together with all equipment and fixtures now or hereafter located
thereon (whether or not later moved), as described with particularity in the Tin
Mill Deed of Trust (excluding assets set forth in Exhibit B to the Tin Mill Deed
of Trust), together with all other property, real or personal, conveyed by or
pledged under or pursuant to the Tin Mill Deed of Trust and/or Security
Agreement and otherwise described as "Property" or "Collateral", respectively
therein; provided, however, that only that portion of the "Collateral" described
in the Security Agreement which is located on, is used in connection with or is
proceeds of the Tin Mill shall be included as part of the "Tin Mill
Collateral.".
"Tin Mill Deed of Trust" means that certain Deed of Trust,
dated as of ____________, 2002 made by the Issuer in favor of ▇▇▇▇▇ ▇▇▇▇, as
trustee, for the benefit of the Trustee and the City of Weirton, West Virginia,
as beneficiaries, (with the City of Weirton's rights thereunder assigned to the
Bond Trustee) and encumbering the Tandem Mill Collateral which constitutes real
property, as amended, supplemented, restated or otherwise modified from time to
time.
"Trustee" means the entity identified as "Trustee" in the
first paragraph hereof and, subject to the provisions of Article V, shall also
include any successor trustee.
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"Trust Indenture Act of 1939"or "Trust Indenture Act" (except
as otherwise provided in Sections 7.1 and 7.2) means the Trust Indenture Act of
1939 as in force at the date as of which this Indenture was originally executed.
"Vendor Financing Programs" means the sale and leaseback
transaction of the Issuer's ▇▇▇▇▇▇-▇▇▇▇▇▇▇ Steam Generating Plant, including
related real property and certain related energy generating equipment, the sale
and leaseback transaction(s) of the Issuer's general office building and
research and development building located in Weirton, West Virginia and the
related conveyance or grant of an option to purchase certain undeveloped real
property adjacent thereto, and the transfer of a major operating lease to a
public entity and other Indebtedness of the Issuer or its Subsidiaries in
connection with the foregoing and related transactions with vendors of the
Issuer as described in the Prospectus.
"Voting Stock" means Capital Stock which ordinarily has voting
power for the election of directors (or persons performing similar functions),
whether at all times or only so long as no senior class of securities has such
voting power by reason of any contingency.
"Wholly Owned Subsidiary" means, at any time, a Subsidiary all
of the Capital Stock of which (except directors' qualifying shares) are at the
time owned directly or indirectly by the Issuer.
ARTICLE II
ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES
Section 2.1. Authentication and Delivery of Securities; Issuance of Exchange
Securities. Upon the execution and delivery of this Indenture, or from time to
time thereafter, Securities in an aggregate principal amount not in excess of
$134,200,000 (except as otherwise provided in Section 2.6), may be executed by
the Issuer and delivered to the Trustee for authentication, and the Trustee
shall thereupon authenticate and deliver said Securities to or upon the written
order of the Issuer, signed by both (a) its Chairman of the Board of Directors,
or any Vice Chairman of the Board of Directors, or its President or any Vice
President (whether or not designated by a number or numbers or a word or words
added before or after the title "Vice President") and (b) by its Treasurer or
any Assistant Treasurer, any Vice President or any Secretary without any further
action by the Issuer. In the case of the original issuance of the Securities,
the Trustee shall be entitled to receive an Opinion of Counsel of the Issuer
dated the date thereof substantially to the effect that:
(a) The Securities have been duly authorized, executed,
authenticated and delivered to the Holders of the Securities and assuming due
authentication by the Trustee, will be (x) valid and binding obligations of the
Issuer enforceable in accordance with their terms, except as (A) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and (B) rights of acceleration
and the availability of equitable remedies may be limited by equitable
principles of general applicability and (y) entitled to the benefits of the
Indenture.
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(b) No consent, approval, authorization or order of, or
qualification or filing with, any governmental body or agency is required for
the issuance of the Securities or the performance by the Issuer of its
obligations under the Securities, except such as have been obtained by the date
of such opinion and such as may be required by the securities or Blue Sky laws
of the various states.
Section 2.2. Execution of Securities. The Securities shall be signed on behalf
of the Issuer by both (a) its Chairman of the Board of Directors or any Vice
Chairman of the Board of Directors or its President or any Vice President
(whether or not designated by a number or numbers or a word or words added
before or after the title "Vice President") and (b) by its Treasurer or any
Assistant Treasurer or its Secretary or any Assistant Secretary, under its
corporate seal which may, but need not, be attested. Such signatures may be the
manual or facsimile signatures of the present or any future such officers. The
seal of the Issuer may be in the form of a facsimile thereof and may be
impressed, affixed, imprinted or otherwise reproduced on the Securities.
Typographical and other minor errors or defects in any such reproduction of the
seal or any such signature shall not affect the validity or enforceability of
any Security which has been duly authenticated and delivered by the Trustee. In
case any officer of the Issuer who shall have signed any of the Securities shall
cease to be such officer before the Security so signed shall be authenticated
and delivered by the Trustee or disposed of by the Issuer, such Security
nevertheless may be authenticated and delivered or disposed of as though the
person who signed such Security had not ceased to be such officer of the Issuer;
and any Security may be signed on behalf of the Issuer by such persons as, at
the actual date of the execution of such Security, shall be the proper officers
of the Issuer, although at the date of the execution and delivery of this
Indenture, any such person was not such officer.
Section 2.3. Certificate of Authentication. Only such Securities as shall bear
thereon a certificate of authentication substantially in the form set forth in
Exhibit C hereof, executed by the Trustee by manual signature of one of its
authorized signatories, shall be entitled to the benefits of this Indenture or
be valid or obligatory for any purpose. Such certificate by the Trustee upon any
Security executed by the Issuer shall be conclusive evidence that the Security
so authenticated has been duly authenticated and delivered hereunder and that
the holder is entitled to the benefits of this Indenture.
Section 2.4. Form, Denomination and Date of Securities; Payments of Interest.
The Securities and the Trustee's certificates of authentication shall be
substantially in the forms attached hereto as Exhibits A-C, respectively. The
Securities shall be issuable as registered securities without coupons and in
denominations provided for in the form of Security attached hereto as Exhibits A
and B. The Securities shall be numbered, lettered, or otherwise distinguished in
such manner or in accordance with such plans as the officers of the Issuer
executing the same may determine with the approval of the Trustee. The
Securities shall be issued in registered form and may, if agreed by the Issuer
and the Holder, be issued in the form of a permanent Global security (any such
Global security, "Global Securities") in the form set forth in Exhibit A hereto.
Securities may be issued, if agreed by the Issuer and the Holder, in the form of
definitive Securities in physical form. Securities shall be issued in registered
form, substantially in the form set forth in Exhibit B hereto. Any of the
Securities may be issued with appropriate insertions, omissions, substitutions
and variations, and may have imprinted or otherwise reproduced thereon such
legend or legends, not inconsistent with the provisions of this Indenture, as
may be required to
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comply with any law or with any rules or regulations pursuant thereto, or with
the rules of any securities market in which the Securities are admitted to
trading, or to conform to general usage. The Issuer shall furnish any such
legends or endorsements to the Trustee in writing. The Issuer shall approve the
form of the Securities and any notation, legend or endorsement on them.
Each Security shall be dated the date of its authentication,
shall bear interest from the date stated therein and shall be payable on the
dates specified on the face of the applicable form of Security.
The person in whose name any Security is registered at the
close of business on any record date with respect to any interest payment date
shall be entitled to receive the interest, if any, payable on such interest
payment date notwithstanding any transfer or exchange of such Security
subsequent to the record date and prior to such interest payment date, except if
and to the extent the Issuer shall default in the payment of the interest due on
such interest payment date, in which case such defaulted interest, if any, shall
be paid to the persons in whose names outstanding Securities are registered at
the close of business on a subsequent record date (which shall be not less than
five business days prior to the date of payment of such defaulted interest, if
any,) established by notice given by mail by or on behalf of the Issuer to the
holders of Securities not less than 15 days preceding such subsequent record
date. The term "record date" as used with respect to any interest payment date
(except a date for payment of defaulted interest, if any,) shall mean if such
interest payment date is the first day of a calendar month, the fifteenth day of
the next preceding calendar month and shall mean, if such interest payment date
is the fifteenth day of a calendar month, the first day of such calendar month,
whether or not such record date is a business day.
Section 2.5. Global Legend. (a) Each Global Security shall bear the following
legend on the face thereof:
UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY 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.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO.
OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE.
(b) Each Security shall bear the following original issue discount
legend:
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FOR PURPOSES OF SECTION 1273 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), THIS SECURITY HAS ORIGINAL
ISSUE DISCOUNT. FOR PURPOSES OF SECTION 1273 OF THE CODE, THE
ISSUE PRICE IS $ AND THE AMOUNT OF ORIGINAL ISSUE DISCOUNT IS
$ , IN EACH CASE PER $1,000 PRINCIPAL AMOUNT OF THIS SECURITY
FOR PURPOSES OF SECTION 1273 OF THE CODE, THE YIELD TO
MATURITY COMPOUNDED SEMIANNUALLY IS %.
Section 2.6. Registration, Transfer and Exchange. The Issuer will keep at each
office or agency to be maintained for the purpose as provided in Section 3.2 a
register or registers in which the transfer of Securities as in this Article
provided. Such register shall be in written form in the English language or in
any other form capable of being converted into such form within a reasonable
time. At all reasonable times, such register or registers shall be open for
inspection by the Trustee.
The Securities are issuable only in registered form. A Holder
may transfer a Security by written application to the Registrar stating the name
of the proposed transferee and otherwise complying with the terms of this
Indenture. No such transfer shall be effected until, and such transferee shall
succeed to the rights of a Holder only upon, final acceptance and registration
of the transfer by the Registrar in the Security Register. Prior to the
registration of any transfer by a Holder as provided herein, the Issuer, the
Trustee, and any agent of the Issuer shall treat the person in whose name the
Security is registered as the owner thereof for all purposes whether or not the
Security shall be overdue, and neither the Issuer, the Trustee, nor any such
agent shall be affected by notice to the contrary. Furthermore, the Depositary
shall, by acceptance of a Global Security, agree that transfers of beneficial
interests in such Global Security may be effected only through a book-entry
system maintained by the Depositary (or its agent), and that ownership of a
beneficial interest in the Global Security shall be required to be reflected in
a book entry. When Securities are presented to the Registrar with a request to
register the transfer or to exchange them for an equal principal amount of
Securities of other authorized denominations, the Registrar shall register the
transfer or make the exchange as requested if its requirements for such
transactions are met. To permit registrations of transfers and exchanges in
accordance with the terms, conditions and restrictions hereof, the Issuer shall
execute and the Trustee shall authenticate Securities at the Registrar's
request. No service charge shall be made for any registration of transfer or
exchange or redemption of the Securities, but the Issuer may require payment of
a sum sufficient to cover any transfer tax or similar governmental charge
payable in connection therewith (other than any such transfer taxes or other
similar governmental charge payable upon exchanges pursuant to Section 2.10, 7.5
or 12.2). The Registrar shall not be required (i) to issue, register the
transfer of or exchange any Security during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Securities selected for redemption under Section 12.2 and ending at the close of
business on the day of such mailing, or (ii) to register the transfer of or
exchange any Security so selected for redemption in whole or in part, except the
unredeemed portion of any Security being redeemed in part.
Upon due presentation for registration of transfer of any
Security at each such office or agency, the Issuer shall execute and the Trustee
shall authenticate and deliver in the
27
name of the transferee or transferees a new Security or Securities in authorized
denominations for a like aggregate principal amount.
All Securities presented for registration of transfer,
exchange, redemption or payment shall (if so required by the Issuer or the
Trustee) be duly endorsed by, or be accompanied by a written instrument or
instruments of transfer in form satisfactory to the Issuer and the Trustee duly
executed by the holder or his attorney duly authorized in writing.
All Securities issued upon any transfer or exchange of
Securities shall be valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such transfer or exchange.
Section 2.7. Book-Entry Provisions for Global Securities. (a) Each Global
Security initially shall (i) be registered in the name of the Depositary or the
nominee of such Depositary and (ii) be delivered to the Trustee as custodian for
such Depositary and (iii) bear legends as set forth in Section 2.5(a). Except as
described in this Article II, owners of interests in the Global Securities shall
not have Securities registered in their names, will not receive physical
delivery of Securities in definitive form and will not be considered the
registered owners or holders thereof under this Indenture for any purpose.
Members of, or participants in, the Depositary ("Agent Members") shall have no
rights under this Indenture with respect to any Global Security held on their
behalf by the Depositary, or the Trustee as its custodian, or under any Global
Security and the Depositary and/or its nominee may be treated by the Issuer, the
Trustee and any agent of the Issuer or the Trustee as the absolute owner of such
Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Issuer, the Trustee or any agent of the Issuer
or the Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a holder of any Security.
(b) Transfers of a Global Security shall be limited to
transfers of such Global Security in whole, but not in part, to the Depositary,
its successors or their respective nominees. Beneficial interests in the Global
Security may be transferred in accordance with the applicable rules and
procedures of the Depositary. In addition, definitive Securities in physical
form shall be transferred to all beneficial owners in exchange for their
beneficial interests in the Global Security if (i) the Depositary notifies the
Issuer that it is unwilling or unable to continue as Depositary for the Global
Security and a successor Depositary is not appointed by the Issuer within 90
days of such notice or (ii) there shall have occurred and be continuing an Event
of Default or any event which after notice or lapse of time or both would be an
Event of Default with respect to the Securities. Securities issued in definitive
form will be in fully registered form, without coupons, in minimum denominations
of $50 and integral multiples of $50 above that amount. Upon issuance of
Securities in definitive form, the Trustee is required to register Securities in
the name of, and cause the Securities to be delivered to, the person or persons
(or nominee thereof) identified as the beneficial owners as the Depositary shall
direct.
(c) In connection with any transfer of a beneficial interest
in a Global Security to a transferee receiving definitive Securities in physical
form pursuant to paragraph (b) of this Section, the Registrar shall reflect on
its books and records the date and the decrease in the
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principal amount of the Global Security in an amount equal to the principal
amount of the beneficial interest in the Global Security to be transferred, and
the Issuer shall execute, and the Trustee shall authenticate and deliver, one or
more definitive Securities in physical form of like tenor and amount.
(d) In connection with the transfer of the entire Global
Security to beneficial owners pursuant to paragraph (b) of this Section, the
Global Security shall be deemed to be surrendered to the Trustee for
cancellation, and the Issuer shall execute, and the Trustee shall authenticate
and deliver, to each beneficial owner identified by the Depositary in exchange
for its beneficial interest in the Global Security, an equal aggregate principal
amount of definitive Securities in physical form or of authorized denominations.
(e) The registered holder of the 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.
Section 2.8. Mutilated, Defaced, Destroyed, Lost and Stolen Securities. In case
any temporary or definitive Security shall become mutilated, defaced or be
apparently destroyed, lost or stolen, the Issuer in its discretion may execute,
and upon the written request of any officer of the Issuer, the Trustee shall
authenticate and deliver, a new Security, bearing a number not contemporaneously
outstanding, in exchange and substitution for the mutilated or defaced Security,
or in lieu of and substitution for the Security so apparently destroyed, lost or
stolen. In every case the applicant for a substitute Security shall furnish to
the Issuer and to the Trustee and any agent of the Issuer or the Trustee such
security or indemnity as may be required by them to indemnify and defend and to
save each of them harmless and, in every case of destruction, loss or theft
evidence to their satisfaction of the apparent destruction, loss or theft of
such Security and of the ownership thereof.
Upon the issuance of any substitute Security, the Issuer may
require the payment of 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 the Trustee and its counsel) connected therewith. In
case any Security which has matured or is about to mature, shall become
mutilated or defaced or be apparently destroyed, lost or stolen, the Issuer may,
instead of issuing a substitute Security, pay or authorize the payment of the
same (without surrender thereof except in the case of a mutilated or defaced
Security), if the applicant for such payment shall furnish to the Issuer and to
the Trustee and any agent of the Issuer or the Trustee such security or
indemnity as any of them may require to save each of them harmless from all
risks, however remote, and, in every case of apparent destruction, loss or
theft, the applicant shall also furnish to the Issuer and the Trustee and any
agent of the Issuer or the Trustee evidence to their satisfaction of the
apparent destruction, loss or theft of such Security and of the ownership
thereof.
Every substitute Security issued pursuant to the provisions of
this Section by virtue of the fact that any Security is apparently destroyed,
lost or stolen shall constitute an additional contractual obligation of the
Issuer, whether or not the apparently destroyed, lost or stolen Security shall
be at any time enforceable by anyone and shall be entitled to all the benefits
29
of (but shall be subject to all the limitations of rights set forth in) this
Indenture equally and proportionately with any and all other Securities duly
authenticated and delivered hereunder. All Securities shall be held and owned
upon the express condition that, to the extent permitted by law, the foregoing
provisions are exclusive with respect to the replacement or payment of
mutilated, defaced, or apparently destroyed, lost or stolen Securities and shall
preclude any and all other rights or remedies notwithstanding any law or statute
existing or hereafter enacted to the contrary with respect to the replacement or
payment of negotiable instruments or other securities without their surrender.
Section 2.9. Cancellation of Securities; Destruction Thereof. All Securities
surrendered for payment, redemption, registration of transfer or exchange, if
surrendered to the Issuer or any agent of the Issuer or the Trustee, shall be
delivered to the Trustee for cancellation or, if surrendered to the Trustee,
shall be cancelled by it; and no Securities shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this Indenture. The
Trustee shall destroy cancelled Securities held by it and deliver a certificate
of destruction to the Issuer. If the Issuer shall acquire 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
delivered to the Trustee for cancellation.
Section 2.10. Temporary Securities. Pending the preparation of definitive
Securities, the Issuer may execute and the Trustee shall authenticate and
deliver temporary Securities (printed, lithographed, typewritten or otherwise
reproduced, in each case in form satisfactory to the Trustee). Temporary
Securities shall be issuable as registered Securities without coupons, of any
authorized denomination, and substantially in the form of the definitive
Securities but with such omissions, insertions and variations as may be
appropriate for temporary Securities, all as may be determined by the Issuer
with the concurrence of the Trustee. Temporary Securities may contain such
reference to any provisions of this Indenture as may be appropriate. Every
Temporary Security shall be executed by the Issuer and be authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the definitive Securities. Without unreasonable delay, the
Issuer shall execute and shall furnish definitive Securities and thereupon
temporary Securities may be surrendered in exchange therefor without charge at
each office or agency to be maintained by the Issuer for the purpose pursuant to
Section 3.2, and the Trustee shall authenticate and deliver in exchange for such
temporary Securities a like aggregate principal amount of definitive Securities
of authorized denominations. Until so exchanged, the temporary Securities shall
be entitled to the same benefits under this Indenture as definitive Securities.
Section 2.11. Wire Payments. Notwithstanding any provisions of this Indenture
and the Securities to the contrary, if the Issuer and a Holder so agree,
payments of cash interest on, and any portion of the principal of any Securities
other than the final payment of principal on a Security, may be made by the
Paying Agent upon receipt from the Issuer in immediately available funds,
directly to the Holder of such Security (whether by Federal funds, wire transfer
or otherwise) if the Holder has delivered written instructions to the Trustee 15
days prior to such payment date requesting that such payment will be so made and
designating the bank account to which such payment shall be so made and in the
case of payments of a portion of the principal of any Securities other than the
final payment of principal on a Security, the holder of such Security surrenders
the same to the Trustee in exchange for a Security or Securities aggregating the
same
30
principal amount as the unredeemed principal amount of the Securities
surrendered. The Trustee shall be entitled to rely on the last instruction
delivered by the Holder pursuant to this Section 2.11 unless a new instruction
is delivered 15 days prior to a payment date. The Issuer will indemnify and hold
the Trustee harmless against any loss, liability or expense (including
attorneys' fees) resulting from any act or omission to act on the part of the
Issuer or any such Holder in connection with any such agreement or which the
Paying Agent may incur as a result of making any payment in accordance with any
such agreement.
Section 2.12. Deposit of Moneys. On or before each payment date (including a
Repurchase Date), the Issuer shall deposit with the Paying Agent (or if the
Issuer or one of its Subsidiaries or any Affiliate of any thereof is the Paying
Agent, shall segregate and hold in trust) money sufficient to make the payment
of principal of and interest due hereunder on such payment date which shall, to
the extent wire payments are to be made pursuant to Section 2.11 or otherwise
pursuant to this Indenture be made in immediately available funds.
ARTICLE III
COVENANTS OF THE ISSUER AND THE TRUSTEE
Section 3.1. Payment of Principal and Interest. The Issuer covenants and agrees
that it will duly and punctually pay or cause to be paid the principal of and
interest on each of the Securities at the place or places, at the respective
times and in the manner provided in the Securities. Each installment of interest
on the Securities may be paid by mailing checks for such interest payable to or
upon the written order of the holders of Securities entitled thereto as they
shall appear on the registry books of the Issuer. The Issuer shall pay interest
on overdue principal at the rate borne by the Securities and shall pay interest
on overdue installments of interest at the same rate to the extent lawful.
Section 3.2. Offices for Payments, etc. So long as any of the Securities remain
outstanding, the Issuer will maintain in the Borough of Manhattan, the City of
New York, the following:
(a) an office or agency where the Securities may be presented
for payment (the "Paying Agent");
(b) an office or agency where the Securities may be presented
for registration of transfer and for exchange as in this Indenture provided (the
"Registrar"); and
(c) an office or agency where notices and demands to or upon
the Issuer in respect of the Securities or of this Indenture may be served.
The Issuer will give to the Trustee written notice of the
location of any such office or agency and of any change of location thereof. The
Issuer hereby initially designates the Trustee's agency at ▇.▇. ▇▇▇▇▇▇ as the
office or agency for each such purpose. In case the Issuer shall fail to
maintain any such office or agency or shall fail to give such notice of the
location or of any change in the location thereof, presentations and demands may
be made and notices may be served at the Corporate Trust Office. The Trustee
shall initially be the Registrar and Paying Agent; provided, however, that the
Issuer may act as Paying Agent or Registrar.
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Section 3.3. Appointment to Fill a Vacancy in Office of Trustee. The Issuer,
whenever necessary to avoid or fill a vacancy in the office of Trustee, will
appoint, in the manner provided in Section 5.9, a Trustee, so that there shall
at all times be a Trustee hereunder.
Section 3.4. Paying Agents. Whenever the Issuer shall appoint a Paying Agent
other than the Trustee, it will cause such Paying Agent to execute and deliver
to the Trustee an instrument in which such agent shall agree with the Trustee,
subject to the provisions of this Section:
(a) that it will hold all sums received by it as such agent
for the payment of the principal of and interest on the Securities (whether such
sums have been paid to it by the Issuer or by any other obligor on the
Securities) in trust for the benefit of the holders of the Securities or of the
Trustee;
(b) that it will give the Trustee notice of any failure by the
Issuer (or by any other obligor on the Securities) to make any payment of the
principal of and interest on the Securities when the same shall be due and
payable; and
(c) pay any such sums so held in trust by it to the Trustee
upon the Trustee's written request at any time during the continuance of the
failure referred to in clause (b) above.
The Issuer will, prior to each due date of the principal of
and interest on the Securities, deposit with the Paying Agent a sum sufficient
to pay such principal, interest, and (unless such Paying Agent is the Trustee)
the Issuer will promptly notify the Trustee of any failure to take such action.
If the Issuer shall act as its own Paying Agent, it will, on
or before each due date of the principal of and interest, on the Securities, set
aside, segregate and hold in trust for the benefit of the holders of the
Securities a sum sufficient to pay such principal interest, so becoming due. The
Issuer will promptly notify the Trustee of any failure to take such action.
Anything in this Section to the contrary notwithstanding, the
Issuer may at any time, for the purpose of obtaining a satisfaction and
discharge of this Indenture or for any other reason, pay or cause to be paid to
the Trustee all sums held in trust by the Issuer or any Paying Agent hereunder,
as required by this Section, such sums to be held by the Trustee upon the trusts
herein contained.
Anything in this Section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of Sections 9.3 and 9.4.
Section 3.5. Certificate to Trustee. The Issuer will furnish to the Trustee
within 120 days after the end of each fiscal year a brief certificate (which
need not comply with Section 11.5) from the principal executive, financial or
accounting officer of the Issuer as to his or her knowledge of the Issuer's
compliance with all conditions and covenants under the Indenture during such
fiscal year (such compliance to be determined without regard to any period of
grace or requirement of notice provided under the Indenture).
32
Section 3.6. Securityholders' Lists. If and so long as the Trustee shall not be
the Security Registrar, the Issuer will furnish or cause to be furnished to the
Trustee a list in such form as the Trustee may reasonably require of the names
and addresses of the holders of the Securities pursuant to Section 312 of the
Trust Indenture Act (a) semiannually not more than 15 days after each record
date for the payment of semiannual interest on the Securities, as herein above
specified, as of such record date, and (b) at such other times as the Trustee
may request in writing, within thirty days after receipt by the Issuer of any
such request as of a date not more than 15 days prior to the time such
information is furnished.
Section 3.7. Reports to Holders of the Securities. The Issuer covenants to file
with the Trustee, within 15 days after the Issuer is required to file the same
with the Commission, copies of the annual reports and of the information,
documents, and other reports which the Issuer may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Exchange Act. If,
during any period in which Securities with an aggregate principal amount equal
to or greater than ten percent of the aggregate principal amount of Securities
originally issued under this Indenture are outstanding, the Issuer is not
obligated to file annual reports, documents or other reports with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act, the Issuer will furnish to
the Trustee the same such annual reports, documents or other reports as if the
Issuer were so subject. In addition, whether or not required by the rules and
regulations of the Commission, the Issuer shall file a copy of all such
information and reports with the Commission for public availability (unless the
Commission will not accept such a filing) and make such information available to
securities analysts and prospective investors upon request.
Section 3.8. Reports by the Trustee. Any Trustee's report required under Section
313(a) of the Trust Indenture Act of 1939 shall be transmitted on or before the
first date for the regular payment of semiannual interest on the Securities next
succeeding November 15 in each year, and shall be dated as of a date convenient
to the Trustee no more than 60 nor less than 45 days prior thereto (unless such
November 15 is less than 45 days prior to such interest payment date, in which
case such report shall be (a) so transmitted on or before the second such
interest payment date next succeeding such November 15 and (b) as of a date
determined as provided above). The Trustee also shall comply with Section
313(b)(2) of the Trust Indenture Act of 1939. In addition, the Trustee shall
transmit by mail all reports as required by Section 313(c) of the Trust
Indenture Act of 1939.
A copy of each report, at the time of its mailing to the
Holders of Securities, shall be mailed to the Issuer and filed with the
Commission and with each stock exchange on which the Securities are listed in
accordance with Section 313(d) of the Trust Indenture Act of 1939. The Issuer
shall promptly notify the Trustee when the Securities are listed on any stock
exchange or of any delisting thereof.
Section 3.9. Limitations on Indebtedness. The Issuer will not, and will not
permit any Subsidiary to, create, incur, assume, become liable for or guarantee
the payment of (collectively, an "incurrence") any Indebtedness (including
Acquired Indebtedness), other than Permitted Indebtedness, or permit any
Subsidiary to issue any Preferred Stock other than Preferred Stock that is
issued to and held by the Issuer or a wholly owned Subsidiary of the Issuer (so
long as the Issuer or a wholly owned Subsidiary of the Issuer owns such
Preferred Stock); provided the Issuer may incur, and may permit any Subsidiary
to incur, Indebtedness (including Acquired
33
Indebtedness) if (a) at the time of such event and after giving effect thereto,
on a pro forma basis, the ratio of Consolidated EBITDA to Consolidated Fixed
Charges for the four fiscal quarters immediately preceding such event for which
financial information is available consistent with the Issuer's prior practice,
taken as one period and calculated on the assumption that such Indebtedness had
been incurred on the first day of such four-quarter period and, in the case of
Acquired Indebtedness, on the assumption that the related acquisition (whether
by means of purchase, merger or otherwise) also had occurred on such date with
the appropriate adjustments with respect to such acquisition being included in
such pro forma calculation, would have been greater than 1.75 to 1, and (b) no
Default or Event of Default shall have occurred and be continuing at the time or
as a consequence of the incurrence of such Indebtedness.
Section 3.10. Limitations on Restricted Payments. The Issuer will not, and will
not permit any of its Subsidiaries to, directly or indirectly, make any
Restricted Payment unless:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of or after giving effect to such Restricted Payment; and
(b) immediately after giving effect to such Restricted
Payment, the aggregate of all Restricted Payments (the fair market value of any
such Restricted Payment, if other than cash, as determined in good faith by the
Issuer's Board of Directors and evidenced by a resolution of such Board of
Directors) declared or made after the Issue Date does not exceed the sum of (i)
50% of the Excess Cash Flow on a cumulative basis during the period (taken as
one accounting period) from and including January 1, 2002 and ending on the last
day of the Issuer's last fiscal quarter ending prior to the date of such
Restricted Payment, plus (ii) 100% of the aggregate net cash proceeds of, and
the fair market value of marketable securities (as determined in good faith by
the Board of Directors and evidenced by a resolution of such Board of Directors)
received by the Issuer from, the issue or sale after January 1, 2002 of Capital
Stock of the Issuer (other than the issue or sale of (A) Disqualified Stock, (B)
Capital Stock of the Issuer to any Subsidiary of the Issuer or (C) Capital Stock
convertible (whether at the option of the Issuer or the holder thereof or upon
the happening of any event) into any security other than its Capital Stock) and
any Indebtedness or other securities of the Issuer convertible into or
exercisable for Capital Stock (other than Disqualified Stock) of the Issuer
which has been so converted or exercised, as the case may be, plus (iii) the
amount by which the Indebtedness of the Issuer is reduced on the Issuer's
balance sheet upon the conversion or exchange (other than by a Subsidiary of the
Issuer) subsequent to the Issue Date of any Indebtedness of the Issuer
convertible or exchangeable for Capital Stock (other than Disqualified Stock) of
the Issuer (less the amount of any cash or the fair market value of other
property distributed to the Issuer upon such conversion or exchange);
provided that, notwithstanding the foregoing, (1) the Issuer and its
Subsidiaries shall be permitted to make Permitted Payments and (2) the Issuer
and any Subsidiary shall be permitted to make Investments in Permitted Joint
Ventures if at the time of such Investment and after giving effect thereto, on a
pro forma basis, (X) the Issuer could incur at least $1.00 of Indebtedness
(other than Permitted Indebtedness) pursuant to clause (a) of Section 3.9
(assuming for purposes of such calculation, if such Investment is made other
than with borrowed funds or funds obtained from the issuance of Capital Stock
specifically for the purpose of such Investment, that the Issuer incurred
Indebtedness in an amount equal to such Investment bearing
34
interest at the weighted average rate of interest paid by the Issuer on its
outstanding Indebtedness during the four fiscal quarters most recently ended) or
otherwise pursuant to clause (xi) of the definition of Permitted Indebtedness,
(Y) the aggregate amount of Investments made pursuant to this clause (2), less
the aggregate amount of dividends, other distributions of earnings and returns
of capital received by the Issuer from such Permitted Joint Ventures in cash,
does not exceed $50,000,000 and (Z) no Default or Event of Default shall have
occurred and be continuing; and provided further that the foregoing clause (b)
shall not prevent (I) the payment of any dividend within 60 days of its
declaration if such dividend could have been made on the date of its declaration
without violation of the provisions of this covenant or (II) the redemption,
repurchase, retirement or other acquisition of any Capital Stock of the Issuer
in exchange for, or out of the proceeds of, the substantially concurrent sale
(other than to a Subsidiary of the Issuer) of other Capital Stock of the Issuer
(other than any Disqualified Stock); provided that the amount of any such net
cash proceeds that are utilized for any such redemption, repurchase, retirement
or other acquisition shall be excluded from clause (ii) of this paragraph (b);
or (III) the defeasance, redemption or repurchase of Indebtedness which is
subordinated in right of payment to the Securities with the net cash proceeds
from an incurrence of Refinancing Indebtedness or the substantially concurrent
sale (other than to a Subsidiary of the Issuer) of other Capital Stock of the
Issuer (other than any Disqualified Stock); provided that the amount of any such
net cash proceeds that are utilized for any such redemption, repurchase,
retirement or other acquisition shall be excluded from clause (ii) of this
paragraph (b).
Section 3.11. Limitations on Transactions with Affiliates. So long as any of the
Securities remain outstanding, neither the Issuer nor any of its Subsidiaries
will directly or indirectly enter into any transaction or series of related
transactions involving aggregate consideration in excess of $ 1,000,000 in any
fiscal year with any Affiliate or holder of 5% or more of any class of Capital
Stock of the Issuer other than the Series C Preferred Stock (including any
Affiliates of such holders) except for any transaction (including any loans or
advances by or to any Affiliate) (i) the terms of which are fair and reasonable
to the Issuer or such Subsidiary, as the case may be, and are at least as
favorable as the terms which could be obtained by the Issuer or such Subsidiary,
as the case may be, in a comparable transaction made on an arm's length basis
with Persons who are not such a holder, an Affiliate of such holder or Affiliate
of the Issuer and (ii) which has been approved by a majority of the Issuer's
directors (including a majority of the Issuer's independent directors, if any)
in the exercise of their fiduciary duties; provided that any such transaction
shall be conclusively deemed to be on terms which are fair and reasonable to the
Issuer or any of its Subsidiaries and on terms which are at least as favorable
as the terms which could be obtained on an arms length basis with Persons who
are not such a holder, an Affiliate of such holder or Affiliate of the Issuer if
such transaction is approved by a majority of the Board of Directors (including
a majority of the Issuer's independent directors, if any). If the Issuer or any
Subsidiary enters into a transaction with an Affiliate (or a series of related
transactions with Affiliates related to a common plan) that involves an
aggregate fair market value of more than $10 million, the Issuer or such
Subsidiary, as the case may be, shall, prior to the consummation thereof, obtain
a favorable opinion as to the fairness of such transactions to the Issuer or the
relevant Subsidiary, as the case may be, from a financial point of view from an
independent nationally recognized investment banking firm and deliver same to
the Trustee.
35
This covenant does not apply to: (a) any transaction between
the Issuer and any of its Wholly Owned Subsidiaries or between any of its Wholly
Owned Subsidiaries; provided that such transactions are not prohibited by other
provisions of this Indenture; (b) any Restricted Payment not otherwise
prohibited by Section 3.10; (c) any transaction pursuant to an agreement in
existence on the date of the Indenture and included as an exhibit to the
Issuer's Exchange Act Reports; (d) transactions between the Issuer and the 1984
ESOP, 1989 ESOP or any other employee benefit plan; (e) any transaction with a
Subsidiary or a Permitted Joint Venture which would constitute a transaction
with an Affiliate solely because the Issuer or a Subsidiary owns an equity
interest in or otherwise controls such Subsidiary or a Permitted Joint Venture;
and (f) reasonable fees and compensation paid to, and indemnity provided on
behalf of, officers, directors or employees of the Issuer or any Subsidiary of
the Issuer as determined in good faith by the Issuer's Board of Directors.
Section 3.12. Restrictions on Disposition of Assets of the Issuer. (a) Subject
to the provisions of Section 8.1 and Section 10.3, the Issuer will not, and will
not permit any of its Subsidiaries to, make any Asset Disposition (excluding any
Asset Disposition of Collateral) unless (i) the Issuer (or the Subsidiary, as
the case may be) receives consideration at the time of such sale or other
disposition at least equal to the fair market value thereof, as determined in
good faith by the Issuer's Board of Directors and evidenced by a resolution of
such Board of Directors; (ii) not less than 75% of the consideration received by
the Issuer (or the Subsidiary, as the case may be) is in the form of cash or
Cash Equivalents and (iii) the Net Cash Proceeds of the Asset Disposition are
within 270 days, at the Issuer's election, applied (A) to the extent the Issuer
elects (or is so required by the terms of any Indebtedness), to prepay or repay
the Credit Facility or the Vendor Financing Programs, or (B)(i) to redeem or
make other payments in respect of the Series C Preferred Stock, or (ii) to make
an investment in properties and assets other than cash, cash equivalents or
inventory that replace the properties and assets that were the subject of the
Asset Disposition or in properties and assets that will be used in the business
of making, processing or distributing steel products, including, without
limitation, tin products or other coated steel products and related businesses,
or (C) to the extent of the balance of such Net Cash Proceeds after application
in accordance with (A) or (B), to make an Asset Disposition Offer to purchase
the Securities (on a pro rata basis if the amount available for such purchase is
less than 100% of the outstanding principal amount of the Securities) and
Secured Series 2002 Bonds on a pari passu basis, at a purchase price of the
principal amount thereof plus accrued and unpaid interest, if any, as the case
may be, to the date of repayment. Notwithstanding the foregoing, the Issuer and
its Subsidiaries will not be required to apply any Net Cash Proceeds to
effectuate an Asset Disposition Offer in accordance with this provision except
to the extent that the aggregate gross proceeds from all Asset Dispositions
which are not applied in accordance with clause (A) or (B) exceed $15,000,000.
(b) Subject to the provisions of Section 8.1 and Section 10.3,
the Issuer will not, and will not permit any of its Subsidiaries to, make any
Asset Disposition of Collateral unless (i) the Issuer (or the Subsidiary, as the
case may be) receives consideration at the time of such sale or other
disposition at least equal to the fair market value thereof, as determined in
good faith by the Issuer's Board of Directors and evidenced by a resolution of
such Board of Directors; (ii) not less than 75% of the consideration received by
the Issuer (or the Subsidiary, as the case may be) is in the form of cash or
Cash Equivalents and (iii) the Net Cash Proceeds of the Asset
36
Disposition are within 270 days, at the Issuer's election, applied (A) to the
extent the Issuer elects (or is so required by the terms of any Indebtedness),
to prepay or repay the Credit Facility which prepayment or repayment shall
constitute a permanent reduction of the commitment under such Credit Facility
(the "Permanent Reduction") or (B)(i) to redeem or make other payments in
respect of the Series C Preferred Stock, or (ii) to make an investment in
replacement properties and assets that will be used in the business of making,
processing or distributing steel products, including, without limitation, tin
products or other coated steel products and related businesses, and grant in
favor of the Trustee for the benefit of the holders of the Securities a Lien on
such replacement properties and assets, which Lien may be subordinated only to
senior secured Indebtedness incurred to finance or refinance, the acquisition of
such replacement properties and assets, or (C) to the extent of the balance of
such Net Cash Proceeds after application in accordance with (A) or (B), to make
an Asset Disposition Offer to purchase the Securities (on a pro rata basis if
the amount available for such purchase is less than 100% of the outstanding
principal amount of the Securities) and Secured Series 2002 Bonds on a pari
passu basis, at a purchase price of the principal amount thereof plus accrued
and unpaid interest, if any, as the case may be, to the date of repayment.
(c) In the event that the Issuer elects to purchase Securities
pursuant to Section 3.12(a)(iii)(C) or Section 3.12(b)(iii)(C) above, the Issuer
will purchase Securities tendered pursuant to a tender offer by the Issuer for
the Securities (the "Asset Disposition Offer") in accordance with the procedures
(including prorationing in the event of oversubscription) set forth in Section
3.12(d). If the aggregate purchase price of Securities tendered pursuant to the
Asset Disposition Offer is less than the Net Cash Proceeds allotted to the
purchase of the Securities, the Issuer shall apply the remaining Net Cash
Proceeds in accordance with clauses (A) and (B) of Sections 3.12(a)(iii) or
3.12(b)(iii) above, as applicable.
(d) (i) In the event that the Issuer elects to purchase
Securities pursuant to Section 3.12(a)(iii)(C) or Section 3.12(b)(iii)(C) above,
the Issuer shall be obligated to deliver to the Trustee and send, by first-class
mail to each Holder, a written notice stating that: (A) such Holder may elect to
have his Securities purchased by the Issuer either in whole or in part (subject
to prorationing as hereinafter described in the event the Asset Disposition
Offer is oversubscribed) in multiples of $1,000 principal amount, at the
applicable purchase price, plus accrued interest and unpaid interest, to the
date of purchase by the Issuer; (B) any Security not tendered or accepted for
payment will continue to accrue interest; (C) any Security accepted for payment
pursuant to the Asset Disposition Offer shall cease to accrue interest after the
Purchase Date; and (D) Holders will be entitled to withdraw their election in
the manner described in clause (iii) below.
The notice shall also specify a purchase date not less than 30
days nor more than 60 days after the date of such notice (the "Purchase Date"),
shall include all instructions and materials necessary to enable each Holder to
tender Securities pursuant to the Asset Disposition Offer, and shall contain
information concerning the business of the Issuer which the Issuer in good faith
believes will enable such Holders to make an informed decision (which at a
minimum will include (1) the most recently filed Annual Report on Form 10-K
(including audited consolidated financial statements) of the Issuer, the most
recent subsequently filed Quarterly Report on Form 10-Q and any Current Report
on Form 8-K of the Issuer filed subsequent to such
37
Quarterly Report, other than Current Reports describing other asset dispositions
otherwise described in the offering materials, (2) corresponding successor
reports or reports otherwise required pursuant to Section 3.7 to be delivered to
Holders if the Issuer is no longer filing reports pursuant to the Securities
Exchange Act of 1934, (3) a description of material developments in the Issuer's
business subsequent to the date of the latest of such reports, and (4) if
material, appropriate pro forma financial information. Substantially
simultaneously with the mailing of the notice, the Issuer shall cause a copy of
such notice to be published in The Wall Street Journal or another newspaper of
general circulation in the Borough of Manhattan, the City of New York.
(ii) Not later than the date upon which written notice of an
Asset Disposition Offer is delivered to the Trustee as provided above, the
Issuer shall deliver to the Trustee an Officers' Certificate as to (A) the
amount of the Asset Disposition Offer (the "Offer Amount"), (B) the allocation
of the Net Cash Proceeds pursuant to which such Asset Disposition Offer is being
made and (C) the compliance of such allocation with the provisions of Section
3.12(a) or Section 3.12(b). Not later than one Business Day prior to the
Purchase Date, the Issuer shall also irrevocably deposit with the Trustee or
with a Paying Agent (or, if the Issuer is acting as its own Paying Agent,
segregate and hold in trust) in immediately available funds an amount equal to
the Offer Amount to be held for payment in accordance with the provisions of
this Section. Upon the expiration of the period for which the Asset Disposition
Offer remains open (the "Offer Period"), the Issuer shall deliver to the Trustee
the Securities or portions thereof which have been properly tendered to and are
to be accepted by the Issuer. The Trustee or a Paying Agent (if any) shall, on
the Purchase Date, mail or deliver payment to each tendering Holder in the
amount of the purchase price. In the event that the aggregate purchase price of
the Securities delivered by the Issuer to the Trustee is less than the Offer
Amount, the Trustee shall deliver the excess to the Issuer immediately after the
expiration of the Offer Period.
(iii) Holders electing to have a Security purchased will be
required to surrender the Security, with an appropriate form duly completed, to
the Trustee at the address specified in the notice at least one Business Day
prior to the Purchase Date. Holders will be entitled to withdraw their election
if the Trustee or Paying Agent (if any) receives not later than the close of
business on the Business Day prior to the Purchase Date a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder and a
statement that such Holder is withdrawing his election to have all or a portion
of his Securities purchased. If at the expiration of the Offer Period, the
aggregate principal amount of Securities surrendered by Holders exceeds the
Offer Amount, the Issuer shall select the Securities to be purchased on a pro
rata basis (with such adjustments as may be deemed appropriate by the Issuer so
that only Securities in denominations of $1,000 or multiples thereof shall be
purchased). Holders whose Securities are purchased only in part will be issued
new Securities equal in principal amount to the unpurchased portion of the
Securities surrendered.
(iv) At the time the Issuer delivers Securities to the Trustee
which are to be accepted for purchase, the Issuer will also deliver an Officers'
Certificate stating that such Securities are to be accepted by the Issuer
pursuant to and in accordance with the terms of this Section. A Security shall
be deemed to have been accepted for purchase at the time the Trustee, directly
or through an agent, mails or delivers payment therefor to the surrendering
Holder.
38
(e) In the event the Issuer is unable to purchase Securities
from Holders in an Asset Disposition Offer because such purchase is prohibited
by any provision of applicable law, the Issuer need not make an Asset
Disposition Offer. The Issuer shall then be obligated to apply the Net Cash
Proceeds in accordance with clause (A) or (B) of Section 3.12(a)(iii) or Section
3.12(b)(iii), as applicable.
(f) Whenever Net Cash Proceeds are received by the Issuer, and
prior to the allocation of such Net Cash Proceeds pursuant to this Section 3.12,
such Net Cash Proceeds shall be (i) set aside by the Issuer in a separate
account pending allocation or (ii) if required under the Credit Facility, the
Security Documents or the Intercreditor Agreement, placed in a cash collateral
account pledged as security for the Credit Facility, pending allocation.
Section 3.13. Limitations on Liens. The Issuer will not, and will not permit any
Subsidiary to, issue, assume or guarantee any Indebtedness secured by a Lien
(other than a Permitted Lien) of or upon any Property of the Issuer or any
Subsidiary or any shares of stock or debt of any Subsidiary which owns Property,
whether such Property is owned at the date of the Indenture or thereafter
acquired, without making effective provision whereby the Securities (together
with, if the Issuer shall so determine, any other debt of the Issuer ranking
equally with the Securities and then existing or thereafter created) shall be
secured by such Lien equally and ratably with such Indebtedness, so long as such
Indebtedness shall be so secured. The Issuer shall not, and shall not permit any
of its Subsidiaries to, directly or indirectly, create, incur, assume or suffer
to exist any Lien on any Collateral now owned or hereafter acquired, or any
income or profits therefrom, except Collateral Permitted Liens.
Section 3.14. Limitations on Sale and Leaseback Transactions. (a) The Issuer
will not and will not permit any Subsidiary to enter into any sale and leaseback
transaction with respect to any Property (whether now owned or hereafter
acquired) unless the net proceeds of the sale or transfer of the Property to be
leased are at least equal to the fair market value (as determined by the Board
of Directors) of such Property and unless the Issuer or such Subsidiary would be
entitled under Sections 3.9 and 3.13, to issue, assume or guarantee debt secured
by a mortgage on such Property in an amount at least equal to the Attributable
Debt in respect of such sale and leaseback transaction; provided, however, that
the foregoing prohibition does not apply to leases between the Issuer and a
Subsidiary or between Subsidiaries or to sales and leasebacks with respect to
the Vendor Financing Programs.
(b) In connection with a financing secured by the Tandem Mill
Collateral in an amount not to exceed $90 million, the Lien in favor of the
Trustee for the benefit of the holders of the Securities on the Tandem Mill
Collateral shall be subordinated and the cash proceeds of any such financing
(net of all legal, title and recording tax expenses, commissions and other fees
and expenses incurred in connection with the financing and after payment of $25
million to the lenders under the Credit Facility (the "Credit Facility
Repayment") and the release by such lenders under the Credit Facility of their
Liens on the Tandem Mill Collateral) must be used in connection with a Permitted
Acquisition and the Issuer or any of its Subsidiaries must ▇▇▇▇▇ ▇ ▇▇▇▇ in favor
of the Trustee for the benefit of the holders of the Securities on the assets
and properties so acquired (excluding working capital assets) which Lien may be
subordinated only to senior secured Indebtedness incurred to finance or
refinance, as applicable, the Permitted
39
Acquisition and may be pari passu with a Lien granted in favor of the Bond
Trustee to secure the Indebtedness relating to the Secured Series 2002 Bonds to
the extent such Indebtedness is then outstanding; provided, however, that such
Credit Facility Repayment shall not reduce the amount of Permitted Working
Capital Indebtedness. In connection with a sale and leaseback transaction with
respect to the Tandem Mill Collateral, the Lien in favor of the Trustee for the
benefit of the holders of the Securities may be released and terminated and the
cash proceeds received by the Issuer (net of all legal, title and recording tax
expenses, commissions and other fees and expenses incurred in connection with
the sale and leaseback transaction and any capital gains taxes incurred as a
consequence of such transaction) shall be applied, at the election of the
Issuer, as follows: (i) to finance or refinance a Permitted Acquisition
permitted under clause (ix) of the definition of Permitted Indebtedness,
provided that the Issuer grants in favor of the Trustee for the benefit of the
holders of the Securities a Lien on the assets and properties so acquired
(excluding working capital assets) which Lien may be subordinated only to senior
secured Indebtedness incurred to finance or refinance, as applicable, the
Permitted Acquisition and may be pari passu with a Lien granted in favor of the
Bond Trustee to secure the Indebtedness relating to the Secured Series 2002
Bonds to the extent such Indebtedness is then outstanding; or (ii) for purposes
other than a Permitted Acquisition so long as not less than fifty percent (50%)
of such cash proceeds are applied by the Issuer, at its election, to (A) redeem
or purchase the Series C Preferred Stock or (B) make an offer to purchase
Securities and Secured Series 2002 Bonds on a pari passu basis and in accordance
with the procedures governing an Asset Disposition Offer set forth in Section
3.12(b)(iii).
Section 3.15. Limitations on Dividend and Other Payment Restrictions Affecting
Subsidiaries. The Issuer will not, and will not permit any of its Subsidiaries
to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction on the ability of any
Subsidiary of the Issuer to: (a)(i) pay dividends or make any other
distributions on its Capital Stock, or any other interest or participation in or
measured by its profits, owned by the Issuer or a Subsidiary of the Issuer, or
(ii) pay any Indebtedness owed to the Issuer or a Subsidiary of the Issuer; (b)
make loans or advances to the Issuer or a Subsidiary of the Issuer; or (c)
transfer any of its properties or assets to the Issuer or a Subsidiary of the
Issuer, except for Permitted Liens and such other encumbrances or restrictions
existing under or by reason of (i) any restrictions, with respect to a
Subsidiary that is not a Subsidiary on the date of this Indenture, under any
agreement in existence at the time such Subsidiary becomes a Subsidiary (unless
such agreement was entered into in connection with, or in contemplation of, such
entity becoming a Subsidiary on or after the date of the Indenture), (ii) any
restrictions under any agreement evidencing any Acquired Indebtedness of a
Subsidiary of the Issuer incurred pursuant to the provisions of Section 3.9;
provided that such restrictions shall not restrict or encumber any assets of the
Issuer or its Subsidiaries other than such Subsidiary, (iii) terms relating to
the nonassignability of any operating lease, (iv) any encumbrance or restriction
existing under any agreement that refinances or replaces the agreements
containing restrictions described in clauses (i)-(iii); provided that the terms
and conditions of any such restrictions are no less favorable to the holders of
the Securities than those under the agreement so refinanced or replaced, or (v)
any encumbrance or restriction due to applicable law.
Section 3.16. Change of Control Option. In the event that there shall occur a
Change of Control, each Holder of Securities shall have the right, at such
Holder's option, to require the Issuer to
40
purchase all or any part of such Holder's Securities, on the date (the
"Repurchase Date") that is 90 days after notice of the Change of Control, at
101% of the principal amount of the Securities plus accrued interest, if any, to
the Repurchase Date.
On or before the thirtieth day after the Change of Control,
the Issuer is obligated to mail, or cause to be mailed, to all Holders of record
of such Securities a notice regarding the Change of Control and the repurchase
right. Substantially simultaneously with mailing of the notice, the Issuer shall
cause a copy of such notice to be published in The Wall Street Journal or
another newspaper of general circulation in the Borough of Manhattan, the City
of New York.
Each such notice of a repurchase right shall state: (i) the
Repurchase Date; (ii) the date by which the repurchase right must be exercised;
(iii) the price for such Securities; and (iv) the procedure which the Holder of
Securities must follow to exercise such right.
To exercise a repurchase right, the holder of such Securities
must deliver, at least two Business Days prior to the Repurchase Date, written
notice to the Issuer (or an agent designated by the Issuer for such purpose) of
the Holder's exercise of such right, together with the Securities with respect
to which the right is being exercised, duly endorsed for transfer. Such written
notice from the Holder shall be irrevocable unless the rescission thereof is
duly approved by the Continuing Directors.
In the event a repurchase right shall be exercised in
accordance with the terms hereof, the Issuer shall pay or cause to be paid the
price payable with respect to the Security or Securities as to which the
repurchase price has been exercised in cash to the Holder of such Security or
Securities, on the Repurchase Date. In the event that a repurchase right is
exercised with respect to less than the entire principal amount of a surrendered
Security, the Issuer shall execute and deliver to the Trustee and the Trustee
shall authenticate for issuance in the name of the Holder a new Security or
Securities in the aggregate principal amount of that portion of such surrendered
Security not repurchased.
The Issuer will comply with all applicable tender offer rules
and regulations, including Section 14(e) of the Exchange Act and the rules
thereunder, if the Issuer is required to give a notice of right of repurchase as
a result of a Change of Control.
As used herein, "Change of Control" means (i) any sale, lease
or other transfer (in one transaction or a series of transactions) of more than
75% of the assets of the Issuer to any Person (other than a Wholly Owned
Subsidiary of the Issuer); (ii) a "person" or "group" (within the meaning of
Sections 13(d) and 14(d)(2) of the Exchange Act (other than the 1984 ESOP, the
1989 ESOP or any other employee benefit plan of the Issuer)) becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of Capital
Stock of the Issuer representing more than 50% of the voting power of such
Capital Stock unless such acquisition of beneficial ownership of shares of
voting power of Capital Stock of the Issuer occurs, directly or indirectly, in
connection with the financing of a Permitted Acquisition; (iii) Continuing
Directors cease to constitute at least a majority of the Board of Directors of
the Issuer; or (iv) the stockholders of the Issuer approve any plan or proposal
for the liquidation or dissolution of the Issuer.
41
As used herein, "Continuing Director" means a director who
either was a member of the Board of Directors of the Issuer on the date of the
Indenture or who became a director of the Issuer subsequent to such date and
whose election, or nomination for election by the Issuer's stockholders, was
duly approved by a majority of the Continuing Directors then on the Board of
Directors of the Issuer.
Section 3.17. Impairment of Security Interest. The Issuer shall not and shall
not permit any of its Subsidiaries to take, or knowingly or negligently omit to
take any action, which action or omission might or would have the result of
materially impairing the security interest in favor of the Trustee on behalf of
the Holders with respect to the Collateral and the Issuer shall not grant to any
Person (other than the Trustee on behalf of the Holders and the Bond Trustee on
behalf of the holders of the Secured Series 2002 Bonds) any interest whatsoever
in the Collateral other than Collateral Permitted Liens and Liens otherwise
permitted by the Security Documents.
Section 3.18. Insurance. The Issuer or its Subsidiaries will at all times keep
all of the Collateral which is of any insurable nature reasonably insured with
insurers, believed by Issuer to be responsible, against loss or damage to the
extent that property of similar character is usually so insured by corporations
similarly situated and owning like properties in the same general geographic
areas in which the Issuer and its Subsidiaries operate; provided, however, that
the Issuer will maintain insurance on the Collateral in such amounts required
under the Credit Facility. All insurance policies relating to the Collateral
shall be endorsed, to name the Trustee as an additional insured, and the Trustee
as loss payee or mortgagee thereunder, as its respective interests may appear,
with loss payable to the Trustee, without contribution, under a standard West
Virginia (or local equivalent) mortgagee clause.
Section 3.19. Use of Insurance Proceeds; Condemnation Awards. Subject to the
Intercreditor Agreement, the Collateral Agency Agreement, and the Security
Documents, all cash proceeds of Collateral consisting of insurance arising from
damage to or destruction of, the Collateral and all cash proceeds of
condemnation awards with respect to the Collateral, shall be promptly delivered
to the Trustee and placed in a Pledged Account pending resolution of its
application (provided, that if such pledged amounts are at any time thereafter
required to be applied to the Securities); and (a) if the Issuer determines that
it desires to repair, rebuild or replace the applicable Collateral with such
proceeds, such proceeds shall remain in Pledged Account (which Pledged Account
may also secure, on a pari passu basis, the Indebtedness relating to the Secured
Series 2002 Bonds to the extent such Indebtedness is then outstanding) and shall
be released to Issuer as required in order to permit the repair, rebuilding or
replacement of the applicable Collateral, or (b) if the Issuer determines not to
repair, rebuild or replace the applicable Collateral, such amount shall be
applied to purchase Securities and the Secured Series 2002 Bonds, on a pro rata
basis based on the outstanding principal amount of the Securities and the
Secured Series 2002 Bonds at the time of such application.
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ARTICLE IV
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT
Section 4.1. Event of Default Defined; Acceleration of Maturity; Waiver of
Default. In case one or more of the following Events of Default (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be 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) shall have occurred and be continuing, that
is to say:
(a) default in the payment of any installment of interest upon
any of the Securities as and when the same shall become due and payable, and
continuance of such default for a period of 30 days; or
(b) default in the payment of all or any part of the principal
on any of the Securities as and when the same shall become due and payable
either at maturity, by declaration or otherwise; or
(c) failure on the part of the Issuer duly to observe or
perform any other of the covenants or agreements on the part of the Issuer
contained in the Securities or in this Indenture for a period of 60 days after
the date on which written notice specifying such failure, stating that such
notice is a "Notice of Default" hereunder and demanding that the Issuer remedy
the same, shall have been given by registered or certified mail, return receipt
requested, to the Issuer by the Trustee, or to the Issuer and the Trustee by the
holders of at least 25% in aggregate principal amount of the Securities at the
time outstanding; or
(d) an event of default, as defined in any indenture or
instrument evidencing or under which the Issuer has at the date of this
Indenture or shall hereafter have outstanding at least $25,000,000 aggregate
principal amount of indebtedness for borrowed money, shall happen and be
continuing and such indebtedness shall have been accelerated so that the same
shall be or become due and payable prior to the date on which the same would
otherwise have become due and payable, and such acceleration shall not be
rescinded or annulled within ten days after notice thereof shall have been given
to the Issuer by the Trustee (if such event be known to it), or to the Issuer
and the Trustee by the holders of at least 25% in aggregate principal amount of
the Securities at the time outstanding; provided that if such event of default
under such indenture or instrument shall be remedied or cured by the Issuer or
waived by the holder of such indebtedness, then the Event of Default hereunder
by reason thereof shall be deemed likewise to have been thereupon remedied,
cured or waived without further action upon the part of either the Trustee or
any of the Securityholders, and provided further that, subject to the provisions
of Sections 5.1 and 5.2, the Trustee shall not be charged with knowledge of any
such default unless written notice thereof shall have been given to the Trustee
by the Issuer, by the holder or an agent of the holder of any such indebtedness,
by the trustee then acting under any indenture or other instrument under which
such default shall have occurred, or by the holders of not less than 25% in the
aggregate principal amount at maturity of the Securities at the time
outstanding; or
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(e) the repudiation by the Issuer of any of its obligations
under the Security Documents or the unenforceability in any material respect of
the Security Documents against the Issuer; or
(f) failure by the Issuer to maintain insurance as required by
Section 3.18; or
(g) upon an "Event of Default" as defined in any of the
Security Documents after the lapse of any applicable grace period; provided,
however, that notwithstanding the foregoing, an Event of Default arising solely
under Section 2.1(c) of each of the Deeds of Trust or Section 7.1(b) of the
Security Agreement or otherwise constituting an Event of Default under each of
the Deeds of Trust or the Security Agreement solely by reason of a breach of any
of the terms, covenants, terms or provisions of documents relating to the
Secured Series 2002 Bonds shall not, in and of itself, constitute an Event of
Default hereunder unless (i) the Bond Trustee shall declare all or any portion
of the Secured Series 2002 Bonds to be immediately due and payable, or (ii) the
Bond Trustee or any other party shall seek to enforce any remedy under the terms
of any of the Deeds of Trust or the Security Agreement; or
(h) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Issuer in an involuntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Issuer or for any substantial part of
its property or ordering the winding up or liquidation of its affairs, and such
decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or
(i) the Issuer shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or consent to the entry of an order for relief in an involuntary case
under any such law, or consent to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of the Issuer or for any substantial part of its property, or make any
general assignment for the benefit of creditors.
Then, and in each and every such case, unless the principal of
all of the Securities shall have already become due and payable, either the
Trustee or the holders of not less than 25% in aggregate principal amount of the
Securities then outstanding hereunder, by notice in writing to the Issuer (and
to the Trustee if given by Securityholders), may declare the entire principal of
all the Securities, the interest accrued thereon, to be due and payable
immediately, and upon any such declaration the same shall become immediately due
and payable. This provision, however, is subject to the condition that if, at
any time after the principal of the Securities shall have been so declared due
and payable, and before any judgment or decree for the payment of the moneys due
shall have been obtained or entered as hereinafter provided, the Issuer shall
pay or shall deposit with the Trustee a sum sufficient to pay all matured
installments of interest upon all the Securities and the principal of any and
all Securities which shall have become due otherwise than by acceleration (with
interest upon such principal and, to the extent that payment of such interest is
enforceable under applicable law, on overdue installments of interest at the
same rate as the rate of interest specified in the Securities, to the date of
such payment or deposit) and if any and all Events of Default under the
Indenture, other than the non-payment of the principal of Securities which shall
have become due by acceleration, shall have been cured, waived or
44
otherwise remedied as provided herein--then and in every such case the holders
of a majority in aggregate principal amount of the Securities then outstanding,
by written notice to the Issuer and to the Trustee, may waive all defaults and
rescind and annul such declaration and its consequences, but no such waiver or
rescission and annulment shall extend to or shall affect any subsequent default
or shall impair any right consequent thereon.
Section 4.2. Collection of Indebtedness by Trustee; Trustee May Prove Debt. The
Issuer covenants that (a) in case default shall be made in the payment of any
installment of interest on any of the Securities when such interest shall have
become due and payable, and such default shall have continued for a period of 30
days or (b) in case default shall be made in the payment of all or any part of
the principal of any of the Securities when the same shall have become due and
payable, whether upon maturity or upon any redemption or by declaration or
otherwise--then upon demand of the Trustee, the Issuer will pay to the Trustee
for the benefit of the holders of the Securities the whole amount that then
shall have become due and payable on all such Securities for principal and
interest, as the case may be (with interest to the date of such payment upon the
overdue principal and, to the extent that payment of such interest is
enforceable under applicable law, on overdue installments of interest at the
same rate as the rate of interest specified in the Securities); and in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including reasonable compensation to the Trustee and
each predecessor Trustee, their respective agents, attorneys and counsel, and
any expenses and liabilities incurred, and all advances made, by the Trustee and
each predecessor Trustee except as a result of its negligence or willful
misconduct. In connection therewith, the Trustee shall comply with the
provisions of Section 313(b)(2) of the Trust Indenture Act of 1939 to the extent
applicable.
Until such demand is made by the Trustee, the Issuer may pay
the principal of and interest on the Securities to the registered holders,
whether or not the Securities be overdue. In case the Issuer shall fail
forthwith to pay such amounts upon such demand, the Trustee, in its own name and
as trustee of an express trust, shall be entitled and empowered to institute any
action or proceedings at law or in equity for the collection of the sums so due
and unpaid, and may prosecute any such action or proceedings to judgment or
final decree, and may enforce any such judgment or final decree against the
Issuer or other obligor upon the Securities and collect in the manner provided
by law out of the property of the Issuer or other obligor upon the Securities,
wherever situated, the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings relative to the
Issuer or any other obligor upon the Securities under Title 11 of the United
States Code or any other applicable Federal or state bankruptcy, insolvency or
other similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor, or in case of any other comparable judicial proceedings relative to the
Issuer or other obligor upon the Securities, or to the creditors or property of
the Issuer or such other obligor, the Trustee, irrespective of whether the
principal of the Securities shall then be due and payable as therein expressed
or by declaration or otherwise and irrespective of whether the Trustee shall
have made any demand pursuant to the provisions of this Section, shall be
entitled and empowered, by intervention in such proceedings or otherwise:
45
(a) to file and prove a claim or claims for the whole amount
of principal and interest owing and unpaid in respect of the Securities, and to
file such other papers or documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for reasonable compensation
to the Trustee and each predecessor Trustee, and their respective agents,
attorneys and counsel, and for reimbursement of all expenses and liabilities
incurred, and all advances made, by the Trustee and each predecessor Trustee,
except as a result of negligence or willful misconduct) and of the
Securityholders allowed in any judicial proceedings relative to the Issuer or
other obligor upon the Securities, or to the creditors or property of the Issuer
or such other obligor;
(b) unless prohibited by applicable law and regulations, to
vote on behalf of the holders of the Securities in any election of a trustee or
a standby trustee in arrangement, reorganization, liquidation or other
bankruptcy or insolvency proceedings or person performing similar functions in
comparable proceedings; and
(c) to collect and receive any moneys or other property
payable or deliverable on any such claims, and to distribute all amounts
received with respect to the claims of the Securityholders and of the Trustee on
their behalf; and any trustee, receiver, or liquidator, custodian or other
similar official is hereby authorized by each of the Securityholders to make
payments to the Trustee, and, in the event that the Trustee shall consent to the
making of payments directly to the Securityholders, to pay to the Trustee such
amounts as shall be sufficient to cover reasonable compensation to the Trustee,
each predecessor Trustee and their respective agents, attorneys and counsel, and
all other expenses and liabilities incurred, and all advances made, by the
Trustee and each predecessor Trustee except as a result of negligence or willful
misconduct.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Securityholder any plan or reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Securityholder in
any such proceeding except, as aforesaid, to vote for the election of a trustee
in bankruptcy or similar person.
All rights of action and of asserting claims under this
Indenture, or under any of the Securities, may be enforced by the Trustee
without the possession of any of the Securities or the production thereof on any
trial or other proceedings relative thereto, and any such action or proceedings
instituted by the Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment, subject to the payment of the
expenses, disbursements and compensation of the Trustee, each predecessor
Trustee and their respective agents and attorneys, shall be for the ratable
benefit of the holders of the Securities.
In any proceedings brought by the Trustee (and also any
proceedings involving the interpretation of any provision of this Indenture to
which the Trustee shall be a party) the Trustee shall be held to represent all
the holders of the Securities, and it shall not be necessary to make any holders
of the Securities parties to any such proceedings.
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Section 4.3. Application of Proceeds. Any moneys collected by the Trustee
pursuant to this Article shall be applied in the following order at the date or
dates fixed by the Trustee and, in case of the distribution of such moneys on
account of principal and interest upon presentation of the several Securities
and stamping (or otherwise noting) thereon the payment, or issuing Securities in
reduced principal amounts in exchange for the presented Securities if only
partially paid, or upon surrender thereof if fully paid:
First: To the payment of costs and expenses, including
reasonable compensation to the Trustee and each predecessor Trustee and
their respective agents and attorneys and of all expenses and
liabilities incurred, and all advances made, by the Trustee and each
predecessor Trustee except as a result of negligence or willful
misconduct;
Second: In case the principal of the Securities shall not have
become and be then due and payable, to the payment of interest in
default in the order of the maturity of the installments of such
interest with interest (to the extent that such interest has been
collected by the Trustee) upon the overdue installments of interest at
the same rate as the rate of interest specified in the Securities, such
payments to be made ratably to the persons entitled thereto, without
discrimination or preference;
Third: In case the principal of the Securities shall have
become and shall be then due and payable, to the payment of the whole
amount then owing and unpaid upon all the Securities for principal,
interest, with interest upon the overdue principal, and (to the extent
that such interest has been collected by the Trustee) upon overdue
installments of interest at the same rate as the rate of interest
specified in the Securities; and in case such moneys shall be
insufficient to pay in full the whole amount so due and unpaid upon the
Securities, then to the payment of such principal and interest, without
preference or priority of principal over interest or of interest over
principal, or of any installment of interest over any other installment
of interest or of any Security over any other Security, ratably to the
aggregate of such principal and accrued and unpaid interest; and
Fourth: To the payment of the remainder, if any, to the Issuer
or any other person lawfully entitled thereto.
Section 4.4. Suits for Enforcement. In case an Event of Default has occurred,
has not been waived and is continuing, the Trustee may in its discretion proceed
to protect and enforce the rights vested in it by this Indenture by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any of such rights, either at law or in equity or in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.
Section 4.5. Restoration of Rights on Abandonment of Proceedings. In case the
Trustee shall have proceeded to enforce any right under this Indenture and such
proceedings shall have been discontinued or abandoned for any reason, or shall
have been determined adversely to the Trustee, then and in every such case the
Issuer and the Trustee shall be restored respectively to their former positions
and rights hereunder, and all rights, remedies and powers of the Issuer, the
Trustee and the Securityholders shall continue as though no such proceedings had
been taken.
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Section 4.6. Limitations on Suits by Securityholders. No holder of any Security
shall have any right by virtue of or by availing of any provision of this
Indenture to institute any action or proceeding at law or in equity or in
bankruptcy or otherwise upon or under or with respect to this Indenture, or for
the appointment of a trustee, receiver, liquidator, custodian or other similar
official or for any other remedy hereunder, unless such holder previously shall
have given to the Trustee written notice of default and of the continuance
thereof, as herein before provided, and unless also the holders of not less than
25% in aggregate principal amount of the Securities then outstanding shall have
made written request upon the Trustee to institute such action or proceedings in
its own name as trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby and the Trustee for 60 days after
its receipt of such notice, request and offer of indemnity shall have failed to
institute any such action or proceedings and no direction inconsistent with such
written request shall have been given to the Trustee pursuant to Section 4.8; it
being understood and intended, and being expressly covenanted by the taker and
holder of every Security with every other taker and holder and the Trustee, that
no one or more holders of Securities shall have any right in any manner whatever
by virtue or by availing of any provision of this Indenture to affect, disturb
or prejudice the rights of any other holder of Securities, or to obtain or seek
to obtain priority over or preference to any other such holder or to enforce any
right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all holders of Securities. For the
protection and enforcement of the provisions of this Section, each and every
Securityholder and the Trustee shall be entitled to such relief as can be given
either at law or in equity.
Section 4.7. Powers and Remedies Cumulative; Delay or Omission Not Waiver of
Default. Except as provided in Section 2.6, no right or remedy herein conferred
upon or reserved to the Trustee or to the Securityholders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
No delay or omission of the Trustee or of any holder of any of
the Securities to exercise any right or power accruing upon any Event of Default
occurring and continuing as aforesaid shall impair any such right or power or
shall be construed to be a waiver of any such Event of Default or an
acquiescence therein; and, subject to Section 4.6, every power and remedy given
by this Indenture or by law to the Trustee or to the Securityholders may be
exercised from time to time, and as often as shall be deemed expedient, by the
Trustee or by the Securityholders.
Section 4.8. Control by Securityholders. The holders of a majority in aggregate
principal amount of the Securities at the time outstanding shall have the right
to direct the time, method, and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee by this Indenture; provided that such direction shall not be
otherwise than in accordance with law and the provisions of this Indenture; and
provided further that (subject to the provisions of Section 5.1) the Trustee
shall have the right to decline to follow any such direction if the Trustee,
being advised by counsel, shall determine that the action or proceeding so
directed may not lawfully be taken or if the Trustee in good faith by its board
of directors, the executive committee, or a trust committee of directors or
responsible officers of the
48
Trustee shall determine that the action or proceedings so directed would involve
the Trustee in personal liability or if the Trustee in good faith shall so
determine that the actions or forbearances specified in or pursuant to such
direction shall be unduly prejudicial to the interests of holders of the
Securities not joining in the giving of said direction, it being understood that
(subject to Section 5.1) the Trustee shall have no duty to ascertain whether or
not such actions or forbearances are unduly prejudicial to such holders.
Nothing in this Indenture shall impair the right of the
Trustee in its discretion to take any action deemed proper by the Trustee and
which is not inconsistent with such direction by Securityholders.
Section 4.9. Waiver of Past Defaults. Prior to the declaration of the
acceleration of maturity of the Securities as provided in Section 4.1, the
holders of a majority in aggregate principal amount of the Securities at the
time outstanding may on behalf of the holders of all the Securities waive any
past default or Event of Default hereunder and its consequences, except a
default (a) in the payment of principal of and interest on any of the Securities
or (b) in respect of a covenant or provision hereof which cannot be modified or
amended without the consent of the holder of each Security affected. In the case
of any such waiver, the Issuer, the Trustee and the holders of the Securities
shall be restored to their former positions and rights hereunder, respectively;
but no such waiver shall extend to any subsequent or other default or impair any
right consequent thereon.
Upon any such waiver, such default shall cease to exist and be deemed to have
been cured and not to have occurred, and any Event of Default arising therefrom
shall be deemed to have been cured, and not to have occurred for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
Section 4.10. Notice of Defaults. If a Default occurs and is continuing and if
it is known to the Trustee, the Trustee shall mail to Securityholders a notice
of the Default within 90 days after it occurs. Except in the case of a Default
in payment of principal of and interest on any Security, the Trustee may
withhold the notice if the Trustee in good faith by its board of directors, the
executive committee, or a trust committee of directors or Responsible Officers
determines that withholding the notice is in the interest of Securityholders.
Section 4.11. Rights of Holders to Receive Payment. Notwithstanding any other
provision of this Indenture, the right of any Holder of a Security to receive
payment of principal of and interest on the Security, on or after the respective
due dates expressed in the Security, 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 the Holder.
ARTICLE V
CONCERNING THE TRUSTEE
Section 5.1. Duties and Responsibilities of the Trustee; During Default; Prior
to Default. The Trustee, prior to the occurrence of an Event of Default and
after the curing or waiving of all Events of Default which may have occurred,
undertakes to perform such duties and only such
49
duties as are specifically set forth in this Indenture and no covenants or
obligations shall be implied in this Indenture or the Securities. In case an
Event of Default has occurred (which has not been cured or waived), the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve
the Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that:
(a) prior to the occurrence of an Event of Default and after
the curing or waiving of all such Events of Default which may have occurred:
(i) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Indenture, and the
Trustee shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon any
statements, certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such statements, certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Indenture but need not
verify the accuracy of the contents thereof;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Responsible Officers of the
Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the holders of not less than a majority in principal amount of the
Securities at the time outstanding relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Indenture.
(d) none of the provisions contained in this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties or in the exercise
of any of its rights or powers, if there shall be reasonable ground for
believing that the repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
(e) whether or not expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to (a), (b),
(c) and (d) of this Section 5.1.
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This Section 5.1 is in furtherance of and subject to Sections
315 and 316 of the Trust Indenture Act of 1939.
Section 5.2. Certain Rights of the Trustee. In furtherance of and subject to the
Trust Indenture Act of 1939, and subject to Section 5.1:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate or any other
certificate, statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture, note, coupon, security or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) any request, direction, order or demand of the Issuer
mentioned herein shall be sufficiently evidenced by an Officers' Certificate
(unless other evidence in respect thereof be herein specifically prescribed);
and any resolution of the Board of Directors may be evidenced to the Trustee by
a copy thereof certified by the secretary or an assistant secretary of the
Issuer;
(c) the Trustee may consult with counsel and any advice or
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted to be taken by it hereunder in
good faith and in accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any
of the trusts or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which might be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or
omitted by it in good faith and believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this Indenture;
(f) prior to the occurrence of an Event of Default hereunder
and after the curing or waiving of all Events of Default, the Trustee shall not
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, appraisal, bond, debenture, note, coupon,
security, or other paper or document unless requested in writing so to do by the
holders of not less than a majority in aggregate principal amount of the
Securities then outstanding; provided that, if the payment within a reasonable
time to the Trustee of the costs, expenses or liabilities likely to be incurred
by it in the making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the terms of
this Indenture, the Trustee may require reasonable indemnity against such
expenses or liabilities as a condition to proceeding; the reasonable expenses of
every such examination shall be paid by the Issuer or, if paid by the Trustee or
any predecessor trustee, shall be repaid by the Issuer upon demand; and
51
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys not regularly in its employ and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent or
attorney appointed with due care by it hereunder.
Section 5.3. Trustee Not Responsible for Recitals, Disposition of Securities or
Application of Proceeds Thereof. The recitals contained herein and in the
Securities, except the Trustee's certificates of authentication, shall be taken
as the statements of the Issuer, and the Trustee assumes no responsibility for
the correctness of the same. The Trustee makes no representation as to the
validity or sufficiency of this Indenture or of the Securities. The Trustee
shall not be accountable for the use or application by the Issuer of any of the
Securities or of the proceeds thereof.
Section 5.4. Trustee and Agents May Hold Securities; Collections, etc. The
Trustee or any agent of the Issuer or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Securities with the same
rights it would have if it were not the Trustee or such agent and may otherwise
deal with the Issuer and receive, collect, hold and retain collections from the
Issuer with the same rights it would have if it were not the Trustee or such
agent.
Section 5.5. Moneys Held by Trustee. Subject to the provisions of Section 9.4
hereof, all moneys received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received,
but need not be segregated from other funds except to the extent required by
mandatory provisions of law. Neither the Trustee nor any agent of the Issuer or
the Trustee shall be under any liability for interest on any moneys received by
it hereunder.
Section 5.6. Compensation and Indemnification of Trustee and Its Prior Claim.
The Issuer covenants and agrees to pay to the Trustee from time to time, and the
Trustee shall be entitled to, reasonable compensation (which shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust) and the Issuer covenants and agrees to pay or reimburse the
Trustee and each predecessor Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by or on behalf of it in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all agents and other persons not regularly in its employ) except any such
expense, disbursement or advance as may arise from its negligence or willful
misconduct. The Issuer also covenants to indemnify, defend and hold the Trustee,
each predecessor Trustee and their respective directors, officers, employees and
agents (collectively, the "Indemnified Persons") harmless from and against every
loss, liability or expense, including without limitation damages, fines, suits,
actions, demands, penalties, costs, out-of-pocket or incidental expenses, legal
fees and expenses, the allocated costs and expenses of in-house counsel and
legal staff and the costs and expenses of defending or preparing to defend
against any claim (collectively, "Losses"), that may be imposed on, incurred by,
or asserted against, any Indemnified Person for or in respect of the Trustee's
(a) execution and delivery of this Indenture, (b) compliance or attempted
compliance with or reliance upon any instruction or other direction upon which
the Trustee is authorized to rely pursuant to the terms of this Indenture and
(c) performance under this Indenture, except in the case of such performance
only and with respect to any Indemnified Person to the extent that the Loss
resulted from such Indemnified Person's
52
negligence or willful misconduct. The obligations of the Issuer under this
Section to compensate and indemnify the Trustee and each predecessor Trustee and
to pay or reimburse the Trustee and each predecessor Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder
and shall survive the satisfaction and discharge of this Indenture and the
resignation or removal of the Trustee for any reason. Such additional
indebtedness shall be a senior claim to that of the Securities upon all property
and funds held or collected by the Trustee as such, except funds held in trust
for the benefit of the holders of particular Securities, and the Securities are
hereby subordinated to such senior claim. When the Trustee incurs expenses or
renders services after an Event of Default specified in Section 4.1(f) or (g)
occurs, the expenses and the compensation for such services are intended to
constitute expenses of administration under any bankruptcy law.
Section 5.7. Right of Trustee to Rely on Officers' Certificate, etc. Subject to
Sections 5.1 and 5.2, whenever in the administration of the trusts of this
Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or willful misconduct
on the part of the Trustee, be deemed to be conclusively proved and established
by an Officers' Certificate delivered to the Trustee, and such certificate, in
the absence of negligence or willful misconduct on the part of the Trustee,
shall be full warrant to the Trustee for any action taken, suffered or omitted
by it under the provisions of this Indenture upon the faith thereof.
Section 5.8. Persons Eligible for Appointment as Trustee. The Trustee hereunder
shall at all times be a corporation having a combined capital and surplus of at
least $25,000,000, and which is eligible in accordance with the provisions of
Section 310(a) of the Trust Indenture Act of 1939. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of a Federal, State or District of Columbia supervising or examining authority,
then for the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published.
Section 5.9. Resignation and Removal; Appointment of Successor Trustee. (a) The
Trustee may at any time resign by giving written notice of resignation to the
Issuer and by mailing notice thereof by first-class mail to holders of
Securities at their last addresses as they shall appear on the Security
register. Upon receiving such notice of resignation, the Issuer shall promptly
appoint a successor trustee by written instrument in duplicate, executed by
authority of the Board of Directors, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the successor trustee. If no
successor trustee shall have been so appointed and have accepted appointment
within 60 days after the mailing of such notice of resignation, the resigning
trustee, the Issuer, the resigning Trustee or the Holders of at least ten
percent in aggregate principal amount of the Securities may petition any court
of competent jurisdiction for the appointment of a successor trustee. Such court
may thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee.
In case at any time any of the following shall occur:
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(i) the Trustee shall fail to comply with the provisions of
Section 310(b) of the Trust Indenture Act of 1939, after written
request therefor by the Issuer or by any Securityholder who has been a
bona fide holder of a Security or Securities for at least six months;
or
(ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 5.8 and shall fail to resign after written
request therefor by the Issuer or by any such Securityholder; or
(iii) the Trustee shall become incapable of acting, or shall
be adjudged a bankrupt or insolvent, or a receiver or liquidator of the
Trustee or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation;
then, in any such case, the Issuer may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors of the Issuer, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor trustee, or,
subject to Section 315(e) of the Trust Indenture Act of 1939, any Securityholder
who has been a bona fide holder of a Security or Securities for at least six
months may on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee. Such court may thereupon, after such notice,
if any, as it may deem proper and prescribe, remove the Trustee and appoint a
successor trustee.
(b) The holders of a majority in aggregate principal amount of
the Securities at the time outstanding may at any time remove the Trustee and
appoint a successor trustee by delivering to the Trustee so removed, to the
successor trustee so appointed and to the Issuer the evidence provided for in
Section 6.1 of the action in that regard taken by the Securityholders.
(c) Any resignation or removal of the Trustee and any
appointment of a successor trustee pursuant to any of the provisions of this
Section 5.9 shall become effective upon acceptance of appointment by the
successor trustee as provided in Section 5.10.
Section 5.10. Acceptance of Appointment by Successor Trustee. Any successor
trustee appointed as provided in Section 5.9 shall execute and deliver to the
Issuer and to its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
shall become effective and such successor trustee, without any further act, deed
or conveyance, shall become vested with all rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as trustee herein; but, nevertheless, on the written request of the Issuer
or of the successor trustee, upon payment of its charges then unpaid, the
trustee ceasing to act shall, subject to Section 9.4, pay over to the successor
trustee all moneys at the time held by it hereunder and shall execute and
deliver an instrument transferring to such successor trustee all such rights,
powers, duties and obligations. Upon request of any such successor trustee, the
Issuer shall execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor trustee all such rights
and powers. Any trustee ceasing to act shall, nevertheless, retain a prior claim
upon all
54
property or funds held or collected by such trustee to secure any amounts then
due it pursuant to the provisions of Section 5.6.
Upon acceptance of appointment by a successor trustee as
provided in this Section 5.10, the Issuer shall mail notice thereof by
first-class mail to the holders of Securities at their last addresses as they
shall appear in the Security register. If the acceptance of appointment is
substantially contemporaneous with the resignation, then the notice called for
by the preceding sentence may be combined with the notice called for by Section
5.9. If the Issuer fails to mail such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Issuer.
Section 5.11. Merger, Conversion, Consolidation or Succession to Business of
Trustee. Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to the corporate trust business of the Trustee, shall be
the successor of the Trustee hereunder; provided that such corporation shall be
eligible under the provisions of Section 5.8, without the execution or filing of
any paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
In case at the time such successor 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 Trustee; and in all such cases such certificate
shall have the full force which it is anywhere in the Securities or in this
Indenture provided that the certificate of the Trustee shall have; provided that
the right to adopt the certificate of authentication of any predecessor Trustee
or to authenticate Securities in the name of any predecessor Trustee shall apply
only to its successor or successors by merger, conversion or consolidation.
Section 5.12. Preferential Collection of Claims Against Issuer. The Trustee is
subject to Section 311(a) of the Trust Indenture Act of 1939, excluding any
creditor relationship listed in Section 311(b) thereof. A Trustee who has
resigned or been removed shall be subject to Section 311(a) of the Trust
Indenture Act of 1939 to the extent indicated therein.
ARTICLE VI
CONCERNING THE SECURITYHOLDERS
Section 6.1. Evidence of Action Taken by Securityholders. Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Securityholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Securityholders in person or by agent duly appointed in writing; and,
except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee.
Proof of execution of any instrument or of a writing appointing any such agent
shall be sufficient for any purpose of
55
this Indenture and (subject to Sections 5.1 and 5.2) conclusive in favor of the
Trustee and the Issuer, if made in the manner provided in this Article.
Section 6.2. Proof of Execution of Instruments and of Holding of Securities;
Record Date. Subject to Sections 5.1 and 5.2, the execution of any instrument by
a Securityholder or his agent or proxy may be proved in accordance with such
reasonable rules and regulations as may be prescribed by the Trustee or in such
manner as shall be satisfactory to the Trustee. The holding of Securities shall
be proved by the Security register or by a certificate of the registrar thereof.
The Issuer may set a record date for purposes of determining the identity of
holders of Securities entitled to vote or consent to any action referred to in
Section 6.1, which record date may be set at any time or from time to time by
notice to the Trustee, for any date or dates (in the case of any adjournment or
resolicitation) not more than 60 days nor less than five days prior to the
proposed date of such vote or consent, and thereafter, notwithstanding any other
provisions hereof, only holders of Securities of record on such record date
shall be entitled to so vote or give such consent or to withdraw such vote or
consent.
Section 6.. Holders to Be Treated as Owners. The Issuer, the Trustee and any
agent of the Issuer or the Trustee may deem and treat the person in whose name
any Security shall be registered upon the Security register as the absolute
owner of such Security (whether or not such Security shall be overdue and
notwithstanding any notation of ownership or other writing thereon) for the
purpose of receiving payment of or on account of the principal of and, subject
to the provisions of this Indenture, interest on such Security and for all other
purposes; and neither the Issuer nor the Trustee nor any agent of the Issuer or
the Trustee shall be affected by any notice to the contrary. All such payments
so made to any such person, or upon his order, shall be valid, and, to the
extent of the sum or sums so paid, effectual to satisfy and discharge the
liability for moneys payable upon any such Security.
Section 6.4. Securities Owned by Issuer Deemed Not Outstanding. In determining
whether the holders of the requisite aggregate principal amount of Securities
have concurred in any direction, consent or waiver under this Indenture,
Securities which are owned by the Issuer or any other obligor on the Securities
or by any person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Issuer or any other obligor on the
Securities shall be disregarded and deemed not to be outstanding for the purpose
of any such determination, except that for the purpose of determining whether
the Trustee shall be protected in relying on any such direction, consent or
waiver only Securities which the Trustee knows are so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Issuer or any other obligor upon the Securities or any
person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Issuer or any other obligor on the Securities.
In case of a dispute as to such right, the advice of counsel shall be full
protection in respect of any decision made by the Trustee in accordance with
such advice. Upon request of the Trustee, the Issuer shall furnish to the
Trustee promptly an Officers' Certificate listing and identifying all
Securities, if any, known by the Issuer to be owned or held by or for the
account of any of the above-described persons; and, subject to Sections 5.1 and
5.2, the Trustee shall be entitled to accept such Officers' Certificate as
conclusive evidence of the facts therein set forth and of the
56
fact that all Securities not listed therein are outstanding for the purpose of
any such determination.
Section 6.5. Right of Revocation of Action Taken. At any time prior to (but not
after) the evidencing to the Trustee, as provided in Section 6.1, of the taking
of any action by the holders of the percentage in aggregate principal amount of
the Securities specified in this Indenture in connection with such action, any
holder of a Security the serial number of which is shown by the evidence to be
included among the serial numbers of the Securities the holders of which have
consented to such action may, by filing written notice at the Corporate Trust
Office and upon proof of holding as provided in this Article, revoke such action
so far as concerns such Security. Except as aforesaid any such action taken by
the holder of any Security shall be conclusive and binding upon such holder and
upon all future holders and owners of such Security and of any Securities issued
in exchange or substitution therefor, irrespective of whether or not any
notation in regard thereto is made upon any such Security. Any action taken by
the holders of the percentage in aggregate principal amount of the Securities
specified in this Indenture in connection with such action shall be conclusively
binding upon the Issuer, the Trustee and the holders of all the Securities.
ARTICLE VII
SUPPLEMENTAL INDENTURES
Section 7.1. Supplemental Indentures Without Consent of Securityholders. The
Issuer, when authorized by a resolution of its Board of Directors, and the
Trustee (or with respect to the Intercreditor Agreement, the Collateral Agent,
at the written direction of the Trustee) may from time to time and at any time,
without the consent of the holders of any of the Securities at the time
outstanding, enter into an indenture or indentures supplemental hereto or amend
a Notes Document, the Intercreditor Agreement or the Collateral Agency Agreement
for one or more of the following purposes:
(a) to convey, transfer, assign, mortgage or pledge to the
Trustee as security for the Securities any property or assets;
(b) to evidence the succession of another corporation to the
Issuer, or successive successions, and the assumption by the successor
corporation of the covenants, agreements and obligations of the Issuer pursuant
to Article VIII;
(c) to add to the covenants of the Issuer such further
covenants, restrictions, conditions or provisions as its Board of Directors
shall consider to be for the protection of the holders of Securities, and to
make the occurrence, or the occurrence and continuance, of a default in any such
additional covenants, restrictions, conditions or provisions an Event of Default
permitting the enforcement of all or any of the several remedies provided in
this Indenture as herein set forth; provided that in respect of any such
additional covenant, restriction, condition or provision such supplemental
indenture may provide for a particular period of grace after default (which
period may be shorter or longer than that allowed in the case of other defaults)
or may provide for an immediate enforcement upon such an Event of Default or may
limit the remedies available to the Trustee upon such an Event of Default or may
limit the right of the holders of a majority in aggregate principal amount of
the Securities to waive such an Event of Default;
57
(d) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture or in any Notes
Documents or the Intercreditor Agreement or Collateral Agency Agreement which
may be defective or inconsistent with any other provision contained herein or in
any supplemental indenture or in any Notes Documents or the Intercreditor
Agreement or Collateral Agency Agreement; or to make such other provisions in
regard to matters or questions arising under this Indenture or under any
supplemental indenture or under the Notes Documents as the Board of Directors
may deem necessary or desirable and which shall not adversely affect the
interests of the holders of the Securities; and
(e) to provide for the issuance under this Indenture of
Securities in coupon form (including Securities registrable as to principal
only) and to provide for exchangeability of such Securities with Securities
issued hereunder in fully registered form, and to make all appropriate changes
for such purpose.
The Trustee (or Collateral Agent, as applicable) is hereby
authorized to join in the execution of any such supplemental indenture or any
such amendment to a Notes Document, the Intercreditor Agreement or Collateral
Agency Agreement, to make any further appropriate agreements and stipulations
which may be therein contained and to accept the conveyance, transfer,
assignment, mortgage or pledge of any property thereunder, but the Trustee (or
Collateral Agent, as applicable) shall not be obligated to enter into (or direct
the Collateral Agent to enter into) any such supplemental indenture or any such
amendment to a Notes Document, the Intercreditor Agreement or Collateral Agency
Agreement which affects the Trustee's (or Collateral Agent's) own rights, duties
or immunities under this Indenture, the Notes Documents, the Intercreditor
Agreement, the Collateral Agency Agreement or otherwise.
Section 7.2. Supplemental Indentures With Consent of Securityholders. With the
consent (evidenced by a majority as provided in Article VI) of the holders of
not less than a majority in aggregate principal amount of the Securities at the
time outstanding, the Issuer, when authorized by a resolution of its Board of
Directors, and the Trustee (or the Collateral Agent, as applicable) may, from
time to time and at any time, enter into an indenture or indentures supplemental
hereto or amend a Notes Document, the Intercreditor Agreement or Collateral
Agency Agreement for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or any Notes Documents, the Intercreditor Agreement, or
Collateral Agency Agreement or of modifying in any manner the rights of the
holders of the Securities; provided that no such supplemental indenture shall,
without the consent of the holders of all Securities then outstanding, (a)
reduce the rate or change the time or place for payment of interest or reduce
any amount payable on redemption thereof; (b) reduce the principal of or change
the fixed maturity or place of payment of any Security; (c) change the currency
of payment of principal of and interest, if any, on any Security; (d) reduce the
principal amount of outstanding Securities necessary to modify or amend this
Indenture; (e) impair the right to institute suit for the enforcement of any
payment on or with respect to any Security; or (f) make any change in Section
4.9, 4.11 or the first paragraph of this Section 7.2. Notwithstanding the
foregoing, with the consent of the holders of not less than 85% in the aggregate
principal amount of the Securities at the time outstanding, the Issuer and the
Trustee (or the Collateral Agent, as applicable) may amend or waive provisions
of this Indenture, the Notes Documents, the Intercreditor Agreement and the
Collateral Agency Agreeement, relating to the Collateral.
58
Upon the request of the Issuer, accompanied by a copy of a
resolution of the Board of Directors certified by the Secretary or an Assistant
Secretary of the Issuer authorizing the execution of any such supplemental
indenture or any such amendment to a Notes Document, the Intercreditor Agreement
or Collateral Agency Agreement and upon the filing with the Trustee of evidence
of the consent of Securityholders and other documents, if any, required by
Section 6.1, the Trustee (or Collateral Agent, as applicable) shall join with
the Issuer in the execution of such supplemental indenture or such amendment to
a Notes Document, the Intercreditor Agreement or Collateral Agency Agreement
unless such supplemental indenture or such amendment to a Notes Document, the
Intercreditor Agreement or Collateral Agency Agreement, affects the Trustee's
(or Collateral Agent's) own rights, duties or immunities under this Indenture,
the Notes Document the Intercreditor Agreement, Collateral Agency Agreement or
otherwise, in which case the Trustee (or the Collateral Agent, as applicable)
may in its discretion, but shall not be obligated to, enter into (or direct the
Collateral Agent to enter into) such supplemental indenture or such amendment to
a Notes Document, the Intercreditor Agreement or Collateral Agency Agreement, as
the case may be.
It shall not be necessary for the consent of the
Securityholders under this Section to approve the particular form of any
proposed supplemental indenture or any proposed amendment to a Notes Document,
the Intercreditor Agreement or Collateral Agency Agreement, but it shall be
sufficient if such consent shall approve the substance thereof.
Promptly after the execution by the Issuer and the Trustee (or
the Collateral Agent, as applicable) of any supplemental indenture or any
amendment to a Notes Document, the Intercreditor Agreement or Collateral Agency
Agreement, pursuant to the provisions of this Section, the Issuer shall mail a
notice thereof by first-class mail to the holders of Securities at their
addresses as they shall appear on the registry books of the Issuer, setting
forth in general terms the substance of such supplemental indenture or such
amendment to a Notes Document, the Intercreditor Agreement or Collateral Agency
Agreement. Any failure of the Issuer to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
supplemental indenture or such amendment to a Notes Document, the Intercreditor
Agreement or Collateral Agency Agreement.
Section 7.3. Effect of Supplemental Indenture. Upon the execution of any
supplemental indenture or any amendment to the Notes Documents, the
Intercreditor Agreement or Collateral Agency Agreement, pursuant to the
provisions hereof, this Indenture shall be and be deemed to be modified and
amended in accordance therewith and the respective rights, limitations of
rights, obligations, duties and immunities under this Indenture of the Trustee,
the Issuer and the holders of Securities shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments, and all the terms and conditions of any such supplemental
indenture shall be and be deemed to be part of the terms and conditions of this
Indenture for any and all purposes.
Section 7.4. Documents to Be Given to Trustee. The Trustee, subject to the
provisions of Sections 5.1 and 5.2, may receive an Officers' Certificate and an
Opinion of Counsel as conclusive evidence that any such supplemental indenture
complies with the applicable provisions of this Indenture and is a legal, valid
and binding obligation of the Issuer enforceable
59
against the Issuer in accordance with its terms, subject to the customary
exceptions. Such supplemental indenture will comply with the Trust Indenture Act
of 1939.
Section 7.5. Notation on Securities in Respect of Supplemental Indentures.
Securities authenticated and delivered after the execution of any supplemental
indenture or any amendment to a Notes Document, the Intercreditor Agreement or
Collateral Agency Agreement, pursuant to the provisions of this Article may bear
a notation in form approved by the Trustee as to any matter provided for by such
supplemental indenture or such amendment to the Notes Documents, the
Intercreditor Agreement or Collateral Agency Agreement or as to any action taken
at any such meeting. If the Issuer or the Trustee shall so determine, new
Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any modification of this Indenture contained in any such
supplemental indenture or any such amendment to a Notes Document may be prepared
by the Issuer, authenticated by the Trustee and delivered in exchange for the
Securities then outstanding.
ARTICLE VIII
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 8.1. Covenant Not to Merge, Consolidate, Sell or Convey Property Except
Under Certain Conditions. The Issuer will not consolidate or merge with or into,
or sell, lease, convey or otherwise dispose of all or substantially all of its
assets (as an entirety or substantially an entirety in one transaction or a
series of related transactions) to, any Person (other than a merger with or into
a Wholly Owned Subsidiary; provided that such Wholly Owned Subsidiary is not
organized in a foreign jurisdiction) unless: (a) the entity formed by or
surviving any such consolidation or merger (if other than the Issuer), or to
which sale, lease, conveyance or other disposition shall have been made (the
"Surviving Entity"), is a corporation organized and existing under the laws of
the United States, any state thereof or the District of Columbia; (b) the
Surviving Entity assumes by supplemental indenture all of the obligations of the
Issuer on the Securities and this Indenture in form and substance satisfactory
to the Trustee; (c) immediately after the transaction, no Default or Event of
Default shall have occurred and be continuing; (d) immediately after giving
effect to such transaction, the Consolidated Net Worth of the Surviving Entity
would be at least equal to the Consolidated Net Worth of the Issuer immediately
prior to such transaction; and (e) immediately after giving effect to such
transaction on a pro forma basis, (i) the Surviving Entity could incur at least
$1.00 of Indebtedness (other than Permitted Indebtedness) pursuant to clause (a)
of Section 3.9, or (ii) the Surviving Entity's ratio of Consolidated
Indebtedness to Consolidated EBITDA for the four fiscal quarters immediately
preceding such transaction for which financial information is available
consistent with the Issuer's prior practice, taken as one period and calculated
on the assumption that all Indebtedness had been incurred on the first day of
such period and that the related transaction and all its adjustments being
included in such pro forma calculation had also occurred on such date, would be
reduced.
Section 8.2. Successor Corporation Substituted. In case of any such
consolidation, merger, sale or conveyance, and following such an assumption by
the successor corporation, such successor corporation shall succeed to and be
substituted for the Issuer, with the same effect as if it had been named herein.
60
Such successor corporation may cause to be signed, and may
issue either in its own name or in the name of the Issuer prior to such
succession any or all of the Securities issuable hereunder which theretofore
shall not have been signed by the Issuer and delivered to the Trustee; and, upon
the order of such successor corporation, instead of the Issuer, and subject to
all the terms, conditions and limitations in this Indenture prescribed, the
Trustee shall authenticate and shall deliver any Securities which previously
shall have been signed and delivered by the officers of the Issuer to the
Trustee for authentication, and any Securities which such successor corporation
thereafter shall cause to be signed and delivered to the Trustee for that
purpose. All of the Securities so issued shall in all respects have the same
legal rank and benefit under this Indenture as the Securities theretofore or
thereafter issued in accordance with the terms of this Indenture as though all
of such Securities had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale, lease or
conveyance, such changes in phraseology and form (but not in substance) may be
made in the Securities thereafter to be issued as may be appropriate.
In the event of any such sale or conveyance (other than a
conveyance by way of lease), the Issuer or any successor corporation which shall
theretofore have become such in the manner described in this Article shall be
discharged from all obligations and covenants under this Indenture and the
Securities and may be liquidated and dissolved.
Section 8.3. Opinion of Counsel to Trustee. The Trustee, subject to the
provisions of Sections 5.1 and 5.2, may receive an Officers' Certificate and an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale, lease or conveyance, and any such assumption, and any such liquidation or
dissolution, complies with the applicable provisions of this Indenture, is in
compliance with all conditions precedent contained in this Indenture and that
such supplemental indenture, if any, constitutes the legal, valid and binding
obligation of the surviving corporation, enforceable against the surviving
corporation in accordance with its terms, subject to the customary exceptions.
ARTICLE IX
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS
Section 9.1. Satisfaction and Discharge of Indenture. If at any time (a) the
Issuer shall have paid or caused to be paid the principal of and interest on all
the Securities outstanding hereunder, as and when the same shall have become due
and payable, or (b) the Issuer shall have delivered to the Trustee for
cancellation all Securities theretofore authenticated (other than any Securities
which shall have been destroyed, lost or stolen and which shall have been
replaced or paid as provided in Section 2.6) or (c)(1) the Issuer shall have
irrevocably deposited or caused to be deposited with the Trustee as trust funds
the entire amount in cash (other than moneys repaid by the Trustee or any Paying
Agent to the Issuer in accordance with Section 9.4) or direct obligations of the
United States of America, backed by its full faith and credit, maturing as to
principal and interest in such amounts and at such times as will insure the
availability of cash sufficient to pay at maturity or upon redemption all such
Securities not theretofore delivered to the Trustee for cancellation, including
principal and interest due or to become due to such date of
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maturity as the case may be, and (2) the Issuer shall have delivered to the
Trustee (i) either (A) a ruling directed to the Trustee received from the
Internal Revenue Service to the effect that the Holders of the Securities will
not recognize income, gain or loss for federal income tax purposes as a result
of the Issuer's exercise of its option under this Section 9.1(c) and will be
subject to Federal income tax on the same amount and in the same manner and at
the same times as would have been the case if such option had not been exercised
or (B) an Opinion of Counsel, reasonably satisfactory to the Trustee, to the
same effect as the ruling described in clause (A) accompanied by a ruling to
that effect published by the Internal Revenue Service and (ii) an Opinion of
Counsel, reasonably satisfactory to the Trustee, to the effect that after the
passage of 90 days following the deposit, the trust funds will not be subject to
the effect of any applicable bankruptcy, insolvency, reorganization or similar
laws affecting creditors' rights generally and if, in any such case, the Issuer
shall also pay or cause to be paid all other sums payable hereunder by the
Issuer, then this Indenture shall cease to be of further effect (except as to
(i) rights of registration of transfer and exchange, and the Issuer's right of
optional redemption, (ii) substitution of apparently mutilated, defaced,
destroyed, lost or stolen Securities, (iii) rights of holders to receive
payments of principal thereof and interest thereon, upon the original stated due
dates therefor (but not upon acceleration), (iv) the rights, obligations and
immunities of the Trustee hereunder and (v) the rights of the Securityholders as
beneficiaries hereof with respect to the property so deposited with the Trustee
payable to all or any of them), and the Trustee, on demand of the Issuer
accompanied by an Officers' Certificate and an Opinion of Counsel and at the
cost and expense of the Issuer, shall execute proper instruments acknowledging
such satisfaction of and discharging this Indenture.
The Issuer agrees to reimburse the Trustee for any costs or
expenses thereafter reasonably incurred and to compensate the Trustee for any
services thereafter reasonably and properly rendered by the Trustee in
connection with this Indenture or the Securities.
Section 9.2. Application by Trustee of Funds Deposited for Payment of
Securities. Subject to Section 9.4, all moneys deposited with the Trustee
pursuant to Section 9.1 shall be held in trust and applied by it to the payment,
either directly or through any Paying Agent (including the Issuer acting as its
own Paying Agent), to the holders of the particular Securities for the payment
or redemption of which such moneys have been deposited with the Trustee, of all
sums due and to become due thereon for principal and interest; but such money
need not be segregated from other funds except to the extent required by law.
Section 9.3. Repayment of Moneys Held by Paying Agent. In connection with the
satisfaction and discharge of this Indenture, all moneys then held by any Paying
Agent under the provisions of this Indenture shall, upon demand of the Issuer,
be repaid to it or paid to the Trustee and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
Section 9.4. Return of Moneys Held by Trustee and Paying Agent Unclaimed for
Three Years. Any moneys deposited with or paid to the Trustee or any Paying
Agent for the payment of the principal of or interest on any Security and not
applied but remaining unclaimed for three years after the date upon which such
principal or interest shall have become due and payable, shall, upon the written
request of the Issuer and unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property law, be repaid to the
Issuer by the
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Trustee or such Paying Agent, and the holder of such Security shall, unless
otherwise required by mandatory provisions of applicable escheat or abandoned or
unclaimed property laws, thereafter look only to the Issuer for any payment
which such holder may be entitled to collect, and all liability of the Trustee
or any Paying Agent with respect to such moneys shall thereupon cease. In the
absence of a written request from the Issuer to return unclaimed funds to the
Issuer, the Trustee shall from time to time deliver all unclaimed funds to or as
directed by applicable escheat authorities, as determined by the Trustee in its
sole discretion, in accordance with the customary practices and procedures of
the Trustee. Any unclaimed funds held by the Trustee pursuant to this Section
9.4 shall be held uninvested and without any liability for interest.
ARTICLE X
COLLATERAL AND SECURITY
Section 10.1. Security Documents. The due and punctual payment of the principal
of and interest on the Securities when and as the same shall be due and payable,
whether on an interest payment date, at maturity, by acceleration, repurchase,
redemption or otherwise, and interest on the overdue principal of and interest
(to the extent permitted by law), if any, on the Securities and performance of
all other obligations of the Issuer to the Holders of Securities or the Trustee
under this Indenture and the Securities, according to the terms hereunder or
thereunder, shall be secured as provided in the Security Documents which the
Issuer has entered into simultaneously with the execution of this Indenture.
Each Holder of Securities, by its acceptance thereof, consents and agrees to the
terms of the Security Documents, the Intercreditor Agreement and the Collateral
Agency Agreement (including, without limitation, the provisions providing for
foreclosure and release of Collateral) as the same may be in effect or may be
amended from time to time in accordance with its terms, authorizes and directs
the Trustee (or Collateral Agent, if applicable), to enter into the Security
Documents, the Intercreditor Agreement and Collateral Agency Agreement and to
perform its obligations and exercise its rights thereunder in accordance
therewith. The Issuer shall do or cause to be done all such acts and things as
may be necessary or proper, or as may be required by the provisions of the
Security Documents, the Intercreditor Agreement and the Collateral Agency
Agreement, to assure and confirm to the Trustee and the Collateral Agent the
security interest in the Collateral contemplated hereby, by the Security
Documents or any part thereof, as from time to time constituted, so as to render
the same available for the security and benefit of this Indenture and of the
Securities secured hereby, according to the intent and purposes herein
expressed. The Issuer shall take, or shall cause its Subsidiaries to take any
and all actions reasonably required to cause the Security Documents to create
and maintain, as security for the obligations of the Issuer hereunder, a valid
and enforceable perfected second priority Lien in and on all the Collateral, in
favor of the Trustee for its benefit and the ratable benefit of the Holders of
Securities, superior to and prior to the rights of all third Persons (other than
the agent on behalf of the lenders under the Credit Facility and the Bond
Trustee on behalf of the holders of the Secured Series 2002 Bonds) and subject
to no Liens (other than Liens granted by the Issuer for purposes of securing its
obligations under the Credit Facility and with respect to the Secured Series
2002 Bonds, Collateral Permitted Liens and any other Liens permitted by the
Security Documents).
Section 10.2. Recording and Opinions. (a) The Issuer shall furnish to the
Collateral Agent and the Trustee promptly following the execution and delivery
of this Indenture, an Opinion of
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Counsel, either (i) stating that, in the opinion of such counsel, action has
been taken with respect to the recording, registering, filing, re-recording,
re-registering and re-filing of all supplemental indentures, financing
statements, continuation statements or other instruments of further assurance as
is necessary to maintain the Lien of the Security Documents and reciting with
respect to the security interests in the Collateral the details of such action
or referring to prior Opinions of Counsel in which such details are given or
(ii) stating that, in the opinion of such counsel, no such action is necessary
to make such Lien effective.
(b) The Issuer shall furnish to the Collateral Agent and the
Trustee on April 1, in each year beginning with April 1, 2003, an Opinion of
Counsel, dated as of such date, either (i)(A) stating that, in the opinion of
such counsel, action has been taken with respect to the recording, registering,
filing, re-recording, re-registering and re-filing of all supplemental
indentures, financing statements, continuation statements or other instruments
of further assurance as is necessary to maintain the Lien of the Security
Documents and reciting with respect to the security interests in the Collateral
the details of such action or referring to prior Opinions of Counsel in which
such details are given, (B) stating that, based on relevant laws as in effect on
the date of such Opinion of Counsel, all financing statements and continuation
statements have been executed and filed that are necessary as of such date and
during the succeeding 12 months fully to preserve and protect, to the extent
such protection and preservation are possible by filing, the rights of the
Holders of Securities and the Collateral Agent and the Trustee hereunder and
under the Security Documents with respect to the security interests in the
Collateral, or (ii) stating that, in the opinion of such counsel, no such action
is necessary to maintain such Lien and assignment.
(c) The Issuer shall otherwise comply with the provisions of
Section 314(d) of the Trust Indenture Act.
Section 10.3. Release or Subordination of Collateral. (a) Subject to subsections
(b), (c) and (d) of this Section 10.3, in the event that any Collateral is sold,
transferred or otherwise disposed of in accordance with Section 3.12, Section
3.14(b), or other transaction permitted by this Indenture (including, without
limitation, an Excepted Sale) or by the Security Documents, or otherwise
pursuant to and in accordance with the Intercreditor Agreement if then in
effect, the Collateral shall, concurrently with the disposition of such
Collateral, automatically be released from the Lien of the relevant Security
Documents, in accordance with the provisions of the Security Documents and
Intercreditor Agreement if then in effect. Subject to subsections (b), (c) and
(d) of this Section 10.3, the Collateral shall be released from the Lien and
security interest created by the Security Documents at any time or from time to
time upon satisfaction and discharge of the obligations of the Issuer under this
Indenture pursuant to Article IX and in accordance with the provisions hereof
and the Security Documents. Upon the request of the Issuer pursuant to an
Opinion of Counsel and an Officer's Certificate certifying that all conditions
precedent to such release hereunder and under the Security Documents have been
met, the Trustee shall or shall cause the Collateral Agent to, as applicable,
release Collateral. Upon receipt of such Officer's Certificate, the Trustee
shall or shall cause the Collateral Agent to (at the sole cost and expense of
the Issuer) execute, deliver or acknowledge any necessary or proper instruments
of termination, satisfaction or release to evidence the release of any
Collateral permitted to be released pursuant to this Indenture or the Security
Documents.
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(b) No Collateral shall be released from the Lien and security
interest created by the Security Documents pursuant to the provisions of the
Security Documents or the Intercreditor Agreement unless there shall have been
delivered to the Trustee or Collateral Agent, if applicable, the Opinion of
Counsel and Officer's Certificate required by this Section 10.3.
(c) At any time when a Default or Event of Default shall have
occurred and be continuing and the maturity of the Securities shall have been
accelerated (whether by declaration or otherwise), no release of Collateral
pursuant to the provisions of the Security Documents shall be effective as
against the Trustee or the Holders of Securities.
(d) The release of any Collateral from the terms of this
Indenture and the Security Documents shall not be deemed to impair the security
under this Indenture in contravention of the provisions hereof if and to the
extent the Collateral is released pursuant to the terms of the Security
Documents. To the extent applicable, the Issuer shall cause Trust Indenture Act
Section 313(b), relating to reports and Section 314(d), relating to the release
of property or securities from the Lien and security interest of the Security
Documents and relating to the substitution therefor of any property or
securities to be subjected to the Lien and security interest of the Security
Documents, to be complied with. Any certificate or opinion required by Section
314(d) of the Trust Indenture Act may be made by an Officer of the Issuer except
in cases where Section 314(d) of the Trust Indenture Act requires that such
certificate or opinion be made by an independent Person, which Person shall be
an independent engineer, appraiser or other expert selected or approved by the
Trustee and the Collateral Agent in the exercise of reasonable care.
(e) In the event that a Lien on Collateral in favor of the
holders of the Securities is to be subordinated in accordance with Section
3.12(b) or Section 3.14(b), the Trustee shall execute and shall, if applicable,
direct the Collateral Agent to execute, such a subordination and/or
intercreditor agreement, as such lender may reasonably require in order to
effect and evidence such Lien subordination.
Section 10.4. Certificates of the Issuer. The Issuer shall furnish to the
Trustee and Collateral Agent, if applicable, prior to each proposed release of
Collateral pursuant to the Security Documents or the Intercreditor Agreement,
(i) all documents required by Section 314(d) of the Trust Indenture Act and (ii)
an Opinion of Counsel, which may be rendered by internal counsel to the Issuer,
to the effect that such accompanying documents constitute all documents required
by Section 314(d) of the Trust Indenture Act. The Trustee may, to the extent
permitted by Sections 5.1 and 5.2 hereof, accept as conclusive evidence of
compliance with the foregoing provisions the appropriate statements contained in
such documents and such Opinion of Counsel.
Section 10.5. Certificates of the Trustee. In the event the Issuer wishes to
release Collateral in accordance with the Security Documents and has delivered
the certificates and documents required by the Security Documents or the
Intercreditor Agreement and Sections 10.5 and 10.6 hereof, the Trustee shall
determine whether it has received all documentation required by Section 314(d)
of the Trust Indenture Act in connection with such release and, based on such
determination and the Opinion of Counsel delivered pursuant to Section 10.2,
shall deliver a certificate to the Collateral Agent, if applicable, setting
forth such determination; provided,
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however, that if the Trustee is the Collateral Agent, the requirement that the
Trustee deliver a certificate to the Collateral Agent shall not be applicable.
Section 10.6. Authorization of Actions to Be Taken by the Trustee Under the
Security Documents. Subject to the provisions of Section 5.1 and 5.2 hereof and
of the Security Documents, the Trustee shall, in its sole discretion and without
the consent of the Holders of Securities, direct, on behalf of the Holders of
Securities, and, if applicable, shall direct the Collateral Agent to, take all
actions the Trustee deems necessary or appropriate in order to (a) enforce any
of the terms of the Security Documents and (b) collect, receive and distribute
any and all amounts payable in respect of the obligations of the Issuer
hereunder. The Trustee and the Collateral Agent, if applicable, shall have power
to institute and maintain such suits and proceedings as the Trustee may deem
expedient to prevent any impairment of the Collateral by any acts that may be
unlawful or in violation of the Security Documents or this Indenture, and such
suits and proceedings as the Trustee or the Collateral Agent, if applicable, may
deem expedient to preserve or protect its interests and the interests of the
Holders of Securities in the Collateral (including power to institute and
maintain suits or proceedings to restrain the enforcement of or compliance with
any legislative or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid if the enforcement of, or compliance with,
such enactment, rule or order would impair the security interest hereunder or be
prejudicial to the interests of the Holders of Securities or of the Trustee or
the Collateral Agent, if applicable).
Section 10.7. Authorization of Receipt of Funds by the Trustee Under the
Security Documents. The Trustee (or the Collateral Agent, if applicable) is
authorized to receive any funds for the benefit of the Holders of Securities
distributed under the Security Documents or Intercreditor Agreement, and to make
further distributions of such funds to the Holders of Securities according to
the provisions of this Indenture, the Security Documents and the Intercreditor
Agreement.
Section 10.8. Release upon Termination of the Issuer's Obligations; Termination
of Security Interest. If the Trustee is not the Collateral Agent, upon the
payment in full of all obligations of the Issuer under this Indenture and the
Securities, or upon the satisfaction and discharge of the obligations of the
Issuer under this Indenture pursuant to Article IX, the Trustee shall, at the
request of the Issuer, deliver a certificate to the Collateral Agent stating
that such obligations have been paid in full, and instruct the Collateral Agent
to release the Liens pursuant to this Indenture and the Security Documents.
Section 10.9. Intercreditor Agreement and Collateral Agency Agreement. Each
Holder of Securities, by its acceptance hereof, consents and agrees to the terms
of the Intercreditor Agreement and the Collateral Agency Agreement and hereby
authorizes and directs the Trustee and the Collateral Agent, as applicable, to
enter into the Intercreditor Agreement and the Collateral Agency Agreement and
any modification, amendment, or supplement thereto or any restatement thereof
and/or to enter into any replacement or additional intercreditor agreement as
contemplated thereunder (collectively, the "Intercreditor Modification
Documents") provided that either (a) the Trustee has determined, in its sole
judgment, that any such Intercreditor Modification Document will not adversely
affect the interests of the Trustee or the holders of the
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Securities or (b) such Intercreditor Modification Document shall have complied
with the provisions of Article VII of this Indenture. The Trustee may rely upon
an opinion of independent counsel as conclusive evidence that any such
Intercreditor Modification Document complies with the provisions of this Section
10.9.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.1. Incorporators, Stockholders, Officers and Directors of Issuer
Exempt from Individual Liability. No recourse under or upon any obligation,
covenant or agreement contained in this Indenture, or in any Security, or
because of any indebtedness evidenced thereby, shall be had against any
incorporator, as such or against any past, present or future stockholder,
officer or director, as such, of the Issuer or of any successor, either directly
or through the Issuer or any successor, under any rule of law, statute or
constitutional provision or by the enforcement of any assessment or by any legal
or equitable proceeding or otherwise, all such liability being expressly waived
and released by the acceptance of the Securities by the holders thereof and as
part of the consideration for the issue of the Securities.
Section 11.2. Provisions of Indenture for the Sole Benefit of Parties and
Securityholders. Nothing in this Indenture or in the Securities, expressed or
implied, shall give or be construed to give to any person, firm or corporation,
other than the parties hereto and their successors and the holders of the
Securities, any legal or equitable right, remedy or claim under this Indenture
or under any covenant or provision herein contained, all such covenants and
provisions being for the sole benefit of the parties hereto and their successors
and of the holders of the Securities.
Section 11.3. Successors and Assigns of Issuer Bound by Indenture. All the
covenants, stipulations, promises and agreements in this Indenture contained by
or in behalf of the Issuer shall bind its successors and assigns, whether so
expressed or not.
Section 11.4. Notices and Demands on Issuer, Trustee and Securityholders. Any
notice or demand which by any provision of this Indenture is required or
permitted to be given or served by the Trustee or by the holders of Securities
to or on the Issuer shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if in writing and mailed, first-class
postage prepaid, to the Issuer addressed (until another address of the Issuer is
filed by the Issuer with the Trustee) to Weirton Steel Corporation, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Vice President - Law and
Secretary or transmitted by facsimile transmission (confirmed by guaranteed
overnight courier) to the following facsimile numbers:
telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
facsimile number: (▇▇▇) ▇▇▇-▇▇▇▇.
Any notice, direction, request or demand by the Issuer or any
Securityholder to or upon the Trustee shall be sufficient for every purpose
hereunder if made, given, furnished or filed, in each case in writing, to or
with the Trustee at its Pittsburgh Corporate Trust Office, One
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Oxford Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Institutional Trust Services or transmitted by facsimile transmission
(confirmed by guaranteed overnight courier) to the following facsimile numbers:
telephone number: (▇▇▇) ▇▇▇-▇▇▇▇
facsimile number: (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to the Dallas Corporate Trust Office, located at
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: Institutional
Trust Services.
If to the Collateral Agent, at the address provided in the
Collateral Agency Agreement for notices to be sent.
Where this Indenture provides for notice to holders, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each holder entitled
thereto, at his last address as it appears in the Security register. In any case
where notice to holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular holder shall
affect the sufficiency of such notice with respect to other holders. Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.
In case, by reason of the suspension of or irregularities in
regular mail service, it shall be impracticable to mail notice to the Issuer and
Securityholders when such notice is required to be given pursuant to any
provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.
Section 11.5. Officers' Certificates and Opinions of Counsel; Statements to Be
Contained Therein. Upon any application or demand by the Issuer to the Trustee
to take any action under any of the provisions of this Indenture, the Issuer
shall furnish to the Trustee an Officers' Certificate stating that all
conditions precedent provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent have been complied with,
except that in the case of any such application or demand as to which the
furnishing of such documents is specifically required by any provision of this
Indenture relating to such particular application or demand, no additional
certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include (a) a statement that the person
making such certificate or opinion has read such covenant or condition, (b) 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, (c) a statement that, in the opinion of such person, he has made such
examination or
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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 (d) a
statement as to whether or not, in the opinion of such person, such condition or
covenant has been complied with.
Any certificate, statement or opinion of an officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or opinion of or representations by counsel, unless such officer knows that the
certificate or opinion or representations with respect to the matters upon which
his certificate, statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of counsel may be based, insofar as it
relates to factual matters or information with respect to which is in the
possession of the Issuer, upon the certificate, statement or opinion of or
representations by an officer or officers of the Issuer, unless such counsel
knows that the certificate, statement or opinion or representations with respect
to the matters upon which his certificate, statement or opinion may be based as
aforesaid are erroneous, or in the exercise of reasonable care should know that
the same are erroneous.
Any certificate, statement or opinion of an officer of the
Issuer or of counsel may be based, insofar as it relates to accounting matters,
upon a certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Issuer, unless such officer or counsel, as the
case may be, knows that the certificate or opinion or representations with
respect to the accounting matters upon which his certificate, statement or
opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
Section 11.6. Payments Due on Saturdays, Sundays and Holidays. If the date of
maturity of interest on or principal of the Securities or the date fixed for
redemption of any Security shall not be a Business Day, then payment of interest
or principal need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall accrue for the
period after such date.
Section 11.7. Trust Indenture Act of 1939. This Indenture shall be subject to
the provisions of the Trust Indenture Act of 1939 that are required to be a part
of this Indenture and shall, to the extent applicable, be governed by such
provisions. If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with another provision included in this Indenture by
operation of Sections 310 to 317, inclusive, of the Trust Indenture Act of 1939
(an "incorporated provision"), such incorporated provision shall control.
Section 11.8. New York Law to Govern. This Indenture and each Security shall be
deemed to be a contract under the laws of the State of New York, and for all
purposes shall be construed in accordance with the laws of said State, except as
may otherwise be required by mandatory provisions of law.
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Section 11.9. Counterparts. This Indenture may be executed in any number of
counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
Section 11.10. Effect of Headings. The Article and Section headings herein and
the Table of Contents are for convenience only and shall not affect the
construction hereof.
Section 11.11. Certain Rights. If a United States Bankruptcy Court shall find
that the grant in favor of the Holders of a Lien on the Collateral constitutes a
preferential or fraudulent transfer to which there is no defense or exception
and the Lien securing the Collateral is avoided by order of such court as a
consequence thereof, the Holders of the Securities shall be entitled to pursue a
claim for payment with respect to the Securities as such Holders would have been
entitled to pursue with respect to the Senior Notes due 2004 or Senior Notes due
2005, as the case may be, which such Holders exchanged for such Securities, as
though such Holders had never exchanged such Senior Notes due 2004 or Senior
Notes due 2005 for the Securities.
ARTICLE XII
REDEMPTION OF SECURITIES
Section 12.1. Right of Optional Redemption; Prices. The Securities may not be
redeemed at the option of the Issuer prior to maturity, except as set forth in
this Section 12.1. The Securities may not be redeemed at the option of the
Issuer prior to April 1, 2004. At any time and from time to time on or after
April 1, 2004, the Issuer may redeem the Securities, in whole or in part, at a
redemption price from April 1, 2004 to March 31, 2005 of 105.00% of the
principal amount thereof, from April 1, 2005 to March 31, 2006 at a redemption
price of 104.00% of the principal amount thereof, from April 1, 2006 to March
31, 2007 at a redemption price of 103.00% of the principal amount thereof, and
thereafter until maturity of 100.00% of the principal amount thereof, in each
case plus accrued interest to the redemption date. Notwithstanding the
foregoing, if the date fixed for redemption as set forth in this paragraph is an
April 1 or October 1, then the interest payable on such date shall be paid to
the holder of record on the preceding March 15 or September 15. Notice of such
redemption shall be mailed not less than 30 nor more than 60 days prior to the
date fixed for redemption to the holders of Securities to be redeemed, all as
provided in the Indenture, in the circumstances set forth in this paragraph.
Section 12.2. Notice of Redemption; Partial Redemptions. Notice of redemption to
the holders of Securities to be redeemed as a whole or in part, shall be given
by mailing notice of such redemption by first class mail, postage prepaid, at
least 30 days and not more than 60 days prior to the date fixed for redemption
to such holders of Securities at their last addresses as they shall appear upon
the registry books. Any notice which is mailed in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
holder receives the notice. Failure to give notice by mail, or any defect in the
notice to the holder of any Security designated for redemption as a whole or in
part, shall not affect the validity of the proceedings for the redemption of any
other Security. The notice of redemption to each such holder shall specify the
principal amount of each Security held by such holder to be redeemed, the date
fixed for redemption, the redemption price, the place or places of payment, that
payment will be made
70
upon presentation and surrender of such Securities, that interest accrued to the
date fixed for redemption will be paid as specified in said notice and that on
and after said date interest thereon or on the portions thereof to be redeemed
will cease to accrue. In case any Security is to be redeemed in part only the
notice of redemption shall state the portion of the principal amount thereof to
be redeemed and shall state that on and after the date fixed for redemption,
upon surrender of such Security, a new Security or Securities in principal
amount equal to the unredeemed portion thereof will be issued.
The notice of redemption of Securities to be redeemed at the
option of the Issuer shall be given by the Issuer or, at the Issuer's request,
by the Trustee in the name and at the expense of the Issuer. The Issuer shall
notify the Trustee of such redemption at least 15 days prior to the date the
notice of redemption is to be sent to the Holders (unless a shorter period of
time shall be satisfactory to the Trustee) and shall specify in such notice
whether the Trustee is to give such notice.
At least one business day prior to the redemption date
specified in the notice of redemption given as provided in this Section, the
Issuer will deposit with the Trustee or with one or more Paying Agents (or, if
the Issuer is acting as its own Paying Agent, set aside, segregate and hold in
trust as provided in Section 3.4) an amount of money sufficient to redeem on the
redemption date all the Securities so called for redemption at the appropriate
redemption price, together with accrued interest to the date fixed for
redemption. If less than all the outstanding Securities are to be redeemed, the
Issuer will deliver to the Trustee at least 70 days prior to the date fixed for
redemption an Officers' Certificate stating the aggregate principal amount of
Securities to be redeemed.
In the event that less than all of the Securities are to be
redeemed at any time, selection of 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 on a national securities exchange, on a pro-rata basis. The
particular Securities to be redeemed shall be selected unless otherwise provided
herein, not less than 40 days or more than 60 days prior to the redemption date
by the Trustee from the outstanding Securities not previously called for
redemption.
The Trustee shall promptly notify the Issuer in writing of the
Securities selected for redemption and, in the case of any Security selected for
partial redemption, the principal amount thereof to be redeemed. Securities and
portions of them selected shall be in amounts of $50 or whole multiples of $50.
Except as provided in the preceding sentence, provisions of this Indenture that
apply to Securities called for redemption also apply to portions of Securities
called for redemption.
Section 12.3. Payment of Securities Called for Redemption. If notice of
redemption has been given as above provided, the Securities or portions of
Securities specified in such notice shall become due and payable on the date and
at the place stated in such notice at the applicable redemption price, together
with interest accrued to the date fixed for redemption, and on and after said
date (unless the Issuer shall default in the payment of such Securities at the
redemption price, together with interest accrued to said date) interest on the
Securities or portions of Securities so called for redemption shall cease to
accrue and, except as provided in Sections 5.5
71
and 9.4, such Securities shall cease from and after the date fixed for
redemption to be entitled to any benefit or security under this Indenture, and
the holders thereof shall have no right in respect of such Securities except the
right to receive the redemption price thereof and unpaid interest to the date
fixed for redemption. On presentation and surrender of such Securities at a
place of payment specified in said notice, said Securities or the specified
portions thereof shall be paid and redeemed by the Issuer at the applicable
redemption price, together with interest accrued thereon to the date fixed for
redemption; provided that any semiannual payment of interest becoming due on the
date fixed for redemption shall be payable to the holders of such Securities
registered as such on the relevant record date subject to the terms and
provisions of Section 2.4 hereof.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate borne
by the Security.
Upon presentation of any Security redeemed in part only, the
Issuer shall execute and the Trustee shall authenticate and deliver to or on the
order of the holder thereof, at the expense of the Issuer, a new Security or
Securities, of authorized denominations, in principal amount equal to the
unredeemed portion of the Security so presented.
Section 12.4. Exclusion of Certain Securities from Eligibility for Selection for
Redemption. Securities shall be excluded from eligibility for selection for
redemption if they are identified by registration and certificate number in a
written statement signed by an authorized officer of the Issuer and delivered to
the Trustee at least 40 days prior to the last date on which notice of
redemption may be given as being owned of record and beneficially by, and not
pledged or hypothecated by either (a) the Issuer or (b) an entity specifically
identified in such written statement directly or indirectly controlling or
controlled by or under direct or indirect common control with the Issuer.
72
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the date first above written.
WEIRTON STEEL CORPORATION
Attest: By:
-----------------------------------
Name:
Title:
▇.▇. ▇▇▇▇▇▇ TRUST COMPANY,
NATIONAL ASSOCIATION, AS TRUSTEE
(SEAL)
Attest: By:
-----------------------------------
Name:
Title:
73
Exhibit A --------- [FORM OF Global SECURITY]
[FORM OF FACE OF SECURITY]
UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY 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.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO.
OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE.
FOR PURPOSES OF SECTION 1273 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (THE "CODE"), THIS SECURITY HAS
ORIGINAL ISSUE DISCOUNT. FOR PURPOSES OF SECTION 1273 OF THE
CODE, THE ISSUE PRICE IS $ AND THE AMOUNT OF ORIGINAL ISSUE
DISCOUNT IS $ , IN EACH CASE PER $1,000 PRINCIPAL AMOUNT OF
THIS SECURITY FOR PURPOSES OF SECTION 1273 OF THE CODE, THE
YIELD TO MATURITY COMPOUNDED SEMIANNUALLY IS %.
No. $
WEIRTON STEEL CORPORATION
10% Senior Secured Notes Due 2008
Weirton Steel Corporation, a Delaware corporation (the "Issuer"), for
value received hereby promises to pay to ______________ or registered assigns
the principal sum of _________________ Dollars at the Issuer's office or agency
for said purpose in the Borough of
74
Manhattan, the City of New York on April 1, 2008 in such coin or currency of the
United States of America as at the time of payment shall be legal tender for the
payment of public and private debts. This Security shall bear interest and the
interest shall accrue and be calculated at the rate and in the manner as set
forth on the reverse hereof and shall be paid at said office or agency.
Reference is made to the further provisions set forth on the reverse
hereof. Such further provisions shall for all purposes have the same effect as
though fully set forth at this place.
This Security shall not be valid or obligatory until the certificate of
authentication hereon shall have been duly manually signed by the Trustee acting
under the Indenture.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed under its corporate seal.
Dated:
WEIRTON STEEL CORPORATION
By:
------------------------------------
Name:
Title:
This is one of the Securities described in the within-mentioned Indenture.
[ ]
_______________________ Authorized Signatory
Dated: as of _______________ __, 2002
75
[FORM OF REVERSE OF SECURITY]
WEIRTON STEEL CORPORATION
10% Senior Secured Notes Due 2008
This Security is one of a duly authorized issue of debt securities of
the Issuer, limited to the aggregate principal amount of $134,200,000 (except as
otherwise provided in the Indenture mentioned below), issued or to be issued
pursuant to an indenture dated as of _________ __, 2002 (the "Indenture"), duly
executed and delivered by the Issuer to ▇.▇. ▇▇▇▇▇▇ Trust Company, National
Association, Trustee (herein called the "Trustee"). Reference is hereby made to
the Indenture and all indentures supplemental thereto for a description of the
rights, limitations of rights, obligations, duties and immunities thereunder of
the Trustee, the Issuer and the holders (the words "holders" or "holder" meaning
the registered holders or registered holder) of the Securities. All capitalized
terms not defined herein shall have the meaning set forth in the Indenture.
Descriptive headings are merely for convenience and shall have no effect on the
meaning or interpretation hereof.
Interest
Interest shall accrue on the principal amount of this Security from
_________ __, 2002 until April 1, 2008 or the earlier redemption of the
Securities as at the respective rates per annum as set forth on the table below,
and the Issuer promises to pay such interest, semi-annually in arrears on April
1 and October 1 of each year, on said principal sum in like coin or currency at
such rates, with the first such payment commencing on October 1, 2002. The
Issuer shall furnish an Officer's Certificate to the Trustee specifying the
applicable interest rate on or prior to April 1 and October 1 of each such year.
------------------------------------------------------------ ---------------------------------------------------------
Interest Period Interest Rate
------------------------------------------------------------ ---------------------------------------------------------
1. From _______ __ 2002 [Issue Date] to March 31, 2003 1. ___% [SEE EXPLANATORY NOTE BELOW].
------------------------------------------------------------ ---------------------------------------------------------
2. From April 1, 2003 to March 31, 2004 2. The lesser of (a) the sum of (i) ___% [SEE
EXPLANATORY NOTE BELOW] and (ii) Contingent Interest
Rate(as defined below), and (b) 10.0% per annum.
------------------------------------------------------------ ---------------------------------------------------------
3. From April 1, 2004 to March 31, 2005 3. The lesser of (a) the sum of (i) ___% [SEE
EXPLANATORY NOTE BELOW] and (ii) Contingent Interest
Rate, and (b) 10.0% per annum.
------------------------------------------------------------ ---------------------------------------------------------
4. From April 1, 2005 to March 31, 2008 4. 10.0% per annum
------------------------------------------------------------ ---------------------------------------------------------
76
[EXPLANATORY NOTE: THE INTEREST RATE PER ANNUM WILL BE DETERMINED
PURSUANT TO A FORMULA WHICH IS BASED ON A "FIXED INTEREST" CALCULATION TO BE
DETERMINED AT THE TIME OF THE ISSUANCE OF THE SECURITIES. IN INTEREST PERIODS 1
THROUGH 3, THE "FIXED INTEREST" CALCULATION WILL BE EQUAL TO THE GREATER OF (A)
0.5% PER ANNUM OR (B) SUCH AMOUNT AVAILABLE FOR PAYMENT, EXPRESSED AS A RATE PER
ANNUM, TO THE HOLDERS OF THE SECURITIES UNDER THE "INTEREST BASKET" SET FORTH IN
THE CREDIT FACILITY. THE "INTEREST BASKET" WILL, IN THE AGGREGATE, BE EQUAL TO
THE EXCESS, IF ANY, OF $4.0 MILLION OVER THE AGGREGATE AMOUNT OF INTEREST TO BE
PAID IN THE APPLICABLE INTEREST PERIOD TO THE HOLDERS OF OUTSTANDING SENIOR
NOTES DUE 2004, SENIOR NOTES DUE 2005, AND SERIES 1989 BONDS, IF ANY. THE AMOUNT
OF THE "INTEREST BASKET" WILL BE ALLOCATED ON A PRO-RATA BASIS AMONGST THE
HOLDERS OF THE SECURITIES.]
"Contingent Interest Rate" shall be expressed as a percentage
determined by dividing (a) 50% of the Excess Cash Flow by (b) the sum of the
principal amount of all Outstanding Securities (including this Security) and the
principal amount of all outstanding Secured Series 2002 Bonds at the time of
such determination.
Interest on the Securities shall be computed on the basis of a 360-day
year of twelve 30-day months. The interest so payable on any April 1 and October
1 will, except as otherwise provided in the Indenture, be paid to the person in
whose name this Security is registered at the close of business on the March 15
or September 15 preceding such April 1 and October 1, whether or not such day is
a Business Day (as defined in the Indenture); provided that interest, if any,
may be paid, at the option of the Issuer, by mailing a check therefor payable to
the registered holder entitled thereto at his last address as it appears on the
Security register. If the date of redemption or purchase of this bond is other
than April 1 or October 1, then the amount of any accrued and unpaid interest
due and payable on this bond at the time of any such redemption or purchase
shall be equal to the amount determined by multiplying (i) the interest rate in
effect as of the most recent interest payment date prior thereto by (ii) a
fraction, the numerator of which is the actual number of days elapsed in the
period for which interest is payable on the date of redemption or purchase, and
the denominator of which is 360.
Unless otherwise agreed by the Issuer and the holder of any Security,
payments by the Issuer in respect of the Securities (including principal,
premium, if any and interest) shall be paid to holders of the Securities in
same-day funds. If the date of maturity of interest on or principal of the
Securities or the date fixed for redemption of any Security shall not be a
Business Day, then payment of interest, or principal will be made on the next
succeeding Business Day, with the same force and effect as if made on the date
of maturity or the date fixed for redemption, and no interest shall accrue for
the period after such date.
Default
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all the Securities may be declared
due and payable, in the manner and with the effect, and subject to the
conditions, provided in the Indenture. The Indenture provides that in certain
events such declaration and its consequences may be waived by the holders of a
majority in aggregate principal amount of the Securities then outstanding and
that, prior to any such declaration, such holders may waive any past default
under the Indenture and its consequences except a default in the payment of
principal of or interest on any of the
77
Securities. Any such consent or waiver by the holder of this Security (unless
revoked as provided in the Indenture) shall be conclusive and binding upon such
holder and upon all future holders and owners of this Security and any Security
which may be issued in exchange or substitution therefor, whether or not any
notation thereof is made upon this Security or such other Securities.
Amendment
The Indenture permits the Issuer and the Trustee, with the consent of
the holders of not less than a majority in aggregate principal amount of the
Securities at the time outstanding, evidenced as in the Indenture provided, to
execute supplemental indentures adding any provisions to or changing in any
manner or eliminating any of the provisions of the Indenture or of any
supplemental indenture or of any Notes Document, the Intercreditor Agreement or
Collateral Agency Agreement or modifying in any manner the rights of the holders
of the Securities; provided that no such supplemental indenture shall, without
the consent of the holders of all Securities then outstanding, (a) reduce the
rate or change the time or place for payment of interest, if any, on any
Security or reduce any amount payable on the redemption hereof; (b) reduce the
principal of or change the fixed maturity or place of payment of any Security;
(c) change the currency of payment of principal and interest, if any, on any
Security; (d) reduce the principal amount of outstanding Securities necessary to
modify or amend the Indenture; (e) impair the right to institute suit for the
enforcement of any payment on or with respect to any Security; or (f) make any
changes in Section 4.9 (waiver of past defaults), Section 4.11 (rights of
holders to receive payment), or the first paragraph of Section 7.2 (supplemental
indentures with consent of securityholders) of the Indenture. Notwithstanding
the foregoing, with the consent of the holders of not less than 85% in the
aggregate principal amount of the Securities at the time outstanding, the Issuer
and the Trustee (or Collateral Agent, as applicable) may amend or waive any
provisions of the Indenture, the Notes Document, the Intercreditor Agreement or
Collateral Agency Agreement, relating to the Collateral.
Redemption
The Securities may not be redeemed at the option of the Issuer prior to
maturity, except as set forth in the Indenture. The Securities may not be
redeemed at the option of the Issuer prior to April 1, 2004. At any time and
from time to time on or after April 1, 2004, the Issuer may redeem the
Securities, in whole or in part, at a redemption price from April 1, 2004 to
March 31, 2005 of 105.00% of the principal amount thereof, from April 1, 2005 to
March 31, 2006 at a redemption price of 104.00% of the principal amount thereof,
from April 1, 2006 to March 31, 2007 at a redemption price of 103.00% of the
principal amount thereof and thereafter until maturity at 100.00% of the
principal amount thereof, in each case plus accrued or unpaid interest to the
redemption date. Notwithstanding the foregoing, if the date fixed for redemption
as set forth in this paragraph is an April 1 or October 1, then the interest
payable on such date shall be paid to the holder of record on the preceding
March 15 or September 15. Notice of such redemption shall be mailed not less
than 30 nor more than 60 days prior to the date fixed for redemption to the
holders of Securities to be redeemed, all as provided in the Indenture, in the
circumstances set forth in this paragraph.
Subject to payment by the Issuer of a sum sufficient to pay the amount
due on redemption, interest on this Security (or portion hereof if this Security
is redeemed in part) shall
78
cease to accrue upon the date duly fixed for redemption of this Security (or
portion hereof if this Security is redeemed in part).
Asset Disposition
Subject to the terms of the Indenture, if the Issuer or any Subsidiary
consummate any Asset Disposition (excluding any Asset Disposition of
Collateral), the Net Cash Proceeds of the Asset Disposition within 270 days,
shall be, at the Issuer's election, applied (A) to the extent the Issuer elects
(or is so required by the terms of any Indebtedness), to prepay or repay the
Credit Facility or the Vendor Financing Programs, or (B)(i) to redeem or make
other payments in respect of the Series C Preferred Stock, or (ii) to make an
investment in properties and assets other than cash, cash equivalents or
inventory that replace the properties and assets that were the subject of the
Asset Disposition or in properties and assets that will be used in the business
of making, processing or distributing steel products, including, without
limitation, tin products or other coated steel products and related businesses,
or (C) to the extent of the balance of such Net Cash Proceeds after application
in accordance with (A) or (B), to make an Asset Disposition Offer to purchase
the Securities (on a pro rata basis if the amount available for such purchase is
less than 100% of the outstanding principal amount of the Securities) and
Secured Series 2002 Bonds on a pari passu basis, at a purchase price of the
principal amount thereof plus accrued and unpaid interest, if any, as the case
may be, to the date of repayment. Notwithstanding the foregoing, the Issuer and
its Subsidiaries will not be required to apply any Net Cash Proceeds to
effectuate an Asset Disposition Offer in accordance with this provision except
to the extent that the aggregate gross proceeds from all Asset Dispositions
which are not applied in accordance with clause (A) or (B) exceed $15,000,000.
Subject to the terms of the Indenture, if the Issuer or any Subsidiary
consummate any Asset Disposition of Collateral, then the Net Cash Proceeds of
the Asset Disposition within 270 days, shall be, at the Issuer's election,
applied (A) to the extent the Issuer elects (or is so required by the terms of
any Indebtedness), to prepay or repay the Credit Facility which prepayment or
repayment shall constitute a permanent reduction of the commitment under such
Credit Facility or (B)(i) to redeem or make other payments in respect of the
Series C Preferred Stock, or (ii) to make an investment in replacement
properties and assets that will be used in the business of making, processing or
distributing steel products, including, without limitation, tin products or
other coated steel products and related businesses, and grant in favor of the
holders of the Securities a Lien, which may be subordinated only to senior
secured Indebtedness, incurred to finance or refinance, as applicable, the
acquisition of such replacement properties and assets, or (C) to the extent of
the balance of such Net Cash Proceeds after application in accordance with (A)
or (B), to make an Asset Disposition Offer to purchase the Securities (on a pro
rata basis if the amount available for such purchase is less than 100% of the
outstanding principal amount of the Securities) and Secured Series 2002 Bonds on
a pari passu basis, at a purchase price of the principal amount thereof plus
accrued and unpaid interest, if any, as the case may be, to the date of
repayment.
Change of Control
In the event that there shall occur a Change of Control, each holder of
the Securities shall have the right, at the Holder's option, to require the
Issuer to purchase all or any part of such
79
Holder's Securities on the Repurchase Date that is 90 days after notice of the
Change of Control, at 101% of the principal amount of the Securities plus
accrued interest, if any, to the Repurchase Date. To be repaid, the Security
must be received, with the completed form entitled Option of Holder to Elect
Purchase (set forth below), by the Paying Agent at its then specified office at
least two Business Days prior to the Repurchase Date. Exercise of the repayment
option by the Securityholder will be irrevocable unless the rescission thereof
is duly approved by the Continuing Directors. The Issuer, the Trustee, and any
authorized agent of the Issuer or the Trustee, may deem and treat the registered
holder hereof as the absolute owner of this Security (whether or not this
Security shall be overdue and notwithstanding any notation of ownership or other
writing hereon made by anyone other than the Issuer or the Trustee or any
authorized agent of the Issuer or the Trustee), for the purpose of receiving
payment of, or on account of, the principal hereof and, subject to the
provisions on the face hereof and interest hereon and for all other purposes,
and neither the Issuer nor the Trustee nor any authorized agent of the Issuer or
the Trustee shall be affected by any notice to the contrary.
Other Terms
No recourse shall be had for the payment of the principal of or
interest on this Security, for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture or any indenture supplemental
thereto, against any incorporator, shareholder, officer or director, as such,
past, present or future, of the Issuer or of any successor corporation, either
directly or through the Issuer or any successor corporation, whether by virtue
of any constitution, statute or rule of law or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issue hereof, expressly waived
and released.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this
Security at the place, times, and rate, and in the currency, herein prescribed.
The Securities are issuable only as registered Securities without
coupons in denominations of $50 and any integral multiple of $50.
At the office or agency of the Issuer referred to on the face hereof
and in the manner and subject to the limitations provided in the Indenture,
Securities may be exchanged for a like aggregate principal amount of Securities
of other authorized denominations.
Upon due presentment for registration of transfer of this Security at
the above-mentioned office or agency of the Issuer, a new Security or Securities
of authorized denominations, for a like aggregate principal amount, will be
issued to the transferee as provided in the Indenture. No service charge shall
be made for any such transfer, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto.
80
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Issuer pursuant to Section
3.12 or 3.16 of the Indenture, check the Box: [ ].
If you wish to have a portion of this Security purchased by the Issuer pursuant
to Section 3.12 or 3.16 of the Indenture, state the amount (in aggregate
principal amount):
$[ ].
Date: [ ] Your Signature: [ ]
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee: [ ]
81
Exhibit B ---------[FORM OF DEFINITIVE SECURITY]
[FORM OF FACE OF SECURITY]
FOR PURPOSES OF SECTION 1273 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE"), THIS SECURITY HAS
ORIGINAL ISSUE DISCOUNT. FOR PURPOSES OF SECTION 1273 OF
THE CODE, THE ISSUE PRICE IS $ AND THE AMOUNT OF ORIGINAL
ISSUE DISCOUNT IS $ , IN EACH CASE PER $1,000 PRINCIPAL
AMOUNT OF THIS SECURITY FOR PURPOSES OF SECTION 1273 OF
THE CODE, THE YIELD TO MATURITY COMPOUNDED SEMIANNUALLY IS
%.
No. $
WEIRTON STEEL CORPORATION
10% Senior Secured Notes Due 2008
Weirton Steel Corporation, a Delaware corporation (the "Issuer"), for
value received hereby promises to pay to ______________ or registered assigns
the principal sum of _________________ Dollars at the Issuer's office or agency
for said purpose in the Borough of Manhattan, the City of New York on April 1,
2008 in such coin or currency of the United States of America as at the time of
payment shall be legal tender for the payment of public and private debts. This
Security shall bear interest and the interest shall accrue and be calculated at
the rate and in the manner as set forth on the reverse hereof and shall be paid
at said office or agency.
Reference is made to the further provisions set forth on the reverse
hereof. Such further provisions shall for all purposes have the same effect as
though fully set forth at this place.
This Security shall not be valid or obligatory until the certificate of
authentication hereon shall have been duly manually signed by the Trustee acting
under the Indenture.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed under its corporate seal.
Dated:
WEIRTON STEEL CORPORATION
By:
-------------------------------------
Name:
Title:
This is one of the Securities described in the within-mentioned Indenture.
[ ]
_______________________ Authorized Signatory
Dated: as of _______________ __, 2002
82
[FORM OF REVERSE OF SECURITY]
WEIRTON STEEL CORPORATION
10% Senior Secured Notes Due 2008
This Security is one of a duly authorized issue of debt securities of
the Issuer, limited to the aggregate principal amount of $134,200,000 (except as
otherwise provided in the Indenture mentioned below), issued or to be issued
pursuant to an indenture dated as of _________ __, 2002 (the "Indenture"), duly
executed and delivered by the Issuer to ▇.▇. ▇▇▇▇▇▇ Trust Company, National
Association, Trustee (herein called the "Trustee"). Reference is hereby made to
the Indenture and all indentures supplemental thereto for a description of the
rights, limitations of rights, obligations, duties and immunities thereunder of
the Trustee, the Issuer and the holders (the words "holders" or "holder" meaning
the registered holders or registered holder) of the Securities. All capitalized
terms not defined herein shall have the meaning set forth in the Indenture.
Descriptive headings are merely for convenience and shall have no effect on the
meaning or interpretation hereof.
Interest
Interest shall accrue on the principal amount of this Security from
_________ __, 2002 until April 1, 2008 or the earlier redemption of the
Securities as at the respective rates per annum as set forth on the table below,
and the Issuer promises to pay such interest, semi-annually in arrears on April
1 and October 1 of each year, on said principal sum in like coin or currency at
such rates, with the first such payment commencing on October 1, 2002. The
Issuer shall furnish an Officer's Certificate to the Trustee specifying the
applicable interest rate on or prior to April 1 and October 1 of each such year.
------------------------------------------------------------ ---------------------------------------------------------
Interest Period Interest Rate
------------------------------------------------------------ ---------------------------------------------------------
1. From _______ __ 2002 [Issue Date] to March 31, 2003 1. ___% [SEE EXPLANATORY NOTE BELOW].
------------------------------------------------------------ ---------------------------------------------------------
2. From April 1, 2003 to March 31, 2004 2. The lesser of (a) the sum of (i) ___% [SEE
EXPLANATORY NOTE BELOW] and (ii) Contingent Interest
Rate (as defined below), and (b) 10.0% per annum.
------------------------------------------------------------ ---------------------------------------------------------
3. From April 1, 2004 to March 31, 2005 3. The lesser of (a) the sum of (i) ___% [SEE
EXPLANATORY NOTE BELOW] and (ii) Contingent Interest
Rate, and (b) 10.0% per annum.
------------------------------------------------------------ ---------------------------------------------------------
4. From April 1, 2005 to March 31, 2008 4. 10.0% per annum
------------------------------------------------------------ ---------------------------------------------------------
83
[EXPLANATORY NOTE: THE INTEREST RATE PER ANNUM WILL BE DETERMINED
PURSUANT TO A FORMULA WHICH IS BASED ON A "FIXED INTEREST" CALCULATION TO BE
DETERMINED AT THE TIME OF THE ISSUANCE OF THE SECURITIES. IN INTEREST PERIODS 1
THROUGH 3, THE "FIXED INTEREST" CALCULATION WILL BE EQUAL TO THE GREATER OF (A)
0.5% PER ANNUM OR (B) SUCH AMOUNT AVAILABLE FOR PAYMENT, EXPRESSED AS A RATE PER
ANNUM, TO THE HOLDERS OF THE SECURITIES UNDER THE "INTEREST BASKET" SET FORTH IN
THE CREDIT FACILITY. THE "INTEREST BASKET" WILL, IN THE AGGREGATE, BE EQUAL TO
THE EXCESS, IF ANY, OF $4.0 MILLION OVER THE AGGREGATE AMOUNT OF INTEREST TO BE
PAID IN THE APPLICABLE INTEREST PERIOD TO THE HOLDERS OF OUTSTANDING SENIOR
NOTES DUE 2004, SENIOR NOTES DUE 2005, AND SERIES 1989 BONDS, IF ANY. THE AMOUNT
OF THE "INTEREST BASKET" WILL BE ALLOCATED ON A PRO-RATA BASIS AMONGST THE
HOLDERS OF THE SECURITIES.]
"Contingent Interest Rate" shall be expressed as a percentage
determined by dividing (a) 50% of the Excess Cash Flow by (b) the sum of the
principal amount of all Outstanding Securities (including this Security) and the
principal amount of all outstanding Secured Series 2002 Bonds at the time of
such determination.
Interest on the Securities shall be computed on the basis of a 360-day
year of twelve 30-day months. The interest so payable on any April 1 and October
1 will, except as otherwise provided in the Indenture, be paid to the person in
whose name this Security is registered at the close of business on the March 15
or September 15 preceding such April 1 and October 1, whether or not such day is
a Business Day (as defined in the Indenture); provided that interest, if any,
may be paid, at the option of the Issuer, by mailing a check therefor payable to
the registered holder entitled thereto at his last address as it appears on the
Security register. If the date of redemption or purchase of this bond is other
than April 1 or October 1, then the amount of any accrued and unpaid interest
due and payable on this bond at the time of any such redemption or purchase
shall be equal to the amount determined by multiplying (i) the interest rate in
effect as of the most recent interest payment date prior thereto by (ii) a
fraction, the numerator of which is the actual number of days elapsed in the
period for which interest is payable on the date of redemption or purchase, and
the denominator of which is 360.
Unless otherwise agreed by the Issuer and the holder of any Security,
payments by the Issuer in respect of the Securities (including principal,
premium, if any and interest) shall be paid to holders of the Securities in
same-day funds. If the date of maturity of interest on or principal of the
Securities or the date fixed for redemption of any Security shall not be a
Business Day, then payment of interest, or principal will be made on the next
succeeding Business Day, with the same force and effect as if made on the date
of maturity or the date fixed for redemption, and no interest shall accrue for
the period after such date.
Default
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all the Securities may be declared
due and payable, in the manner and with the effect, and subject to the
conditions, provided in the Indenture. The Indenture provides that in certain
events such declaration and its consequences may be waived by the holders of a
majority in aggregate principal amount of the Securities then outstanding and
that, prior to any such declaration, such holders may waive any past default
under the Indenture and its consequences except a default in the payment of
principal of or interest on any of the
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Securities. Any such consent or waiver by the holder of this Security (unless
revoked as provided in the Indenture) shall be conclusive and binding upon such
holder and upon all future holders and owners of this Security and any Security
which may be issued in exchange or substitution therefor, whether or not any
notation thereof is made upon this Security or such other Securities.
Amendment
The Indenture permits the Issuer and the Trustee, with the consent of
the holders of not less than a majority in aggregate principal amount of the
Securities at the time outstanding, evidenced as in the Indenture provided, to
execute supplemental indentures adding any provisions to or changing in any
manner or eliminating any of the provisions of the Indenture or of any
supplemental indenture or of any Notes Document, the Intercreditor Agreement or
Collateral Agency Agreement or modifying in any manner the rights of the holders
of the Securities; provided that no such supplemental indenture shall, without
the consent of the holders of all Securities then outstanding, (a) reduce the
rate or change the time or place for payment of interest, if any, on any
Security or reduce any amount payable on the redemption hereof; (b) reduce the
principal of or change the fixed maturity or place of payment of any Security;
(c) change the currency of payment of principal and interest, if any, on any
Security; (d) reduce the principal amount of outstanding Securities necessary to
modify or amend the Indenture; (e) impair the right to institute suit for the
enforcement of any payment on or with respect to any Security; or (f) make any
changes in Section 4.9 (waiver of past defaults), Section 4.11 (rights of
holders to receive payment), or the first paragraph of Section 7.2 (supplemental
indentures with consent of securityholders) of the Indenture. Notwithstanding
the foregoing, with the consent of the holders of not less than 85% in the
aggregate principal amount of the Securities at the time outstanding, the Issuer
and the Trustee (or Collateral Agent, as applicable) may amend or waive any
provisions of the Indenture, the Notes Documents, the Intercreditor Agreement or
Collateral Agency Agreement, relating to the Collateral.
Redemption
The Securities may not be redeemed at the option of the Issuer prior to
maturity, except as set forth in the Indenture. The Securities may not be
redeemed at the option of the Issuer prior to April 1, 2004. At any time and
from time to time on or after April 1, 2004, the Issuer may redeem the
Securities, in whole or in part, at a redemption price from April 1, 2004 to
March 31, 2005 of 105.00% of the principal amount thereof, from April 1, 2005 to
March 31, 2006 at a redemption price of 104.00% of the principal amount thereof,
from April 1, 2006 to March 31, 2007 at a redemption price of 103.00% of the
principal amount thereof and thereafter until maturity at 100.00% of the
principal amount thereof, in each case plus accrued or unpaid interest to the
redemption date. Notwithstanding the foregoing, if the date fixed for redemption
as set forth in this paragraph is an April 1 or October 1, then the interest
payable on such date shall be paid to the holder of record on the preceding
March 15 or September 15. Notice of such redemption shall be mailed not less
than 30 nor more than 60 days prior to the date fixed for redemption to the
holders of Securities to be redeemed, all as provided in the Indenture, in the
circumstances set forth in this paragraph.
Subject to payment by the Issuer of a sum sufficient to pay the amount
due on redemption, interest on this Security (or portion hereof if this Security
is redeemed in part) shall
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cease to accrue upon the date duly fixed for redemption of this Security (or
portion hereof if this Security is redeemed in part).
Asset Disposition
Subject to the terms of the Indenture, if the Issuer or any Subsidiary
consummate any Asset Disposition (excluding any Asset Disposition of
Collateral), the Net Cash Proceeds of the Asset Disposition within 270 days,
shall be, at the Issuer's election, applied (A) to the extent the Issuer elects
(or is so required by the terms of any Indebtedness), to prepay or repay the
Credit Facility or the Vendor Financing Programs, or (B)(i) to redeem or make
other payments in respect of the Series C Preferred Stock, or (ii) to make an
investment in properties and assets other than cash, cash equivalents or
inventory that replace the properties and assets that were the subject of the
Asset Disposition or in properties and assets that will be used in the business
of making, processing or distributing steel products, including, without
limitation, tin products or other coated steel products and related businesses,
or (C) to the extent of the balance of such Net Cash Proceeds after application
in accordance with (A) or (B), to make an Asset Disposition Offer to purchase
the Securities (on a pro rata basis if the amount available for such purchase is
less than 100% of the outstanding principal amount of the Securities) and
Secured Series 2002 Bonds on a pari passu basis, at a purchase price of the
principal amount thereof plus accrued and unpaid interest, if any, as the case
may be, to the date of repayment. Notwithstanding the foregoing, the Issuer and
its Subsidiaries will not be required to apply any Net Cash Proceeds to
effectuate an Asset Disposition Offer in accordance with this provision except
to the extent that the aggregate gross proceeds from all Asset Dispositions
which are not applied in accordance with clause (A) or (B) exceed $15,000,000.
Subject to the terms of the Indenture, if the Issuer or any Subsidiary
consummate any Asset Disposition of Collateral, then the Net Cash Proceeds of
the Asset Disposition within 270 days, shall be, at the Issuer's election,
applied (A) to the extent the Issuer elects (or is so required by the terms of
any Indebtedness), to prepay or repay the Credit Facility which prepayment or
repayment shall constitute a permanent reduction of the commitment under such
Credit Facility or (B)(i) to redeem or make other payments in respect of the
Series C Preferred Stock, or (ii) to make an investment in replacement
properties and assets that will be used in the business of making, processing or
distributing steel products, including, without limitation, tin products or
other coated steel products and related businesses, and grant in favor of the
holders of the Securities a Lien, which may be subordinated only to senior
secured Indebtedness incurred to finance or refinance, as applicable, the
acquisition of such replacement properties and assets, or (C) to the extent of
the balance of such Net Cash Proceeds after application in accordance with (A)
or (B), to make an Asset Disposition Offer to purchase the Securities (on a pro
rata basis if the amount available for such purchase is less than 100% of the
outstanding principal amount of the Securities) and Secured Series 2002 Bonds on
a pari passu basis, at a purchase price of the principal amount thereof plus
accrued and unpaid interest, if any, as the case may be, to the date of
repayment.
Change of Control
In the event that there shall occur a Change of Control, each holder of
the Securities shall have the right, at the Holder's option, to require the
Issuer to purchase all or any part of such
86
Holder's Securities on the Repurchase Date that is 90 days after notice of the
Change of Control, at 101% of the principal amount of the Securities plus
accrued interest, if any, to the Repurchase Date. To be repaid, the Security
must be received, with the completed form entitled Option of Holder to Elect
Purchase (set forth below), by the Paying Agent at its then specified office at
least two Business Days prior to the Repurchase Date. Exercise of the repayment
option by the Securityholder will be irrevocable unless the rescission thereof
is duly approved by the Continuing Directors. The Issuer, the Trustee, and any
authorized agent of the Issuer or the Trustee, may deem and treat the registered
holder hereof as the absolute owner of this Security (whether or not this
Security shall be overdue and notwithstanding any notation of ownership or other
writing hereon made by anyone other than the Issuer or the Trustee or any
authorized agent of the Issuer or the Trustee), for the purpose of receiving
payment of, or on account of, the principal hereof and, subject to the
provisions on the face hereof and interest hereon and for all other purposes,
and neither the Issuer nor the Trustee nor any authorized agent of the Issuer or
the Trustee shall be affected by any notice to the contrary.
Other Terms
No recourse shall be had for the payment of the principal of or
interest on this Security, for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture or any indenture supplemental
thereto, against any incorporator, shareholder, officer or director, as such,
past, present or future, of the Issuer or of any successor corporation, either
directly or through the Issuer or any successor corporation, whether by virtue
of any constitution, statute or rule of law or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issue hereof, expressly waived
and released.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this
Security at the place, times, and rate, and in the currency, herein prescribed.
The Securities are issuable only as registered Securities without
coupons in denominations of $50 and any integral multiple of $50.
At the office or agency of the Issuer referred to on the face hereof
and in the manner and subject to the limitations provided in the Indenture,
Securities may be exchanged for a like aggregate principal amount of Securities
of other authorized denominations.
Upon due presentment for registration of transfer of this Security at
the above-mentioned office or agency of the Issuer, a new Security or Securities
of authorized denominations, for a like aggregate principal amount, will be
issued to the transferee as provided in the Indenture. No service charge shall
be made for any such transfer, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto.
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OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Issuer pursuant to Section
3.12 or 3.16 of the Indenture, check the Box: [ ].
If you wish to have a portion of this Security purchased by the Issuer pursuant
to Section 3.12 or 3.16 of the Indenture, state the amount (in aggregate
principal amount):
$[ ].
Date: [ ] Your Signature: [ ]
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee: [ ]
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Exhibit C --------- [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities described in the within-mentioned Indenture.
, as Trustee Dated:
---------------------
--------------------------------- Authorized Signatory
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Exhibit D --------- [FORM OF DEED OF TRUST]
90